[House Report 115-153]
[From the U.S. Government Publishing Office]


   115th Congress  }                                    {  Rept. 115-153
                         HOUSE OF REPRESENTATIVES
   1st Session     }                                    {   Part 1
                    
                                                       
_______________________________________________________________________

                                     


                      FINANCIAL CHOICE ACT OF 2010

                               ----------                              

                              R E P O R T

                                 of the

                    COMMITTEE ON FINANCIAL SERVICES

                             together with

                             MINORITY VIEWS

                         [to accompany H.R. 10]

                              BOOK 1 OF 2
                              

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]






  May 25, 2017.--Committed to the Committee of the Whole House on the 
              State of the Union and ordered to be printed
              
              
              




                      FINANCIAL CHOICE ACT OF 2010
                                                                  
                             (Book 1 of 2)
                             
                             
                             
                             
                             
                             
                             
115th Congress  }                                              {  Rept. 115-153
                            HOUSE OF REPRESENTATIVES          
 1st Session    }                                              {  Part 1
_______________________________________________________________________

                                     


                      FINANCIAL CHOICE ACT OF 2010

                               __________

                              R E P O R T

                                 of the

                    COMMITTEE ON FINANCIAL SERVICES

                             together with

                             MINORITY VIEWS

                         [to accompany H.R. 10]

                              BOOK 1 OF 2
                              

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]


  May 25, 2017.--Committed to the Committee of the Whole House on the 
              State of the Union and ordered to be printed
              
 
 
                       
                U.S. GOVERNMENT PUBLISHING OFFICE
                
  25-561                WASHINGTON : 2017        
  
  
  
 
 
              
              


115th Congress     }                                     {  Rept. 115-153
                         HOUSE OF REPRESENTATIVES
 1st Session       }                                     {       Part 1

======================================================================



 
                      FINANCIAL CHOICE ACT OF 2010

                                _______
                                

  May 25, 2017.--Committed to the Committee of the Whole House on the 
              State of the Union and ordered to be printed

                                _______
                                

Mr. Hensarling, from the Committee on Financial Services, submitted the 
                               following

                              R E P O R T

                             together with

                             MINORITY VIEWS

                         [To accompany H.R. 10]

      [Including cost estimate of the Congressional Budget Office]

    The Committee on Financial Service, to whom was referred 
the bill (H.R. 10) to create hope and opportunity for 
investors, consumers, and entrepreneurs by ending bailouts and 
Too Big to Fail, holding Washington and Wall Street 
accountable, eliminating red tape to increase access to capital 
and credit, and repealing the provisions of the Dodd-Frank Act 
that make America less prosperous, less stable, and less free, 
and for other purposes, having considered the same, report 
favorably thereon with an amendment and recommend that the bill 
as amended do pass.
    The amendment is as follows:
  Strike all after the enacting clause and insert the 
following:

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

  (a) Short Title.--This Act may be cited as the ``Financial CHOICE Act 
of 2017''.
  (b) Table of Contents.--The table of contents for this Act is as 
follows:

Sec. 1. Short title; table of contents.

         TITLE I--ENDING ``TOO BIG TO FAIL'' AND BANK BAILOUTS

        Subtitle A--Repeal of the Orderly Liquidation Authority

Sec. 111. Repeal of the orderly liquidation authority.

              Subtitle B--Financial Institution Bankruptcy

Sec. 121. General provisions relating to covered financial 
corporations.
Sec. 122. Liquidation, reorganization, or recapitalization of a covered 
financial corporation.
Sec. 123. Amendments to title 28, United States Code.

                Subtitle C--Ending Government Guarantees

Sec. 131. Repeal of obligation guarantee program.
Sec. 132. Repeal of systemic risk determination in resolutions.
Sec. 133. Restrictions on use of the Exchange Stabilization Fund.

     Subtitle D--Eliminating Financial Market Utility Designations

Sec. 141. Repeal of title VIII.

       Subtitle E--Reform of the Financial Stability Act of 2010

Sec. 151. Repeal and modification of provisions of the Financial 
Stability Act of 2010.
Sec. 152. Operational risk capital requirements for banking 
organizations.

          TITLE II--DEMANDING ACCOUNTABILITY FROM WALL STREET

                Subtitle A--SEC Penalties Modernization

Sec. 211. Enhancement of civil penalties for securities laws 
violations.
Sec. 212. Updated civil money penalties of Public Company Accounting 
Oversight Board.
Sec. 213. Updated civil money penalty for controlling persons in 
connection with insider trading.
Sec. 214. Update of certain other penalties.
Sec. 215. Monetary sanctions to be used for the relief of victims.
Sec. 216. GAO report on use of civil money penalty authority by 
Commission.

               Subtitle B--FIRREA Penalties Modernization

Sec. 221. Increase of civil and criminal penalties originally 
established in the Financial Institutions Reform, Recovery, and 
Enforcement Act of 1989.

   TITLE III--DEMANDING ACCOUNTABILITY FROM FINANCIAL REGULATORS AND 
                  DEVOLVING POWER AWAY FROM WASHINGTON

                   Subtitle A--Cost-Benefit Analyses

Sec. 311. Definitions.
Sec. 312. Required regulatory analysis.
Sec. 313. Rule of construction.
Sec. 314. Public availability of data and regulatory analysis.
Sec. 315. Five-year regulatory impact analysis.
Sec. 316. Retrospective review of existing rules.
Sec. 317. Judicial review.
Sec. 318. Chief Economists Council.
Sec. 319. Conforming amendments.
Sec. 320. Other regulatory entities.
Sec. 321. Avoidance of duplicative or unnecessary analyses.

Subtitle B--Congressional Review of Federal Financial Agency Rulemaking

Sec. 331. Congressional review.
Sec. 332. Congressional approval procedure for major rules.
Sec. 333. Congressional disapproval procedure for nonmajor rules.
Sec. 334. Definitions.
Sec. 335. Judicial review.
Sec. 336. Effective date of certain rules.
Sec. 337. Budgetary effects of rules subject to section 332 of the 
Financial CHOICE Act of 2017.

             Subtitle C--Judicial Review of Agency Actions

Sec. 341. Scope of judicial review of agency actions.

             Subtitle D--Leadership of Financial Regulators

Sec. 351. Federal Deposit Insurance Corporation.
Sec. 352. Federal Housing Finance Agency.

         Subtitle E--Congressional Oversight of Appropriations

Sec. 361. Bringing the Federal Deposit Insurance Corporation into the 
appropriations process.
Sec. 362. Bringing the Federal Housing Finance Agency into the 
appropriations process.
Sec. 363. Bringing the National Credit Union Administration into the 
appropriations process.
Sec. 364. Bringing the Office of the Comptroller of the Currency into 
the appropriations process.
Sec. 365. Bringing the non-monetary policy related functions of the 
Board of Governors of the Federal Reserve System into the 
appropriations process.

                  Subtitle F--International Processes

Sec. 371. Requirements for international processes.

                  Subtitle G--Unfunded Mandates Reform

Sec. 381. Definitions.
Sec. 382. Statements to accompany significant regulatory actions.
Sec. 383. Small government agency plan.
Sec. 384. State, local, and tribal government and private sector input.
Sec. 385. Least burdensome option or explanation required.
Sec. 386. Assistance to the Office of Information and Regulatory 
Affairs.
Sec. 387. Office of Information and Regulatory Affairs 
responsibilities.
Sec. 388. Judicial review.

                  Subtitle H--Enforcement Coordination

Sec. 391. Policies to minimize duplication of enforcement efforts.

           Subtitle I--Penalties for Unauthorized Disclosures

Sec. 392. Criminal penalty for unauthorized disclosures.

                Subtitle II--Stop Settlement Slush Funds

Sec. 393. Limitation on donations made pursuant to settlement 
agreements to which certain departments or agencies are a party.

 TITLE IV--UNLEASHING OPPORTUNITIES FOR SMALL BUSINESSES, INNOVATORS, 
           AND JOB CREATORS BY FACILITATING CAPITAL FORMATION

Subtitle A--Small Business Mergers, Acquisitions, Sales, and Brokerage 
                             Simplification

Sec. 401. Registration exemption for merger and acquisition brokers.
Sec. 402. Effective date.

               Subtitle B--Encouraging Employee Ownership

Sec. 406. Increased threshold for disclosures relating to compensatory 
benefit plans.

          Subtitle C--Small Company Disclosure Simplification

Sec. 411. Exemption from XBRL requirements for emerging growth 
companies and other smaller companies.
Sec. 412. Analysis by the SEC.
Sec. 413. Report to Congress.
Sec. 414. Definitions.

   Subtitle D--Securities and Exchange Commission Overpayment Credit

Sec. 416. Refunding or crediting overpayment of section 31 fees.

             Subtitle E--Fair Access to Investment Research

Sec. 421. Safe harbor for investment fund research.

               Subtitle F--Accelerating Access to Capital

Sec. 426. Expanded eligibility for use of Form S-3.

                  Subtitle G--Enhancing the RAISE Act

Sec. 431. Certain accredited investor transactions.

             Subtitle H--Small Business Credit Availability

Sec. 436. Business development company ownership of securities of 
investment advisers and certain financial companies.
Sec. 437. Expanding access to capital for business development 
companies.
Sec. 438. Parity for business development companies regarding offering 
and proxy rules.

                    Subtitle I--Fostering Innovation

Sec. 441. Temporary exemption for low-revenue issuers.

        Subtitle J--Small Business Capital Formation Enhancement

Sec. 446. Annual review of government-business forum on capital 
formation.

              Subtitle K--Helping Angels Lead Our Startups

Sec. 451. Definition of angel investor group.
Sec. 452. Clarification of general solicitation.

                     Subtitle L--Main Street Growth

Sec. 456. Venture exchanges.

                 Subtitle M--Micro Offering Safe Harbor

Sec. 461. Exemptions for micro-offerings.

               Subtitle N--Private Placement Improvement

Sec. 466. Revisions to SEC Regulation D.

              Subtitle O--Supporting America's Innovators

Sec. 471. Investor limitation for qualifying venture capital funds.

                      Subtitle P--Fix Crowdfunding

Sec. 476. Crowdfunding exemption.
Sec. 477. Exclusion of crowdfunding investors from shareholder cap.
Sec. 478. Preemption of State law.
Sec. 479. Treatment of funding portals.

        Subtitle Q--Corporate Governance Reform and Transparency

Sec. 481. Definitions.
Sec. 482. Registration of proxy advisory firms.
Sec. 483. Commission annual report.

                        Subtitle R--Senior Safe

Sec. 491. Immunity.
Sec. 492. Training required.
Sec. 493. Relationship to State law.

       Subtitle S--National Securities Exchange Regulatory Parity

Sec. 496. Application of exemption.

           Subtitle T--Private Company Flexibility and Growth

Sec. 497. Shareholder threshold for registration.

        Subtitle U--Small Company Capital Formation Enhancements

Sec. 498. JOBS Act-related exemption.

                Subtitle V--Encouraging Public Offerings

Sec. 499. Expanding testing the waters and confidential submissions.

  TITLE V--REGULATORY RELIEF FOR MAIN STREET AND COMMUNITY FINANCIAL 
                              INSTITUTIONS

         Subtitle A--Preserving Access to Manufactured Housing

Sec. 501. Mortgage originator definition.
Sec. 502. High-Cost mortgage definition.

                      Subtitle B--Mortgage Choice

Sec. 506. Definition of points and fees.

         Subtitle C--Financial Institution Customer Protection

Sec. 511. Requirements for deposit account termination requests and 
orders.
Sec. 512. Amendments to the Financial Institutions Reform, Recovery, 
and Enforcement Act of 1989.

           Subtitle D--Portfolio Lending and Mortgage Access

Sec. 516. Safe harbor for certain loans held on portfolio.

    Subtitle E--Application of the Expedited Funds Availability Act

Sec. 521. Application of the Expedited Funds Availability Act.

        Subtitle F--Small Bank Holding Company Policy Statement

Sec. 526. Changes required to small bank holding company policy 
statement on assessment of financial and managerial factors.

           Subtitle G--Community Institution Mortgage Relief

Sec. 531. Community financial institution mortgage relief.

   Subtitle H--Financial Institutions Examination Fairness and Reform

Sec. 536. Timeliness of examination reports.

  Subtitle I--National Credit Union Administration Budget Transparency

Sec. 541. Budget transparency for the NCUA.

   Subtitle J--Taking Account of Institutions With Low Operation Risk

Sec. 546. Regulations appropriate to business models.

      Subtitle K--Federal Savings Association Charter Flexibility

Sec. 551. Option for Federal savings associations to operate as a 
covered savings association.

                Subtitle L--SAFE Transitional Licensing

Sec. 556. Eliminating barriers to jobs for loan originators.

                       Subtitle M--Right to Lend

Sec. 561. Small business loan data collection requirement.

              Subtitle N--Community Bank Reporting Relief

Sec. 566. Short form call report.

          Subtitle O--Homeowner Information Privacy Protection

Sec. 571. Study regarding privacy of information collected under the 
Home Mortgage Disclosure Act of 1975.

            Subtitle P--Home Mortgage Disclosure Adjustment

Sec. 576. Depository institutions subject to maintenance of records and 
disclosure requirements.

           Subtitle Q--Protecting Consumers' Access to Credit

Sec. 581. Rate of interest after transfer of loan.

                 Subtitle R--NCUA Overhead Transparency

Sec. 586. Fund transparency.

             Subtitle S--Housing Opportunities Made Easier

Sec. 591. Clarification of donated services to non-profits.

  TITLE VI--REGULATORY RELIEF FOR STRONGLY CAPITALIZED, WELL MANAGED 
                         BANKING ORGANIZATIONS

Sec. 601. Capital election.
Sec. 602. Regulatory relief.
Sec. 603. Contingent capital study.
Sec. 604. Study on altering the current prompt corrective action rules.
Sec. 605. Definitions.

   TITLE VII--EMPOWERING AMERICANS TO ACHIEVE FINANCIAL INDEPENDENCE

       Subtitle A--Separation of Powers and Liberty Enhancements

Sec. 711. Consumer Law Enforcement Agency.
Sec. 712. Authority of the Office of Information and Regulatory 
Affairs.
Sec. 713. Bringing the Agency into the regular appropriations process.
Sec. 714. Consumer Law Enforcement Agency Inspector General Reform.
Sec. 715. Private parties authorized to compel the Agency to seek 
sanctions by filing civil actions; Adjudications deemed actions.
Sec. 716. Civil investigative demands to be appealed to courts.
Sec. 717. Agency dual mandate and economic analysis.
Sec. 718. No deference to Agency interpretation.

                Subtitle B--Administrative Enhancements

Sec. 721. Advisory opinions.
Sec. 722. Reform of Consumer Financial Civil Penalty Fund.
Sec. 723. Agency pay fairness.
Sec. 724. Elimination of market monitoring functions.
Sec. 725. Reforms to mandatory functional units.
Sec. 726. Repeal of mandatory advisory board.
Sec. 727. Elimination of supervision authority.
Sec. 728. Transfer of old OTS building from OCC to GSA.
Sec. 729. Limitation on Agency authority.

                    Subtitle C--Policy Enhancements

Sec. 731. Consumer right to financial privacy.
Sec. 732. Repeal of Council authority to set aside Agency rules and 
requirement of safety and soundness considerations when issuing rules.
Sec. 733. Removal of authority to regulate small-dollar credit.
Sec. 734. Reforming indirect auto financing guidance.
Sec. 735. Prohibition of Government price controls for payment card 
transactions.
Sec. 736. Removal of Agency UDAAP authority.
Sec. 737. Preservation of UDAP authority for Federal banking 
regulators.
Sec. 738. Repeal of authority to restrict arbitration.

                TITLE VIII--CAPITAL MARKETS IMPROVEMENTS

       Subtitle A--SEC Reform, Restructuring, and Accountability

Sec. 801. Authorization of appropriations.
Sec. 802. Report on unobligated appropriations.
Sec. 803. SEC Reserve Fund abolished.
Sec. 804. Fees to offset appropriations.
Sec. 805. Commission relocation funding prohibition.
Sec. 806. Implementation of recommendations.
Sec. 807. Office of Credit Ratings to report to the Division of Trading 
and Markets.
Sec. 808. Office of Municipal Securities to report to the Division of 
Trading and Markets.
Sec. 809. Independence of Commission Ombudsman.
Sec. 810. Investor Advisory Committee improvements.
Sec. 811. Duties of Investor Advocate.
Sec. 812. Elimination of exemption of Small Business Capital Formation 
Advisory Committee from Federal Advisory Committee Act.
Sec. 813. Internal risk controls.
Sec. 814. Applicability of notice and comment requirements of the 
Administrative Procedure Act to guidance voted on by the Commission.
Sec. 815. Limitation on pilot programs.
Sec. 816. Procedure for obtaining certain intellectual property.
Sec. 817. Process for closing investigations.
Sec. 818. Enforcement Ombudsman.
Sec. 819. Adequate notice.
Sec. 820. Advisory committee on Commission's enforcement policies and 
practices.
Sec. 821. Process to permit recipient of Wells notification to appear 
before Commission staff in-person.
Sec. 822. Publication of enforcement manual.
Sec. 823. Private parties authorized to compel the Securities and 
Exchange Commission to seek sanctions by filing civil actions.
Sec. 824. Certain findings required to approve civil money penalties 
against issuers.
Sec. 825. Repeal of authority of the Commission to prohibit persons 
from serving as officers or directors.
Sec. 826. Subpoena duration and renewal.
Sec. 827. Elimination of automatic disqualifications.
Sec. 828. Denial of award to culpable whistleblowers.
Sec. 829. Confidentiality of records obtained from foreign securities 
and law enforcement authorities.
Sec. 830. Clarification of authority to impose sanctions on persons 
associated with a broker or dealer.
Sec. 831. Complaint and burden of proof requirements for certain 
actions for breach of fiduciary duty.
Sec. 832. Congressional access to information held by the Public 
Company Accounting Oversight Board.
Sec. 833. Abolishing Investor Advisory Group.
Sec. 834. Repeal of requirement for Public Company Accounting Oversight 
Board to use certain funds for merit scholarship program.
Sec. 835. Reallocation of fines for violations of rules of municipal 
securities rulemaking board.

 Subtitle B--Eliminating Excessive Government Intrusion in the Capital 
                                Markets

Sec. 841. Repeal of Department of Labor fiduciary rule and requirements 
prior to rulemaking relating to standards of conduct for brokers and 
dealers.
Sec. 842. Exemption from risk retention requirements for nonresidential 
mortgage.
Sec. 843. Frequency of shareholder approval of executive compensation.
Sec. 844. Shareholder Proposals.
Sec. 845. Prohibition on requiring a single ballot.
Sec. 846. Requirement for municipal advisor for issuers of municipal 
securities.
Sec. 847. Small issuer exemption from internal control evaluation.
Sec. 848. Streamlining of applications for an exemption from the 
Investment Company Act of 1940.
Sec. 849. Restriction on recovery of erroneously awarded compensation.
Sec. 850. Exemptive authority for certain provisions relating to 
registration of nationally recognized statistical rating organizations.
Sec. 851. Risk-based examinations of Nationally Recognized Statistical 
Rating Organizations.
Sec. 852. Transparency of credit rating methodologies.
Sec. 853. Repeal of certain attestation requirements relating to credit 
ratings.
Sec. 854. Look-back review by NRSRO.
Sec. 855. Approval of credit rating procedures and methodologies.
Sec. 856. Exception for providing certain material information relating 
to a credit rating.
Sec. 857. Repeals.
Sec. 858. Exemption of and reporting by private equity fund advisers.
Sec. 859. Records and reports of private funds.
Sec. 860. Definition of accredited investor.
Sec. 861. Repeal of certain provisions requiring a study and report to 
Congress.
Sec. 862. Repeal.

             Subtitle C--Harmonization of Derivatives Rules

Sec. 871. Commissions review and harmonization of rules relating to the 
regulation of over-the-counter swaps markets.
Sec. 872. Treatment of transactions between affiliates.

       TITLE IX--REPEAL OF THE VOLCKER RULE AND OTHER PROVISIONS

Sec. 901. Repeals.

            TITLE X--FED OVERSIGHT REFORM AND MODERNIZATION

Sec. 1001. Requirements for policy rules of the Federal Open Market 
Committee.
Sec. 1002. Federal Open Market Committee blackout period.
Sec. 1003. Public transcripts of FOMC meetings.
Sec. 1004. Membership of Federal Open Market Committee.
Sec. 1005. Frequency of testimony of the Chairman of the Board of 
Governors of the Federal Reserve System to Congress.
Sec. 1006. Vice Chairman for Supervision report requirement.
Sec. 1007. Salaries, financial disclosures, and office staff of the 
Board of Governors of the Federal Reserve System.
Sec. 1008. Amendments to powers of the Board of Governors of the 
Federal Reserve System.
Sec. 1009. Interest rates on balances maintained at a Federal Reserve 
bank by depository institutions established by Federal Open Market 
Committee.
Sec. 1010. Audit reform and transparency for the Board of Governors of 
the Federal Reserve System.
Sec. 1011. Establishment of a Centennial Monetary Commission.

   TITLE XI--IMPROVING INSURANCE COORDINATION THROUGH AN INDEPENDENT 
                                ADVOCATE

Sec. 1101. Repeal of the Federal Insurance Office; Creation of the 
Office of the Independent Insurance Advocate.
Sec. 1102. Treatment of covered agreements.

                    TITLE XII--TECHNICAL CORRECTIONS

Sec. 1201. Table of contents; Definitional corrections.
Sec. 1202. Antitrust savings clause corrections.
Sec. 1203. Title I corrections.
Sec. 1204. Title III corrections.
Sec. 1205. Title IV correction.
Sec. 1206. Title VI corrections.
Sec. 1207. Title VII corrections.
Sec. 1208. Title IX corrections.
Sec. 1209. Title X corrections.
Sec. 1210. Title XII correction.
Sec. 1211. Title XIV correction.
Sec. 1212. Technical corrections to other statutes.

         TITLE I--ENDING ``TOO BIG TO FAIL'' AND BANK BAILOUTS

        Subtitle A--Repeal of the Orderly Liquidation Authority

SEC. 111. REPEAL OF THE ORDERLY LIQUIDATION AUTHORITY.

  (a) In General.--Title II of the Dodd-Frank Wall Street Reform and 
Consumer Protection Act is hereby repealed and any Federal law amended 
by such title shall, on and after the effective date of this Act, be 
effective as if title II of the Dodd-Frank Wall Street Reform and 
Consumer Protection Act had not been enacted.
  (b) Conforming Amendments.--
          (1) Dodd-frank wall street reform and consumer protection 
        act.--The Dodd-Frank Wall Street Reform and Consumer Protection 
        Act is amended--
                  (A) in the table of contents for such Act, by 
                striking all items relating to title II;
                  (B) in section 165(d)--
                          (i) in paragraph (1), by striking ``, the 
                        Council, and the Corporation'' and inserting 
                        ``and the Council'';
                          (ii) in paragraph (2), by striking ``, the 
                        Council, and the Corporation'' and inserting 
                        ``and the Council'';
                          (iii) in paragraph (3), by striking ``and the 
                        Corporation'';
                          (iv) in paragraph (4)--
                                  (I) by striking ``and the Corporation 
                                jointly determine'' and inserting 
                                ``determines'';
                                  (II) by striking ``their'' and 
                                inserting ``its'';
                                  (III) in subparagraph (A), by 
                                striking ``and the Corporation''; and
                                  (IV) in subparagraph (B), by striking 
                                ``and the Corporation'';
                          (v) in paragraph (5)--
                                  (I) in subparagraph (A), by striking 
                                ``and the Corporation may jointly'' and 
                                inserting ``may''; and
                                  (II) in subparagraph (B)--
                                          (aa) by striking ``and the 
                                        Corporation'' each place such 
                                        term appears;
                                          (bb) by striking ``may 
                                        jointly'' and inserting 
                                        ``may'';
                                          (cc) by striking ``have 
                                        jointly'' and inserting 
                                        ``has'';
                          (vi) in paragraph (6), by striking ``, a 
                        receiver appointed under title II,''; and
                          (vii) by amending paragraph (8) to read as 
                        follows:
          ``(8) Rules.--Not later than 12 months after enactment of 
        this paragraph, the Board of Governors shall issue final rules 
        implementing this section.''; and
                  (C) in section 716(g), by striking ``or a covered 
                financial company under title II''.
          (2) Federal deposit insurance act.--Section 10(b)(3) of the 
        Federal Deposit Insurance Act (12 U.S.C. 1820(b)(3)) is amended 
        by striking ``, or of such nonbank financial company supervised 
        by the Board of Governors or bank holding company described in 
        section 165(a) of the Financial Stability Act of 2010, for the 
        purpose of implementing its authority to provide for orderly 
        liquidation of any such company under title II of that Act''.
          (3) Federal reserve act.--Section 13(3) of the Federal 
        Reserve Act is amended--
                  (A) in subparagraph (B)--
                          (i) in clause (ii), by striking ``, 
                        resolution under title II of the Dodd-Frank 
                        Wall Street Reform and Consumer Protection Act, 
                        or'' and inserting ``or is subject to 
                        resolution under''; and
                          (ii) in clause (iii), by striking ``, 
                        resolution under title II of the Dodd-Frank 
                        Wall Street Reform and Consumer Protection Act, 
                        or'' and inserting ``or resolution under''; and
                  (B) by striking subparagraph (E).

              Subtitle B--Financial Institution Bankruptcy

SEC. 121. GENERAL PROVISIONS RELATING TO COVERED FINANCIAL 
                    CORPORATIONS.

  (a) Definition.--Section 101 of title 11, United States Code, is 
amended by inserting the following after paragraph (9):
          ``(9A) The term `covered financial corporation' means any 
        corporation incorporated or organized under any Federal or 
        State law, other than a stockbroker, a commodity broker, or an 
        entity of the kind specified in paragraph (2) or (3) of section 
        109(b), that is--
                  ``(A) a bank holding company, as defined in section 
                2(a) of the Bank Holding Company Act of 1956; or
                  ``(B) a corporation that exists for the primary 
                purpose of owning, controlling and financing its 
                subsidiaries, that has total consolidated assets of 
                $50,000,000,000 or greater, and for which, in its most 
                recently completed fiscal year--
                          ``(i) annual gross revenues derived by the 
                        corporation and all of its subsidiaries from 
                        activities that are financial in nature (as 
                        defined in section 4(k) of the Bank Holding 
                        Company Act of 1956) and, if applicable, from 
                        the ownership or control of one or more insured 
                        depository institutions, represents 85 percent 
                        or more of the consolidated annual gross 
                        revenues of the corporation; or
                          ``(ii) the consolidated assets of the 
                        corporation and all of its subsidiaries related 
                        to activities that are financial in nature (as 
                        defined in section 4(k) of the Bank Holding 
                        Company Act of 1956) and, if applicable, 
                        related to the ownership or control of one or 
                        more insured depository institutions, 
                        represents 85 percent or more of the 
                        consolidated assets of the corporation.''.
  (b) Applicability of Chapters.--Section 103 of title 11, United 
States Code, is amended by adding at the end the following:
  ``(l) Subchapter V of chapter 11 of this title applies only in a case 
under chapter 11 concerning a covered financial corporation.''.
  (c) Who May Be a Debtor.--Section 109 of title 11, United States 
Code, is amended--
          (1) in subsection (b)--
                  (A) in paragraph (2), by striking ``or'' at the end;
                  (B) in paragraph (3)(B), by striking the period at 
                the end and inserting ``; or''; and
                  (C) by adding at the end the following:
          ``(4) a covered financial corporation.''; and
          (2) in subsection (d)--
                  (A) by striking ``and'' before ``an uninsured State 
                member bank'';
                  (B) by striking ``or'' before ``a corporation''; and
                  (C) by inserting ``, or a covered financial 
                corporation'' after ``Federal Deposit Insurance 
                Corporation Improvement Act of 1991''.
  (d) Conversion to Chapter 7.--Section 1112 of title 11, United States 
Code, is amended by adding at the end the following:
  ``(g) Notwithstanding section 109(b), the court may convert a case 
under subchapter V to a case under chapter 7 if--
          ``(1) a transfer approved under section 1185 has been 
        consummated;
          ``(2) the court has ordered the appointment of a special 
        trustee under section 1186; and
          ``(3) the court finds, after notice and a hearing, that 
        conversion is in the best interest of the creditors and the 
        estate.''.
  (e)(1) Section 726(a)(1) of title 11, United States Code, is amended 
by inserting after ``first,'' the following: ``in payment of any unpaid 
fees, costs, and expenses of a special trustee appointed under section 
1186, and then''.
  (2) Section 1129(a) of title 11, United States Code, is amended by 
inserting after paragraph (16) the following:
          ``(17) In a case under subchapter V, all payable fees, costs, 
        and expenses of the special trustee have been paid or the plan 
        provides for the payment of all such fees, costs, and expenses 
        on the effective date of the plan.
          ``(18) In a case under subchapter V, confirmation of the plan 
        is not likely to cause serious adverse effects on financial 
        stability in the United States.''.
  (f) Section 322(b)(2) of title 11, United States Code, is amended by 
striking ``The'' and inserting ``In cases under subchapter V, the 
United States trustee shall recommend to the court, and in all other 
cases, the''.

SEC. 122. LIQUIDATION, REORGANIZATION, OR RECAPITALIZATION OF A COVERED 
                    FINANCIAL CORPORATION.

  Chapter 11 of title 11, United States Code, is amended by adding at 
the end the following (and conforming the table of contents for such 
chapter accordingly):

 ``SUBCHAPTER V--LIQUIDATION, REORGANIZATION, OR RECAPITALIZATION OF A 
                     COVERED FINANCIAL CORPORATION

``Sec. 1181. Inapplicability of other sections

  ``Sections 303 and 321(c) do not apply in a case under this 
subchapter concerning a covered financial corporation. Section 365 does 
not apply to a transfer under section 1185, 1187, or 1188.

``Sec. 1182. Definitions for this subchapter

  ``In this subchapter, the following definitions shall apply:
          ``(1) The term `Board' means the Board of Governors of the 
        Federal Reserve System.
          ``(2) The term `bridge company' means a newly formed 
        corporation to which property of the estate may be transferred 
        under section 1185(a) and the equity securities of which may be 
        transferred to a special trustee under section 1186(a).
          ``(3) The term `capital structure debt' means all unsecured 
        debt of the debtor for borrowed money for which the debtor is 
        the primary obligor, other than a qualified financial contract 
        and other than debt secured by a lien on property of the estate 
        that is to be transferred to a bridge company pursuant to an 
        order of the court under section 1185(a).
          ``(4) The term `contractual right' means a contractual right 
        of a kind defined in section 555, 556, 559, 560, or 561.
          ``(5) The term `qualified financial contract' means any 
        contract of a kind defined in paragraph (25), (38A), (47), or 
        (53B) of section 101, section 741(7), or paragraph (4), (5), 
        (11), or (13) of section 761.
          ``(6) The term `special trustee' means the trustee of a trust 
        formed under section 1186(a)(1).

``Sec. 1183. Commencement of a case concerning a covered financial 
                    corporation

  ``(a) A case under this subchapter concerning a covered financial 
corporation may be commenced by the filing of a petition with the court 
by the debtor under section 301 only if the debtor states to the best 
of its knowledge under penalty of perjury in the petition that it is a 
covered financial corporation.
  ``(b) The commencement of a case under subsection (a) constitutes an 
order for relief under this subchapter.
  ``(c) The members of the board of directors (or body performing 
similar functions) of a covered financial company shall have no 
liability to shareholders, creditors, or other parties in interest for 
a good faith filing of a petition to commence a case under this 
subchapter, or for any reasonable action taken in good faith in 
contemplation of such a petition or a transfer under section 1185 or 
section 1186, whether prior to or after commencement of the case.
  ``(d) Counsel to the debtor shall provide, to the greatest extent 
practicable without disclosing the identity of the potential debtor, 
sufficient confidential notice to the chief judge of the court of 
appeals for the circuit embracing the district in which such counsel 
intends to file a petition to commence a case under this subchapter 
regarding the potential commencement of such case. The chief judge of 
such court shall randomly assign to preside over such case a bankruptcy 
judge selected from among the bankruptcy judges designated by the Chief 
Justice of the United States under section 298 of title 28.

``Sec. 1184. Regulators

  ``The Board, the Securities Exchange Commission, the Office of the 
Comptroller of the Currency of the Department of the Treasury, the 
Commodity Futures Trading Commission, and the Federal Deposit Insurance 
Corporation may raise and may appear and be heard on any issue in any 
case or proceeding under this subchapter.

``Sec. 1185. Special transfer of property of the estate

  ``(a) On request of the trustee, and after notice and a hearing that 
shall occur not less than 24 hours after the order for relief, the 
court may order a transfer under this section of property of the 
estate, and the assignment of executory contracts, unexpired leases, 
and qualified financial contracts of the debtor, to a bridge company. 
Upon the entry of an order approving such transfer, any property 
transferred, and any executory contracts, unexpired leases, and 
qualified financial contracts assigned under such order shall no longer 
be property of the estate. Except as provided under this section, the 
provisions of section 363 shall apply to a transfer and assignment 
under this section.
  ``(b) Unless the court orders otherwise, notice of a request for an 
order under subsection (a) shall consist of electronic or telephonic 
notice of not less than 24 hours to--
          ``(1) the debtor;
          ``(2) the holders of the 20 largest secured claims against 
        the debtor;
          ``(3) the holders of the 20 largest unsecured claims against 
        the debtor;
          ``(4) counterparties to any debt, executory contract, 
        unexpired lease, and qualified financial contract requested to 
        be transferred under this section;
          ``(5) the Board;
          ``(6) the Federal Deposit Insurance Corporation;
          ``(7) the Secretary of the Treasury and the Office of the 
        Comptroller of the Currency of the Treasury;
          ``(8) the Commodity Futures Trading Commission;
          ``(9) the Securities and Exchange Commission;
          ``(10) the United States trustee or bankruptcy administrator; 
        and
          ``(11) each primary financial regulatory agency, as defined 
        in section 2(12) of the Dodd-Frank Wall Street Reform and 
        Consumer Protection Act, with respect to any affiliate the 
        equity securities of which are proposed to be transferred under 
        this section.
  ``(c) The court may not order a transfer under this section unless 
the court determines, based upon a preponderance of the evidence, 
that--
          ``(1) the transfer under this section is necessary to prevent 
        serious adverse effects on financial stability in the United 
        States;
          ``(2) the transfer does not provide for the assumption of any 
        capital structure debt by the bridge company;
          ``(3) the transfer does not provide for the transfer to the 
        bridge company of any property of the estate that is subject to 
        a lien securing a debt, executory contract, unexpired lease or 
        agreement (including a qualified financial contract) of the 
        debtor unless--
                  ``(A)(i) the bridge company assumes such debt, 
                executory contract, unexpired lease or agreement 
                (including a qualified financial contract), including 
                any claims arising in respect thereof that would not be 
                allowed secured claims under section 506(a)(1) and 
                after giving effect to such transfer, such property 
                remains subject to the lien securing such debt, 
                executory contract, unexpired lease or agreement 
                (including a qualified financial contract); and
                  ``(ii) the court has determined that assumption of 
                such debt, executory contract, unexpired lease or 
                agreement (including a qualified financial contract) by 
                the bridge company is in the best interests of the 
                estate; or
                  ``(B) such property is being transferred to the 
                bridge company in accordance with the provisions of 
                section 363;
          ``(4) the transfer does not provide for the assumption by the 
        bridge company of any debt, executory contract, unexpired lease 
        or agreement (including a qualified financial contract) of the 
        debtor secured by a lien on property of the estate unless the 
        transfer provides for such property to be transferred to the 
        bridge company in accordance with paragraph (3)(A) of this 
        subsection;
          ``(5) the transfer does not provide for the transfer of the 
        equity of the debtor;
          ``(6) the trustee has demonstrated that the bridge company is 
        not likely to fail to meet the obligations of any debt, 
        executory contract, qualified financial contract, or unexpired 
        lease assumed and assigned to the bridge company;
          ``(7) the transfer provides for the transfer to a special 
        trustee all of the equity securities in the bridge company and 
        appointment of a special trustee in accordance with section 
        1186;
          ``(8) after giving effect to the transfer, adequate provision 
        has been made for the fees, costs, and expenses of the estate 
        and special trustee; and
          ``(9) the bridge company will have governing documents, and 
        initial directors and senior officers, that are in the best 
        interest of creditors and the estate.
  ``(d) Immediately before a transfer under this section, the bridge 
company that is the recipient of the transfer shall--
          ``(1) not have any property, executory contracts, unexpired 
        leases, qualified financial contracts, or debts, other than any 
        property acquired or executory contracts, unexpired leases, or 
        debts assumed when acting as a transferee of a transfer under 
        this section; and
          ``(2) have equity securities that are property of the estate, 
        which may be sold or distributed in accordance with this title.

``Sec. 1186. Special trustee

  ``(a)(1) An order approving a transfer under section 1185 shall 
require the trustee to transfer to a qualified and independent special 
trustee, who is appointed by the court, all of the equity securities in 
the bridge company that is the recipient of a transfer under section 
1185 to hold in trust for the sole benefit of the estate, subject to 
satisfaction of the special trustee's fees, costs, and expenses. The 
trust of which the special trustee is the trustee shall be a newly 
formed trust governed by a trust agreement approved by the court as in 
the best interests of the estate, and shall exist for the sole purpose 
of holding and administering, and shall be permitted to dispose of, the 
equity securities of the bridge company in accordance with the trust 
agreement.
  ``(2) In connection with the hearing to approve a transfer under 
section 1185, the trustee shall confirm to the court that the Board has 
been consulted regarding the identity of the proposed special trustee 
and advise the court of the results of such consultation.
  ``(b) The trust agreement governing the trust shall provide--
          ``(1) for the payment of the fees, costs, expenses, and 
        indemnities of the special trustee from the assets of the 
        debtor's estate;
          ``(2) that the special trustee provide--
                  ``(A) quarterly reporting to the estate, which shall 
                be filed with the court; and
                  ``(B) information about the bridge company reasonably 
                requested by a party in interest to prepare a 
                disclosure statement for a plan providing for 
                distribution of any securities of the bridge company if 
                such information is necessary to prepare such 
                disclosure statement;
          ``(3) that for as long as the equity securities of the bridge 
        company are held by the trust, the special trustee shall file a 
        notice with the court in connection with--
                  ``(A) any change in a director or senior officer of 
                the bridge company;
                  ``(B) any modification to the governing documents of 
                the bridge company; and
                  ``(C) any material corporate action of the bridge 
                company, including--
                          ``(i) recapitalization;
                          ``(ii) a material borrowing;
                          ``(iii) termination of an intercompany debt 
                        or guarantee;
                          ``(iv) a transfer of a substantial portion of 
                        the assets of the bridge company; or
                          ``(v) the issuance or sale of any securities 
                        of the bridge company;
          ``(4) that any sale of any equity securities of the bridge 
        company shall not be consummated until the special trustee 
        consults with the Federal Deposit Insurance Corporation and the 
        Board regarding such sale and discloses the results of such 
        consultation with the court;
          ``(5) that, subject to reserves for payments permitted under 
        paragraph (1) provided for in the trust agreement, the proceeds 
        of the sale of any equity securities of the bridge company by 
        the special trustee be held in trust for the benefit of or 
        transferred to the estate;
          ``(6) the process and guidelines for the replacement of the 
        special trustee; and
          ``(7) that the property held in trust by the special trustee 
        is subject to distribution in accordance with subsection (c).
  ``(c)(1) The special trustee shall distribute the assets held in 
trust--
          ``(A) if the court confirms a plan in the case, in accordance 
        with the plan on the effective date of the plan; or
          ``(B) if the case is converted to a case under chapter 7, as 
        ordered by the court.
  ``(2) As soon as practicable after a final distribution under 
paragraph (1), the office of the special trustee shall terminate, 
except as may be necessary to wind up and conclude the business and 
financial affairs of the trust.
  ``(d) After a transfer to the special trustee under this section, the 
special trustee shall be subject only to applicable nonbankruptcy law, 
and the actions and conduct of the special trustee shall no longer be 
subject to approval by the court in the case under this subchapter.

``Sec. 1187. Temporary and supplemental automatic stay; assumed debt

  ``(a)(1) A petition filed under section 1183 operates as a stay, 
applicable to all entities, of the termination, acceleration, or 
modification of any debt, contract, lease, or agreement of the kind 
described in paragraph (2), or of any right or obligation under any 
such debt, contract, lease, or agreement, solely because of--
          ``(A) a default by the debtor under any such debt, contract, 
        lease, or agreement; or
          ``(B) a provision in such debt, contract, lease, or 
        agreement, or in applicable nonbankruptcy law, that is 
        conditioned on--
                  ``(i) the insolvency or financial condition of the 
                debtor at any time before the closing of the case;
                  ``(ii) the commencement of a case under this title 
                concerning the debtor;
                  ``(iii) the appointment of or taking possession by a 
                trustee in a case under this title concerning the 
                debtor or by a custodian before the commencement of the 
                case; or
                  ``(iv) a credit rating agency rating, or absence or 
                withdrawal of a credit rating agency rating--
                          ``(I) of the debtor at any time after the 
                        commencement of the case;
                          ``(II) of an affiliate during the period from 
                        the commencement of the case until 48 hours 
                        after such order is entered;
                          ``(III) of the bridge company while the 
                        trustee or the special trustee is a direct or 
                        indirect beneficial holder of more than 50 
                        percent of the equity securities of--
                                  ``(aa) the bridge company; or
                                  ``(bb) the affiliate, if all of the 
                                direct or indirect interests in the 
                                affiliate that are property of the 
                                estate are transferred under section 
                                1185; or
                          ``(IV) of an affiliate while the trustee or 
                        the special trustee is a direct or indirect 
                        beneficial holder of more than 50 percent of 
                        the equity securities of--
                                  ``(aa) the bridge company; or
                                  ``(bb) the affiliate, if all of the 
                                direct or indirect interests in the 
                                affiliate that are property of the 
                                estate are transferred under section 
                                1185.
  ``(2) A debt, contract, lease, or agreement described in this 
paragraph is--
          ``(A) any debt (other than capital structure debt), executory 
        contract, or unexpired lease of the debtor (other than a 
        qualified financial contract);
          ``(B) any agreement under which the debtor issued or is 
        obligated for debt (other than capital structure debt);
          ``(C) any debt, executory contract, or unexpired lease of an 
        affiliate (other than a qualified financial contract); or
          ``(D) any agreement under which an affiliate issued or is 
        obligated for debt.
  ``(3) The stay under this subsection terminates--
          ``(A) for the benefit of the debtor, upon the earliest of--
                  ``(i) 48 hours after the commencement of the case;
                  ``(ii) assumption of the debt, contract, lease, or 
                agreement by the bridge company under an order 
                authorizing a transfer under section 1185;
                  ``(iii) a final order of the court denying the 
                request for a transfer under section 1185; or
                  ``(iv) the time the case is dismissed; and
          ``(B) for the benefit of an affiliate, upon the earliest of--
                  ``(i) the entry of an order authorizing a transfer 
                under section 1185 in which the direct or indirect 
                interests in the affiliate that are property of the 
                estate are not transferred under section 1185;
                  ``(ii) a final order by the court denying the request 
                for a transfer under section 1185;
                  ``(iii) 48 hours after the commencement of the case 
                if the court has not ordered a transfer under section 
                1185; or
                  ``(iv) the time the case is dismissed.
  ``(4) Subsections (d), (e), (f), and (g) of section 362 apply to a 
stay under this subsection.
  ``(b) A debt, executory contract (other than a qualified financial 
contract), or unexpired lease of the debtor, or an agreement under 
which the debtor has issued or is obligated for any debt, may be 
assumed by a bridge company in a transfer under section 1185 
notwithstanding any provision in an agreement or in applicable 
nonbankruptcy law that--
          ``(1) prohibits, restricts, or conditions the assignment of 
        the debt, contract, lease, or agreement; or
          ``(2) accelerates, terminates, or modifies, or permits a 
        party other than the debtor to terminate or modify, the debt, 
        contract, lease, or agreement on account of--
                  ``(A) the assignment of the debt, contract, lease, or 
                agreement; or
                  ``(B) a change in control of any party to the debt, 
                contract, lease, or agreement.
  ``(c)(1) A debt, contract, lease, or agreement of the kind described 
in subparagraph (A) or (B) of subsection (a)(2) may not be accelerated, 
terminated, or modified, and any right or obligation under such debt, 
contract, lease, or agreement may not be accelerated, terminated, or 
modified, as to the bridge company solely because of a provision in the 
debt, contract, lease, or agreement or in applicable nonbankruptcy 
law--
          ``(A) of the kind described in subsection (a)(1)(B) as 
        applied to the debtor;
          ``(B) that prohibits, restricts, or conditions the assignment 
        of the debt, contract, lease, or agreement; or
          ``(C) that accelerates, terminates, or modifies, or permits a 
        party other than the debtor to terminate or modify, the debt, 
        contract, lease or agreement on account of--
                  ``(i) the assignment of the debt, contract, lease, or 
                agreement; or
                  ``(ii) a change in control of any party to the debt, 
                contract, lease, or agreement.
  ``(2) If there is a default by the debtor under a provision other 
than the kind described in paragraph (1) in a debt, contract, lease or 
agreement of the kind described in subparagraph (A) or (B) of 
subsection (a)(2), the bridge company may assume such debt, contract, 
lease, or agreement only if the bridge company--
          ``(A) shall cure the default;
          ``(B) compensates, or provides adequate assurance in 
        connection with a transfer under section 1185 that the bridge 
        company will promptly compensate, a party other than the debtor 
        to the debt, contract, lease, or agreement, for any actual 
        pecuniary loss to the party resulting from the default; and
          ``(C) provides adequate assurance in connection with a 
        transfer under section 1185 of future performance under the 
        debt, contract, lease, or agreement, as determined by the court 
        under section 1185(c)(4).

``Sec. 1188. Treatment of qualified financial contracts and affiliate 
                    contracts

  ``(a) Notwithstanding sections 362(b)(6), 362(b)(7), 362(b)(17), 
362(b)(27), 362(o), 555, 556, 559, 560, and 561, a petition filed under 
section 1183 operates as a stay, during the period specified in section 
1187(a)(3)(A), applicable to all entities, of the exercise of a 
contractual right--
          ``(1) to cause the modification, liquidation, termination, or 
        acceleration of a qualified financial contract of the debtor or 
        an affiliate;
          ``(2) to offset or net out any termination value, payment 
        amount, or other transfer obligation arising under or in 
        connection with a qualified financial contract of the debtor or 
        an affiliate; or
          ``(3) under any security agreement or arrangement or other 
        credit enhancement forming a part of or related to a qualified 
        financial contract of the debtor or an affiliate.
  ``(b)(1) During the period specified in section 1187(a)(3)(A), the 
trustee or the affiliate shall perform all payment and delivery 
obligations under such qualified financial contract of the debtor or 
the affiliate, as the case may be, that become due after the 
commencement of the case. The stay provided under subsection (a) 
terminates as to a qualified financial contract of the debtor or an 
affiliate immediately upon the failure of the trustee or the affiliate, 
as the case may be, to perform any such obligation during such period.
  ``(2) Any failure by a counterparty to any qualified financial 
contract of the debtor or any affiliate to perform any payment or 
delivery obligation under such qualified financial contract, including 
during the pendency of the stay provided under subsection (a), shall 
constitute a breach of such qualified financial contract by the 
counterparty.
  ``(c) Subject to the court's approval, a qualified financial contract 
between an entity and the debtor may be assigned to or assumed by the 
bridge company in a transfer under, and in accordance with, section 
1185 if and only if--
          ``(1) all qualified financial contracts between the entity 
        and the debtor are assigned to and assumed by the bridge 
        company in the transfer under section 1185;
          ``(2) all claims of the entity against the debtor in respect 
        of any qualified financial contract between the entity and the 
        debtor (other than any claim that, under the terms of the 
        qualified financial contract, is subordinated to the claims of 
        general unsecured creditors) are assigned to and assumed by the 
        bridge company;
          ``(3) all claims of the debtor against the entity under any 
        qualified financial contract between the entity and the debtor 
        are assigned to and assumed by the bridge company; and
          ``(4) all property securing or any other credit enhancement 
        furnished by the debtor for any qualified financial contract 
        described in paragraph (1) or any claim described in paragraph 
        (2) or (3) under any qualified financial contract between the 
        entity and the debtor is assigned to and assumed by the bridge 
        company.
  ``(d) Notwithstanding any provision of a qualified financial contract 
or of applicable nonbankruptcy law, a qualified financial contract of 
the debtor that is assumed or assigned in a transfer under section 1185 
may not be accelerated, terminated, or modified, after the entry of the 
order approving a transfer under section 1185, and any right or 
obligation under the qualified financial contract may not be 
accelerated, terminated, or modified, after the entry of the order 
approving a transfer under section 1185 solely because of a condition 
described in section 1187(c)(1), other than a condition of the kind 
specified in section 1187(b) that occurs after property of the estate 
no longer includes a direct beneficial interest or an indirect 
beneficial interest through the special trustee, in more than 50 
percent of the equity securities of the bridge company.
  ``(e) Notwithstanding any provision of any agreement or in applicable 
nonbankruptcy law, an agreement of an affiliate (including an executory 
contract, an unexpired lease, qualified financial contract, or an 
agreement under which the affiliate issued or is obligated for debt) 
and any right or obligation under such agreement may not be 
accelerated, terminated, or modified, solely because of a condition 
described in section 1187(c)(1), other than a condition of the kind 
specified in section 1187(b) that occurs after the bridge company is no 
longer a direct or indirect beneficial holder of more than 50 percent 
of the equity securities of the affiliate, at any time after the 
commencement of the case if--
          ``(1) all direct or indirect interests in the affiliate that 
        are property of the estate are transferred under section 1185 
        to the bridge company within the period specified in subsection 
        (a);
          ``(2) the bridge company assumes--
                  ``(A) any guarantee or other credit enhancement 
                issued by the debtor relating to the agreement of the 
                affiliate; and
                  ``(B) any obligations in respect of rights of setoff, 
                netting arrangement, or debt of the debtor that 
                directly arises out of or directly relates to the 
                guarantee or credit enhancement; and
          ``(3) any property of the estate that directly serves as 
        collateral for the guarantee or credit enhancement is 
        transferred to the bridge company.

``Sec. 1189. Licenses, permits, and registrations

  ``(a) Notwithstanding any otherwise applicable nonbankruptcy law, if 
a request is made under section 1185 for a transfer of property of the 
estate, any Federal, State, or local license, permit, or registration 
that the debtor or an affiliate had immediately before the commencement 
of the case and that is proposed to be transferred under section 1185 
may not be accelerated, terminated, or modified at any time after the 
request solely on account of--
          ``(1) the insolvency or financial condition of the debtor at 
        any time before the closing of the case;
          ``(2) the commencement of a case under this title concerning 
        the debtor;
          ``(3) the appointment of or taking possession by a trustee in 
        a case under this title concerning the debtor or by a custodian 
        before the commencement of the case; or
          ``(4) a transfer under section 1185.
  ``(b) Notwithstanding any otherwise applicable nonbankruptcy law, any 
Federal, State, or local license, permit, or registration that the 
debtor had immediately before the commencement of the case that is 
included in a transfer under section 1185 shall be valid and all rights 
and obligations thereunder shall vest in the bridge company.

``Sec. 1190. Exemption from securities laws

  ``For purposes of section 1145, a security of the bridge company 
shall be deemed to be a security of a successor to the debtor under a 
plan if the court approves the disclosure statement for the plan as 
providing adequate information (as defined in section 1125(a)) about 
the bridge company and the security.

``Sec. 1191. Inapplicability of certain avoiding powers

  ``A transfer made or an obligation incurred by the debtor to an 
affiliate prior to or after the commencement of the case, including any 
obligation released by the debtor or the estate to or for the benefit 
of an affiliate, in contemplation of or in connection with a transfer 
under section 1185 is not avoidable under section 544, 547, 
548(a)(1)(B), or 549, or under any similar nonbankruptcy law.

``Sec. 1192. Consideration of financial stability

  ``The court may consider the effect that any decision in connection 
with this subchapter may have on financial stability in the United 
States.''.

SEC. 123. AMENDMENTS TO TITLE 28, UNITED STATES CODE.

  (a) Amendment to Chapter 13.--Chapter 13 of title 28, United States 
Code, is amended by adding at the end the following:

``Sec. 298. Judge for a case under subchapter V of chapter 11 of title 
                    11

  ``(a)(1) Notwithstanding section 295, the Chief Justice of the United 
States shall designate not fewer than 10 bankruptcy judges to be 
available to hear a case under subchapter V of chapter 11 of title 11. 
Bankruptcy judges may request to be considered by the Chief Justice of 
the United States for such designation.
  ``(2) Notwithstanding section 155, a case under subchapter V of 
chapter 11 of title 11 shall be heard under section 157 by a bankruptcy 
judge designated under paragraph (1), who shall be randomly assigned to 
hear such case by the chief judge of the court of appeals for the 
circuit embracing the district in which the case is pending. To the 
greatest extent practicable, the approvals required under section 155 
should be obtained.
  ``(3) If the bankruptcy judge assigned to hear a case under paragraph 
(2) is not assigned to the district in which the case is pending, the 
bankruptcy judge shall be temporarily assigned to the district.
  ``(b) A case under subchapter V of chapter 11 of title 11, and all 
proceedings in the case, shall take place in the district in which the 
case is pending.
  ``(c) In this section, the term `covered financial corporation' has 
the meaning given that term in section 101(9A) of title 11.''.
  (b) Amendment to Section 1334 of Title 28.--Section 1334 of title 28, 
United States Code, is amended by adding at the end the following:
  ``(f) This section does not grant jurisdiction to the district court 
after a transfer pursuant to an order under section 1185 of title 11 of 
any proceeding related to a special trustee appointed, or to a bridge 
company formed, in connection with a case under subchapter V of chapter 
11 of title 11.''.
  (c) Technical and Conforming Amendment.--The table of sections for 
chapter 13 of title 28, United States Code, is amended by adding at the 
end the following:

``298. Judge for a case under subchapter V of chapter 11 of title 
11.''.

                Subtitle C--Ending Government Guarantees

SEC. 131. REPEAL OF OBLIGATION GUARANTEE PROGRAM.

  (a) In General.--The following sections of the Dodd-Frank Wall Street 
Reform and Consumer Protection Act (12 U.S.C. 5301 et seq.) are 
repealed:
          (1) Section 1104.
          (2) Section 1105.
          (3) Section 1106.
  (b) Clerical Amendment.--The table of contents under section 1(b) of 
the Dodd-Frank Wall Street Reform and Consumer Protection Act is 
amended by striking the items relating to sections 1104, 1105, and 
1106.

SEC. 132. REPEAL OF SYSTEMIC RISK DETERMINATION IN RESOLUTIONS.

  Section 13(c)(4)(G) of the Federal Deposit Insurance Act (12 U.S.C. 
1823(c)(4)(G)) is hereby repealed.

SEC. 133. RESTRICTIONS ON USE OF THE EXCHANGE STABILIZATION FUND.

  (a) In General.--Section 5302 of title 31, United States Code, is 
amended by adding at the end the following:
  ``(e) Amounts in the fund may not be used for the establishment of a 
guaranty program for any nongovernmental entity.''.
  (b) Conforming Amendment.--Section 131(b) of the Emergency Economic 
Stabilization Act of 2008 (12 U.S.C. 5236(b)) is amended by inserting 
``, or for the purposes of preventing the liquidation or insolvency of 
any entity'' before the period.

     Subtitle D--Eliminating Financial Market Utility Designations

SEC. 141. REPEAL OF TITLE VIII.

  (a) Repeal.--Title VIII of the Dodd-Frank Wall Street Reform and 
Consumer Protection Act (12 U.S.C. 5461 et seq.) is repealed, and 
provisions of law amended by such title are restored and revived as if 
such title had never been enacted.
  (b) Clerical Amendment.--The table of contents in section 1(b) of the 
Dodd-Frank Wall Street Reform and Consumer Protection Act is amended by 
striking the items relating to title VIII.

       Subtitle E--Reform of the Financial Stability Act of 2010

SEC. 151. REPEAL AND MODIFICATION OF PROVISIONS OF THE FINANCIAL 
                    STABILITY ACT OF 2010.

  (a) Repeals.--The following provisions of the Financial Stability Act 
of 2010 are repealed, and the provisions of law amended or repealed by 
such provisions are restored or revived as if such provisions had not 
been enacted:
          (1) Subtitle B.
          (2) Section 113.
          (3) Section 114.
          (4) Section 115.
          (5) Section 116.
          (6) Section 117.
          (7) Section 119.
          (8) Section 120.
          (9) Section 121.
          (10) Section 161.
          (11) Section 162.
          (12) Section 164.
          (13) Section 166.
          (14) Section 167.
          (15) Section 168.
          (16) Section 170.
          (17) Section 172.
          (18) Section 174.
          (19) Section 175.
  (b) Additional Modifications.--The Financial Stability Act of 2010 
(12 U.S.C. 5311 et seq.) is amended--
          (1) in section 102(a), by striking paragraph (5);
          (2) in section 111--
                  (A) in subsection (b)--
                          (i) in paragraph (1)--
                                  (I) by striking ``who shall each'' 
                                and inserting ``who shall, except as 
                                provided below, each''; and
                                  (II) by striking subparagraphs (B) 
                                through (J) and inserting the 
                                following:
                  ``(B) each member of the Board of Governors, who 
                shall collectively have 1 vote on the Council;
                  ``(C) the Comptroller of the Currency;
                  ``(D) the Director of the Consumer Law Enforcement 
                Agency;
                  ``(E) each member of the Commission, who shall 
                collectively have 1 vote on the Council;
                  ``(F) each member of the Corporation, who shall 
                collectively have 1 vote on the Council;
                  ``(G) each member of the Commodity Futures Trading 
                Commission, who shall collectively have 1 vote on the 
                Council;
                  ``(H) the Director of the Federal Housing Finance 
                Agency;
                  ``(I) each member of the National Credit Union 
                Administration Board, who shall collectively have 1 
                vote on the Council; and
                  ``(J) the Independent Insurance Advocate.'';
                          (ii) in paragraph (2)--
                                  (I) by striking subparagraphs (A) and 
                                (B); and
                                  (II) by redesignating subparagraphs 
                                (C), (D), and (E) as subparagraphs (A), 
                                (B), and (C), respectively; and
                          (iii) by adding at the end the following:
          ``(4) Voting by multi-person entity.--
                  ``(A) Voting within the entity.--An entity described 
                under subparagraph (B), (E), (F), (G), or (I) of 
                paragraph (1) shall determine the entity's Council vote 
                by using the voting process normally applicable to 
                votes by the entity's members.
                  ``(B) Casting of entity vote.--The 1 collective 
                Council vote of an entity described under subparagraph 
                (A) shall be cast by the head of such agency or, in the 
                event such head is unable to cast such vote, the next 
                most senior member of the entity available.'';
                  (B) in subsection (c), by striking ``subparagraphs 
                (C), (D), and (E)'' and inserting ``subparagraphs (B), 
                (C), and (D)'';
                  (C) in subsection (e), by adding at the end the 
                following:
          ``(3) Staff access.--Any member of the Council may select to 
        have one or more individuals on the member's staff attend a 
        meeting of the Council, including any meeting of 
        representatives of the member agencies other than the members 
        themselves.
          ``(4) Congressional oversight.--All meetings of the Council, 
        whether or not open to the public, shall be open to the 
        attendance by members of the Committee on Financial Services of 
        the House of Representatives and the Committee on Banking, 
        Housing, and Urban Affairs of the Senate.
          ``(5) Member agency meetings.--Any meeting of representatives 
        of the member agencies other than the members themselves shall 
        be open to attendance by staff of the Committee on Financial 
        Services of the House of Representatives and the Committee on 
        Banking, Housing, and Urban Affairs of the Senate.'';
                  (D) by striking subsection (g) (relating to the 
                nonapplicability of FACA);
                  (E) by inserting after subsection (f) the following:
  ``(g) Open Meeting Requirement.--The Council shall be an agency for 
purposes of section 552b of title 5, United States Code (commonly 
referred to as the `Government in the Sunshine Act').
  ``(h) Confidential Congressional Briefings.--At the request of the 
Chairman of the Committee on Financial Services of the House of 
Representatives or the Chairman of the Committee on Banking, Housing, 
and Urban Affairs of the Senate, the Chairperson shall appear before 
Congress to provide a confidential briefing.''; and
                  (F) by redesignating subsections (h) through (j) as 
                subsections (i) through (k), respectively;
          (3) in section 112--
                  (A) in subsection (a)(2)--
                          (i) in subparagraph (A), by striking ``the 
                        Federal Insurance Office and, if necessary to 
                        assess risks to the United States financial 
                        system, direct the Office of Financial Research 
                        to'' and inserting ``and, if necessary to 
                        assess risks to the United States financial 
                        system,'';
                          (ii) by striking subparagraphs (B), (H), (I), 
                        and (J);
                          (iii) by redesignating subparagraphs (C), 
                        (D), (E), (F), (G), (K), (L), (M), and (N) as 
                        subparagraphs (B), (C), (D), (E), (F), (G), 
                        (H), (I), and (J), respectively;
                          (iv) in subparagraph (J), as so 
                        redesignated--
                                  (I) in clause (iii), by adding 
                                ``and'' at the end;
                                  (II) by striking clauses (iv) and 
                                (v); and
                                  (III) by redesignating clause (vi) as 
                                clause (iv); and
                  (B) in subsection (d)--
                          (i) in paragraph (1), by striking ``the 
                        Office of Financial Research, member agencies, 
                        and the Federal Insurance Office'' and 
                        inserting ``member agencies'';
                          (ii) in paragraph (2), by striking ``the 
                        Office of Financial Research, any member 
                        agency, and the Federal Insurance Office,'' and 
                        inserting ``member agencies'';
                          (iii) in paragraph (3)--
                                  (I) by striking ``, acting through 
                                the Office of Financial Research,'' 
                                each place it appears; and
                                  (II) in subparagraph (B), by striking 
                                ``the Office of Financial Research 
                                or''; and
                          (iv) in paragraph (5)(A), by striking ``, the 
                        Office of Financial Research,'';
          (4) by amending section 118 to read as follows:

``SEC. 118. COUNCIL FUNDING.

  ``There is authorized to be appropriated to the Council $4,000,000 
for fiscal year 2017 and each fiscal year thereafter to carry out the 
duties of the Council.'';
          (5) in section 163--
                  (A) by striking subsection (a);
                  (B) by redesignating subsection (b) as subsection 
                (a); and
                  (C) in subsection (a), as so redesignated--
                          (i) by striking ``or a nonbank financial 
                        company supervised by the Board of Governors'' 
                        each place such term appears;
                          (ii) in paragraph (4), by striking ``In 
                        addition'' and inserting the following:
                  ``(A) In general.--In addition''; and
                          (iii) by adding at the end the following:
                  ``(B) Exception for qualifying banking 
                organization.--Subparagraph (A) shall not apply to a 
                proposed acquisition by a qualifying banking 
                organization, as defined under section 605 of the 
                Financial CHOICE Act of 2017.''; and
          (6) in section 165--
                  (A) by striking ``nonbank financial companies 
                supervised by the Board of Governors and'' each place 
                such term appears;
                  (B) by striking ``nonbank financial company 
                supervised by the Board of Governors and'' each place 
                such term appears;
                  (C) in subsection (a), by amending paragraph (2) to 
                read as follows:
          ``(2) Tailored application.--In prescribing more stringent 
        prudential standards under this section, the Board of Governors 
        may differentiate among companies on an individual basis or by 
        category, taking into consideration their capital structure, 
        riskiness, complexity, financial activities (including the 
        financial activities of their subsidiaries), size, and any 
        other risk-related factors that the Board of Governors deems 
        appropriate.'';
                  (D) in subsection (b)--
                          (i) in paragraph (1)(B)(iv), by striking ``, 
                        on its own or pursuant to a recommendation made 
                        by the Council in accordance with section 
                        115,'';
                          (ii) in paragraph (2)--
                                  (I) by striking ``foreign nonbank 
                                financial company supervised by the 
                                Board of Governors or'';
                                  (II) by striking ``shall--'' and all 
                                that follows through ``give due'' and 
                                inserting ``shall give due'';
                                  (III) in subparagraph (A), by 
                                striking ``; and'' and inserting a 
                                period; and
                                  (IV) by striking subparagraph (B);
                          (iii) in paragraph (3)--
                                  (I) in subparagraph (A)--
                                          (aa) by striking clause (i);
                                          (bb) by redesignating clauses 
                                        (ii), (iii), and (iv) as 
                                        clauses (i), (ii), and (iii), 
                                        respectively; and
                                          (cc) in clause (iii), as so 
                                        redesignated, by adding ``and'' 
                                        at the end;
                                  (II) by striking subparagraphs (B) 
                                and (C); and
                                  (III) by redesignating subparagraph 
                                (D) as subparagraph (B); and
                          (iv) in paragraph (4), by striking ``a 
                        nonbank financial company supervised by the 
                        Board of Governors or'';
                  (E) in subsection (c)--
                          (i) in paragraph (1), by striking ``under 
                        section 115(c)''; and
                          (ii) in paragraph (2)--
                                  (I) by amending subparagraph (A) to 
                                read as follows:
                  ``(A) any recommendations of the Council;''; and
                                  (II) in subparagraph (D), by striking 
                                ``nonbank financial company supervised 
                                by the Board of Governors or'';
                  (F) in subsection (d)--
                          (i) by striking ``a nonbank financial company 
                        supervised by the Board of Governors or'' each 
                        place such term appears;
                          (ii) in paragraph (1), by striking 
                        ``periodically'' and inserting ``not more often 
                        than every 2 years'';
                          (iii) in paragraph (3)--
                                  (I) by striking ``The Board'' and 
                                inserting the following:
                  ``(A) In general.--The Board'';
                                  (II) by striking ``shall review'' and 
                                inserting the following: ``shall--
                          ``(i) review'';
                                  (III) by striking the period and 
                                inserting ``; and''; and
                                  (IV) by adding at the end the 
                                following:
                          ``(ii) not later than the end of the 6-month 
                        period beginning on the date the bank holding 
                        company submits the resolution plan, provide 
                        feedback to the bank holding company on such 
                        plan.
                  ``(B) Disclosure of assessment framework.--The Board 
                of Governors shall publicly disclose the assessment 
                framework that is used to review information under this 
                paragraph and shall provide the public with a notice 
                and comment period before finalizing such assessment 
                framework.''.
                          (iv) in paragraph (6), by striking ``nonbank 
                        financial company supervised by the Board, any 
                        bank holding company,'' and inserting ``bank 
                        holding company'';
                  (G) in subsection (e)--
                          (i) in paragraph (1), by striking ``a nonbank 
                        financial company supervised by the Board of 
                        Governors or'';
                          (ii) in paragraph (3), by striking ``the 
                        nonbank financial company supervised by the 
                        Board of Governors or'' each place such term 
                        appears; and
                          (iii) in paragraph (4), by striking ``a 
                        nonbank financial company supervised by the 
                        Board of Governors or'';
                  (H) in subsection (g)(1), by striking ``and any 
                nonbank financial company supervised by the Board of 
                Governors'';
                  (I) in subsection (h)--
                          (i) by striking paragraph (1);
                          (ii) by redesignating paragraphs (2), (3), 
                        and (4) as paragraphs (1), (2), and (3), 
                        respectively;
                          (iii) in paragraph (1), as so redesignated, 
                        by striking ``paragraph (3)'' each place such 
                        term appears and inserting ``paragraph (2)''; 
                        and
                          (iv) in paragraph (2), as so redesignated--
                                  (I) in subparagraph (A), by striking 
                                ``the nonbank financial company 
                                supervised by the Board of Governors or 
                                bank holding company described in 
                                subsection (a), as applicable'' and 
                                inserting ``a bank holding company 
                                described in subsection (a)''; and
                                  (II) in subparagraph (B), by striking 
                                ``the nonbank financial company 
                                supervised by the Board of Governors or 
                                a bank holding company described in 
                                subsection (a), as applicable'' and 
                                inserting ``a bank holding company 
                                described in subsection (a)'';
                  (J) in subsection (i)--
                          (i) in paragraph (1)--
                                  (I) in subparagraph (A), by striking 
                                ``, in coordination with the 
                                appropriate primary financial 
                                regulatory agencies and the Federal 
                                Insurance Office,'';
                                  (II) in subparagraph (B)--
                                          (aa) by amending clause (i) 
                                        to read as follows:
                          ``(i) shall--
                                  ``(I) issue regulations, after 
                                providing for public notice and 
                                comment, that provide for at least 3 
                                different sets of conditions under 
                                which the evaluation required by this 
                                subsection shall be conducted, 
                                including baseline, adverse, and 
                                severely adverse, and methodologies, 
                                including models used to estimate 
                                losses on certain assets, and the Board 
                                of Governors shall not carry out any 
                                such evaluation until 60 days after 
                                such regulations are issued; and
                                  ``(II) provide copies of such 
                                regulations to the Comptroller General 
                                of the United States and the Panel of 
                                Economic Advisors of the Congressional 
                                Budget Office before publishing such 
                                regulations;'';
                                          (bb) in clause (ii), by 
                                        striking ``and nonbank 
                                        financial companies'';
                                          (cc) in clause (iv), by 
                                        striking ``and'' at the end;
                                          (dd) in clause (v), by 
                                        striking the period and 
                                        inserting the following: ``, 
                                        including any results of a 
                                        resubmitted test;''; and
                                          (ee) by adding at the end the 
                                        following:
                          ``(vi) shall, in establishing the severely 
                        adverse condition under clause (i), provide 
                        detailed consideration of the model's effects 
                        on financial stability and the cost and 
                        availability of credit;
                          ``(vii) shall, in developing the models and 
                        methodologies and providing them for notice and 
                        comment under this subparagraph, publish a 
                        process to test the models and methodologies 
                        for their potential to magnify systemic and 
                        institutional risks instead of facilitating 
                        increased resiliency;
                          ``(viii) shall design and publish a process 
                        to test and document the sensitivity and 
                        uncertainty associated with the model system's 
                        data quality, specifications, and assumptions; 
                        and
                          ``(ix) shall communicate the range and 
                        sources of uncertainty surrounding the models 
                        and methodologies.''; and
                                  (III) by adding at the end the 
                                following:
                  ``(C) CCAR requirements.--
                          ``(i) Parameters and consequences applicable 
                        to ccar.--The requirements of subparagraph (B) 
                        shall apply to CCAR.
                          ``(ii) Two-year limitation.--The Board of 
                        Governors may not subject a company to CCAR 
                        more than once every two years.
                          ``(iii) Mid-cycle resubmission.--If a company 
                        receives a quantitative objection to, or 
                        otherwise desires to amend the company's 
                        capital plan, the company may file a new 
                        streamlined plan at any time after a capital 
                        planning exercise has been completed and before 
                        a subsequent capital planning exercise.
                          ``(iv) Limitation on qualitative capital 
                        planning objections.--In carrying out CCAR, the 
                        Board of Governors may not object to a 
                        company's capital plan on the basis of 
                        qualitative deficiencies in the company's 
                        capital planning process.
                          ``(v) Company inquiries.--The Board of 
                        Governors shall establish and publish 
                        procedures for responding to inquiries from 
                        companies subject to CCAR, including 
                        establishing the time frame in which such 
                        responses will be made, and make such 
                        procedures publicly available.
                          ``(vi) CCAR defined.--For purposes of this 
                        subparagraph and subparagraph (E), the term 
                        `CCAR' means the Comprehensive Capital Analysis 
                        and Review established by the Board of 
                        Governors.''; and
                          (ii) in paragraph (2)--
                                  (I) in subparagraph (A)--
                                          (aa) by striking ``a bank 
                                        holding company'' and inserting 
                                        ``bank holding company'';
                                          (bb) by striking 
                                        ``semiannual'' and inserting 
                                        ``annual'';
                                          (cc) by striking ``All other 
                                        financial companies'' and 
                                        inserting ``All other bank 
                                        holding companies''; and
                                          (dd) by striking ``and are 
                                        regulated by a primary Federal 
                                        financial regulatory agency'';
                                  (II) in subparagraph (B)--
                                          (aa) by striking ``and to its 
                                        primary financial regulatory 
                                        agency''; and
                                          (bb) by striking ``primary 
                                        financial regulatory agency'' 
                                        the second time it appears and 
                                        inserting ``Board of 
                                        Governors''; and
                                  (III) in subparagraph (C)--
                                          (aa) by striking ``Each 
                                        Federal primary financial 
                                        regulatory agency, in 
                                        coordination with the Board of 
                                        Governors and the Federal 
                                        Insurance Office,'' and 
                                        inserting ``The Board of 
                                        Governors''; and
                                          (bb) by striking ``consistent 
                                        and comparable''.
                  (K) in subsection (j)--
                          (i) in paragraph (1), by striking ``or a 
                        nonbank financial company supervised by the 
                        Board of Governors''; and
                          (ii) in paragraph (2), by striking ``the 
                        factors described in subsections (a) and (b) of 
                        section 113 and any other'' and inserting 
                        ``any'';
                  (L) in subsection (k)(1), by striking ``or nonbank 
                financial company supervised by the Board of 
                Governors''; and
                  (M) by adding at the end the following:
  ``(l) Exemption for Qualifying Banking Organizations.--This section 
shall not apply to a proposed acquisition by a qualifying banking 
organization, as defined under section 605 of the Financial CHOICE Act 
of 2017.''.
  (c) Treatment of Other Resolution Plan Requirements.--
          (1) In general.--With respect to an appropriate Federal 
        banking agency that requires a banking organization to submit 
        to the agency a resolution plan not described under section 
        165(d) of the Dodd-Frank Wall Street Reform and Consumer 
        Protection Act--
                  (A) the agency shall comply with the requirements of 
                paragraphs (3) and (4) of such section 165(d);
                  (B) the agency may not require the submission of such 
                a resolution plan more often than every 2 years; and
                  (C) paragraphs (6) and (7) of such section 165(d) 
                shall apply to such a resolution plan.
          (2) Definitions.--For purposes of this subsection, the terms 
        ``appropriate Federal banking agency'' and ``banking 
        organization'' have the meaning given those terms, 
        respectively, under section 105.
  (d) Actions to Create a Bank Holding Company.--Section 3(b)(1) of the 
Bank Holding Company Act of 1956 (12 U.S.C. 1842(b)(1)) is amended--
          (1) by striking ``Upon receiving'' and inserting the 
        following:
                  ``(A) In general.--Upon receiving'';
          (2) by striking ``Notwithstanding any other provision'' and 
        inserting the following:
                  ``(B) Immediate action.--
                          ``(i) In general.--Notwithstanding any other 
                        provision''; and
          (3) by adding at the end the following:
                          ``(ii) Exception.--The Board may not take any 
                        action pursuant to clause (i) on an application 
                        that would cause any company to become a bank 
                        holding company unless such application 
                        involves the company acquiring a bank that is 
                        critically undercapitalized (as such term is 
                        defined under section 38(b) of the Federal 
                        Deposit Insurance Act).''.
  (e) Concentration Limits Applied Only to Banking Organizations.--
Section 14 of the Bank Holding Company Act of 1956 (12 U.S.C. 1852) is 
amended--
          (1) by striking ``financial company'' each place such term 
        appears and inserting ``banking organization'';
          (2) in subsection (a)--
                  (A) by amending paragraph (2) to read as follows:
          ``(2) the term `banking organization' means--
                  ``(A) an insured depository institution;
                  ``(B) a bank holding company;
                  ``(C) a savings and loan holding company;
                  ``(D) a company that controls an insured depository 
                institution; and
                  ``(E) a foreign bank or company that is treated as a 
                bank holding company for purposes of this Act; and'';
                  (B) in paragraph (3)--
                          (i) in subparagraph (A)(ii), by adding 
                        ``and'' at the end;
                          (ii) in subparagraph (B)(ii), by striking ``; 
                        and'' and inserting a period; and
                          (iii) by striking subparagraph (C); and
          (3) in subsection (b), by striking ``financial companies'' 
        and inserting ``banking organizations''.
  (f) Conforming Amendment.--Section 3502(5) of title 44, United States 
Code, is amended by striking ``the Office of Financial Research,''.
  (g) Clerical Amendment.--The table of contents under section 1(b) of 
the Dodd-Frank Wall Street Reform and Consumer Protection Act is 
amended by striking the items relating to subtitle B of title I and 
113, 114, 115, 116, 117, 119, 120, 121, 161, 162, 164, 166, 167, 168, 
170, 172, 174, and 175.

SEC. 152. OPERATIONAL RISK CAPITAL REQUIREMENTS FOR BANKING 
                    ORGANIZATIONS.

  (a) In General.--An appropriate Federal banking agency may not 
establish an operational risk capital requirement for banking 
organizations, unless such requirement--
          (1) is based on the risks posed by a banking organization's 
        current activities and businesses;
          (2) is appropriately sensitive to the risks posed by such 
        current activities and businesses;
          (3) is determined under a forward-looking assessment of 
        potential losses that may arise out of a banking organization's 
        current activities and businesses, which is not solely based on 
        a banking organization's historical losses; and
          (4) permits adjustments based on qualifying operational risk 
        mitigants.
  (b) Definitions.--For purposes of this section, the terms 
``appropriate Federal banking agency'' and ``banking organization'' 
have the meaning given those terms, respectively, under section 605.

          TITLE II--DEMANDING ACCOUNTABILITY FROM WALL STREET

                Subtitle A--SEC Penalties Modernization

SEC. 211. ENHANCEMENT OF CIVIL PENALTIES FOR SECURITIES LAWS 
                    VIOLATIONS.

  (a) Updated Civil Money Penalties.--
          (1) Securities act of 1933.--
                  (A) Money penalties in administrative actions.--
                Section 8A(g)(2) of the Securities Act of 1933 (15 
                U.S.C. 77h-1(g)(2)) is amended--
                          (i) in subparagraph (A)--
                                  (I) by striking ``$7,500'' and 
                                inserting ``$10,000''; and
                                  (II) by striking ``$75,000'' and 
                                inserting ``$100,000'';
                          (ii) in subparagraph (B)--
                                  (I) by striking ``$75,000'' and 
                                inserting ``$100,000''; and
                                  (II) by striking ``$375,000'' and 
                                inserting ``$500,000''; and
                          (iii) by striking subparagraph (C) and 
                        inserting the following:
                  ``(C) Third tier.--
                          ``(i) In general.--Notwithstanding 
                        subparagraphs (A) and (B), the amount of 
                        penalty for each such act or omission shall not 
                        exceed the amount specified in clause (ii) if--
                                  ``(I) the act or omission described 
                                in paragraph (1) involved fraud, 
                                deceit, manipulation, or deliberate or 
                                reckless disregard of a regulatory 
                                requirement; and
                                  ``(II) such act or omission directly 
                                or indirectly resulted in--
                                          ``(aa) substantial losses or 
                                        created a significant risk of 
                                        substantial losses to other 
                                        persons; or
                                          ``(bb) substantial pecuniary 
                                        gain to the person who 
                                        committed the act or omission.
                          ``(ii) Maximum amount of penalty.--The amount 
                        referred to in clause (i) is the greatest of--
                                  ``(I) $300,000 for a natural person 
                                or $1,450,000 for any other person;
                                  ``(II) 3 times the gross amount of 
                                pecuniary gain to the person who 
                                committed the act or omission; or
                                  ``(III) the amount of losses incurred 
                                by victims as a result of the act or 
                                omission.''.
                  (B) Money penalties in civil actions.--Section 
                20(d)(2) of the Securities Act of 1933 (15 U.S.C. 
                77t(d)(2)) is amended--
                          (i) in subparagraph (A)--
                                  (I) by striking ``$5,000'' and 
                                inserting ``$10,000''; and
                                  (II) by striking ``$50,000'' and 
                                inserting ``$100,000'';
                          (ii) in subparagraph (B)--
                                  (I) by striking ``$50,000'' and 
                                inserting ``$100,000''; and
                                  (II) by striking ``$250,000'' and 
                                inserting ``$500,000''; and
                          (iii) by striking subparagraph (C) and 
                        inserting the following:
                  ``(C) Third tier.--
                          ``(i) In general.--Notwithstanding 
                        subparagraphs (A) and (B), the amount of 
                        penalty for each such violation shall not 
                        exceed the amount specified in clause (ii) if--
                                  ``(I) the violation described in 
                                paragraph (1) involved fraud, deceit, 
                                manipulation, or deliberate or reckless 
                                disregard of a regulatory requirement; 
                                and
                                  ``(II) such violation directly or 
                                indirectly resulted in substantial 
                                losses or created a significant risk of 
                                substantial losses to other persons.
                          ``(ii) Maximum amount of penalty.--The amount 
                        referred to in clause (i) is the greatest of--
                                  ``(I) $300,000 for a natural person 
                                or $1,450,000 for any other person;
                                  ``(II) 3 times the gross amount of 
                                pecuniary gain to such defendant as a 
                                result of the violation; or
                                  ``(III) the amount of losses incurred 
                                by victims as a result of the 
                                violation.''.
          (2) Securities exchange act of 1934.--
                  (A) Money penalties in civil actions.--Section 
                21(d)(3)(B) of the Securities Exchange Act of 1934 (15 
                U.S.C. 78u(d)(3)(B)) is amended--
                          (i) in clause (i)--
                                  (I) by striking ``$5,000'' and 
                                inserting ``$10,000''; and
                                  (II) by striking ``$50,000'' and 
                                inserting ``$100,000'';
                          (ii) in clause (ii)--
                                  (I) by striking ``$50,000'' and 
                                inserting ``$100,000''; and
                                  (II) by striking ``$250,000'' and 
                                inserting ``$500,000''; and
                          (iii) by striking clause (iii) and inserting 
                        the following:
                  ``(iii) Third tier.--
                          ``(I) In general.--Notwithstanding clauses 
                        (i) and (ii), the amount of penalty for each 
                        such violation shall not exceed the amount 
                        specified in subclause (II) if--
                                  ``(aa) the violation described in 
                                subparagraph (A) involved fraud, 
                                deceit, manipulation, or deliberate or 
                                reckless disregard of a regulatory 
                                requirement; and
                                  ``(bb) such violation directly or 
                                indirectly resulted in substantial 
                                losses or created a significant risk of 
                                substantial losses to other persons.
                          ``(II) Maximum amount of penalty.--The amount 
                        referred to in subclause (I) is the greatest 
                        of--
                                  ``(aa) $300,000 for a natural person 
                                or $1,450,000 for any other person;
                                  ``(bb) 3 times the gross amount of 
                                pecuniary gain to such defendant as a 
                                result of the violation; or
                                  ``(cc) the amount of losses incurred 
                                by victims as a result of the 
                                violation.''.
                  (B) Money penalties in administrative actions.--
                Section 21B(b) of the Securities Exchange Act of 1934 
                (15 U.S.C. 78u-2(b)) is amended--
                          (i) in paragraph (1)--
                                  (I) by striking ``$5,000'' and 
                                inserting ``$10,000''; and
                                  (II) by striking ``$50,000'' and 
                                inserting ``$100,000'';
                          (ii) in paragraph (2)--
                                  (I) by striking ``$50,000'' and 
                                inserting ``$100,000''; and
                                  (II) by striking ``$250,000'' and 
                                inserting ``$500,000''; and
                          (iii) by striking paragraph (3) and inserting 
                        the following:
          ``(3) Third tier.--
                  ``(A) In general.--Notwithstanding paragraphs (1) and 
                (2), the amount of penalty for each such act or 
                omission shall not exceed the amount specified in 
                subparagraph (B) if--
                          ``(i) the act or omission described in 
                        subsection (a) involved fraud, deceit, 
                        manipulation, or deliberate or reckless 
                        disregard of a regulatory requirement; and
                          ``(ii) such act or omission directly or 
                        indirectly resulted in substantial losses or 
                        created a significant risk of substantial 
                        losses to other persons or resulted in 
                        substantial pecuniary gain to the person who 
                        committed the act or omission.
                  ``(B) Maximum amount of penalty.--The amount referred 
                to in subparagraph (A) is the greatest of--
                          ``(i) $300,000 for a natural person or 
                        $1,450,000 for any other person;
                          ``(ii) 3 times the gross amount of pecuniary 
                        gain to the person who committed the act or 
                        omission; or
                          ``(iii) the amount of losses incurred by 
                        victims as a result of the act or omission.''.
          (3) Investment company act of 1940.--
                  (A) Money penalties in administrative actions.--
                Section 9(d)(2) of the Investment Company Act of 1940 
                (15 U.S.C. 80a-9(d)(2)) is amended--
                          (i) in subparagraph (A)--
                                  (I) by striking ``$5,000'' and 
                                inserting ``$10,000''; and
                                  (II) by striking ``$50,000'' and 
                                inserting ``$100,000'';
                          (ii) in subparagraph (B)--
                                  (I) by striking ``$50,000'' and 
                                inserting ``$100,000''; and
                                  (II) by striking ``$250,000'' and 
                                inserting ``$500,000''; and
                          (iii) by striking subparagraph (C) and 
                        inserting the following:
                  ``(C) Third tier.--
                          ``(i) In general.--Notwithstanding 
                        subparagraphs (A) and (B), the amount of 
                        penalty for each such act or omission shall not 
                        exceed the amount specified in clause (ii) if--
                                  ``(I) the act or omission described 
                                in paragraph (1) involved fraud, 
                                deceit, manipulation, or deliberate or 
                                reckless disregard of a regulatory 
                                requirement; and
                                  ``(II) such act or omission directly 
                                or indirectly resulted in substantial 
                                losses or created a significant risk of 
                                substantial losses to other persons or 
                                resulted in substantial pecuniary gain 
                                to the person who committed the act or 
                                omission.
                          ``(ii) Maximum amount of penalty.--The amount 
                        referred to in clause (i) is the greatest of--
                                  ``(I) $300,000 for a natural person 
                                or $1,450,000 for any other person;
                                  ``(II) 3 times the gross amount of 
                                pecuniary gain to the person who 
                                committed the act or omission; or
                                  ``(III) the amount of losses incurred 
                                by victims as a result of the act or 
                                omission.''.
                  (B) Money penalties in civil actions.--Section 
                42(e)(2) of the Investment Company Act of 1940 (15 
                U.S.C. 80a-41(e)(2)) is amended--
                          (i) in subparagraph (A)--
                                  (I) by striking ``$5,000'' and 
                                inserting ``$10,000''; and
                                  (II) by striking ``$50,000'' and 
                                inserting ``$100,000'';
                          (ii) in subparagraph (B)--
                                  (I) by striking ``$50,000'' and 
                                inserting ``$100,000''; and
                                  (II) by striking ``$250,000'' and 
                                inserting ``$500,000''; and
                          (iii) by striking subparagraph (C) and 
                        inserting the following:
                  ``(C) Third tier.--
                          ``(i) In general.--Notwithstanding 
                        subparagraphs (A) and (B), the amount of 
                        penalty for each such violation shall not 
                        exceed the amount specified in clause (ii) if--
                                  ``(I) the violation described in 
                                paragraph (1) involved fraud, deceit, 
                                manipulation, or deliberate or reckless 
                                disregard of a regulatory requirement; 
                                and
                                  ``(II) such violation directly or 
                                indirectly resulted in substantial 
                                losses or created a significant risk of 
                                substantial losses to other persons.
                          ``(ii) Maximum amount of penalty.--The amount 
                        referred to in clause (i) is the greatest of--
                                  ``(I) $300,000 for a natural person 
                                or $1,450,000 for any other person;
                                  ``(II) 3 times the gross amount of 
                                pecuniary gain to such defendant as a 
                                result of the violation; or
                                  ``(III) the amount of losses incurred 
                                by victims as a result of the 
                                violation.''.
          (4) Investment advisers act of 1940.--
                  (A) Money penalties in administrative actions.--
                Section 203(i)(2) of the Investment Advisers Act of 
                1940 (15 U.S.C. 80b-3(i)(2)) is amended--
                          (i) in subparagraph (A)--
                                  (I) by striking ``$5,000'' and 
                                inserting ``$10,000''; and
                                  (II) by striking ``$50,000'' and 
                                inserting ``$100,000'';
                          (ii) in subparagraph (B)--
                                  (I) by striking ``$50,000'' and 
                                inserting ``$100,000''; and
                                  (II) by striking ``$250,000'' and 
                                inserting ``$500,000''; and
                          (iii) by striking subparagraph (C) and 
                        inserting the following:
                  ``(C) Third tier.--
                          ``(i) In general.--Notwithstanding 
                        subparagraphs (A) and (B), the amount of 
                        penalty for each such act or omission shall not 
                        exceed the amount specified in clause (ii) if--
                                  ``(I) the act or omission described 
                                in paragraph (1) involved fraud, 
                                deceit, manipulation, or deliberate or 
                                reckless disregard of a regulatory 
                                requirement; and
                                  ``(II) such act or omission directly 
                                or indirectly resulted in substantial 
                                losses or created a significant risk of 
                                substantial losses to other persons or 
                                resulted in substantial pecuniary gain 
                                to the person who committed the act or 
                                omission.
                          ``(ii) Maximum amount of penalty.--The amount 
                        referred to in clause (i) is the greatest of--
                                  ``(I) $300,000 for a natural person 
                                or $1,450,000 for any other person;
                                  ``(II) 3 times the gross amount of 
                                pecuniary gain to the person who 
                                committed the act or omission; or
                                  ``(III) the amount of losses incurred 
                                by victims as a result of the act or 
                                omission.''.
                  (B) Money penalties in civil actions.--Section 
                209(e)(2) of the Investment Advisers Act of 1940 (15 
                U.S.C. 80b-9(e)(2)) is amended--
                          (i) in subparagraph (A)--
                                  (I) by striking ``$5,000'' and 
                                inserting ``$10,000''; and
                                  (II) by striking ``$50,000'' and 
                                inserting ``$100,000'';
                          (ii) in subparagraph (B)--
                                  (I) by striking ``$50,000'' and 
                                inserting ``$100,000''; and
                                  (II) by striking ``$250,000'' and 
                                inserting ``$500,000''; and
                          (iii) by striking subparagraph (C) and 
                        inserting the following:
                  ``(C) Third tier.--
                          ``(i) In general.--Notwithstanding 
                        subparagraphs (A) and (B), the amount of 
                        penalty for each such violation shall not 
                        exceed the amount specified in clause (ii) if--
                                  ``(I) the violation described in 
                                paragraph (1) involved fraud, deceit, 
                                manipulation, or deliberate or reckless 
                                disregard of a regulatory requirement; 
                                and
                                  ``(II) such violation directly or 
                                indirectly resulted in substantial 
                                losses or created a significant risk of 
                                substantial losses to other persons.
                          ``(ii) Maximum amount of penalty.--The amount 
                        referred to in clause (i) is the greatest of--
                                  ``(I) $300,000 for a natural person 
                                or $1,450,000 for any other person;
                                  ``(II) 3 times the gross amount of 
                                pecuniary gain to such defendant as a 
                                result of the violation; or
                                  ``(III) the amount of losses incurred 
                                by victims as a result of the 
                                violation.''.
  (b) Penalties for Recidivists.--
          (1) Securities act of 1933.--
                  (A) Money penalties in administrative actions.--
                Section 8A(g)(2) of the Securities Act of 1933 (15 
                U.S.C. 77h-1(g)(2)) is amended by adding at the end the 
                following:
                  ``(D) Fourth tier.--Notwithstanding subparagraphs 
                (A), (B), and (C), the maximum amount of penalty for 
                each such act or omission shall be 3 times the 
                otherwise applicable amount in such subparagraphs if, 
                within the 5-year period preceding such act or 
                omission, the person who committed the act or omission 
                was criminally convicted for securities fraud or became 
                subject to a judgment or order imposing monetary, 
                equitable, or administrative relief in any Commission 
                action alleging fraud by that person.''.
                  (B) Money penalties in civil actions.--Section 
                20(d)(2) of the Securities Act of 1933 (15 U.S.C. 
                77t(d)(2)) is amended by adding at the end the 
                following:
                  ``(D) Fourth tier.--Notwithstanding subparagraphs 
                (A), (B), and (C), the maximum amount of penalty for 
                each such violation shall be 3 times the otherwise 
                applicable amount in such subparagraphs if, within the 
                5-year period preceding such violation, the defendant 
                was criminally convicted for securities fraud or became 
                subject to a judgment or order imposing monetary, 
                equitable, or administrative relief in any Commission 
                action alleging fraud by that defendant.''.
          (2) Securities exchange act of 1934.--
                  (A) Money penalties in civil actions.--Section 
                21(d)(3)(B) of the Securities Exchange Act of 1934 (15 
                U.S.C. 78u(d)(3)(B)) is amended by adding at the end 
                the following:
                          ``(iv) Fourth tier.--Notwithstanding clauses 
                        (i), (ii), and (iii), the maximum amount of 
                        penalty for each such violation shall be 3 
                        times the otherwise applicable amount in such 
                        clauses if, within the 5-year period preceding 
                        such violation, the defendant was criminally 
                        convicted for securities fraud or became 
                        subject to a judgment or order imposing 
                        monetary, equitable, or administrative relief 
                        in any Commission action alleging fraud by that 
                        defendant.''.
                  (B) Money penalties in administrative actions.--
                Section 21B(b) of the Securities Exchange Act of 1934 
                (15 U.S.C. 78u-2(b)) is amended by adding at the end 
                the following:
          ``(4) Fourth tier.--Notwithstanding paragraphs (1), (2), and 
        (3), the maximum amount of penalty for each such act or 
        omission shall be 3 times the otherwise applicable amount in 
        such paragraphs if, within the 5-year period preceding such act 
        or omission, the person who committed the act or omission was 
        criminally convicted for securities fraud or became subject to 
        a judgment or order imposing monetary, equitable, or 
        administrative relief in any Commission action alleging fraud 
        by that person.''.
          (3) Investment company act of 1940.--
                  (A) Money penalties in administrative actions.--
                Section 9(d)(2) of the Investment Company Act of 1940 
                (15 U.S.C. 80a-9(d)(2)) is amended by adding at the end 
                the following:
                  ``(D) Fourth tier.--Notwithstanding subparagraphs 
                (A), (B), and (C), the maximum amount of penalty for 
                each such act or omission shall be 3 times the 
                otherwise applicable amount in such subparagraphs if, 
                within the 5-year period preceding such act or 
                omission, the person who committed the act or omission 
                was criminally convicted for securities fraud or became 
                subject to a judgment or order imposing monetary, 
                equitable, or administrative relief in any Commission 
                action alleging fraud by that person.''.
                  (B) Money penalties in civil actions.--Section 
                42(e)(2) of the Investment Company Act of 1940 (15 
                U.S.C. 80a-41(e)(2)) is amended by adding at the end 
                the following:
                  ``(D) Fourth tier.--Notwithstanding subparagraphs 
                (A), (B), and (C), the maximum amount of penalty for 
                each such violation shall be 3 times the otherwise 
                applicable amount in such subparagraphs if, within the 
                5-year period preceding such violation, the defendant 
                was criminally convicted for securities fraud or became 
                subject to a judgment or order imposing monetary, 
                equitable, or administrative relief in any Commission 
                action alleging fraud by that defendant.''.
          (4) Investment advisers act of 1940.--
                  (A) Money penalties in administrative actions.--
                Section 203(i)(2) of the Investment Advisers Act of 
                1940 (15 U.S.C. 80b-3(i)(2)) is amended by adding at 
                the end the following:
                  ``(D) Fourth tier.--Notwithstanding subparagraphs 
                (A), (B), and (C), the maximum amount of penalty for 
                each such act or omission shall be 3 times the 
                otherwise applicable amount in such subparagraphs if, 
                within the 5-year period preceding such act or 
                omission, the person who committed the act or omission 
                was criminally convicted for securities fraud or became 
                subject to a judgment or order imposing monetary, 
                equitable, or administrative relief in any Commission 
                action alleging fraud by that person.''.
                  (B) Money penalties in civil actions.--Section 
                209(e)(2) of the Investment Advisers Act of 1940 (15 
                U.S.C. 80b-9(e)(2)) is amended by adding at the end the 
                following:
                  ``(D) Fourth tier.--Notwithstanding subparagraphs 
                (A), (B), and (C), the maximum amount of penalty for 
                each such violation shall be 3 times the otherwise 
                applicable amount in such subparagraphs if, within the 
                5-year period preceding such violation, the defendant 
                was criminally convicted for securities fraud or became 
                subject to a judgment or order imposing monetary, 
                equitable, or administrative relief in any Commission 
                action alleging fraud by that defendant.''.
  (c) Violations of Injunctions and Bars.--
          (1) Securities act of 1933.--Section 20(d) of the Securities 
        Act of 1933 (15 U.S.C. 77t(d)) is amended--
                  (A) in paragraph (1), by inserting after ``the rules 
                or regulations thereunder,'' the following: ``a Federal 
                court injunction or a bar obtained or entered by the 
                Commission under this title,''; and
                  (B) by striking paragraph (4) and inserting the 
                following:
          ``(4) Special provisions relating to a violation of an 
        injunction or certain orders.--
                  ``(A) In general.--Each separate violation of an 
                injunction or order described in subparagraph (B) shall 
                be a separate offense, except that in the case of a 
                violation through a continuing failure to comply with 
                such injunction or order, each day of the failure to 
                comply with the injunction or order shall be deemed a 
                separate offense.
                  ``(B) Injunctions and orders.--Subparagraph (A) shall 
                apply with respect to any action to enforce--
                          ``(i) a Federal court injunction obtained 
                        pursuant to this title;
                          ``(ii) an order entered or obtained by the 
                        Commission pursuant to this title that bars, 
                        suspends, places limitations on the activities 
                        or functions of, or prohibits the activities 
                        of, a person; or
                          ``(iii) a cease-and-desist order entered by 
                        the Commission pursuant to section 8A.''.
          (2) Securities exchange act of 1934.--Section 21(d)(3) of the 
        Securities Exchange Act of 1934 (15 U.S.C. 78u(d)(3)) is 
        amended--
                  (A) in subparagraph (A), by inserting after ``the 
                rules or regulations thereunder,'' the following: ``a 
                Federal court injunction or a bar obtained or entered 
                by the Commission under this title,''; and
                  (B) by striking subparagraph (D) and inserting the 
                following:
          ``(D) Special provisions relating to a violation of an 
        injunction or certain orders.--
                  ``(i) In general.--Each separate violation of an 
                injunction or order described in clause (ii) shall be a 
                separate offense, except that in the case of a 
                violation through a continuing failure to comply with 
                such injunction or order, each day of the failure to 
                comply with the injunction or order shall be deemed a 
                separate offense.
                  ``(ii) Injunctions and orders.--Clause (i) shall 
                apply with respect to an action to enforce--
                          ``(I) a Federal court injunction obtained 
                        pursuant to this title;
                          ``(II) an order entered or obtained by the 
                        Commission pursuant to this title that bars, 
                        suspends, places limitations on the activities 
                        or functions of, or prohibits the activities 
                        of, a person; or
                          ``(III) a cease-and-desist order entered by 
                        the Commission pursuant to section 21C.''.
          (3) Investment company act of 1940.--Section 42(e) of the 
        Investment Company Act of 1940 (15 U.S.C. 80a-41(e)) is 
        amended--
                  (A) in paragraph (1), by inserting after ``the rules 
                or regulations thereunder,'' the following: ``a Federal 
                court injunction or a bar obtained or entered by the 
                Commission under this title,''; and
                  (B) by striking paragraph (4) and inserting the 
                following:
          ``(4) Special provisions relating to a violation of an 
        injunction or certain orders.--
                  ``(A) In general.--Each separate violation of an 
                injunction or order described in subparagraph (B) shall 
                be a separate offense, except that in the case of a 
                violation through a continuing failure to comply with 
                such injunction or order, each day of the failure to 
                comply with the injunction or order shall be deemed a 
                separate offense.
                  ``(B) Injunctions and orders.--Subparagraph (A) shall 
                apply with respect to any action to enforce--
                          ``(i) a Federal court injunction obtained 
                        pursuant to this title;
                          ``(ii) an order entered or obtained by the 
                        Commission pursuant to this title that bars, 
                        suspends, places limitations on the activities 
                        or functions of, or prohibits the activities 
                        of, a person; or
                          ``(iii) a cease-and-desist order entered by 
                        the Commission pursuant to section 9(f).''.
          (4) Investment advisers act of 1940.--Section 209(e) of the 
        Investment Advisers Act of 1940 (15 U.S.C. 80b-9(e)) is 
        amended--
                  (A) in paragraph (1), by inserting after ``the rules 
                or regulations thereunder,'' the following: ``a Federal 
                court injunction or a bar obtained or entered by the 
                Commission under this title,''; and
                  (B) by striking paragraph (4) and inserting the 
                following:
          ``(4) Special provisions relating to a violation of an 
        injunction or certain orders.--
                  ``(A) In general.--Each separate violation of an 
                injunction or order described in subparagraph (B) shall 
                be a separate offense, except that in the case of a 
                violation through a continuing failure to comply with 
                such injunction or order, each day of the failure to 
                comply with the injunction or order shall be deemed a 
                separate offense.
                  ``(B) Injunctions and orders.--Subparagraph (A) shall 
                apply with respect to any action to enforce--
                          ``(i) a Federal court injunction obtained 
                        pursuant to this title;
                          ``(ii) an order entered or obtained by the 
                        Commission pursuant to this title that bars, 
                        suspends, places limitations on the activities 
                        or functions of, or prohibits the activities 
                        of, a person; or
                          ``(iii) a cease-and-desist order entered by 
                        the Commission pursuant to section 203(k).''.
  (d) Effective Date.--The amendments made by this section shall apply 
with respect to conduct that occurs after the date of the enactment of 
this Act.

SEC. 212. UPDATED CIVIL MONEY PENALTIES OF PUBLIC COMPANY ACCOUNTING 
                    OVERSIGHT BOARD.

  (a) In General.--Section 105(c)(4)(D) of the Sarbanes-Oxley Act of 
2002 (15 U.S.C. 7215(c)(4)(D)) is amended--
          (1) in clause (i)--
                  (A) by striking ``$100,000'' and inserting 
                ``$200,000''; and
                  (B) by striking ``$2,000,000'' and inserting 
                ``$4,000,000''; and
          (2) in clause (ii)--
                  (A) by striking ``$750,000'' and inserting 
                ``$1,500,000''; and
                  (B) by striking ``$15,000,000'' and inserting 
                ``$22,000,000''.
  (b) Effective Date.--The amendments made by this section shall apply 
with respect to conduct that occurs after the date of the enactment of 
this Act.

SEC. 213. UPDATED CIVIL MONEY PENALTY FOR CONTROLLING PERSONS IN 
                    CONNECTION WITH INSIDER TRADING.

  (a) In General.--Section 21A(a)(3) of the Securities Exchange Act of 
1934 (15 U.S.C. 78u-1(a)(3)) is amended by striking ``$1,000,000'' and 
inserting ``$2,500,000''.
  (b) Effective Date.--The amendment made by this section shall apply 
with respect to conduct that occurs after the date of the enactment of 
this Act.

SEC. 214. UPDATE OF CERTAIN OTHER PENALTIES.

  (a) In General.--Section 32 of the Securities Exchange Act of 1934 
(15 U.S.C. 78ff) is amended--
          (1) in subsection (a), by striking ``$5,000,000'' and 
        inserting ``$7,000,000''; and
          (2) in subsection (c)--
                  (A) in paragraph (1)--
                          (i) in subparagraph (A), by striking 
                        ``$2,000,000'' and inserting ``$4,000,000''; 
                        and
                          (ii) in subparagraph (B), by striking 
                        ``$10,000'' and inserting ``$50,000''; and
                  (B) in paragraph (2)--
                          (i) in subparagraph (A), by striking 
                        ``$100,000'' and inserting ``$250,000''; and
                          (ii) in subparagraph (B), by striking 
                        ``$10,000'' and inserting ``$50,000''.
  (b) Effective Date.--The amendments made by this section shall apply 
with respect to conduct that occurs after the date of the enactment of 
this Act.

SEC. 215. MONETARY SANCTIONS TO BE USED FOR THE RELIEF OF VICTIMS.

  (a) In General.--Section 308(a) of the Sarbanes-Oxley Act of 2002 (15 
U.S.C. 7246(a)) is amended to read as follows:
  ``(a) Monetary Sanctions to Be Used for the Relief of Victims.--
          ``(1) In general.--If, in any judicial or administrative 
        action brought by the Commission under the securities laws, the 
        Commission obtains a monetary sanction (as defined in section 
        21F(a) of the Securities Exchange Act of 1934) against any 
        person for a violation of such laws, or such person agrees, in 
        settlement of any such action, to such monetary sanction, the 
        amount of such monetary sanction shall, on the motion or at the 
        direction of the Commission, be added to and become part of a 
        disgorgement fund or other fund established for the benefit of 
        the victims of such violation.
          ``(2) Definition of victim.--In this subsection, the term 
        `victim' has the meaning given the term `crime victim' in 
        section 3771(e) of title 18, United States Code.''.
  (b) Monetary Sanction Defined.--Section 21F(a)(4)(A) of the 
Securities Exchange Act of 1934 (15 U.S.C. 78u-6(a)(4)(A)) is amended 
by striking ``ordered'' and inserting ``required''.
  (c) Effective Date.--The amendments made by this section apply with 
respect to any monetary sanction ordered or required to be paid before 
or after the date of enactment of this Act.

SEC. 216. GAO REPORT ON USE OF CIVIL MONEY PENALTY AUTHORITY BY 
                    COMMISSION.

  (a) In General.--Not later than 2 years after the date of the 
enactment of this Act, the Comptroller General of the United States 
shall submit to the Committee on Financial Services of the House of 
Representatives and the Committee on Banking, Housing, and Urban 
Affairs of the Senate a report on the use by the Commission of the 
authority to impose or obtain civil money penalties for violations of 
the securities laws during the period beginning on June 1, 2010, and 
ending on the date of the enactment of this Act.
  (b) Matters Required To Be Included.--The matters covered by the 
report required by subsection (a) shall include the following:
          (1) The types of violations for which civil money penalties 
        were imposed or obtained.
          (2) The types of persons on whom civil money penalties were 
        imposed or from whom such penalties were obtained.
          (3) The number and dollar amount of civil money penalties 
        imposed or obtained, disaggregated as follows:
                  (A) Penalties imposed in administrative actions and 
                penalties obtained in judicial actions.
                  (B) Penalties imposed on or obtained from issuers 
                (individual and aggregate filers) and penalties imposed 
                on or obtained from other persons.
                  (C) Penalties permitted to be retained for use by the 
                Commission and penalties deposited in the general fund 
                of the Treasury of the United States.
          (4) For penalties imposed on or obtained from issuers:
                  (A) Whether the violations involved resulted in 
                direct economic benefit to the issuers.
                  (B) The impact of the penalties on the shareholders 
                of the issuers.
  (c) Definitions.--In this section, the terms ``Commission'', 
``issuer'', and ``securities laws'' have the meanings given such terms 
in section 3(a) of the Securities Exchange Act of 1934 (15 U.S.C. 
78c(a)).

               Subtitle B--FIRREA Penalties Modernization

SEC. 221. INCREASE OF CIVIL AND CRIMINAL PENALTIES ORIGINALLY 
                    ESTABLISHED IN THE FINANCIAL INSTITUTIONS REFORM, 
                    RECOVERY, AND ENFORCEMENT ACT OF 1989.

  (a) Amendments to FIRREA.--Section 951(b) of the Financial 
Institutions Reform, Recovery, and Enforcement Act of 1989 (12 U.S.C. 
1833a(b)) is amended--
          (1) in paragraph (1), by striking ``$1,000,000'' and 
        inserting ``$1,500,000''; and
          (2) in paragraph (2), by striking ``$1,000,000 per day or 
        $5,000,000'' and inserting ``$1,500,000 per day or 
        $7,500,000''.
  (b) Amendments to the Home Owners' Loan Act.--The Home Owners' Loan 
Act (12 U.S.C. 1461 et seq.) is amended--
          (1) in section 5(v)(6), by striking ``$1,000,000'' and 
        inserting ``$1,500,000''; and
          (2) in section 10--
                  (A) in subsection (r)(3), by striking ``$1,000,000'' 
                and inserting ``$1,500,000''; and
                  (B) in subsection (i)(1)(B), by striking 
                ``$1,000,000'' and inserting ``$1,500,000''.
  (c) Amendments to the Federal Deposit Insurance Act.--The Federal 
Deposit Insurance Act (12 U.S.C. 1811 et seq.) is amended--
          (1) in section 7--
                  (A) in subsection (a)(1), by striking ``$1,000,000'' 
                and inserting ``$1,500,000''; and
                  (B) in subsection (j)(16)(D), by striking 
                ``$1,000,000'' each place such term appears and 
                inserting ``$1,500,000'';
          (2) in section 8--
                  (A) in subsection (i)(2)(D), by striking 
                ``$1,000,000'' each place such term appears and 
                inserting ``$1,500,000''; and
                  (B) in subsection (j), by striking ``$1,000,000'' and 
                inserting ``$1,500,000''; and
          (3) in section 19(b), by striking ``$1,000,000'' and 
        inserting ``$1,500,000''.
  (d) Amendments to the Federal Credit Union Act.--The Federal Credit 
Union Act (12 U.S.C. 1751 et seq.) is amended--
          (1) in section 202(a)(3), by striking ``$1,000,000'' and 
        inserting ``$1,500,000'';
          (2) in section 205(d)(3), by striking ``$1,000,000'' and 
        inserting ``$1,500,000''; and
          (3) in section 206--
                  (A) in subsection (k)(2)(D), by striking 
                ``$1,000,000'' each place such term appears and 
                inserting ``$1,500,000''; and
                  (B) in subsection (l), by striking ``$1,000,000'' and 
                inserting ``$1,500,000''.
  (e) Amendments to the Revised Statutes of the United States.--Title 
LXII of the Revised Statutes of the United States is amended--
          (1) in section 5213(c), by striking ``$1,000,000'' and 
        inserting ``$1,500,000''; and
          (2) in section 5239(b)(4), by striking ``$1,000,000'' each 
        place such term appears and inserting ``$1,500,000''.
  (f) Amendments to the Federal Reserve Act.--The Federal Reserve Act 
(12 U.S.C. 221 et seq.) is amended--
          (1) in the 6th undesignated paragraph of section 9, by 
        striking ``$1,000,000'' and inserting ``$1,500,000'';
          (2) in section 19(l)(4), by striking ``$1,000,000'' each 
        place such term appears and inserting ``$1,500,000''; and
          (3) in section 29(d), by striking ``$1,000,000'' each place 
        such term appears and inserting ``$1,500,000''.
  (g) Amendments to the Bank Holding Company Act Amendments of 1970.--
Section 106(b)(2)(F)(iv) of the Bank Holding Company Act Amendments of 
1970 (12 U.S.C. 1978(b)(2)(F)(iv)) is amended by striking 
``$1,000,000'' each place such term appears and inserting 
``$1,500,000''.
  (h) Amendments to the Bank Holding Company Act of 1956.--Section 8 of 
the Bank Holding Company Act of 1956 (12 U.S.C. 1847) is amended--
          (1) in subsection (a)(2), by striking ``$1,000,000'' and 
        inserting ``$1,500,000''; and
          (2) in subsection (d)(3), by striking ``$1,000,000'' and 
        inserting ``$1,500,000''.
  (i) Amendments to Title 18, United States Code.--Title 18, United 
States Code, is amended--
          (1) in section 215(a) of chapter 11, by striking 
        ``$1,000,000'' and inserting ``$1,500,000'';
          (2) in chapter 31--
                  (A) in section 656, by striking ``$1,000,000'' and 
                inserting ``$1,500,000''; and
                  (B) in section 657, by striking ``$1,000,000'' and 
                inserting ``$1,500,000'';
          (3) in chapter 47--
                  (A) in section 1005, by striking ``$1,000,000'' and 
                inserting ``$1,500,000'';
                  (B) in section 1006, by striking ``$1,000,000'' and 
                inserting ``$1,500,000'';
                  (C) in section 1007, by striking ``$1,000,000'' and 
                inserting ``$1,500,000''; and
                  (D) in section 1014, by striking ``$1,000,000'' and 
                inserting ``$1,500,000''; and
          (4) in chapter 63--
                  (A) in section 1341, by striking ``$1,000,000'' and 
                inserting ``$1,500,000'';
                  (B) in section 1343, by striking ``$1,000,000'' and 
                inserting ``$1,500,000''; and
                  (C) in section 1344, by striking ``$1,000,000'' and 
                inserting ``$1,500,000''.

   TITLE III--DEMANDING ACCOUNTABILITY FROM FINANCIAL REGULATORS AND 
                  DEVOLVING POWER AWAY FROM WASHINGTON

                   Subtitle A--Cost-Benefit Analyses

SEC. 311. DEFINITIONS.

  As used in this subtitle--
          (1) the term ``agency'' means the Board of Governors of the 
        Federal Reserve System, the Consumer Law Enforcement Agency, 
        the Commodity Futures Trading Commission, the Federal Deposit 
        Insurance Corporation, the Federal Housing Finance Agency, the 
        Office of the Comptroller of the Currency, the National Credit 
        Union Administration, and the Securities and Exchange 
        Commission;
          (2) the term ``chief economist'' means--
                  (A) with respect to the Board of Governors of the 
                Federal Reserve System, the Director of the Division of 
                Research and Statistics, or an employee of the agency 
                with comparable authority;
                  (B) with respect to the Consumer Law Enforcement 
                Agency, the Head of the Office of Economic Analysis, or 
                an employee of the agency with comparable authority;
                  (C) with respect to the Commodity Futures Trading 
                Commission, the Chief Economist, or an employee of the 
                agency with comparable authority;
                  (D) with respect to the Federal Deposit Insurance 
                Corporation, the Director of the Division of Insurance 
                and Research, or an employee of the agency with 
                comparable authority;
                  (E) with respect to the Federal Housing Finance 
                Agency, the Chief Economist, or an employee of the 
                agency with comparable authority;
                  (F) with respect to the Office of the Comptroller of 
                the Currency, the Director for Policy Analysis, or an 
                employee of the agency with comparable authority;
                  (G) with respect to the National Credit Union 
                Administration, the Chief Economist, or an employee of 
                the agency with comparable authority; and
                  (H) with respect to the Securities and Exchange 
                Commission, the Director of the Division of Economic 
                and Risk Analysis, or an employee of the agency with 
                comparable authority;
          (3) the term ``Council'' means the Chief Economists Council 
        established under section 318; and
          (4) the term ``regulation''--
                  (A) means an agency statement of general 
                applicability and future effect that is designed to 
                implement, interpret, or prescribe law or policy or to 
                describe the procedure or practice requirements of an 
                agency, including rules, orders of general 
                applicability, interpretive releases, and other 
                statements of general applicability that the agency 
                intends to have the force and effect of law; and
                  (B) does not include--
                          (i) a regulation issued in accordance with 
                        the formal rulemaking provisions of section 556 
                        or 557 of title 5, United States Code;
                          (ii) a regulation that is limited to agency 
                        organization, management, or personnel matters;
                          (iii) a regulation promulgated pursuant to 
                        statutory authority that expressly prohibits 
                        compliance with this provision;
                          (iv) a regulation that is certified by the 
                        agency to be an emergency action, if such 
                        certification is published in the Federal 
                        Register;
                          (v) a regulation that is promulgated by the 
                        Board of Governors of the Federal Reserve 
                        System or the Federal Open Market Committee 
                        under section 10A, 10B, 13, 13A, or 19 of the 
                        Federal Reserve Act, or any of subsections (a) 
                        through (f) of section 14 of that Act; or
                          (vi) a regulation filed with the Commission 
                        by the Public Company Accounting Oversight 
                        Board, the Municipal Securities Rulemaking 
                        Board, or any national securities association 
                        registered under section 15A of the Securities 
                        Exchange Act of 1934 (15 U.S.C. 78o-4(a)) for 
                        which the board or association has itself 
                        conducted the cost-benefit analysis and 
                        otherwise complied with the requirements of 
                        section 312.

SEC. 312. REQUIRED REGULATORY ANALYSIS.

  (a) Requirements for Notices of Proposed Rulemaking.--An agency may 
not issue a notice of proposed rulemaking unless the agency includes in 
the notice of proposed rulemaking an analysis that contains, at a 
minimum, with respect to each regulation that is being proposed--
          (1) an identification of the need for the regulation and the 
        regulatory objective, including identification of the nature 
        and significance of the market failure, regulatory failure, or 
        other problem that necessitates the regulation;
          (2) an explanation of why the private market or State, local, 
        or tribal authorities cannot adequately address the identified 
        market failure or other problem;
          (3) an analysis of the adverse impacts to regulated entities, 
        other market participants, economic activity, or agency 
        effectiveness that are engendered by the regulation and the 
        magnitude of such adverse impacts;
          (4) a quantitative and qualitative assessment of all 
        anticipated direct and indirect costs and benefits of the 
        regulation (as compared to a benchmark that assumes the absence 
        of the regulation), including--
                  (A) compliance costs;
                  (B) effects on economic activity, net job creation 
                (excluding jobs related to ensuring compliance with the 
                regulation), efficiency, competition, and capital 
                formation;
                  (C) regulatory administrative costs; and
                  (D) costs imposed by the regulation on State, local, 
                or tribal governments or other regulatory authorities;
          (5) if quantified benefits do not outweigh quantitative 
        costs, a justification for the regulation;
          (6) an identification and assessment of all available 
        alternatives to the regulation, including modification of an 
        existing regulation or statute, together with--
                  (A) an explanation of why the regulation meets the 
                objectives of the regulation more effectively than the 
                alternatives, and if the agency is proposing multiple 
                alternatives, an explanation of why a notice of 
                proposed rulemaking, rather than an advanced notice of 
                proposed rulemaking, is appropriate; and
                  (B) if the regulation is not a pilot program, an 
                explanation of why a pilot program is not appropriate;
          (7) if the regulation specifies the behavior or manner of 
        compliance, an explanation of why the agency did not instead 
        specify performance objectives;
          (8) an assessment of how the burden imposed by the regulation 
        will be distributed among market participants, including 
        whether consumers, investors, small businesses, or independent 
        financial firms and advisors will be disproportionately 
        burdened;
          (9) an assessment of the extent to which the regulation is 
        inconsistent, incompatible, or duplicative with the existing 
        regulations of the agency or those of other domestic and 
        international regulatory authorities with overlapping 
        jurisdiction;
          (10) a description of any studies, surveys, or other data 
        relied upon in preparing the analysis;
          (11) an assessment of the degree to which the key assumptions 
        underlying the analysis are subject to uncertainty; and
          (12) an explanation of predicted changes in market structure 
        and infrastructure and in behavior by market participants, 
        including consumers and investors, assuming that they will 
        pursue their economic interests.
  (b) Requirements for Notices of Final Rulemaking.--
          (1) In general.--Notwithstanding any other provision of law, 
        an agency may not issue a notice of final rulemaking with 
        respect to a regulation unless the agency--
                  (A) has issued a notice of proposed rulemaking for 
                the relevant regulation;
                  (B) has conducted and includes in the notice of final 
                rulemaking an analysis that contains, at a minimum, the 
                elements required under subsection (a); and
                  (C) includes in the notice of final rulemaking 
                regulatory impact metrics selected by the chief 
                economist to be used in preparing the report required 
                pursuant to section 315.
          (2) Consideration of comments.--The agency shall incorporate 
        in the elements described in paragraph (1)(B) the data and 
        analyses provided to the agency by commenters during the 
        comment period, or explain why the data or analyses are not 
        being incorporated.
          (3) Comment period.--An agency shall not publish a notice of 
        final rulemaking with respect to a regulation, unless the 
        agency--
                  (A) has allowed at least 90 days from the date of 
                publication in the Federal Register of the notice of 
                proposed rulemaking for the submission of public 
                comments; or
                  (B) includes in the notice of final rulemaking an 
                explanation of why the agency was not able to provide a 
                90-day comment period.
          (4) Prohibited rules.--
                  (A) In general.--An agency may not publish a notice 
                of final rulemaking if the agency, in its analysis 
                under paragraph (1)(B), determines that the quantified 
                costs are greater than the quantified benefits under 
                subsection (a)(5).
                  (B) Publication of analysis.--If the agency is 
                precluded by subparagraph (A) from publishing a notice 
                of final rulemaking, the agency shall publish in the 
                Federal Register and on the public website of the 
                agency its analysis under paragraph (1)(B), and provide 
                the analysis to each House of Congress.
                  (C) Congressional waiver.--If the agency is precluded 
                by subparagraph (A) from publishing a notice of final 
                rulemaking, Congress, by joint resolution pursuant to 
                the procedures set forth for joint resolutions in 
                section 802 of title 5, United States Code, may direct 
                the agency to publish a notice of final rulemaking 
                notwithstanding the prohibition contained in 
                subparagraph (A). In applying section 802 of title 5, 
                United States Code, for purposes of this paragraph, 
                section 802(e)(2) shall not apply and the terms--
                          (i) ``joint resolution'' or ``joint 
                        resolution described in subsection (a)'' means 
                        only a joint resolution introduced during the 
                        period beginning on the submission or 
                        publication date and ending 60 days thereafter 
                        (excluding days either House of Congress is 
                        adjourned for more than 3 days during a session 
                        of Congress), the matter after the resolving 
                        clause of which is as follows: ``That Congress 
                        directs, notwithstanding the prohibition 
                        contained in section 312(b)(4)(A) of the 
                        Financial CHOICE Act of 2017, the __ to publish 
                        the notice of final rulemaking for the 
                        regulation or regulations that were the subject 
                        of the analysis submitted by the __ to Congress 
                        on __.'' (The blank spaces being appropriately 
                        filled in.); and
                          (ii) ``submission or publication date'' 
                        means--
                                  (I) the date on which the analysis 
                                under paragraph (1)(B) is submitted to 
                                Congress under paragraph (4)(B); or
                                  (II) if the analysis is submitted to 
                                Congress less than 60 session days or 
                                60 legislative days before the date on 
                                which the Congress adjourns a session 
                                of Congress, the date on which the same 
                                or succeeding Congress first convenes 
                                its next session.

SEC. 313. RULE OF CONSTRUCTION.

  For purposes of the Paperwork Reduction Act (44 U.S.C. 3501 et seq.), 
obtaining, causing to be obtained, or soliciting information for 
purposes of complying with section 312 with respect to a proposed 
rulemaking shall not be construed to be a collection of information, 
provided that the agency has first issued an advanced notice of 
proposed rulemaking in connection with the regulation, identifies that 
advanced notice of proposed rulemaking in its solicitation of 
information, and informs the person from whom the information is 
obtained or solicited that the provision of information is voluntary.

SEC. 314. PUBLIC AVAILABILITY OF DATA AND REGULATORY ANALYSIS.

  (a) In General.--At or before the commencement of the public comment 
period with respect to a regulation, the agency shall make available on 
its public website sufficient information about the data, 
methodologies, and assumptions underlying the analyses performed 
pursuant to section 312 so that the analytical results of the agency 
are capable of being substantially reproduced, subject to an acceptable 
degree of imprecision or error.
  (b) Confidentiality.--The agency shall comply with subsection (a) in 
a manner that preserves the confidentiality of nonpublic information, 
including confidential trade secrets, confidential commercial or 
financial information, and confidential information about positions, 
transactions, or business practices.

SEC. 315. FIVE-YEAR REGULATORY IMPACT ANALYSIS.

  (a) In General.--Not later than 5 years after the date of publication 
in the Federal Register of a notice of final rulemaking, the chief 
economist of the agency shall issue a report that examines the economic 
impact of the subject regulation, including the direct and indirect 
costs and benefits of the regulation.
  (b) Regulatory Impact Metrics.--In preparing the report required by 
subsection (a), the chief economist shall employ the regulatory impact 
metrics included in the notice of final rulemaking pursuant to section 
312(b)(1)(C).
  (c) Reproducibility.--The report shall include the data, 
methodologies, and assumptions underlying the evaluation so that the 
agency's analytical results are capable of being substantially 
reproduced, subject to an acceptable degree of imprecision or error.
  (d) Confidentiality.--The agency shall comply with subsection (c) in 
a manner that preserves the confidentiality of nonpublic information, 
including confidential trade secrets, confidential commercial or 
financial information, and confidential information about positions, 
transactions, or business practices.
  (e) Report.--The agency shall submit the report required by 
subsection (a) to the Committee on Banking, Housing, and Urban Affairs 
of the Senate and the Committee on Financial Services of the House of 
Representatives and post it on the public website of the agency. The 
Commodity Futures Trading Commission shall also submit its report to 
the Committee on Agriculture, Nutrition, and Forestry of the Senate and 
the Committee on Agriculture of the House of Representatives.

SEC. 316. RETROSPECTIVE REVIEW OF EXISTING RULES.

  (a) Regulatory Improvement Plan.--Not later than 1 year after the 
date of enactment of this Act and every 5 years thereafter, each agency 
shall develop, submit to the Committee on Banking, Housing, and Urban 
Affairs of the Senate and the Committee on Financial Services of the 
House of Representatives, and post on the public website of the agency 
a plan, consistent with law and its resources and regulatory 
priorities, under which the agency will modify, streamline, expand, or 
repeal existing regulations so as to make the regulatory program of the 
agency more effective or less burdensome in achieving the regulatory 
objectives. The Commodity Futures Trading Commission shall also submit 
its plan to the Committee on Agriculture, Nutrition, and Forestry of 
the Senate and the Committee on Agriculture of the House of 
Representatives.
  (b) Implementation Progress Report.--Two years after the date of 
submission of each plan required under subsection (a), each agency 
shall develop, submit to the Committee on Banking, Housing, and Urban 
Affairs of the Senate and the Committee on Financial Services of the 
House of Representatives, and post on the public website of the agency 
a report of the steps that it has taken to implement the plan, steps 
that remain to be taken to implement the plan, and, if any parts of the 
plan will not be implemented, reasons for not implementing those parts 
of the plan. The Commodity Futures Trading Commission shall also submit 
its plan to the Committee on Agriculture, Nutrition, and Forestry of 
the Senate and the Committee on Agriculture of the House of 
Representatives.

SEC. 317. JUDICIAL REVIEW.

  (a) In General.--Notwithstanding any other provision of law, during 
the period beginning on the date on which a notice of final rulemaking 
for a regulation is published in the Federal Register and ending 1 year 
later, a person that is adversely affected or aggrieved by the 
regulation is entitled to bring an action in the United States Court of 
Appeals for the District of Columbia Circuit for judicial review of 
agency compliance with the requirements of section 312.
  (b) Stay.--The court may stay the effective date of the regulation or 
any provision thereof.
  (c) Relief.--If the court finds that an agency has not complied with 
the requirements of section 312, the court shall vacate the subject 
regulation, unless the agency shows by clear and convincing evidence 
that vacating the regulation would result in irreparable harm. Nothing 
in this section affects other limitations on judicial review or the 
power or duty of the court to dismiss any action or deny relief on any 
other appropriate legal or equitable ground.

SEC. 318. CHIEF ECONOMISTS COUNCIL.

  (a) Establishment.--There is established the Chief Economists 
Council.
  (b) Membership.--The Council shall consist of the chief economist of 
each agency. The members of the Council shall select the first 
chairperson of the Council. Thereafter the position of Chairperson 
shall rotate annually among the members of the Council.
  (c) Meetings.--The Council shall meet at the call of the Chairperson, 
but not less frequently than quarterly.
  (d) Report.--One year after the effective date of this Act and 
annually thereafter, the Council shall prepare and submit to the 
Committee on Banking, Housing, and Urban Affairs and the Committee on 
Agriculture, Nutrition, and Forestry of the Senate and the Committee on 
Financial Services and the Committee on Agriculture of the House of 
Representatives a report on--
          (1) the benefits and costs of regulations adopted by the 
        agencies during the past 12 months;
          (2) the regulatory actions planned by the agencies for the 
        upcoming 12 months;
          (3) the cumulative effect of the existing regulations of the 
        agencies on economic activity, innovation, international 
        competitiveness of entities regulated by the agencies, and net 
        job creation (excluding jobs related to ensuring compliance 
        with the regulation);
          (4) the training and qualifications of the persons who 
        prepared the cost-benefit analyses of each agency during the 
        past 12 months;
          (5) the sufficiency of the resources available to the chief 
        economists during the past 12 months for the conduct of the 
        activities required by this subtitle; and
          (6) recommendations for legislative or regulatory action to 
        enhance the efficiency and effectiveness of financial 
        regulation in the United States.

SEC. 319. CONFORMING AMENDMENTS.

  Section 15(a) of the Commodity Exchange Act (7 U.S.C. 19(a)) is 
amended--
          (1) by striking paragraph (1);
          (2) in paragraph (2), by striking ``(2)'' and all that 
        follows through ``light of--'' and inserting the following:
          ``(1) Considerations.--Before promulgating a regulation under 
        this chapter or issuing an order (except as provided in 
        paragraph (2)), the Commission shall take into consideration--
        '';
          (3) in paragraph (1), as so redesignated--
                  (A) in subparagraph (B), by striking ``futures'' and 
                inserting ``the relevant'';
                  (B) in subparagraph (C), by adding ``and'' at the 
                end;
                  (C) in subparagraph (D), by striking ``; and'' and 
                inserting a period; and
                  (D) by striking subparagraph (E); and
          (4) by redesignating paragraph (3) as paragraph (2).

SEC. 320. OTHER REGULATORY ENTITIES.

  Not later than 1 year after the date of enactment of this Act, the 
Securities and Exchange Commission shall provide to the Committee on 
Banking, Housing, and Urban Affairs of the Senate and the Committee on 
Financial Services of the House of Representatives a report setting 
forth a plan for subjecting the Public Company Accounting Oversight 
Board, the Municipal Securities Rulemaking Board, and any national 
securities association registered under section 15A of the Securities 
Exchange Act of 1934 (15 U.S.C. 78o-4(a)) to the requirements of this 
subtitle, other than direct representation on the Council.

SEC. 321. AVOIDANCE OF DUPLICATIVE OR UNNECESSARY ANALYSES.

  An agency may perform the analyses required by this subtitle in 
conjunction with, or as a part of, any other agenda or analysis 
required by any other provision of law, if such other analysis 
satisfies the provisions of this subtitle.

Subtitle B--Congressional Review of Federal Financial Agency Rulemaking

SEC. 331. CONGRESSIONAL REVIEW.

  (a)(1)(A) Before a rule may take effect, a Federal financial agency 
shall publish in the Federal Register a list of information on which 
the rule is based, including data, scientific and economic studies, and 
cost-benefit analyses, and identify how the public can access such 
information online, and shall submit to each House of the Congress and 
to the Comptroller General a report containing--
          (i) a copy of the rule;
          (ii) a concise general statement relating to the rule;
          (iii) a classification of the rule as a major or nonmajor 
        rule, including an explanation of the classification 
        specifically addressing each criteria for a major rule 
        contained within subparagraphs (A) through (C) of section 
        334(2);
          (iv) a list of any other related regulatory actions intended 
        to implement the same statutory provision or regulatory 
        objective as well as the individual and aggregate economic 
        effects of those actions; and
          (v) the proposed effective date of the rule.
  (B) On the date of the submission of the report under subparagraph 
(A), the Federal financial agency shall submit to the Comptroller 
General and make available to each House of Congress--
          (i) a complete copy of the cost-benefit analysis of the rule, 
        if any, including an analysis of any jobs added or lost, 
        differentiating between public and private sector jobs;
          (ii) the Federal financial agency's actions pursuant to 
        sections 603, 604, 605, 607, and 609 of title 5, United States 
        Code;
          (iii) the Federal financial agency's actions pursuant to 
        sections 202, 203, 204, and 205 of the Unfunded Mandates Reform 
        Act of 1995; and
          (iv) any other relevant information or requirements under any 
        other Act and any relevant Executive orders.
  (C) Upon receipt of a report submitted under subparagraph (A), each 
House shall provide copies of the report to the chairman and ranking 
member of each standing committee with jurisdiction under the rules of 
the House of Representatives or the Senate to report a bill to amend 
the provision of law under which the rule is issued.
  (2)(A) The Comptroller General shall provide a report on each major 
rule to the committees of jurisdiction by the end of 15 calendar days 
after the submission or publication date. The report of the Comptroller 
General shall include an assessment of the Federal financial agency's 
compliance with procedural steps required by paragraph (1)(B) and an 
assessment of whether the major rule imposes any new limits or mandates 
on private-sector activity.
  (B) Federal financial agencies shall cooperate with the Comptroller 
General by providing information relevant to the Comptroller General's 
report under subparagraph (A).
  (3) A major rule relating to a report submitted under paragraph (1) 
shall take effect upon enactment of a joint resolution of approval 
described in section 332 or as provided for in the rule following 
enactment of a joint resolution of approval described in section 332, 
whichever is later.
  (4) A nonmajor rule shall take effect as provided by section 333 
after submission to Congress under paragraph (1).
  (5) If a joint resolution of approval relating to a major rule is not 
enacted within the period provided in subsection (b)(2), then a joint 
resolution of approval relating to the same rule may not be considered 
under this subtitle in the same Congress by either the House of 
Representatives or the Senate.
  (b)(1) A major rule shall not take effect unless the Congress enacts 
a joint resolution of approval described under section 332.
  (2) If a joint resolution described in subsection (a) is not enacted 
into law by the end of 70 session days or legislative days, as 
applicable, beginning on the date on which the report referred to in 
subsection (a)(1)(A) is received by Congress (excluding days either 
House of Congress is adjourned for more than 3 days during a session of 
Congress), then the rule described in that resolution shall be deemed 
not to be approved and such rule shall not take effect.
  (c)(1) Notwithstanding any other provision of this section (except 
subject to paragraph (3)), a major rule may take effect for one 90-
calendar-day period if the President makes a determination under 
paragraph (2) and submits written notice of such determination to the 
Congress.
  (2) Paragraph (1) applies to a determination made by the President by 
Executive order that the major rule should take effect because such 
rule is--
          (A) necessary because of an imminent threat to health or 
        safety or other emergency;
          (B) necessary for the enforcement of criminal laws;
          (C) necessary for national security; or
          (D) issued pursuant to any statute implementing an 
        international trade agreement.
  (3) An exercise by the President of the authority under this 
subsection shall have no effect on the procedures under section 332.
  (d)(1) In addition to the opportunity for review otherwise provided 
under this subtitle, in the case of any rule for which a report was 
submitted in accordance with subsection (a)(1)(A) during the period 
beginning on the date occurring--
          (A) in the case of the Senate, 60 session days; or
          (B) in the case of the House of Representatives, 60 
        legislative days,
before the date the Congress is scheduled to adjourn a session of 
Congress through the date on which the same or succeeding Congress 
first convenes its next session, sections 332 and 333 shall apply to 
such rule in the succeeding session of Congress.
  (2)(A) In applying sections 332 and 333 for purposes of such 
additional review, a rule described under paragraph (1) shall be 
treated as though--
          (i) such rule were published in the Federal Register on--
                  (I) in the case of the Senate, the 15th session day; 
                or
                  (II) in the case of the House of Representatives, the 
                15th legislative day,
        after the succeeding session of Congress first convenes; and
          (ii) a report on such rule were submitted to Congress under 
        subsection (a)(1) on such date.
  (B) Nothing in this paragraph shall be construed to affect the 
requirement under subsection (a)(1) that a report shall be submitted to 
Congress before a rule can take effect.
  (3) A rule described under paragraph (1) shall take effect as 
otherwise provided by law (including other subsections of this 
section).

SEC. 332. CONGRESSIONAL APPROVAL PROCEDURE FOR MAJOR RULES.

  (a)(1) For purposes of this section, the term ``joint resolution'' 
means only a joint resolution addressing a report classifying a rule as 
major pursuant to section 331(a)(1)(A)(iii) that--
          (A) bears no preamble;
          (B) bears the following title (with blanks filled as 
        appropriate): ``Approving the rule submitted by ___ relating to 
        ___.'';
          (C) includes after its resolving clause only the following 
        (with blanks filled as appropriate): ``That Congress approves 
        the rule submitted by ___ relating to ___.''; and
          (D) is introduced pursuant to paragraph (2).
  (2) After a House of Congress receives a report classifying a rule as 
major pursuant to section 331(a)(1)(A)(iii), the majority leader of 
that House (or his or her respective designee) shall introduce (by 
request, if appropriate) a joint resolution described in paragraph 
(1)--
          (A) in the case of the House of Representatives, within 3 
        legislative days; and
          (B) in the case of the Senate, within 3 session days.
  (3) A joint resolution described in paragraph (1) shall not be 
subject to amendment at any stage of proceeding.
  (b) A joint resolution described in subsection (a) shall be referred 
in each House of Congress to the committees having jurisdiction over 
the provision of law under which the rule is issued.
  (c) In the Senate, if the committee or committees to which a joint 
resolution described in subsection (a) has been referred have not 
reported it at the end of 15 session days after its introduction, such 
committee or committees shall be automatically discharged from further 
consideration of the resolution and it shall be placed on the calendar. 
A vote on final passage of the resolution shall be taken on or before 
the close of the 15th session day after the resolution is reported by 
the committee or committees to which it was referred, or after such 
committee or committees have been discharged from further consideration 
of the resolution.
  (d)(1) In the Senate, when the committee or committees to which a 
joint resolution is referred have reported, or when a committee or 
committees are discharged (under subsection (c)) from further 
consideration of a joint resolution described in subsection (a), it is 
at any time thereafter in order (even though a previous motion to the 
same effect has been disagreed to) for a motion to proceed to the 
consideration of the joint resolution, and all points of order against 
the joint resolution (and against consideration of the joint 
resolution) are waived. The motion is not subject to amendment, or to a 
motion to postpone, or to a motion to proceed to the consideration of 
other business. A motion to reconsider the vote by which the motion is 
agreed to or disagreed to shall not be in order. If a motion to proceed 
to the consideration of the joint resolution is agreed to, the joint 
resolution shall remain the unfinished business of the Senate until 
disposed of.
  (2) In the Senate, debate on the joint resolution, and on all 
debatable motions and appeals in connection therewith, shall be limited 
to not more than 2 hours, which shall be divided equally between those 
favoring and those opposing the joint resolution. A motion to further 
limit debate is in order and not debatable. An amendment to, or a 
motion to postpone, or a motion to proceed to the consideration of 
other business, or a motion to recommit the joint resolution is not in 
order.
  (3) In the Senate, immediately following the conclusion of the debate 
on a joint resolution described in subsection (a), and a single quorum 
call at the conclusion of the debate if requested in accordance with 
the rules of the Senate, the vote on final passage of the joint 
resolution shall occur.
  (4) Appeals from the decisions of the Chair relating to the 
application of the rules of the Senate to the procedure relating to a 
joint resolution described in subsection (a) shall be decided without 
debate.
  (e) In the House of Representatives, if any committee to which a 
joint resolution described in subsection (a) has been referred has not 
reported it to the House at the end of 15 legislative days after its 
introduction, such committee shall be discharged from further 
consideration of the joint resolution, and it shall be placed on the 
appropriate calendar. On the second and fourth Thursdays of each month 
it shall be in order at any time for the Speaker to recognize a Member 
who favors passage of a joint resolution that has appeared on the 
calendar for at least 5 legislative days to call up that joint 
resolution for immediate consideration in the House without 
intervention of any point of order. When so called up a joint 
resolution shall be considered as read and shall be debatable for 1 
hour equally divided and controlled by the proponent and an opponent, 
and the previous question shall be considered as ordered to its passage 
without intervening motion. It shall not be in order to reconsider the 
vote on passage. If a vote on final passage of the joint resolution has 
not been taken by the third Thursday on which the Speaker may recognize 
a Member under this subsection, such vote shall be taken on that day.
  (f)(1) If, before passing a joint resolution described in subsection 
(a), one House receives from the other a joint resolution having the 
same text, then--
          (A) the joint resolution of the other House shall not be 
        referred to a committee; and
          (B) the procedure in the receiving House shall be the same as 
        if no joint resolution had been received from the other House 
        until the vote on passage, when the joint resolution received 
        from the other House shall supplant the joint resolution of the 
        receiving House.
  (2) This subsection shall not apply to the House of Representatives 
if the joint resolution received from the Senate is a revenue measure.
  (g) If either House has not taken a vote on final passage of the 
joint resolution by the last day of the period described in section 
331(b)(2), then such vote shall be taken on that day.
  (h) This section and section 333 are enacted by Congress--
          (1) as an exercise of the rulemaking power of the Senate and 
        House of Representatives, respectively, and as such is deemed 
        to be part of the rules of each House, respectively, but 
        applicable only with respect to the procedure to be followed in 
        that House in the case of a joint resolution described in 
        subsection (a) and superseding other rules only where 
        explicitly so; and
          (2) with full recognition of the Constitutional right of 
        either House to change the rules (so far as they relate to the 
        procedure of that House) at any time, in the same manner and to 
        the same extent as in the case of any other rule of that House.

SEC. 333. CONGRESSIONAL DISAPPROVAL PROCEDURE FOR NONMAJOR RULES.

  (a) For purposes of this section, the term ``joint resolution'' means 
only a joint resolution introduced in the period beginning on the date 
on which the report referred to in section 331(a)(1)(A) is received by 
Congress and ending 60 days thereafter (excluding days either House of 
Congress is adjourned for more than 3 days during a session of 
Congress), the matter after the resolving clause of which is as 
follows: ``That Congress disapproves the nonmajor rule submitted by the 
___ relating to ___, and such rule shall have no force or effect.'' 
(The blank spaces being appropriately filled in).
  (b) A joint resolution described in subsection (a) shall be referred 
to the committees in each House of Congress with jurisdiction.
  (c) In the Senate, if the committee to which is referred a joint 
resolution described in subsection (a) has not reported such joint 
resolution (or an identical joint resolution) at the end of 15 session 
days after the date of introduction of the joint resolution, such 
committee may be discharged from further consideration of such joint 
resolution upon a petition supported in writing by 30 Members of the 
Senate, and such joint resolution shall be placed on the calendar.
  (d)(1) In the Senate, when the committee to which a joint resolution 
is referred has reported, or when a committee is discharged (under 
subsection (c)) from further consideration of a joint resolution 
described in subsection (a), it is at any time thereafter in order 
(even though a previous motion to the same effect has been disagreed 
to) for a motion to proceed to the consideration of the joint 
resolution, and all points of order against the joint resolution (and 
against consideration of the joint resolution) are waived. The motion 
is not subject to amendment, or to a motion to postpone, or to a motion 
to proceed to the consideration of other business. A motion to 
reconsider the vote by which the motion is agreed to or disagreed to 
shall not be in order. If a motion to proceed to the consideration of 
the joint resolution is agreed to, the joint resolution shall remain 
the unfinished business of the Senate until disposed of.
  (2) In the Senate, debate on the joint resolution, and on all 
debatable motions and appeals in connection therewith, shall be limited 
to not more than 10 hours, which shall be divided equally between those 
favoring and those opposing the joint resolution. A motion to further 
limit debate is in order and not debatable. An amendment to, or a 
motion to postpone, or a motion to proceed to the consideration of 
other business, or a motion to recommit the joint resolution is not in 
order.
  (3) In the Senate, immediately following the conclusion of the debate 
on a joint resolution described in subsection (a), and a single quorum 
call at the conclusion of the debate if requested in accordance with 
the rules of the Senate, the vote on final passage of the joint 
resolution shall occur.
  (4) Appeals from the decisions of the Chair relating to the 
application of the rules of the Senate to the procedure relating to a 
joint resolution described in subsection (a) shall be decided without 
debate.
  (e) In the Senate, the procedure specified in subsection (c) or (d) 
shall not apply to the consideration of a joint resolution respecting a 
nonmajor rule--
          (1) after the expiration of the 60 session days beginning 
        with the applicable submission or publication date; or
          (2) if the report under section 331(a)(1)(A) was submitted 
        during the period referred to in section 331(d)(1), after the 
        expiration of the 60 session days beginning on the 15th session 
        day after the succeeding session of Congress first convenes.
  (f) If, before the passage by one House of a joint resolution of that 
House described in subsection (a), that House receives from the other 
House a joint resolution described in subsection (a), then the 
following procedures shall apply:
          (1) The joint resolution of the other House shall not be 
        referred to a committee.
          (2) With respect to a joint resolution described in 
        subsection (a) of the House receiving the joint resolution--
                  (A) the procedure in that House shall be the same as 
                if no joint resolution had been received from the other 
                House; but
                  (B) the vote on final passage shall be on the joint 
                resolution of the other House.

SEC. 334. DEFINITIONS.

  For purposes of this subtitle:
          (1) The term ``Federal financial agency'' means the Consumer 
        Law Enforcement Agency, Board of Governors of the Federal 
        Reserve System, the Commodity Futures Trading Commission, the 
        Federal Deposit Insurance Corporation, the Federal Housing 
        Finance Agency, the Office of the Comptroller of the Currency, 
        the National Credit Union Administration, and the Securities 
        and Exchange Commission.
          (2) The term ``major rule'' means any rule, including an 
        interim final rule, that the Administrator of the Office of 
        Information and Regulatory Affairs of the Office of Management 
        and Budget finds has resulted in or is likely to result in--
                  (A) an annual effect on the economy of $100 million 
                or more;
                  (B) a major increase in costs or prices for 
                consumers, individual industries, Federal, State, or 
                local government agencies, or geographic regions; or
                  (C) significant adverse effects on competition, 
                employment, investment, productivity, innovation, or on 
                the ability of United States-based enterprises to 
                compete with foreign-based enterprises in domestic and 
                export markets.
          (3) The term ``nonmajor rule'' means any rule that is not a 
        major rule.
          (4) The term ``rule'' has the meaning given such term in 
        section 551 of title 5, United States Code, except that such 
        term does not include--
                  (A) any rule of particular applicability, including a 
                rule that approves or prescribes for the future rates, 
                wages, prices, services, or allowances therefore, 
                corporate or financial structures, reorganizations, 
                mergers, or acquisitions thereof, or accounting 
                practices or disclosures bearing on any of the 
                foregoing;
                  (B) any rule relating to agency management or 
                personnel; or
                  (C) any rule of agency organization, procedure, or 
                practice that does not substantially affect the rights 
                or obligations of non-agency parties.
          (5) The term ``submission date or publication date'', except 
        as otherwise provided in this subtitle, means--
                  (A) in the case of a major rule, the date on which 
                the Congress receives the report submitted under 
                section 331(a)(1)(A); and
                  (B) in the case of a nonmajor rule, the later of--
                          (i) the date on which the Congress receives 
                        the report submitted under section 
                        331(a)(1)(A); and
                          (ii) the date on which the nonmajor rule is 
                        published in the Federal Register, if so 
                        published.

SEC. 335. JUDICIAL REVIEW.

  (a) No determination, finding, action, or omission under this 
subtitle shall be subject to judicial review.
  (b) Notwithstanding subsection (a), a court may determine whether a 
Federal financial agency has completed the necessary requirements under 
this subtitle for a rule to take effect.
  (c) The enactment of a joint resolution of approval under section 332 
shall not be interpreted to serve as a grant or modification of 
statutory authority by Congress for the promulgation of a rule, shall 
not extinguish or affect any claim, whether substantive or procedural, 
against any alleged defect in a rule, and shall not form part of the 
record before the court in any judicial proceeding concerning a rule 
except for purposes of determining whether or not the rule is in 
effect.

SEC. 336. EFFECTIVE DATE OF CERTAIN RULES.

  Notwithstanding section 331--
          (1) any rule that establishes, modifies, opens, closes, or 
        conducts a regulatory program for a commercial, recreational, 
        or subsistence activity related to hunting, fishing, or 
        camping, or
          (2) any rule other than a major rule which the Federal 
        financial agency for good cause finds (and incorporates the 
        finding and a brief statement of reasons therefore in the rule 
        issued) that notice and public procedure thereon are 
        impracticable, unnecessary, or contrary to the public interest,
shall take effect at such time as the Federal financial agency 
promulgating the rule determines.

SEC. 337. BUDGETARY EFFECTS OF RULES SUBJECT TO SECTION 332 OF THE 
                    FINANCIAL CHOICE ACT OF 2017.

  Section 257(b)(2) of the Balanced Budget and Emergency Deficit 
Control Act of 1985 is amended by adding at the end the following new 
subparagraph:
          ``(E) Budgetary effects of rules subject to section 332 of 
        the financial choice act of 2017.--Any rules subject to the 
        congressional approval procedure set forth in section 332 of 
        the Financial CHOICE Act of 2017 affecting budget authority, 
        outlays, or receipts shall be assumed to be effective unless it 
        is not approved in accordance with such section.''.

             Subtitle C--Judicial Review of Agency Actions

SEC. 341. SCOPE OF JUDICIAL REVIEW OF AGENCY ACTIONS.

  (a) In General.--Notwithstanding any other provision of law, in any 
judicial review of an agency action pursuant to chapter 7 of title 5, 
United States Code, to the extent necessary to decision and when 
presented, the reviewing court shall determine the meaning or 
applicability of the terms of an agency action and decide de novo all 
relevant questions of law, including the interpretation of 
constitutional and statutory provisions, and rules made by an agency. 
Notwithstanding any other provision of law, this section shall apply in 
any action for judicial review of agency action authorized under any 
provision of law. No law may exempt any such civil action from the 
application of this section except by specific reference to this 
section.
  (b) Agency Defined.--For purposes of this section, the term 
``agency'' means the Consumer Law Enforcement Agency, the Board of 
Governors of the Federal Reserve System, the Commodity Futures Trading 
Commission, the Federal Deposit Insurance Corporation, the Federal 
Housing Finance Agency, the Office of the Comptroller of the Currency, 
the National Credit Union Administration, and the Securities and 
Exchange Commission.
  (c) Effective Date.--Subsection (a) shall take effect after the end 
of the 2-year period beginning on the date of the enactment of this 
Act.

             Subtitle D--Leadership of Financial Regulators

SEC. 351. FEDERAL DEPOSIT INSURANCE CORPORATION.

  Section 2 of the Federal Deposit Insurance Act (12 U.S.C. 1812) is 
amended--
          (1) in subsection (a)(1), by striking ``5 members'' and all 
        that follows through ``3 of whom'' and inserting the following: 
        ``5 members, who'';
          (2) by amending subsection (d) to read as follows:
  ``(d) Vacancy.--Any vacancy on the Board of Directors shall be filled 
in the manner in which the original appointment was made.''; and
          (3) in subsection (f)--
                  (A) by striking paragraph (2); and
                  (B) by redesignating paragraph (3) as paragraph (2).

SEC. 352. FEDERAL HOUSING FINANCE AGENCY.

  Section 1312(b)(2) of the Federal Housing Enterprises Financial 
Safety and Soundness Act of 1992 (12 U.S.C. 4512) is amended by 
striking ``for cause''.

         Subtitle E--Congressional Oversight of Appropriations

SEC. 361. BRINGING THE FEDERAL DEPOSIT INSURANCE CORPORATION INTO THE 
                    APPROPRIATIONS PROCESS.

  (a) In General.--Section 10(a) of the Federal Deposit Insurance Act 
(12 U.S.C. 1820(a)) is amended--
          (1) by striking ``(a) The'' and inserting the following:
  ``(a) Powers.--
          ``(1) In general.--The'';
          (2) by inserting ``, subject to paragraph (2),'' after ``The 
        Board of Directors of the Corporation''; and
          (3) by adding at the end the following new paragraph:
          ``(2) Appropriations requirement.--
                  ``(A) Operating fund.--There is established an 
                Operating Fund, to which Congress shall provide annual 
                appropriations to the Corporation, which shall be 
                separate from the Deposit Insurance Fund.
                  ``(B) Recovery of costs of annual appropriation.--The 
                Corporation shall collect assessments and other fees, 
                as provided under this Act, that are designed to 
                recover the costs to the Government of the annual 
                appropriation to the Corporation by Congress. Except as 
                provided in (E) and subject to subparagraph (F), the 
                Corporation may only incur obligations, or allow and 
                pay expenses, from the Operating Fund pursuant to an 
                appropriations Act.
                  ``(C) Deposits.--Assessments and other fees described 
                under subparagraph (B) for any fiscal year--
                          ``(i) shall be deposited in the Operating 
                        Fund; and
                          ``(ii) except as provided in subparagraph 
                        (E), shall not be collected for any fiscal year 
                        except to the extent provided in advance in 
                        appropriation Acts.
                  ``(D) Credits.--Amounts deposited in the Operating 
                Fund during a fiscal year shall be credited as 
                offsetting the amount appropriated to the Operating 
                Fund for such fiscal year.
                  ``(E) Lapse of appropriation.--If on the first day of 
                a fiscal year an appropriation to the Corporation has 
                not been enacted, the Corporation shall continue to 
                collect the assessments and other fees described under 
                subparagraph (B) at the rate in effect during the 
                preceding fiscal year, until 60 days after the date 
                such an appropriation is enacted.
                  ``(F) Exception for certain programs.--This paragraph 
                shall not apply to the Corporation's Insurance Business 
                Line Programs and Receivership Management Business Line 
                Programs, as in existence on the date of enactment of 
                this paragraph.''.
  (b) Conforming Amendment.--Subsection (d) of section 7 of the Federal 
Deposit Insurance Act (12 U.S.C. 1817) is amended to read as follows:
  ``(d) Deposit Insurance Fund Exempt From Apportionment.--
Notwithstanding any other provision of law, amounts received pursuant 
to any assessments or other fees that are deposited into the Deposit 
Insurance Fund shall not be subject to apportionment for the purposes 
of chapter 15 of title 31, United States Code, or under any other 
authority.''.
  (c) Effective Date.--The amendments made by this section shall apply 
with respect to expenses paid and fees collected on or after the date 
that is 90 days after the date of the enactment of the first 
appropriation Act that provides for appropriations to the Federal 
Deposit Insurance Corporation and that is enacted after the date of the 
enactment of this Act.

SEC. 362. BRINGING THE FEDERAL HOUSING FINANCE AGENCY INTO THE 
                    APPROPRIATIONS PROCESS.

  (a) In General.--Section 1316 of the Housing and Community 
Development Act of 1992 (12 U.S.C. 4516) is amended--
          (1) by amending subsection (a) to read as follows:
  ``(a) Appropriations Requirement.--
          ``(1) Recovery of costs of annual appropriation.--The Agency 
        shall collect assessments and other fees that are designed to 
        recover the costs to the Government of the annual appropriation 
        to the Agency by Congress.
          ``(2) Offsetting collections.--Assessments and other fees 
        described under paragraph (1) for any fiscal year--
                  ``(A) shall be deposited and credited as offsetting 
                collections to the account providing appropriations to 
                the Agency; and
                  ``(B) except as provided in paragraph (3), shall not 
                be collected for any fiscal year except to the extent 
                provided in advance in appropriation Acts.
          ``(3) Lapse of appropriation.--If on the first day of a 
        fiscal year an appropriation to the Agency has not been 
        enacted, the Agency shall continue to collect (as offsetting 
        collections) the assessments and other fees described under 
        paragraph (1) at the rate in effect during the preceding fiscal 
        year, until 60 days after the date such an appropriation is 
        enacted.''; and
          (2) by striking subsection (f).
  (b) Effective Date.--The amendments made by this section shall apply 
with respect to expenses paid and assessments and other fees collected 
on or after the date that is 90 days after the date of the enactment of 
the first appropriation Act that provides for appropriations to the 
Federal Housing Finance Agency and that is enacted after the date of 
the enactment of this Act.

SEC. 363. BRINGING THE NATIONAL CREDIT UNION ADMINISTRATION INTO THE 
                    APPROPRIATIONS PROCESS.

  (a) In General.--Section 105 of the Federal Credit Union Act (12 
U.S.C. 1755) is amended--
          (1) by amending subsections (a) and (b) to read as follows:
  ``(a) Payment by Federal Credit Unions to Administration.--Each 
insured credit union shall pay to the Administration an annual fee.
  ``(b) Determinations of Assessment Periods and Payment Dates.--The 
Board shall determine the periods for which the fee referred to under 
subsection (a) shall be assessed and the date for the payment of such 
fee or increments thereof.'';
          (2) in subsection (c), by striking ``operating'';
          (3) by amending subsection (d) to read as follows:
  ``(d) Appropriations Requirement.--
          ``(1) Recovery of costs of annual appropriation.--The 
        Administration shall collect fees other than those fees 
        referred to under subsection (a) from each insured credit 
        union, as provided under this Act, in an amount stated as a 
        percentage of insured shares of each insured credit union 
        (which percentage shall be the same for all insured credit 
        unions). Such fees shall be designed to recover the costs to 
        the Government of the annual appropriation to the 
        Administration by Congress.
          ``(2) Offsetting collections.--Fees described under paragraph 
        (1) for any fiscal year--
                  ``(A) shall be deposited and credited as offsetting 
                collections to the account providing appropriations to 
                the Administration; and
                  ``(B) except as provided in paragraph (3), shall not 
                be collected for any fiscal year except to the extent 
                provided in advance in appropriation Acts.
          ``(3) Lapse of appropriation.--If on the first day of a 
        fiscal year an appropriation to the Administration has not been 
        enacted, the Administration shall continue to collect (as 
        offsetting collections) the fees described under paragraph (1) 
        at the rate in effect during the preceding fiscal year, until 
        60 days after the date such an appropriation is enacted.
          ``(4) Exception for insurance functions.--This subsection 
        shall not apply to the National Credit Union Share Insurance 
        Fund, including assessments and other fees that are deposited 
        into, and amounts paid from, the National Credit Union Share 
        Insurance Fund.''; and
          (4) by striking subsection (e).
  (b) Conforming Amendments.--The Federal Credit Union Act (12 U.S.C. 
1751 et seq.) is amended--
          (1) in section 120(j), by striking paragraph (3);
          (2) by amending section 128 to read as follows:

``SEC. 128. NATIONAL CREDIT UNION SHARE INSURANCE FUND EXEMPT FROM 
                    APPORTIONMENT.

  ``Notwithstanding any other provision of law, amounts received 
pursuant to any assessments or other fees that are deposited into the 
National Credit Union Share Insurance Fund or the Temporary Corporate 
Credit Union Stabilization Fund shall not be subject to apportionment 
for the purposes of chapter 15 of title 31, United States Code, or 
under any other authority.''; and
          (3) in section 203(a), by striking ``and for such 
        administrative and other expenses incurred in carrying out the 
        purposes of this title''.
  (c) Effective Date.--The amendments made by this section shall apply 
with respect to expenses paid and fees collected on or after the date 
that is 90 days after the date of the enactment of the first 
appropriation Act that provides for appropriations to the National 
Credit Union Administration and that is enacted after the date of the 
enactment of this Act.

SEC. 364. BRINGING THE OFFICE OF THE COMPTROLLER OF THE CURRENCY INTO 
                    THE APPROPRIATIONS PROCESS.

  (a) In General.--Section 5240A of the Revised Statutes of the United 
States (12 U.S.C. 16) is amended--
          (1) by striking ``Sec. 5240A. The Comptroller of the Currency 
        may collect an assessment, fee, or other charge from any entity 
        described in section 3(q)(1) of the Federal Deposit Insurance 
        Act (12 U.S.C. 1813(q)(1)), as the Comptroller determines is 
        necessary or appropriate to carry out the responsibilities of 
        the Office of the Comptroller of the Currency. In establishing 
        the amount of an assessment, fee, or charge collected from an 
        entity under this section,'' and inserting the following:

``SEC. 5240A. COLLECTION OF FEES; APPROPRIATIONS REQUIREMENT.

  ``(a) In General.--In establishing the amount of an assessment, fee, 
or charge collected from an entity under subsection (b),'';
          (2) by striking ``Funds derived'' and all that follows 
        through the end of the section; and
          (3) by adding at the end the following:
  ``(b) Appropriations Requirement.--
          ``(1) Recovery of costs of annual appropriation.--The 
        Comptroller of the Currency shall impose and collect 
        assessments, fees, or other charges that are designed to 
        recover the costs to the Government of the annual appropriation 
        to the Office of the Comptroller of the Currency by Congress.
          ``(2) Offsetting collections.--Assessments and other fees 
        described under paragraph (1) for any fiscal year--
                  ``(A) shall be deposited and credited as offsetting 
                collections to the account providing appropriations to 
                the Office of the Comptroller of the Currency; and
                  ``(B) except as provided in paragraph (3), shall not 
                be collected for any fiscal year except to the extent 
                provided in advance in appropriation Acts.
          ``(3) Lapse of appropriation.--If on the first day of a 
        fiscal year an appropriation to the Office of the Comptroller 
        of the Currency has not been enacted, the Comptroller of the 
        Currency shall continue to collect (as offsetting collections) 
        the assessments and other fees described under paragraph (1) at 
        the rate in effect during the preceding fiscal year, until 60 
        days after the date such an appropriation is enacted.''.
  (b) Conforming Amendment.--Section 5240 (12 U.S.C. 481 et seq.) of 
the Revised Statutes of the United States is amended by striking the 
fourth undesignated paragraph.
  (c) Effective Date.--The amendments made by this section shall apply 
with respect to expenses paid and fees collected on or after the date 
that is 90 days after the date of the enactment of the first 
appropriation Act that provides for appropriations to the Comptroller 
of the Currency and that is enacted after the date of the enactment of 
this Act.

SEC. 365. BRINGING THE NON-MONETARY POLICY RELATED FUNCTIONS OF THE 
                    BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM 
                    INTO THE APPROPRIATIONS PROCESS.

  (a) In General.--The Federal Reserve Act is amended by inserting 
after section 11B the following:

``SEC. 11C. APPROPRIATIONS REQUIREMENT FOR NON-MONETARY POLICY RELATED 
                    ADMINISTRATIVE COSTS.

  ``(a) Appropriations Requirement.--
          ``(1) Recovery of costs of annual appropriation.--The Board 
        of Governors of the Federal Reserve System and the Federal 
        reserve banks shall collect assessments and other fees, as 
        provided under this Act, that are designed to recover the costs 
        to the Government of the annual appropriation to the Board of 
        Governors of the Federal Reserve System by Congress. The Board 
        of Governors of the Federal Reserve System and the Federal 
        reserve banks may only incur obligations or allow and pay 
        expenses with respect to non-monetary policy related 
        administrative costs pursuant to an appropriations Act.
          ``(2) Offsetting collections.--Assessments and other fees 
        described under paragraph (1) for any fiscal year--
                  ``(A) shall be deposited and credited as offsetting 
                collections to the account providing appropriations to 
                the Board of Governors of the Federal Reserve System; 
                and
                  ``(B) except as provided in paragraph (3), shall not 
                be collected for any fiscal year except to the extent 
                provided in advance in appropriation Acts.
          ``(3) Lapse of appropriation.--If on the first day of a 
        fiscal year an appropriation to the Board of Governors of the 
        Federal Reserve System has not been enacted, the Board of 
        Governors of the Federal Reserve System shall continue to 
        collect (as offsetting collections) the assessments and other 
        fees described under paragraph (1) at the rate in effect during 
        the preceding fiscal year, until 60 days after the date such an 
        appropriation is enacted.
          ``(4) Limitation.--This subsection shall only apply to the 
        non-monetary policy related administrative costs of the Board 
        of Governors of the Federal Reserve System.
  ``(b) Definitions.--For purposes of this section:
          ``(1) Monetary policy.--The term `monetary policy' means a 
        strategy for producing a generally acceptable exchange medium 
        that supports the productive employment of economic resources 
        by reliably serving as both a unit of account and store of 
        value.
          ``(2) Non-monetary policy related administrative costs.--The 
        term `non-monetary policy related administrative costs' means 
        administrative costs not related to the conduct of monetary 
        policy, and includes--
                  ``(A) direct operating expenses for supervising and 
                regulating entities supervised and regulated by the 
                Board of Governors of the Federal Reserve System, 
                including conducting examinations, conducting stress 
                tests, communicating with the entities regarding 
                supervisory matters and laws, and regulations;
                  ``(B) operating expenses for activities integral to 
                carrying out supervisory and regulatory 
                responsibilities, such as training staff in the 
                supervisory function, research and analysis functions 
                including library subscription services, and collecting 
                and processing regulatory reports filed by supervised 
                institutions; and
                  ``(C) support, overhead, and pension expenses related 
                to the items described under subparagraphs (A) and 
                (B).''.
  (b) Effective Date.--The amendments made by this section shall apply 
with respect to expenses paid and fees collected on or after the date 
that is 90 days after the date of the enactment of the first 
appropriation Act that provides for appropriations to the Board of 
Governors of the Federal Reserve System and that is enacted after the 
date of the enactment of this Act.

                  Subtitle F--International Processes

SEC. 371. REQUIREMENTS FOR INTERNATIONAL PROCESSES.

  (a) Board of Governors Requirements.--Section 11 of the Federal 
Reserve Act (12 U.S.C. 248), as amended by section 1007(a), is further 
amended by adding at the end the following new subsection:
  ``(w) International Processes.--
          ``(1) Notice of process; consultation.--At least 30 calendar 
        days before any member or employee of the Board of Governors of 
        the Federal Reserve System participates in a process of setting 
        financial standards as a part of any foreign or multinational 
        entity, the Board of Governors shall--
                  ``(A) issue a notice of the process, including the 
                subject matter, scope, and goals of the process, to the 
                Committee on Financial Services of the House of 
                Representatives and the Committee on Banking, Housing, 
                and Urban Affairs of the Senate;
                  ``(B) make such notice available to the public, 
                including on the website of the Board of Governors; and
                  ``(C) solicit public comment, and consult with the 
                committees described under subparagraph (A), with 
                respect to the subject matter, scope, and goals of the 
                process.
          ``(2) Public reports on process.--After the end of any 
        process described under paragraph (1), the Board of Governors 
        shall issue a public report on the topics that were discussed 
        during the process and any new or revised rulemakings or policy 
        changes that the Board of Governors believes should be 
        implemented as a result of the process.
          ``(3) Notice of agreements; consultation.--At least 90 
        calendar days before any member or employee of the Board of 
        Governors of the Federal Reserve System participates in a 
        process of setting financial standards as a part of any foreign 
        or multinational entity, the Board of Governors shall--
                  ``(A) issue a notice of agreement to the Committee on 
                Financial Services of the House of Representatives and 
                the Committee on Banking, Housing, and Urban Affairs of 
                the Senate;
                  ``(B) make such notice available to the public, 
                including on the website of the Board of Governors; and
                  ``(C) consult with the committees described under 
                subparagraph (A) with respect to the nature of the 
                agreement and any anticipated effects such agreement 
                will have on the economy.
          ``(4) Definition.--For purposes of this subsection, the term 
        `process' shall include any official proceeding or meeting on 
        financial regulation of a recognized international organization 
        with authority to set financial standards on a global or 
        regional level, including the Financial Stability Board, the 
        Basel Committee on Banking Supervision (or a similar 
        organization), and the International Association of Insurance 
        Supervisors (or a similar organization).''.
  (b) FDIC Requirements.--The Federal Deposit Insurance Act (12 U.S.C. 
1811 et seq.) is amended by adding at the end the following new 
section:

``SEC. 51. INTERNATIONAL PROCESSES.

  ``(a) Notice of Process; Consultation.--At least 30 calendar days 
before the Board of Directors participates in a process of setting 
financial standards as a part of any foreign or multinational entity, 
the Board of Directors shall--
          ``(1) issue a notice of the process, including the subject 
        matter, scope, and goals of the process, to the Committee on 
        Financial Services of the House of Representatives and the 
        Committee on Banking, Housing, and Urban Affairs of the Senate;
          ``(2) make such notice available to the public, including on 
        the website of the Corporation; and
          ``(3) solicit public comment, and consult with the committees 
        described under paragraph (1), with respect to the subject 
        matter, scope, and goals of the process.
  ``(b) Public Reports on Process.--After the end of any process 
described under subsection (a), the Board of Directors shall issue a 
public report on the topics that were discussed at the process and any 
new or revised rulemakings or policy changes that the Board of 
Directors believes should be implemented as a result of the process.
  ``(c) Notice of Agreements; Consultation.--At least 90 calendar days 
before the Board of Directors participates in a process of setting 
financial standards as a part of any foreign or multinational entity, 
the Board of Directors shall--
          ``(1) issue a notice of agreement to the Committee on 
        Financial Services of the House of Representatives and the 
        Committee on Banking, Housing, and Urban Affairs of the Senate;
          ``(2) make such notice available to the public, including on 
        the website of the Corporation; and
          ``(3) consult with the committees described under paragraph 
        (1) with respect to the nature of the agreement and any 
        anticipated effects such agreement will have on the economy.
  ``(d) Definition.--For purposes of this section, the term `process' 
shall include any official proceeding or meeting on financial 
regulation of a recognized international organization with authority to 
set financial standards on a global or regional level, including the 
Financial Stability Board, the Basel Committee on Banking Supervision 
(or a similar organization), and the International Association of 
Insurance Supervisors (or a similar organization).''.
  (c) Treasury Requirements.--Section 325 of title 31, United States 
Code, is amended by adding at the end the following new subsection:
  ``(d) International Processes.--
          ``(1) Notice of process; consultation.--At least 30 calendar 
        days before the Secretary participates in a process of setting 
        financial standards as a part of any foreign or multinational 
        entity, the Secretary shall--
                  ``(A) issue a notice of the process, including the 
                subject matter, scope, and goals of the process, to the 
                Committee on Financial Services of the House of 
                Representatives and the Committee on Banking, Housing, 
                and Urban Affairs of the Senate;
                  ``(B) make such notice available to the public, 
                including on the website of the Department of the 
                Treasury; and
                  ``(C) solicit public comment, and consult with the 
                committees described under subparagraph (A), with 
                respect to the subject matter, scope, and goals of the 
                process.
          ``(2) Public reports on process.--After the end of any 
        process described under paragraph (1), the Secretary shall 
        issue a public report on the topics that were discussed at the 
        process and any new or revised rulemakings or policy changes 
        that the Secretary believes should be implemented as a result 
        of the process.
          ``(3) Notice of agreements; consultation.--At least 90 
        calendar days before the Secretary participates in a process of 
        setting financial standards as a part of any foreign or 
        multinational entity, the Secretary shall--
                  ``(A) issue a notice of agreement to the Committee on 
                Financial Services of the House of Representatives and 
                the Committee on Banking, Housing, and Urban Affairs of 
                the Senate;
                  ``(B) make such notice available to the public, 
                including on the website of the Department of the 
                Treasury; and
                  ``(C) consult with the committees described under 
                subparagraph (A) with respect to the nature of the 
                agreement and any anticipated effects such agreement 
                will have on the economy.
          ``(4) Definition.--For purposes of this subsection, the term 
        `process' shall include any official proceeding or meeting on 
        financial regulation of a recognized international organization 
        with authority to set financial standards on a global or 
        regional level, including the Financial Stability Board, the 
        Basel Committee on Banking Supervision (or a similar 
        organization), and the International Association of Insurance 
        Supervisors (or a similar organization).''.
  (d) OCC Requirements.--Chapter one of title LXII of the Revised 
Statutes of the United States (12 U.S.C. 21 et seq.) is amended--
          (1) by adding at the end the following new section:

``SEC. 5156B. INTERNATIONAL PROCESSES.

  ``(a) Notice of Process; Consultation.--At least 30 calendar days 
before the Comptroller of the Currency participates in a process of 
setting financial standards as a part of any foreign or multinational 
entity, the Board of Directors shall--
          ``(1) issue a notice of the process, including the subject 
        matter, scope, and goals of the process, to the Committee on 
        Financial Services of the House of Representatives and the 
        Committee on Banking, Housing, and Urban Affairs of the Senate;
          ``(2) make such notice available to the public, including on 
        the website of the Office of the Comptroller of the Currency; 
        and
          ``(3) solicit public comment, and consult with the committees 
        described under paragraph (1), with respect to the subject 
        matter, scope, and goals of the process.
  ``(b) Public Reports on Process.--After the end of any process 
described under subsection (a), the Board of Directors shall issue a 
public report on the topics that were discussed at the process and any 
new or revised rulemakings or policy changes that the Board of 
Directors believes should be implemented as a result of the process.
  ``(c) Notice of Agreements; Consultation.--At least 90 calendar days 
before the Board of Directors participates in a process of setting 
financial standards as a part of any foreign or multinational entity, 
the Board of Directors shall--
          ``(1) issue a notice of agreement to the Committee on 
        Financial Services of the House of Representatives and the 
        Committee on Banking, Housing, and Urban Affairs of the Senate;
          ``(2) make such notice available to the public, including on 
        the website of the Office of the Comptroller of the Currency; 
        and
          ``(3) consult with the committees described under paragraph 
        (1) with respect to the nature of the agreement and any 
        anticipated effects such agreement will have on the economy.
  ``(d) Definition.--For purposes of this section, the term `process' 
shall include any official proceeding or meeting on financial 
regulation of a recognized international organization with authority to 
set financial standards on a global or regional level, including the 
Financial Stability Board, the Basel Committee on Banking Supervision 
(or a similar organization), and the International Association of 
Insurance Supervisors (or a similar organization).''; and
          (2) in the table of contents for such chapter, by adding at 
        the end the following new item:

``5156B. International processes.''.

  (e) Securities and Exchange Commission Requirements.--Section 4 of 
the Securities Exchange Act of 1934 (15 U.S.C. 78d), as amended by 
section 818(a), is further amended by adding at the end the following 
new subsection:
  ``(j) International Processes.--
          ``(1) Notice of process; consultation.--At least 30 calendar 
        days before the Commission participates in a process of setting 
        financial standards as a part of any foreign or multinational 
        entity, the Commission shall--
                  ``(A) issue a notice of the process, including the 
                subject matter, scope, and goals of the process, to the 
                Committee on Financial Services of the House of 
                Representatives and the Committee on Banking, Housing, 
                and Urban Affairs of the Senate;
                  ``(B) make such notice available to the public, 
                including on the website of the Commission; and
                  ``(C) solicit public comment, and consult with the 
                committees described under subparagraph (A), with 
                respect to the subject matter, scope, and goals of the 
                process.
          ``(2) Public reports on process.--After the end of any 
        process described under paragraph (1), the Commission shall 
        issue a public report on the topics that were discussed at the 
        process and any new or revised rulemakings or policy changes 
        that the Commission believes should be implemented as a result 
        of the process.
          ``(3) Notice of agreements; consultation.--At least 90 
        calendar days before the Commission participates in a process 
        of setting financial standards as a part of any foreign or 
        multinational entity, the Commission shall--
                  ``(A) issue a notice of agreement to the Committee on 
                Financial Services of the House of Representatives and 
                the Committee on Banking, Housing, and Urban Affairs of 
                the Senate;
                  ``(B) make such notice available to the public, 
                including on the website of the Commission; and
                  ``(C) consult with the committees described under 
                subparagraph (A) with respect to the nature of the 
                agreement and any anticipated effects such agreement 
                will have on the economy.
          ``(4) Definition.--For purposes of this subsection, the term 
        `process' shall include any official proceeding or meeting on 
        financial regulation of a recognized international organization 
        with authority to set financial standards on a global or 
        regional level, including the Financial Stability Board, the 
        Basel Committee on Banking Supervision (or a similar 
        organization), and the International Association of Insurance 
        Supervisors (or a similar organization).''.
  (f) Commodity Futures Trading Commission Requirements.--Section 2 of 
the Commodity Exchange Act (7 U.S.C. 2) is amended by adding at the end 
the following:
  ``(k) International Processes.--
          ``(1) Notice of process; consultation.--At least 30 calendar 
        days before the Commission participates in a process of setting 
        financial standards as a part of any foreign or multinational 
        entity, the Commission shall--
                  ``(A) issue a notice of the process, including the 
                subject matter, scope, and goals of the process, to--
                          ``(i) the Committees on Financial Services 
                        and Agriculture of the House of 
                        Representatives; and
                          ``(ii) the Committees on Banking, Housing, 
                        and Urban Affairs and Agriculture, Nutrition, 
                        and Forestry of the Senate;
                  ``(B) make such notice available to the public, 
                including on the website of the Commission; and
                  ``(C) solicit public comment, and consult with the 
                committees described under subparagraph (A), with 
                respect to the subject matter, scope, and goals of the 
                process.
          ``(2) Public reports on process.--After the end of any 
        process described under paragraph (1), the Commission shall 
        issue a public report on the topics that were discussed during 
        the process and any new or revised rulemakings or policy 
        changes that the Commission believes should be implemented as a 
        result of the process.
          ``(3) Notice of agreements; consultation.--At least 90 
        calendar days before the Commission participates in a process 
        of setting financial standards as a part of any foreign or 
        multinational entity, the Commission shall--
                  ``(A) issue a notice of agreement to--
                          ``(i) the Committees on Financial Services 
                        and Agriculture of the House of 
                        Representatives; and
                          ``(ii) the Committees on Banking, Housing, 
                        and Urban Affairs and Agriculture, Nutrition, 
                        and Forestry of the Senate;
                  ``(B) make such notice available to the public, 
                including on the website of the Commission; and
                  ``(C) consult with the committees described under 
                subparagraph (A) with respect to the nature of the 
                agreement and any anticipated effects such agreement 
                will have on the economy.
          ``(4) Definition.--For purposes of this subsection, the term 
        `process' shall include any official proceeding or meeting on 
        financial regulation of a recognized international organization 
        with authority to set financial standards on a global or 
        regional level, including the Financial Stability Board, the 
        Basel Committee on Banking Supervision (or a similar 
        organization), and the International Association of Insurance 
        Supervisors (or a similar organization).''.

                  Subtitle G--Unfunded Mandates Reform

SEC. 381. DEFINITIONS.

  For purposes of this title:
          (1) Agency.--The term ``agency'' has the meaning given such 
        term under section 311.
          (2) Other definitions.--Except as provided under paragraph 
        (1), the definitions under section 421 of the Congressional 
        Budget and Impoundment Control Act of 1974 shall apply to this 
        title.

SEC. 382. STATEMENTS TO ACCOMPANY SIGNIFICANT REGULATORY ACTIONS.

  (a) In General.--Unless otherwise expressly prohibited by law, before 
promulgating any general notice of proposed rulemaking or any final 
rule, or within six months after promulgating any final rule that was 
not preceded by a general notice of proposed rulemaking, if the 
proposed rulemaking or final rule includes a Federal mandate that may 
result in an annual effect on State, local, or tribal governments, or 
to the private sector, in the aggregate of $100,000,000 or more in any 
1 year, the agency shall prepare a written statement containing the 
following:
          (1) The text of the draft proposed rulemaking or final rule, 
        together with the information required under subsections (a) 
        and (b)(1) of section 312, as applicable, including an 
        explanation of the manner in which the proposed rulemaking or 
        final rule is consistent with the statutory requirement and 
        avoids undue interference with State, local, and tribal 
        governments in the exercise of their governmental functions.
          (2) Estimates by the agency, if and to the extent that the 
        agency determines that accurate estimates are reasonably 
        feasible, of--
                  (A) the future compliance costs of the Federal 
                mandate; and
                  (B) any disproportionate budgetary effects of the 
                Federal mandate upon any particular regions of the 
                nation or particular State, local, or tribal 
                governments, urban or rural or other types of 
                communities, or particular segments of the private 
                sector.
          (3)(A) A detailed description of the extent of the agency's 
        prior consultation with the private sector and elected 
        representatives (under section 384) of the affected State, 
        local, and tribal governments.
          (B) A detailed summary of the comments and concerns that were 
        presented by the private sector and State, local, or tribal 
        governments either orally or in writing to the agency.
          (C) A detailed summary of the agency's evaluation of those 
        comments and concerns.
          (4) A detailed summary of how the agency complied with each 
        of the regulatory principles described under section 312, as 
        applicable.
  (b) Promulgation.--In promulgating a general notice of proposed 
rulemaking or a final rule for which a statement under subsection (a) 
is required, the agency shall include in the promulgation a summary of 
the information contained in the statement.
  (c) Preparation in Conjunction With Other Statement.--Any agency may 
prepare any statement required under subsection (a) in conjunction with 
or as a part of any other statement or analysis, provided that the 
statement or analysis satisfies the provisions of subsection (a).

SEC. 383. SMALL GOVERNMENT AGENCY PLAN.

  Before establishing any regulatory requirements that might 
significantly or uniquely affect small governments, agencies shall have 
developed a plan under which the agency shall--
          (1) provide notice of the requirements to potentially 
        affected small governments, if any;
          (2) enable officials of affected small governments to provide 
        meaningful and timely input in the development of regulatory 
        proposals containing significant Federal intergovernmental 
        mandates; and
          (3) inform, educate, and advise small governments on 
        compliance with the requirements.

SEC. 384. STATE, LOCAL, AND TRIBAL GOVERNMENT AND PRIVATE SECTOR INPUT.

  (a) In General.--Each agency shall, to the extent permitted in law, 
develop an effective process to permit elected officers of State, 
local, and tribal governments (or their designated employees with 
authority to act on their behalf), and impacted parties within the 
private sector (including small business), to provide meaningful and 
timely input in the development of regulatory proposals containing 
significant Federal mandates.
  (b) Meetings Between State, Local, Tribal and Federal Officers.--The 
Federal Advisory Committee Act (5 U.S.C. App.) shall not apply to 
actions in support of intergovernmental communications where--
          (1) meetings are held exclusively between Federal officials 
        and elected officers of State, local, and tribal governments 
        (or their designated employees with authority to act on their 
        behalf) acting in their official capacities; and
          (2) such meetings are solely for the purposes of exchanging 
        views, information, or advice relating to the management or 
        implementation of Federal programs established pursuant to 
        public law that explicitly or inherently share 
        intergovernmental responsibilities or administration.
  (c) Guidelines.--For appropriate implementation of subsections (a) 
and (b) consistent with applicable laws and regulations, the following 
guidelines shall be followed:
          (1) Consultations shall take place as early as possible, 
        before issuance of a notice of proposed rulemaking, continue 
        through the final rule stage, and be integrated explicitly into 
        the rulemaking process.
          (2) Agencies shall consult with a wide variety of State, 
        local, and tribal officials and impacted parties within the 
        private sector (including small businesses). Geographic, 
        political, and other factors that may differentiate varying 
        points of view should be considered.
          (3) Agencies should estimate benefits and costs to assist 
        with these consultations. The scope of the consultation should 
        reflect the cost and significance of the Federal mandate being 
        considered.
          (4) Agencies shall, to the extent practicable--
                  (A) seek out the views of State, local, and tribal 
                governments, and impacted parties within the private 
                sector (including small business), on costs, benefits, 
                and risks; and
                  (B) solicit ideas about alternative methods of 
                compliance and potential flexibilities, and input on 
                whether the Federal regulation will harmonize with and 
                not duplicate similar laws in other levels of 
                government.
          (5) Consultations shall address the cumulative impact of 
        regulations on the affected entities.
          (6) Agencies may accept electronic submissions of comments by 
        relevant parties but may not use those comments as the sole 
        method of satisfying the guidelines in this subsection.

SEC. 385. LEAST BURDENSOME OPTION OR EXPLANATION REQUIRED.

  (a) In General.--Except as provided in subsection (b), before 
promulgating any rule for which a written statement is required under 
section 382, the agency shall identify and consider a reasonable number 
of regulatory alternatives and from those alternatives select the least 
costly, most cost-effective or least burdensome alternative that 
achieves the objectives of the rule, for--
          (1) State, local, and tribal governments, in the case of a 
        rule containing a Federal intergovernmental mandate; and
          (2) the private sector, in the case of a rule containing a 
        Federal private sector mandate.
  (b) Exception.--The provisions of subsection (a) shall apply unless--
          (1) the head of the affected agency publishes with the final 
        rule an explanation of why the least costly, most cost-
        effective or least burdensome method of achieving the 
        objectives of the rule was not adopted; or
          (2) the provisions are inconsistent with law.
  (c) Certification.--No later than 1 year after the date of the 
enactment of this Act, the Administrator of the Office of Information 
and Regulatory Affairs shall certify to Congress, with a written 
explanation, agency compliance with this section and include in that 
certification agencies and rulemakings that fail to adequately comply 
with this section.

SEC. 386. ASSISTANCE TO THE OFFICE OF INFORMATION AND REGULATORY 
                    AFFAIRS.

  The Administrator of the Office of Information and Regulatory Affairs 
shall--
          (1) collect from agencies the statements prepared under 
        section 382; and
          (2) periodically forward copies of such statements to the 
        Director of the Congressional Budget Office on a reasonably 
        timely basis after promulgation of the general notice of 
        proposed rulemaking or of the final rule for which the 
        statement was prepared.

SEC. 387. OFFICE OF INFORMATION AND REGULATORY AFFAIRS 
                    RESPONSIBILITIES.

  (a) In General.--The Administrator of the Office of Information and 
Regulatory Affairs shall provide meaningful guidance and oversight so 
that each agency's regulations for which a written statement is 
required under section 382 are consistent with the principles and 
requirements of this title, as well as other applicable laws, and do 
not conflict with the policies or actions of another agency. If the 
Administrator determines that an agency's regulations for which a 
written statement is required under section 382 do not comply with such 
principles and requirements, are not consistent with other applicable 
laws, or conflict with the policies or actions of another agency, the 
Administrator shall identify areas of non-compliance, notify the 
agency, and request that the agency comply before the agency finalizes 
the regulation concerned.
  (b) Annual Statements to Congress on Agency Compliance.--The 
Administrator of the Office of Information and Regulatory Affairs 
annually shall submit to Congress a written report detailing compliance 
by each agency with the requirements of this title that relate to 
regulations for which a written statement is required by section 382, 
including activities undertaken at the request of the Administrator to 
improve compliance, during the preceding reporting period. The report 
shall also contain an appendix detailing compliance by each agency with 
section 384.

SEC. 388. JUDICIAL REVIEW.

  (a) Agency Statements on Significant Regulatory Actions.--
          (1) In general.--Compliance or noncompliance by any agency 
        with the provisions of section 382, paragraphs (1) and (2) of 
        section 383(a), and subsections (a) and (b) of section 385 
        shall be subject to judicial review in accordance with this 
        section.
          (2) Limited review of agency compliance or noncompliance.--
                  (A) Agency compliance or noncompliance with the 
                provisions of section 382, paragraphs (1) and (2) of 
                section 383(a), and subsections (a) and (b) of section 
                385 shall be subject to judicial review under section 
                706(1) of title 5, United States Code, and as provided 
                under subparagraph (B).
                  (B) If an agency fails to prepare the written 
                statement (including the preparation of the estimates, 
                analyses, statements, or descriptions) under section 
                382, prepare the written plan under paragraphs (1) and 
                (2) of section 383(a), or comply with subsections (a) 
                and (b) of section 385, a court may compel the agency 
                to prepare such written statement, prepare such written 
                plan, or comply with such section;
          (3) Review of agency rules.--In any judicial review under any 
        other Federal law of an agency rule for which a written 
        statement under section 382, a written plan under paragraphs 
        (1) and (2) of section 383(a), or compliance with subsections 
        (a) and (b) of section 385 is required, the inadequacy or 
        failure to prepare such statement (including the inadequacy or 
        failure to prepare any estimate, analysis, statement, or 
        description), to prepare such written plan, or to comply with 
        such section may be used as a basis for staying, enjoining, 
        invalidating or otherwise affecting such agency rule.
          (4) Certain information as part of record.--Any information 
        generated under section 382, paragraphs (1) and (2) of section 
        383(a), and subsections (a) and (b) of section 385 that is part 
        of the rulemaking record for judicial review under the 
        provisions of any other Federal law may be considered as part 
        of the record for judicial review conducted under such other 
        provisions of Federal law.
          (5) Application of other federal law.--For any petition under 
        paragraph (2) the provisions of such other Federal law shall 
        control all other matters, such as exhaustion of administrative 
        remedies, the time for and manner of seeking review and venue, 
        except that if such other Federal law does not provide a 
        limitation on the time for filing a petition for judicial 
        review that is less than 180 days, such limitation shall be 180 
        days after a final rule is promulgated by the appropriate 
        agency.
          (6) Effective date.--This subsection shall apply to any 
        agency rule for which a general notice of proposed rulemaking 
        is promulgated on or after the date of the enactment of this 
        Act.
  (b) Judicial Review and Rule of Construction.--Except as provided in 
subsection (a)--
          (1) any estimate, analysis, statement, description or report 
        prepared under this title, and any compliance or noncompliance 
        with the provisions of this title, and any determination 
        concerning the applicability of the provisions of this title 
        shall not be subject to judicial review; and
          (2) no provision of this title shall be construed to create 
        any right or benefit, substantive or procedural, enforceable by 
        any person in any administrative or judicial action.

                  Subtitle H--Enforcement Coordination

SEC. 391. POLICIES TO MINIMIZE DUPLICATION OF ENFORCEMENT EFFORTS.

  Each agency (as defined under section 311) shall, not later than the 
end of the 90-day period beginning on the date of the enactment of this 
Act, implement policies and procedures--
          (1) to minimize duplication of efforts with other Federal or 
        State authorities when bringing an administrative or judicial 
        action against an individual or entity;
          (2) to establish when joint investigations, administrative 
        actions, or judicial actions or the coordination of law 
        enforcement activities are necessary and appropriate and in the 
        public interest; and
          (3) to, in the course of a joint investigation, 
        administrative action, or judicial action, establish a lead 
        agency to avoid duplication of efforts and unnecessary burdens 
        and to ensure consistent enforcement, as necessary and 
        appropriate and in the public interest.

           Subtitle I--Penalties for Unauthorized Disclosures

SEC. 392. CRIMINAL PENALTY FOR UNAUTHORIZED DISCLOSURES.

  Section 165 of the Financial Stability Act of 2010 (12 U.S.C. 5365), 
as amended by section 151(b)(6)(M), is further amended by adding at the 
end the following:
  ``(m) Criminal Penalty for Unauthorized Disclosures.--
          ``(1) In general.--Any officer or employee of a Federal 
        department or agency, who by virtue of such officer or 
        employee's employment or official position, has possession of, 
        or access to, agency records which contain individually 
        identifiable information submitted pursuant to the requirements 
        of this section, the disclosure of which is prohibited by 
        Federal statute, rule, or regulation, and who knowing that 
        disclosure of the specific material is so prohibited, willfully 
        discloses the material in any manner to any person or agency 
        not entitled to receive it, shall be guilty of a misdemeanor 
        and fined not more than $5,000.
          ``(2) Obtaining records under false pretenses.--Any person 
        who knowingly and willfully requests or obtains information 
        described under paragraph (1) from a Federal department or 
        agency under false pretenses shall be guilty of a misdemeanor 
        and fined not more than $5,000.
          ``(3) Treatment of determinations.--For purposes of this 
        subsection, a determination made under subsection (d) or (i) 
        based on individually identifiable information submitted 
        pursuant to the requirements of this section shall be deemed 
        individually identifiable information, the disclosure of which 
        is prohibited by Federal statute.''.

                Subtitle II--Stop Settlement Slush Funds

SEC. 393. LIMITATION ON DONATIONS MADE PURSUANT TO SETTLEMENT 
                    AGREEMENTS TO WHICH CERTAIN DEPARTMENTS OR AGENCIES 
                    ARE A PARTY.

  (a) Limitation on Required Donations.--No settlement to which a 
department or agency is a party may direct or provide for a payment to 
any person who is not a victim of the alleged wrongdoing.
  (b) Penalty.--Any Executive branch official or agent thereof who 
enters into or enforces a settlement in violation of subsection (a), 
shall be subject to the same penalties that would apply in the case of 
a violation of section 3302 of title 31, United States Code.
  (c) Effective Date.--Subsections (a) and (b) apply only in the case 
of a settlement agreement concluded on or after the date of enactment 
of this Act.
  (d) Definitions.--
          (1) The term ``department or agency''--
                  (A) has the meaning given the term ``agency'' under 
                section 311; and
                  (B) means the Department of Housing and Urban 
                Development, the Department of Justice, and the Rural 
                Housing Service of the Department of Agriculture.
          (2) The term ``settlement agreement'' means a settlement 
        agreement resolving a civil action or potential civil action, a 
        plea agreement, a deferred prosecution agreement, or a non-
        prosecution agreement.
          (3) The term ``payment'' means a payment or loan.
          (4) The term ``payment to any person who is not a victim'' 
        means any payment other than a payment--
                  (A) to a person who is party to the lawsuit or 
                settlement;
                  (B) that provides restitution for or otherwise 
                directly remedies actual harm (including to the 
                environment) directly and proximately caused by the 
                party making the payment as a result of that party's 
                alleged wrongdoing;
                  (C) that constitutes payment for services rendered in 
                connection with the case; or
                  (D) made pursuant to section 3663 of title 18, United 
                States Code.

 TITLE IV--UNLEASHING OPPORTUNITIES FOR SMALL BUSINESSES, INNOVATORS, 
           AND JOB CREATORS BY FACILITATING CAPITAL FORMATION

Subtitle A--Small Business Mergers, Acquisitions, Sales, and Brokerage 
                             Simplification

SEC. 401. REGISTRATION EXEMPTION FOR MERGER AND ACQUISITION BROKERS.

  Section 15(b) of the Securities Exchange Act of 1934 (15 U.S.C. 
78o(b)) is amended by adding at the end the following:
          ``(13) Registration exemption for merger and acquisition 
        brokers.--
                  ``(A) In general.--Except as provided in subparagraph 
                (B), an M&A broker shall be exempt from registration 
                under this section.
                  ``(B) Excluded activities.--An M&A broker is not 
                exempt from registration under this paragraph if such 
                broker does any of the following:
                          ``(i) Directly or indirectly, in connection 
                        with the transfer of ownership of an eligible 
                        privately held company, receives, holds, 
                        transmits, or has custody of the funds or 
                        securities to be exchanged by the parties to 
                        the transaction.
                          ``(ii) Engages on behalf of an issuer in a 
                        public offering of any class of securities that 
                        is registered, or is required to be registered, 
                        with the Commission under section 12 or with 
                        respect to which the issuer files, or is 
                        required to file, periodic information, 
                        documents, and reports under subsection (d).
                          ``(iii) Engages on behalf of any party in a 
                        transaction involving a public shell company.
                  ``(C) Disqualifications.--An M&A broker is not exempt 
                from registration under this paragraph if such broker 
                is subject to--
                          ``(i) suspension or revocation of 
                        registration under paragraph (4);
                          ``(ii) a statutory disqualification described 
                        in section 3(a)(39);
                          ``(iii) a disqualification under the rules 
                        adopted by the Commission under section 926 of 
                        the Investor Protection and Securities Reform 
                        Act of 2010 (15 U.S.C. 77d note); or
                          ``(iv) a final order described in paragraph 
                        (4)(H).
                  ``(D) Rule of construction.--Nothing in this 
                paragraph shall be construed to limit any other 
                authority of the Commission to exempt any person, or 
                any class of persons, from any provision of this title, 
                or from any provision of any rule or regulation 
                thereunder.
                  ``(E) Definitions.--In this paragraph:
                          ``(i) Control.--The term `control' means the 
                        power, directly or indirectly, to direct the 
                        management or policies of a company, whether 
                        through ownership of securities, by contract, 
                        or otherwise. There is a presumption of control 
                        for any person who--
                                  ``(I) is a director, general partner, 
                                member or manager of a limited 
                                liability company, or officer 
                                exercising executive responsibility (or 
                                has similar status or functions);
                                  ``(II) has the right to vote 20 
                                percent or more of a class of voting 
                                securities or the power to sell or 
                                direct the sale of 20 percent or more 
                                of a class of voting securities; or
                                  ``(III) in the case of a partnership 
                                or limited liability company, has the 
                                right to receive upon dissolution, or 
                                has contributed, 20 percent or more of 
                                the capital.
                          ``(ii) Eligible privately held company.--The 
                        term `eligible privately held company' means a 
                        privately held company that meets both of the 
                        following conditions:
                                  ``(I) The company does not have any 
                                class of securities registered, or 
                                required to be registered, with the 
                                Commission under section 12 or with 
                                respect to which the company files, or 
                                is required to file, periodic 
                                information, documents, and reports 
                                under subsection (d).
                                  ``(II) In the fiscal year ending 
                                immediately before the fiscal year in 
                                which the services of the M&A broker 
                                are initially engaged with respect to 
                                the securities transaction, the company 
                                meets either or both of the following 
                                conditions (determined in accordance 
                                with the historical financial 
                                accounting records of the company):
                                          ``(aa) The earnings of the 
                                        company before interest, taxes, 
                                        depreciation, and amortization 
                                        are less than $25,000,000.
                                          ``(bb) The gross revenues of 
                                        the company are less than 
                                        $250,000,000.
                          ``(iii) M&A broker.--The term `M&A broker' 
                        means a broker, and any person associated with 
                        a broker, engaged in the business of effecting 
                        securities transactions solely in connection 
                        with the transfer of ownership of an eligible 
                        privately held company, regardless of whether 
                        the broker acts on behalf of a seller or buyer, 
                        through the purchase, sale, exchange, issuance, 
                        repurchase, or redemption of, or a business 
                        combination involving, securities or assets of 
                        the eligible privately held company, if the 
                        broker reasonably believes that--
                                  ``(I) upon consummation of the 
                                transaction, any person acquiring 
                                securities or assets of the eligible 
                                privately held company, acting alone or 
                                in concert, will control and, directly 
                                or indirectly, will be active in the 
                                management of the eligible privately 
                                held company or the business conducted 
                                with the assets of the eligible 
                                privately held company; and
                                  ``(II) if any person is offered 
                                securities in exchange for securities 
                                or assets of the eligible privately 
                                held company, such person will, prior 
                                to becoming legally bound to consummate 
                                the transaction, receive or have 
                                reasonable access to the most recent 
                                fiscal year-end financial statements of 
                                the issuer of the securities as 
                                customarily prepared by the management 
                                of the issuer in the normal course of 
                                operations and, if the financial 
                                statements of the issuer are audited, 
                                reviewed, or compiled, any related 
                                statement by the independent 
                                accountant, a balance sheet dated not 
                                more than 120 days before the date of 
                                the offer, and information pertaining 
                                to the management, business, results of 
                                operations for the period covered by 
                                the foregoing financial statements, and 
                                material loss contingencies of the 
                                issuer.
                          ``(iv) Public shell company.--The term 
                        `public shell company' is a company that at the 
                        time of a transaction with an eligible 
                        privately held company--
                                  ``(I) has any class of securities 
                                registered, or required to be 
                                registered, with the Commission under 
                                section 12 or that is required to file 
                                reports pursuant to subsection (d);
                                  ``(II) has no or nominal operations; 
                                and
                                  ``(III) has--
                                          ``(aa) no or nominal assets;
                                          ``(bb) assets consisting 
                                        solely of cash and cash 
                                        equivalents; or
                                          ``(cc) assets consisting of 
                                        any amount of cash and cash 
                                        equivalents and nominal other 
                                        assets.
                  ``(F) Inflation adjustment.--
                          ``(i) In general.--On the date that is 5 
                        years after the date of the enactment of this 
                        paragraph, and every 5 years thereafter, each 
                        dollar amount in subparagraph (E)(ii)(II) shall 
                        be adjusted by--
                                  ``(I) dividing the annual value of 
                                the Employment Cost Index For Wages and 
                                Salaries, Private Industry Workers (or 
                                any successor index), as published by 
                                the Bureau of Labor Statistics, for the 
                                calendar year preceding the calendar 
                                year in which the adjustment is being 
                                made by the annual value of such index 
                                (or successor) for the calendar year 
                                ending December 31, 2012; and
                                  ``(II) multiplying such dollar amount 
                                by the quotient obtained under 
                                subclause (I).
                          ``(ii) Rounding.--Each dollar amount 
                        determined under clause (i) shall be rounded to 
                        the nearest multiple of $100,000.''.

SEC. 402. EFFECTIVE DATE.

  This subtitle and any amendment made by this subtitle shall take 
effect on the date that is 90 days after the date of the enactment of 
this Act.

               Subtitle B--Encouraging Employee Ownership

SEC. 406. INCREASED THRESHOLD FOR DISCLOSURES RELATING TO COMPENSATORY 
                    BENEFIT PLANS.

  Not later than 60 days after the date of the enactment of this Act, 
the Securities and Exchange Commission shall revise section 230.701(e) 
of title 17, Code of Federal Regulations, so as to increase from 
$5,000,000 to $20,000,000 the aggregate sales price or amount of 
securities sold during any consecutive 12-month period in excess of 
which the issuer is required under such section to deliver an 
additional disclosure to investors. The Commission shall index for 
inflation such aggregate sales price or amount every 5 years to reflect 
the change in the Consumer Price Index for All Urban Consumers 
published by the Bureau of Labor Statistics, rounding to the nearest 
$1,000,000.

          Subtitle C--Small Company Disclosure Simplification

SEC. 411. EXEMPTION FROM XBRL REQUIREMENTS FOR EMERGING GROWTH 
                    COMPANIES AND OTHER SMALLER COMPANIES.

  (a) Exemption for Emerging Growth Companies.--Emerging growth 
companies are exempted from the requirements to use Extensible Business 
Reporting Language (XBRL) for financial statements and other periodic 
reporting required to be filed with the Commission under the securities 
laws. Such companies may elect to use XBRL for such reporting.
  (b) Exemption for Other Smaller Companies.--Issuers with total annual 
gross revenues of less than $250,000,000 are exempt from the 
requirements to use XBRL for financial statements and other periodic 
reporting required to be filed with the Commission under the securities 
laws. Such issuers may elect to use XBRL for such reporting. An 
exemption under this subsection shall continue in effect until--
          (1) the date that is five years after the date of enactment 
        of this Act; or
          (2) the date that is two years after a determination by the 
        Commission, by order after conducting the analysis required by 
        section 3, that the benefits of such requirements to such 
        issuers outweigh the costs, but no earlier than three years 
        after enactment of this Act.
  (c) Modifications to Regulations.--Not later than 60 days after the 
date of enactment of this Act, the Commission shall revise its 
regulations under parts 229, 230, 232, 239, 240, and 249 of title 17, 
Code of Federal Regulations, to reflect the exemptions set forth in 
subsections (a) and (b).

SEC. 412. ANALYSIS BY THE SEC.

  The Commission shall conduct an analysis of the costs and benefits to 
issuers described in section 411(b) of the requirements to use XBRL for 
financial statements and other periodic reporting required to be filed 
with the Commission under the securities laws. Such analysis shall 
include an assessment of--
          (1) how such costs and benefits may differ from the costs and 
        benefits identified by the Commission in the order relating to 
        interactive data to improve financial reporting (dated January 
        30, 2009; 74 Fed. Reg. 6776) because of the size of such 
        issuers;
          (2) the effects on efficiency, competition, capital 
        formation, and financing and on analyst coverage of such 
        issuers (including any such effects resulting from use of XBRL 
        by investors);
          (3) the costs to such issuers of--
                  (A) submitting data to the Commission in XBRL;
                  (B) posting data on the website of the issuer in 
                XBRL;
                  (C) software necessary to prepare, submit, or post 
                data in XBRL; and
                  (D) any additional consulting services or filing 
                agent services;
          (4) the benefits to the Commission in terms of improved 
        ability to monitor securities markets, assess the potential 
        outcomes of regulatory alternatives, and enhance investor 
        participation in corporate governance and promote capital 
        formation; and
          (5) the effectiveness of standards in the United States for 
        interactive filing data relative to the standards of 
        international counterparts.

SEC. 413. REPORT TO CONGRESS.

  Not later than one year after the date of enactment of this Act, the 
Commission shall provide the Committee on Financial Services of the 
House of Representatives and the Committee on Banking, Housing, and 
Urban Affairs of the Senate a report regarding--
          (1) the progress in implementing XBRL reporting within the 
        Commission;
          (2) the use of XBRL data by Commission officials;
          (3) the use of XBRL data by investors;
          (4) the results of the analysis required by section 412; and
          (5) any additional information the Commission considers 
        relevant for increasing transparency, decreasing costs, and 
        increasing efficiency of regulatory filings with the 
        Commission.

SEC. 414. DEFINITIONS.

  As used in this subtitle, the terms ``Commission'', ``emerging growth 
company'', ``issuer'', and ``securities laws'' have the meanings given 
such terms in section 3 of the Securities Exchange Act of 1934 (15 
U.S.C. 78c).

   Subtitle D--Securities and Exchange Commission Overpayment Credit

SEC. 416. REFUNDING OR CREDITING OVERPAYMENT OF SECTION 31 FEES.

  (a) In General.--Section 31 of the Securities Exchange Act of 1934 
(15 U.S.C. 78ee) is amended by adding at the end the following:
  ``(n) Overpayment.--If a national securities exchange or national 
securities association pays to the Commission an amount in excess of 
fees and assessments due under this section and informs the Commission 
of such amount paid in excess within 10 years of the date of the 
payment, the Commission shall offset future fees and assessments due by 
such exchange or association in an amount equal to such excess 
amount.''.
  (b) Applicability.--The amendment made by this section shall apply to 
any fees and assessments paid before, on, or after the date of 
enactment of this section.

             Subtitle E--Fair Access to Investment Research

SEC. 421. SAFE HARBOR FOR INVESTMENT FUND RESEARCH.

  (a) Expansion of the Safe Harbor.--Not later than the end of the 45-
day period beginning on the date of enactment of this Act, the 
Securities and Exchange Commission shall propose, and not later than 
the end of the 120-day period beginning on such date, the Commission 
shall adopt, upon such terms, conditions, or requirements as the 
Commission may determine necessary or appropriate in the public 
interest, for the protection of investors, and for the promotion of 
capital formation, revisions to section 230.139 of title 17, Code of 
Federal Regulations, to provide that a covered investment fund research 
report that is published or distributed by a broker or dealer--
          (1) shall be deemed, for purposes of sections 2(a)(10) and 
        5(c) of the Securities Act of 1933 (15 U.S.C. 77b(a)(10), 
        77e(c)), not to constitute an offer for sale or an offer to 
        sell a security that is the subject of an offering pursuant to 
        a registration statement that is effective, even if the broker 
        or dealer is participating or will participate in the 
        registered offering of the covered investment fund's 
        securities; and
          (2) shall be deemed to satisfy the conditions of subsection 
        (a)(1) or (a)(2) of section 230.139 of title 17, Code of 
        Federal Regulations, or any successor provisions, for purposes 
        of the Commission's rules and regulations under the Federal 
        securities laws and the rules of any self-regulatory 
        organization.
  (b) Implementation of Safe Harbor.--In implementing the safe harbor 
pursuant to subsection (a), the Commission shall--
          (1) not, in the case of a covered investment fund with a 
        class of securities in substantially continuous distribution, 
        condition the safe harbor on whether the broker's or dealer's 
        publication or distribution of a covered investment fund 
        research report constitutes such broker's or dealer's 
        initiation or reinitiation of research coverage on such covered 
        investment fund or its securities;
          (2) not--
                  (A) require the covered investment fund to have been 
                registered as an investment company under the 
                Investment Company Act of 1940 (15 U.S.C. 80a-1 et 
                seq.) or subject to the reporting requirements of 
                section 13 or 15(d) of the Securities Exchange Act of 
                1934 (15 U.S.C. 78m, 78o(d)) for any period exceeding 
                the period of time referenced under paragraph 
                (a)(1)(i)(A)(1) of section 230.139 of title 17, Code of 
                Federal Regulations; or
                  (B) impose a minimum float provision exceeding that 
                referenced in paragraph (a)(1)(i)(A)(1)(i) of section 
                230.139 of title 17, Code of Federal Regulations;
          (3) provide that a self-regulatory organization may not 
        maintain or enforce any rule that would--
                  (A) prohibit the ability of a member to publish or 
                distribute a covered investment fund research report 
                solely because the member is also participating in a 
                registered offering or other distribution of any 
                securities of such covered investment fund; or
                  (B) prohibit the ability of a member to participate 
                in a registered offering or other distribution of 
                securities of a covered investment fund solely because 
                the member has published or distributed a covered 
                investment fund research report about such covered 
                investment fund or its securities; and
          (4) provide that a covered investment fund research report 
        shall not be subject to section 24(b) of the Investment Company 
        Act of 1940 (15 U.S.C. 80a-24(b)) or the rules and regulations 
        thereunder, except that such report may still be subject to 
        such section and the rules and regulations thereunder to the 
        extent that it is otherwise not subject to the content 
        standards in the rules of any self-regulatory organization 
        related to research reports, including those contained in the 
        rules governing communications with the public regarding 
        investment companies or substantially similar standards.
  (c) Rules of Construction.--Nothing in this Act shall be construed as 
in any way limiting--
          (1) the applicability of the antifraud or antimanipulation 
        provisions of the Federal securities laws and rules adopted 
        thereunder to a covered investment fund research report, 
        including section 17 of the Securities Act of 1933 (15 U.S.C. 
        77q), section 34(b) of the Investment Company Act of 1940 (15 
        U.S.C. 80a-33), and sections 9 and 10 of the Securities 
        Exchange Act of 1934 (15 U.S.C. 78i, 78j); or
          (2) the authority of any self-regulatory organization to 
        examine or supervise a member's practices in connection with 
        such member's publication or distribution of a covered 
        investment fund research report for compliance with applicable 
        provisions of the Federal securities laws or self-regulatory 
        organization rules related to research reports, including those 
        contained in rules governing communications with the public.
  (d) Interim Effectiveness of Safe Harbor.--
          (1) In general.--From and after the 120-day period beginning 
        on the date of enactment of this Act, if the Commission has not 
        adopted revisions to section 230.139 of title 17, Code of 
        Federal Regulations, as required by subsection (a), and until 
        such time as the Commission has done so, a broker or dealer 
        distributing or publishing a covered investment fund research 
        report after such date shall be able to rely on the provisions 
        of section 230.139 of title 17, Code of Federal Regulations, 
        and the broker or dealer's publication of such report shall be 
        deemed to satisfy the conditions of subsection (a)(1) or (a)(2) 
        of section 230.139 of title 17, Code of Federal Regulations, if 
        the covered investment fund that is the subject of such report 
        satisfies the reporting history requirements (without regard to 
        Form S-3 or Form F-3 eligibility) and minimum float provisions 
        of such subsections for purposes of the Commission's rules and 
        regulations under the Federal securities laws and the rules of 
        any self-regulatory organization, as if revised and implemented 
        in accordance with subsections (a) and (b).
          (2) Status of covered investment fund.--After such period and 
        until the Commission has adopted revisions to section 230.139 
        and FINRA has revised rule 2210, for purposes of subsection 
        (c)(7)(O) of such rule, a covered investment fund shall be 
        deemed to be a security that is listed on a national securities 
        exchange and that is not subject to section 24(b) of the 
        Investment Company Act of 1940 (15 U.S.C. 80a-24(b)). 
        Communications concerning only covered investment funds that 
        fall within the scope of such section shall not be required to 
        be filed with FINRA.
  (e) Definitions.--For purposes of this section:
          (1) The term ``covered investment fund research report'' 
        means a research report published or distributed by a broker or 
        dealer about a covered investment fund or any securities issued 
        by the covered investment fund, but not including a research 
        report to the extent that it is published or distributed by the 
        covered investment fund or any affiliate of the covered 
        investment fund.
          (2) The term ``covered investment fund'' means--
                  (A) an investment company registered under, or that 
                has filed an election to be treated as a business 
                development company under, the Investment Company Act 
                of 1940 and that has filed a registration statement 
                under the Securities Act of 1933 for the public 
                offering of a class of its securities, which 
                registration statement has been declared effective by 
                the Commission; and
                  (B) a trust or other person--
                          (i) issuing securities in an offering 
                        registered under the Securities Act of 1933 and 
                        which class of securities is listed for trading 
                        on a national securities exchange;
                          (ii) the assets of which consist primarily of 
                        commodities, currencies, or derivative 
                        instruments that reference commodities or 
                        currencies, or interests in the foregoing; and
                          (iii) that provides in its registration 
                        statement under the Securities Act of 1933 that 
                        a class of its securities are purchased or 
                        redeemed, subject to conditions or limitations, 
                        for a ratable share of its assets.
          (3) The term ``FINRA'' means the Financial Industry 
        Regulatory Authority.
          (4) The term ``research report'' has the meaning given that 
        term under section 2(a)(3) of the Securities Act of 1933 (15 
        U.S.C. 77b(a)(3)), except that such term shall not include an 
        oral communication.
          (5) The term ``self-regulatory organization'' has the meaning 
        given to that term under section 3(a)(26) of the Securities 
        Exchange Act of 1934 (15 U.S.C. 78c(a)(26)).

               Subtitle F--Accelerating Access to Capital

SEC. 426. EXPANDED ELIGIBILITY FOR USE OF FORM S-3.

  Not later than 45 days after the date of the enactment of this Act, 
the Securities and Exchange Commission shall revise Form S-3--
          (1) so as to permit securities to be registered pursuant to 
        General Instruction I.B.1. of such form provided that either--
                  (A) the aggregate market value of the voting and non-
                voting common equity held by non-affiliates of the 
                registrant is $75,000,000 or more; or
                  (B) the registrant has at least one class of common 
                equity securities listed and registered on a national 
                securities exchange; and
          (2) so as to remove the requirement of paragraph (c) from 
        General Instruction I.B.6. of such form.

                  Subtitle G--Enhancing the RAISE Act

SEC. 431. CERTAIN ACCREDITED INVESTOR TRANSACTIONS.

  Section 4 of the Securities Act of 1933 (15 U.S.C. 77d) is amended--
          (1) by amending subsection (d) to read as follows:
  ``(d)(1) The transactions referred to in subsection (a)(7) are 
transactions where--
                  ``(A) each purchaser is an accredited investor, as 
                that term is defined in section 230.501(a) of title 17, 
                Code of Federal Regulations (or any successor thereto); 
                and
                  ``(B) if any securities sold in reliance on 
                subsection (a)(7) are offered by means of any general 
                solicitation or general advertising, all such sales are 
                made through a platform available only to accredited 
                investors.
  ``(2) Securities sold in reliance on subsection (a)(7) shall be 
deemed to have been acquired in a transaction not involving any public 
offering.
  ``(3) The exemption provided by this subsection shall not be 
available for a transaction where the seller is--
          ``(A) an issuer, its subsidiaries or parent;
          ``(B) an underwriter acting on behalf of the issuer, its 
        subsidiaries or parent, which receives compensation from the 
        issuer with respect to such sale; or
          ``(C) a dealer.
  ``(4) A transaction meeting the requirements of this subsection shall 
be deemed not to be a distribution for purposes of section 2(a)(11).''; 
and
          (2) by striking subsection (e).

             Subtitle H--Small Business Credit Availability

SEC. 436. BUSINESS DEVELOPMENT COMPANY OWNERSHIP OF SECURITIES OF 
                    INVESTMENT ADVISERS AND CERTAIN FINANCIAL 
                    COMPANIES.

  (a) In General.--Section 60 of the Investment Company Act of 1940 (15 
U.S.C. 80a-59) is amended--
          (1) by striking ``Notwithstanding'' and inserting ``(a) 
        Notwithstanding'';
          (2) by striking ``except that the Commission shall not'' and 
        inserting the following: ``except that--
          ``(1) section 12 shall not apply to the purchasing, otherwise 
        acquiring, or holding by a business development company of any 
        security issued by, or any other interest in the business of, 
        any person who is an investment adviser registered under title 
        II of this Act, who is an investment adviser to an investment 
        company, or who is an eligible portfolio company; and
          ``(2) the Commission shall not'';
          (3) by adding at the end the following:
  ``(b) Nothing in this section shall prevent the Commission from 
issuing rules to address potential conflicts of interest between 
business development companies and investment advisers.''.
  (b) Definition of Eligible Portfolio Company.--Section 2(a)(46)(B) of 
the Investment Company Act of 1940 (15 U.S.C. 80a-2(a)(46)(B)) is 
amended by inserting before the semicolon the following: ``(unless it 
is described in paragraph (2), (3), (4), (5), (6), or (9) of such 
section)''.
  (c) Investment Threshold.--Section 55(a) of the Investment Company 
Act of 1940 is amended by inserting before the colon the following: ``, 
provided that no more than 50 percent of its total assets are assets 
described in section 3(c)''.

SEC. 437. EXPANDING ACCESS TO CAPITAL FOR BUSINESS DEVELOPMENT 
                    COMPANIES.

  (a) In General.--Section 61(a) of the Investment Company Act of 1940 
(15 U.S.C. 80a-60(a)) is amended--
          (1) by redesignating paragraphs (2) through (4) as paragraphs 
        (3) through (5), respectively;
          (2) by striking paragraph (1) and inserting the following:
          ``(1) Except as provided in paragraph (2), the asset coverage 
        requirements of subparagraphs (A) and (B) of section 18(a)(1) 
        (and any related rule promulgated under this Act) applicable to 
        business development companies shall be 200 percent.
          ``(2) The asset coverage requirements of subparagraphs (A) 
        and (B) of section 18(a)(1) and of subparagraphs (A) and (B) of 
        section 18(a)(2) (and any related rule promulgated under this 
        Act) applicable to a business development company shall be 150 
        percent if--
                  ``(A) within five business days of the approval of 
                the adoption of the asset coverage requirements 
                described in clause (ii), the business development 
                company discloses such approval and the date of its 
                effectiveness in a Form 8-K filed with the Commission 
                and in a notice on its website and discloses in its 
                periodic filings made under section 13 of the 
                Securities and Exchange Act of 1934 (15 U.S.C. 78m)--
                          ``(i) the aggregate value of the senior 
                        securities issued by such company and the asset 
                        coverage percentage as of the date of such 
                        company's most recent financial statements; and
                          ``(ii) that such company has adopted the 
                        asset coverage requirements of this 
                        subparagraph and the effective date of such 
                        requirements;
                  ``(B) with respect to a business development company 
                that issues equity securities that are registered on a 
                national securities exchange, the periodic filings of 
                the company under section 13(a) of the Securities 
                Exchange Act of 1934 (15 U.S.C. 78m) include 
                disclosures reasonably designed to ensure that 
                shareholders are informed of--
                          ``(i) the amount of indebtedness and asset 
                        coverage ratio of the company, determined as of 
                        the date of the financial statements of the 
                        company dated on or most recently before the 
                        date of such filing; and
                          ``(ii) the principal risk factors associated 
                        with such indebtedness, to the extent such risk 
                        is incurred by the company; and
                  ``(C)(i) the application of this paragraph to the 
                company is approved by the required majority (as 
                defined in section 57(o)) of the directors of or 
                general partners of such company who are not interested 
                persons of the business development company, which 
                application shall become effective on the date that is 
                1 year after the date of the approval, and, with 
                respect to a business development company that issues 
                equity securities that are not registered on a national 
                securities exchange, the company extends, to each 
                person who is a shareholder as of the date of the 
                approval, an offer to repurchase the equity securities 
                held by such person as of such approval date, with 25 
                percent of such securities to be repurchased in each of 
                the four quarters following such approval date; or
                  ``(ii) the company obtains, at a special or annual 
                meeting of shareholders or partners at which a quorum 
                is present, the approval of more than 50 percent of the 
                votes cast of the application of this paragraph to the 
                company, which application shall become effective on 
                the date immediately after the date of the approval.'';
          (3) in paragraph (3) (as redesignated), by inserting ``or 
        which is a stock'' after ``indebtedness'';
          (4) in subparagraph (A) of paragraph (4) (as redesignated)--
                  (A) in the matter preceding clause (i), by striking 
                ``voting''; and
                  (B) by amending clause (iii) to read as follows:
                          ``(iii) the exercise or conversion price at 
                        the date of issuance of such warrants, options, 
                        or rights is not less than--
                                  ``(I) the market value of the 
                                securities issuable upon the exercise 
                                of such warrants, options, or rights at 
                                the date of issuance of such warrants, 
                                options, or rights; or
                                  ``(II) if no such market value 
                                exists, the net asset value of the 
                                securities issuable upon the exercise 
                                of such warrants, options, or rights at 
                                the date of issuance of such warrants, 
                                options, or rights; and''; and
          (5) by adding at the end the following:
          ``(6)(A) Except as provided in subparagraph (B), the 
        following shall not apply to a business development company:
                  ``(i) Subparagraphs (C) and (D) of section 18(a)(2).
                  ``(ii) Subparagraph (E) of section 18(a)(2), to the 
                extent such subparagraph requires any priority over any 
                other class of stock as to distribution of assets upon 
                liquidation.
                  ``(iii) With respect to a senior security which is a 
                stock, subsections (c) and (i) of section 18.
          ``(B) Subparagraph (A) shall not apply with respect to 
        preferred stock issued to a person who is not known by the 
        company to be a qualified institutional buyer (as defined in 
        section 3(a) of the Securities Exchange Act of 1934).''.
  (b) Conforming Amendments.--The Investment Company Act of 1940 (15 
U.S.C. 80a-1 et seq.) is amended--
          (1) in section 57--
                  (A) in subsection (j)(1), by striking ``section 
                61(a)(3)(B)'' and inserting ``section 61(a)(4)(B)''; 
                and
                  (B) in subsection (n)(2), by striking ``section 
                61(a)(3)(B)'' and inserting ``section 61(a)(4)(B)''; 
                and
          (2) in section 63(3), by striking ``section 61(a)(3)'' and 
        inserting ``section 61(a)(4)''.

SEC. 438. PARITY FOR BUSINESS DEVELOPMENT COMPANIES REGARDING OFFERING 
                    AND PROXY RULES.

  (a) Revision to Rules.--Not later than 1 year after the date of 
enactment of this Act, the Securities and Exchange Commission shall 
revise any rules to the extent necessary to allow a business 
development company that has filed an election pursuant to section 54 
of the Investment Company Act of 1940 (15 U.S.C. 80a-53) to use the 
securities offering and proxy rules that are available to other issuers 
that are required to file reports under section 13 or section 15(d) of 
the Securities Exchange Act of 1934 (15 U.S.C. 78m; 78o(d)). Any action 
that the Commission takes pursuant to this subsection shall include the 
following:
          (1) The Commission shall revise rule 405 under the Securities 
        Act of 1933 (17 C.F.R. 230.405)--
                  (A) to remove the exclusion of a business development 
                company from the definition of a well-known seasoned 
                issuer provided by that rule; and
                  (B) to add registration statements filed on Form N-2 
                to the definition of automatic shelf registration 
                statement provided by that rule.
          (2) The Commission shall revise rules 168 and 169 under the 
        Securities Act of 1933 (17 C.F.R. 230.168 and 230.169) to 
        remove the exclusion of a business development company from an 
        issuer that can use the exemptions provided by those rules.
          (3) The Commission shall revise rules 163 and 163A under the 
        Securities Act of 1933 (17 C.F.R. 230.163 and 230.163A) to 
        remove a business development company from the list of issuers 
        that are ineligible to use the exemptions provided by those 
        rules.
          (4) The Commission shall revise rule 134 under the Securities 
        Act of 1933 (17 C.F.R. 230.134) to remove the exclusion of a 
        business development company from that rule.
          (5) The Commission shall revise rules 138 and 139 under the 
        Securities Act of 1933 (17 C.F.R. 230.138 and 230.139) to 
        specifically include a business development company as an 
        issuer to which those rules apply.
          (6) The Commission shall revise rule 164 under the Securities 
        Act of 1933 (17 C.F.R. 230.164) to remove a business 
        development company from the list of issuers that are excluded 
        from that rule.
          (7) The Commission shall revise rule 433 under the Securities 
        Act of 1933 (17 C.F.R. 230.433) to specifically include a 
        business development company that is a well-known seasoned 
        issuer as an issuer to which that rule applies.
          (8) The Commission shall revise rule 415 under the Securities 
        Act of 1933 (17 C.F.R. 230.415)--
                  (A) to state that the registration for securities 
                provided by that rule includes securities registered by 
                a business development company on Form N-2; and
                  (B) to provide an exception for a business 
                development company from the requirement that a Form N-
                2 registrant must furnish the undertakings required by 
                item 34.4 of Form N-2.
          (9) The Commission shall revise rule 497 under the Securities 
        Act of 1933 (17 C.F.R. 230.497) to include a process for a 
        business development company to file a form of prospectus that 
        is parallel to the process for filing a form of prospectus 
        under rule 424(b).
          (10) The Commission shall revise rules 172 and 173 under the 
        Securities Act of 1933 (17 C.F.R. 230.172 and 230.173) to 
        remove the exclusion of an offering of a business development 
        company from those rules.
          (11) The Commission shall revise rule 418 under the 
        Securities Act of 1933 (17 C.F.R. 230.418) to provide that a 
        business development company that would otherwise meet the 
        eligibility requirements of General Instruction I.A of Form S-3 
        shall be exempt from paragraph (a)(3) of that rule.
          (12) The Commission shall revise rule 14a-101 under the 
        Securities Exchange Act of 1934 (17 C.F.R. 240.14a-101) to 
        provide that a business development company that would 
        otherwise meet the requirements of General Instruction I.A of 
        Form S-3 shall be deemed to meet the requirements of Form S-3 
        for purposes of Schedule 14A.
          (13) The Commission shall revise rule 103 under Regulation FD 
        (17 C.F.R. 243.103) to provide that paragraph (a) of that rule 
        applies for purposes of Form N-2.
  (b) Revision to Form N-2.--Not later than 1 year after the date of 
enactment of this Act, the Commission shall revise Form N-2--
          (1) to include an item or instruction that is similar to item 
        12 on Form S-3 to provide that a business development company 
        that would otherwise meet the requirements of Form S-3 shall 
        incorporate by reference its reports and documents filed under 
        the Securities Exchange Act of 1934 into its registration 
        statement filed on Form N-2; and
          (2) to include an item or instruction that is similar to the 
        instruction regarding automatic shelf offerings by well-known 
        seasoned issuers on Form S-3 to provide that a business 
        development company that is a well-known seasoned issuer may 
        file automatic shelf offerings on Form N-2.
  (c) Treatment if Revisions Not Completed in Timely Manner.--If the 
Commission fails to complete the revisions required by subsections (a) 
and (b) by the time required by such subsections, a business 
development company shall be entitled to treat such revisions as having 
been completed in accordance with the actions required to be taken by 
the Commission by such subsections until such time as such revisions 
are completed by the Commission.
  (d) Rule of Construction.--Any reference in this section to a rule or 
form means such rule or form or any successor rule or form.

                    Subtitle I--Fostering Innovation

SEC. 441. TEMPORARY EXEMPTION FOR LOW-REVENUE ISSUERS.

  Section 404 of the Sarbanes-Oxley Act of 2002 (15 U.S.C. 7262) is 
amended by adding at the end the following:
  ``(d) Temporary Exemption for Low-Revenue Issuers.--
          ``(1) Low-revenue exemption.--Subsection (b) shall not apply 
        with respect to an audit report prepared for an issuer that--
                  ``(A) ceased to be an emerging growth company on the 
                last day of the fiscal year of the issuer following the 
                fifth anniversary of the date of the first sale of 
                common equity securities of the issuer pursuant to an 
                effective registration statement under the Securities 
                Act of 1933;
                  ``(B) had average annual gross revenues of less than 
                $50,000,000 as of its most recently completed fiscal 
                year; and
                  ``(C) is not a large accelerated filer.
          ``(2) Expiration of temporary exemption.--An issuer ceases to 
        be eligible for the exemption described under paragraph (1) at 
        the earliest of--
                  ``(A) the last day of the fiscal year of the issuer 
                following the tenth anniversary of the date of the 
                first sale of common equity securities of the issuer 
                pursuant to an effective registration statement under 
                the Securities Act of 1933;
                  ``(B) the last day of the fiscal year of the issuer 
                during which the average annual gross revenues of the 
                issuer exceed $50,000,000; or
                  ``(C) the date on which the issuer becomes a large 
                accelerated filer.
          ``(3) Definitions.--For purposes of this subsection:
                  ``(A) Average annual gross revenues.--The term 
                `average annual gross revenues' means the total gross 
                revenues of an issuer over its most recently completed 
                three fiscal years divided by three.
                  ``(B) Emerging growth company.--The term `emerging 
                growth company' has the meaning given such term under 
                section 3 of the Securities Exchange Act of 1934 (15 
                U.S.C. 78c).
                  ``(C) Large accelerated filer.--The term `large 
                accelerated filer' has the meaning given that term 
                under section 240.12b-2 of title 17, Code of Federal 
                Regulations, or any successor thereto.''.

        Subtitle J--Small Business Capital Formation Enhancement

SEC. 446. ANNUAL REVIEW OF GOVERNMENT-BUSINESS FORUM ON CAPITAL 
                    FORMATION.

  Section 503 of the Small Business Investment Incentive Act of 1980 
(15 U.S.C. 80c-1) is amended by adding at the end the following:
  ``(e) The Commission shall--
          ``(1) review the findings and recommendations of the forum; 
        and
          ``(2) each time the forum submits a finding or recommendation 
        to the Commission, promptly issue a public statement--
                  ``(A) assessing the finding or recommendation of the 
                forum; and
                  ``(B) disclosing the action, if any, the Commission 
                intends to take with respect to the finding or 
                recommendation.''.

              Subtitle K--Helping Angels Lead Our Startups

SEC. 451. DEFINITION OF ANGEL INVESTOR GROUP.

  As used in this subtitle, the term ``angel investor group'' means any 
group that--
          (1) is composed of accredited investors interested in 
        investing personal capital in early-stage companies;
          (2) holds regular meetings and has defined processes and 
        procedures for making investment decisions, either individually 
        or among the membership of the group as a whole; and
          (3) is neither associated nor affiliated with brokers, 
        dealers, or investment advisers.

SEC. 452. CLARIFICATION OF GENERAL SOLICITATION.

  (a) In General.--Not later than 6 months after the date of enactment 
of this Act, the Securities and Exchange Commission shall revise 
Regulation D of its rules (17 C.F.R. 230.500 et seq.) to require that 
in carrying out the prohibition against general solicitation or general 
advertising contained in section 230.502(c) of title 17, Code of 
Federal Regulations, the prohibition shall not apply to a presentation 
or other communication made by or on behalf of an issuer which is made 
at an event--
          (1) sponsored by--
                  (A) the United States or any territory thereof, by 
                the District of Columbia, by any State, by a political 
                subdivision of any State or territory, or by any agency 
                or public instrumentality of any of the foregoing;
                  (B) a college, university, or other institution of 
                higher education;
                  (C) a nonprofit organization;
                  (D) an angel investor group;
                  (E) a venture forum, venture capital association, or 
                trade association; or
                  (F) any other group, person or entity as the 
                Securities and Exchange Commission may determine by 
                rule;
          (2) where any advertising for the event does not reference 
        any specific offering of securities by the issuer;
          (3) the sponsor of which--
                  (A) does not make investment recommendations or 
                provide investment advice to event attendees;
                  (B) does not engage in an active role in any 
                investment negotiations between the issuer and 
                investors attending the event;
                  (C) does not charge event attendees any fees other 
                than administrative fees; and
                  (D) does not receive any compensation with respect to 
                such event that would require registration of the 
                sponsor as a broker or a dealer under the Securities 
                Exchange Act of 1934, or as an investment advisor under 
                the Investment Advisers Act of 1940; and
          (4) where no specific information regarding an offering of 
        securities by the issuer is communicated or distributed by or 
        on behalf of the issuer, other than--
                  (A) that the issuer is in the process of offering 
                securities or planning to offer securities;
                  (B) the type and amount of securities being offered;
                  (C) the amount of securities being offered that have 
                already been subscribed for; and
                  (D) the intended use of proceeds of the offering.
  (b) Rule of Construction.--Subsection (a) may only be construed as 
requiring the Securities and Exchange Commission to amend the 
requirements of Regulation D with respect to presentations and 
communications, and not with respect to purchases or sales.

                     Subtitle L--Main Street Growth

SEC. 456. VENTURE EXCHANGES.

  (a) Securities Exchange Act of 1934.--Section 6 of the Securities 
Exchange Act of 1934 (15 U.S.C. 78f) is amended by adding at the end 
the following:
  ``(m) Venture Exchange.--
          ``(1) Registration.--
                  ``(A) In general.--A national securities exchange may 
                elect to be treated (or for a listing tier of such 
                exchange to be treated) as a venture exchange by 
                notifying the Commission of such election, either at 
                the time the exchange applies to be registered as a 
                national securities exchange or after registering as a 
                national securities exchange.
                  ``(B) Determination time period.--With respect to a 
                securities exchange electing to be treated (or for a 
                listing tier of such exchange to be treated) as a 
                venture exchange--
                          ``(i) at the time the exchange applies to be 
                        registered as a national securities exchange, 
                        such application and election shall be deemed 
                        to have been approved by the Commission unless 
                        the Commission denies such application before 
                        the end of the 6-month period beginning on the 
                        date the Commission received such application; 
                        and
                          ``(ii) after registering as a national 
                        securities exchange, such election shall be 
                        deemed to have been approved by the Commission 
                        unless the Commission denies such approval 
                        before the end of the 6-month period beginning 
                        on the date the Commission received 
                        notification of such election.
          ``(2) Powers and restrictions.--A venture exchange--
                  ``(A) may only constitute, maintain, or provide a 
                market place or facilities for bringing together 
                purchasers and sellers of venture securities;
                  ``(B) may determine the increment to be used for 
                quoting and trading venture securities on the exchange;
                  ``(C) shall disseminate last sale and quotation 
                information on terms that are fair and reasonable and 
                not unreasonably discriminatory;
                  ``(D) may choose to carry out periodic auctions for 
                the sale of a venture security instead of providing 
                continuous trading of the venture security; and
                  ``(E) may not extend unlisted trading privileges to 
                any venture security.
          ``(3) Exemptions from certain national security exchange 
        regulations.--A venture exchange shall not be required to--
                  ``(A) comply with any of sections 242.600 through 
                242.612 of title 17, Code of Federal Regulations;
                  ``(B) comply with any of sections 242.300 through 
                242.303 of title 17, Code of Federal Regulations;
                  ``(C) submit any data to a securities information 
                processor; or
                  ``(D) use decimal pricing.
          ``(4) Treatment of certain exempted securities.--A security 
        that is exempt from registration pursuant to section 3(b) of 
        the Securities Act of 1933 shall be exempt from section 12(a) 
        of this title with respect to the trading of such security on a 
        venture exchange, if the issuer of such security is in 
        compliance with all disclosure obligations of such section 3(b) 
        and the regulations issued under such section.
          ``(5) Definitions.--For purposes of this subsection:
                  ``(A) Early-stage, growth company.--
                          ``(i) In general.--The term `early-stage, 
                        growth company' means an issuer--
                                  ``(I) that has not made an initial 
                                public offering of any securities of 
                                the issuer; and
                                  ``(II) with a market capitalization 
                                of $1,000,000,000 (as such amount is 
                                indexed for inflation every 5 years by 
                                the Commission to reflect the change in 
                                the Consumer Price Index for All Urban 
                                Consumers published by the Bureau of 
                                Labor Statistics, setting the threshold 
                                to the nearest $1,000,000) or less.
                          ``(ii) Treatment when market capitalization 
                        exceeds threshold.--
                                  ``(I) In general.--In the case of an 
                                issuer that is an early-stage, growth 
                                company the securities of which are 
                                traded on a venture exchange, such 
                                issuer shall not cease to be an early-
                                stage, growth company by reason of the 
                                market capitalization of such issuer 
                                exceeding the threshold specified in 
                                clause (i)(II) until the end of the 
                                period of 24 consecutive months during 
                                which the market capitalization of such 
                                issuer exceeds $2,000,000,000 (as such 
                                amount is indexed for inflation every 5 
                                years by the Commission to reflect the 
                                change in the Consumer Price Index for 
                                All Urban Consumers published by the 
                                Bureau of Labor Statistics, setting the 
                                threshold to the nearest $1,000,000).
                                  ``(II) Exemptions.--If an issuer 
                                would cease to be an early-stage, 
                                growth company under subclause (I), the 
                                venture exchange may, at the request of 
                                the issuer, exempt the issuer from the 
                                market capitalization requirements of 
                                this subparagraph for the 1-year period 
                                that begins on the day after the end of 
                                the 24-month period described in such 
                                subclause. The venture exchange may, at 
                                the request of the issuer, extend the 
                                exemption for 1 additional year.
                  ``(B) Venture security.--The term `venture security' 
                means--
                          ``(i) securities of an early-stage, growth 
                        company that are exempt from registration 
                        pursuant to section 3(b) of the Securities Act 
                        of 1933; and
                          ``(ii) securities of an emerging growth 
                        company.''.
  (b) Securities Act of 1933.--Section 18(b)(1) of the Securities Act 
of 1933 (15 U.S.C. 77r(b)(1)) is amended--
          (1) in subparagraph (B), by striking ``or'' at the end;
          (2) in subparagraph (C), by striking the period and inserting 
        ``; or''; and
          (3) by adding at the end the following:
                  ``(D) a venture security, as defined under section 
                6(m)(5) of the Securities Exchange Act of 1934.''.
  (c) Sense of Congress.--It is the sense of the Congress that the 
Securities and Exchange Commission should--
          (1) when necessary or appropriate in the public interest and 
        consistent with the protection of investors, make use of the 
        Commission's general exemptive authority under section 36 of 
        the Securities Exchange Act of 1934 (15 U.S.C. 78mm) with 
        respect to the provisions added by this section; and
          (2) if the Commission determines appropriate, create an 
        Office of Venture Exchanges within the Commission's Division of 
        Trading and Markets.
  (d) Rule of Construction.--Nothing in this section or the amendments 
made by this section shall be construed to impair or limit the 
construction of the antifraud provisions of the securities laws (as 
defined in section 3(a) of the Securities Exchange Act of 1934 (15 
U.S.C. 78c(a))) or the authority of the Securities and Exchange 
Commission under those provisions.
  (e) Effective Date for Tiers of Existing National Securities 
Exchanges.--In the case of a securities exchange that is registered as 
a national securities exchange under section 6 of the Securities 
Exchange Act of 1934 (15 U.S.C. 78f) on the date of the enactment of 
this Act, any election for a listing tier of such exchange to be 
treated as a venture exchange under subsection (m) of such section 
shall not take effect before the date that is 180 days after such date 
of enactment.

                 Subtitle M--Micro Offering Safe Harbor

SEC. 461. EXEMPTIONS FOR MICRO-OFFERINGS.

  (a) In General.--Section 4 of the Securities Act of 1933 (15 U.S.C. 
77d) is amended--
          (1) in subsection (a), by adding at the end the following:
          ``(8) transactions meeting the requirements of subsection 
        (e).''; and
          (2) as amended by section 434(2), by adding at the end the 
        following:
  ``(e) Certain Micro-Offerings.--The transactions referred to in 
subsection (a)(8) are transactions involving the sale of securities by 
an issuer (including all entities controlled by or under common control 
with the issuer) that meet all of the following requirements:
          ``(1) Pre-existing relationship.--Each purchaser has a 
        substantive pre-existing relationship with an officer of the 
        issuer, a director of the issuer, or a shareholder holding 10 
        percent or more of the shares of the issuer.
          ``(2) 35 or fewer purchasers.--There are no more than, or the 
        issuer reasonably believes that there are no more than, 35 
        purchasers of securities from the issuer that are sold in 
        reliance on the exemption provided under subsection (a)(8) 
        during the 12-month period preceding such transaction.
          ``(3) Small offering amount.--The aggregate amount of all 
        securities sold by the issuer, including any amount sold in 
        reliance on the exemption provided under subsection (a)(8), 
        during the 12-month period preceding such transaction, does not 
        exceed $500,000.''.
  (b) Exemption Under State Regulations.--Section 18(b)(4) of the 
Securities Act of 1933 (15 U.S.C. 77r(b)(4)) is amended--
          (1) in subparagraph (F), by striking ``or'' at the end;
          (2) in subparagraph (G), by striking the period and inserting 
        ``; or''; and
          (3) by adding at the end the following:
                  ``(H) section 4(a)(8).''.

               Subtitle N--Private Placement Improvement

SEC. 466. REVISIONS TO SEC REGULATION D.

  Not later than 45 days following the date of the enactment of this 
Act, the Securities and Exchange Commission shall revise Regulation D 
(17 C.F.R. 501 et seq.) in accordance with the following:
          (1) The Commission shall revise Form D filing requirements to 
        require an issuer offering or selling securities in reliance on 
        an exemption provided under Rule 506 of Regulation D to file 
        with the Commission a single notice of sales containing the 
        information required by Form D for each new offering of 
        securities no earlier than 15 days after the date of the first 
        sale of securities in the offering. The Commission shall not 
        require such an issuer to file any notice of sales containing 
        the information required by Form D except for the single notice 
        described in the previous sentence.
          (2) The Commission shall make the information contained in 
        each Form D filing available to the securities commission (or 
        any agency or office performing like functions) of each State 
        and territory of the United States and the District of 
        Columbia.
          (3) The Commission shall not condition the availability of 
        any exemption for an issuer under Rule 506 of Regulation D (17 
        C.F.R. 230.506) on the issuer's or any other person's filing 
        with the Commission of a Form D or any similar report.
          (4) The Commission shall not require issuers to submit 
        written general solicitation materials to the Commission in 
        connection with a Rule 506(c) offering, except when the 
        Commission requests such materials pursuant to the Commission's 
        authority under section 8A or section 20 of the Securities Act 
        of 1933 (15 U.S.C. 77h-1 or 77t) or section 9, 10(b), 21A, 21B, 
        or 21C of the Securities Exchange Act of 1934 (15 U.S.C. 78i, 
        78j(b), 78u-1, 78u-2, or 78u-3).
          (5) The Commission shall not extend the requirements 
        contained in Rule 156 to private funds.
          (6) The Commission shall revise Rule 501(a) of Regulation D 
        to provide that a person who is a ``knowledgeable employee'' of 
        a private fund or the fund's investment adviser, as defined in 
        Rule 3c-5(a)(4) (17 C.F.R. 270.3c-5(a)(4)), shall be an 
        accredited investor for purposes of a Rule 506 offering of a 
        private fund with respect to which the person is a 
        knowledgeable employee.

              Subtitle O--Supporting America's Innovators

SEC. 471. INVESTOR LIMITATION FOR QUALIFYING VENTURE CAPITAL FUNDS.

  Section 3(c)(1) of the Investment Company Act of 1940 (15 U.S.C. 80a-
3(c)(1)) is amended--
          (1) by inserting after ``one hundred persons'' the following: 
        ``(or, with respect to a qualifying venture capital fund, 500 
        persons)''; and
          (2) by adding at the end the following:
                  ``(C) The term `qualifying venture capital fund' 
                means any venture capital fund (as defined pursuant to 
                section 203(l)(1) of the Investment Advisers Act of 
                1940 (15 U.S.C. 80b-3(l)(1)) with no more than 
                $50,000,000 in aggregate capital contributions and 
                uncalled committed capital, as such dollar amount is 
                annually adjusted by the Commission to reflect the 
                change in the Consumer Price Index for All Urban 
                Consumers published by the Bureau of Labor Statistics 
                of the Department of Labor.''.

                      Subtitle P--Fix Crowdfunding

SEC. 476. CROWDFUNDING EXEMPTION.

  (a) Securities Act of 1933.--Section 4(a) of the Securities Act of 
1933 (15 U.S.C. 77d) is amended by striking paragraph (6) and inserting 
the following:
          ``(6) transactions involving the offer or sale of securities 
        by an issuer, provided that--
                  ``(A) in the case of a transaction involving an 
                intermediary between the issuer and the investor, such 
                intermediary complies with the requirements under 
                section 4A(a); and
                  ``(B) in the case of a transaction not involving an 
                intermediary between the issuer and the investor, the 
                issuer complies with the requirements under section 
                4A(b).''.
  (b) Requirements to Qualify for Crowdfunding Exemption.--Section 4A 
of the Securities Act of 1933 (15 U.S.C. 77d-1) is amended to read as 
follows:

``SEC. 4A. REQUIREMENTS WITH RESPECT TO CERTAIN SMALL TRANSACTIONS.

  ``(a) Requirements on Intermediaries.--For purposes of section 
4(a)(6), a person acting as an intermediary in a transaction involving 
the offer or sale of securities shall comply with the requirements of 
this subsection if the intermediary--
          ``(1) warns investors, including on the intermediary's 
        website used for the offer and sale of such securities, of the 
        speculative nature generally applicable to investments in 
        startups, emerging businesses, and small issuers, including 
        risks in the secondary market related to illiquidity;
          ``(2) warns investors that they are subject to the 
        restriction on sales requirement described under subsection 
        (e);
          ``(3) takes reasonable measures to reduce the risk of fraud 
        with respect to such transaction;
          ``(4) registers with the Commission and the Financial 
        Industry Regulatory Authority, including by providing the 
        Commission with the intermediary's physical address, website 
        address, and the names of the intermediary and employees of the 
        intermediary, and keep such information up-to-date;
          ``(5) provides the Commission with continuous investor-level 
        access to the intermediary's website;
          ``(6) requires each potential investor to answer questions 
        demonstrating--
                  ``(A) an understanding of the level of risk generally 
                applicable to investments in startups, emerging 
                businesses, and small issuers;
                  ``(B) an understanding of the risk of illiquidity; 
                and
                  ``(C) such other areas as the Commission may 
                determine appropriate by rule or regulation, including 
                information relating to the owners' and management's 
                experience, and any related party transactions and 
                conflicts of interest;
          ``(7) carries out a background check on the issuer's 
        principals;
          ``(8) provides the Commission and potential investors with 
        notice of the offering not less than 10 days prior to such 
        offering, not later than the first day securities are offered 
        to potential investors, including--
                  ``(A) the issuer's name, legal status, physical 
                address, and website address;
                  ``(B) the names of the issuer's principals;
                  ``(C) the stated purpose and intended use of the 
                proceeds of the offering sought by the issuer; and
                  ``(D) the target offering amount and the deadline to 
                reach the target offering amount;
          ``(9) outsources cash-management functions to a qualified 
        third party custodian, such as a broker or dealer registered 
        under section 15(b)(1) of the Securities Exchange Act of 1934, 
        a trust company, or an insured depository institution;
          ``(10) makes available on the intermediary's website a method 
        of communication that permits the issuer and investors to 
        communicate with one another;
          ``(11) provides the Commission with a notice upon completion 
        of the offering, which shall include the aggregate offering 
        amount and the number of purchasers; and
  ``(b) Requirements on Issuers if No Intermediary.--For purposes of 
section 4(a)(6), an issuer who offers or sells securities without an 
intermediary shall comply with the requirements of this subsection if 
the issuer--
          ``(1) warns investors, including on the issuer's website, of 
        the speculative nature generally applicable to investments in 
        startups, emerging businesses, and small issuers, including 
        risks in the secondary market related to illiquidity;
          ``(2) warns investors that they are subject to the 
        restriction on sales requirement described under subsection 
        (e);
          ``(3) takes reasonable measures to reduce the risk of fraud 
        with respect to such transaction;
          ``(4) provides the Commission with the issuer's physical 
        address, website address, and the names of the principals and 
        employees of the issuers, and keeps such information up-to-
        date;
          ``(5) provides the Commission with continuous investor-level 
        access to the issuer's website;
          ``(6) requires each potential investor to answer questions 
        demonstrating--
                  ``(A) an understanding of the level of risk generally 
                applicable to investments in startups, emerging 
                businesses, and small issuers;
                  ``(B) an understanding of the risk of illiquidity; 
                and
                  ``(C) such other areas as the Commission may 
                determine appropriate by rule or regulation;
          ``(7) provides the Commission with notice of the offering not 
        less than 10 days prior to such offering, not later than the 
        first day securities are offered to potential investors, 
        including--
                  ``(A) the stated purpose and intended use of the 
                proceeds of the offering sought by the issuer; and
                  ``(B) the target offering amount and the deadline to 
                reach the target offering amount;
          ``(8) outsources cash-management functions to a qualified 
        third party custodian, such as a broker or dealer registered 
        under section 15(b)(1) of the Securities Exchange Act of 1934, 
        a trust company, or an insured depository institution;
          ``(9) makes available on the issuer's website a method of 
        communication that permits the issuer and investors to 
        communicate with one another;
          ``(10) does not offer personalized investment advice;
          ``(11) provides the Commission with a notice upon completion 
        of the offering, which shall include the aggregate offering 
        amount and the number of purchasers; and
  ``(c) Verification of Income.--For purposes of section 4(a)(6), an 
issuer or intermediary may rely on certifications as to annual income 
provided by the person to whom the securities are sold to verify the 
investor's income.
  ``(d) Information Available to States.--The Commission shall make the 
notices described under subsections (a)(9), (a)(13), (b)(8), and 
(b)(13) and the information described under subsections (a)(4) and 
(b)(4) available to the States.
  ``(e) Restriction on Sales.--With respect to a transaction involving 
the issuance of securities described under section 4(a)(6), a purchaser 
may not transfer such securities during the 1-year period beginning on 
the date of purchase, unless such securities are sold to--
          ``(1) the issuer of such securities; or
          ``(2) an accredited investor.
  ``(f) Construction.--
          ``(1) No registration as broker.--With respect to a 
        transaction described under section 4(a)(6) involving an 
        intermediary, such intermediary shall not be required to 
        register as a broker under section 15(a)(1) of the Securities 
        Exchange Act of 1934 solely by reason of participation in such 
        transaction.
          ``(2) No preclusion of other capital raising.--Nothing in 
        this section or section 4(a)(6) shall be construed as 
        preventing an issuer from raising capital through methods not 
        described under section 4(a)(6).''.
  (c) Rulemaking.--Not later than 180 days after the date of enactment 
of this Act, the Securities and Exchange Commission shall issue or 
revise such rules as may be necessary to carry out section 4A of the 
Securities Act of 1933, ans amended by this Act. In issuing or revising 
such rules, the Commission shall consider the costs and benefits of the 
action.
  (d) Disqualification.--Not later than 180 days after the date of 
enactment of this Act, the Securities and Exchange Commission shall by 
rule or regulation establish disqualification provisions under which an 
issuer shall not be eligible to utilize the exemption under section 
4(a)(6) of the Securities Act of 1933 (as amended by this Act) based on 
the disciplinary history of the issuer or its predecessors, affiliates, 
officers, directors, or persons fulfilling similar roles. The 
Commission shall also establish disqualification provisions under which 
an intermediary shall not be eligible to act as an intermediary in 
connection with an offering utilizing the exemption under section 
4(a)(6) of the Securities Act of 1933 based on the disciplinary history 
of the intermediary or its predecessors, affiliates, officers, 
directors, or persons fulfilling similar roles. Such provisions shall 
be substantially similar to the disqualification provisions contained 
in the regulations adopted in accordance with section 926 of the Dodd-
Frank Wall Street Reform and Consumer Protection Act (15 U.S.C. 77d 
note).

SEC. 477. EXCLUSION OF CROWDFUNDING INVESTORS FROM SHAREHOLDER CAP.

  Section 12(g)(5) of the Securities Exchange Act of 1934 (15 U.S.C. 
78l(g)(5)) is amended--
          (1) by striking ``(5) For the purposes'' and inserting:
          ``(5) Definitions.--
                  ``(A) In general.--For the purposes''; and
          (2) by adding at the end the following:
                  ``(B) Exclusion for persons holding certain 
                securities.--For purposes of this subsection, 
                securities held by persons who purchase such securities 
                in transactions described under section 4(a)(6) of the 
                Securities Act of 1933 shall not be deemed to be `held 
                of record'.''.

SEC. 478. PREEMPTION OF STATE LAW.

  (a) In General.--Section 18(b)(4)(C) of the Securities Act of 1933 
(15 U.S.C. 77r(b)(4)(C)) is amended by striking ``section 4(6)'' and 
inserting ``section 4(a)(6)''.
  (b) Clarification of the Preservation of State Enforcement 
Authority.--
          (1) In general.--The amendments made by subsection (a) relate 
        solely to State registration, documentation, and offering 
        requirements, as described under section 18(a) of Securities 
        Act of 1933 (15 U.S.C. 77r(a)), and shall have no impact or 
        limitation on other State authority to take enforcement action 
        with regard to an issuer, intermediary, or any other person or 
        entity using the exemption from registration provided by 
        section 4(a)(6) of such Act, except that a State may not impose 
        any fees under such authority.
          (2) Clarification of state jurisdiction over unlawful conduct 
        of intermediaries, issuers, and custodians.--Section 18(c)(1) 
        of the Securities Act of 1933 is amended by striking ``in 
        connection with securities or securities transactions'' and all 
        that follows and inserting the following: ``, in connection 
        with securities or securities transactions, with respect to--
                  ``(A) fraud or deceit;
                  ``(B) unlawful conduct by a broker or dealer; and
                  ``(C) with respect to a transaction described under 
                section 4(a)(6), unlawful conduct by an intermediary, 
                issuer, or custodian.''.

SEC. 479. TREATMENT OF FUNDING PORTALS.

  Section 5312(c) of title 31, United States Code, is amended by adding 
at the end the following:
          ``(2) Funding portals not included in definition.--The term 
        `financial institution' (as defined in subsection (a)) does not 
        include a funding portal (as defined under section 3(a) of the 
        Securities Exchange Act of 1934 (15 U.S.C. 78c(a))).''.

        Subtitle Q--Corporate Governance Reform and Transparency

SEC. 481. DEFINITIONS.

  (a) Securities Exchange Act of 1934.--Section 3(a) of the Securities 
Exchange Act of 1934 (15 U.S.C. 78c(a)) is amended by adding at the end 
the following new paragraphs:
          ``(83) Proxy advisory firm.--The term `proxy advisory firm' 
        means any person who is primarily engaged in the business of 
        providing proxy voting research, analysis, or recommendations 
        to clients, which conduct constitutes a solicitation within the 
        meaning of section 14 and the Commission's rules and 
        regulations thereunder, except to the extent that the person is 
        exempted by such rules and regulations from requirements 
        otherwise applicable to persons engaged in a solicitation.
          ``(84) Person associated with a proxy advisory firm.--The 
        term `person associated with' a proxy advisory firm means any 
        partner, officer, or director of a proxy advisory firm (or any 
        person occupying a similar status or performing similar 
        functions), any person directly or indirectly controlling, 
        controlled by, or under common control with a proxy advisory 
        firm, or any employee of a proxy advisory firm, except that 
        persons associated with a proxy advisory firm whose functions 
        are clerical or ministerial shall not be included in the 
        meaning of such term. The Commission may by rules and 
        regulations classify, for purposes or any portion or portions 
        of this Act, persons, including employees controlled by a proxy 
        advisory firm.''.
  (b) Applicable Definitions.--As used in this subtitle--
          (1) the term ``Commission'' means the Securities and Exchange 
        Commission; and
          (2) the term ``proxy advisory firm'' has the same meaning as 
        in section 3(a)(83) of the Securities Exchange Act of 1934, as 
        added by this subtitle.

SEC. 482. REGISTRATION OF PROXY ADVISORY FIRMS.

  (a) Amendment.--The Securities Exchange Act of 1934 is amended by 
inserting after section 15G the following new section:

``SEC. 15H. REGISTRATION OF PROXY ADVISORY FIRMS.

  ``(a) Conduct Prohibited.--It shall be unlawful for a proxy advisory 
firm to make use of the mails or any means or instrumentality of 
interstate commerce to provide proxy voting research, analysis, or 
recommendations to any client, unless such proxy advisory firm is 
registered under this section.
  ``(b) Registration Procedures.--
          ``(1) Application for registration.--
                  ``(A) In general.--A proxy advisory firm must file 
                with the Commission an application for registration, in 
                such form as the Commission shall require, by rule or 
                regulation, and containing the information described in 
                subparagraph (B).
                  ``(B) Required information.--An application for 
                registration under this section shall contain 
                information regarding--
                          ``(i) a certification that the applicant has 
                        adequate financial and managerial resources to 
                        consistently provide proxy advice based on 
                        accurate information;
                          ``(ii) the procedures and methodologies that 
                        the applicant uses in developing proxy voting 
                        recommendations, including whether and how the 
                        applicant considers the size of a company when 
                        making proxy voting recommendations;
                          ``(iii) the organizational structure of the 
                        applicant;
                          ``(iv) whether or not the applicant has in 
                        effect a code of ethics, and if not, the 
                        reasons therefor;
                          ``(v) any potential or actual conflict of 
                        interest relating to the ownership structure of 
                        the applicant or the provision of proxy 
                        advisory services by the applicant, including 
                        whether the proxy advisory firm engages in 
                        services ancillary to the provision of proxy 
                        advisory services such as consulting services 
                        for corporate issuers, and if so the revenues 
                        derived therefrom;
                          ``(vi) the policies and procedures in place 
                        to manage conflicts of interest under 
                        subsection (f); and
                          ``(vii) any other information and documents 
                        concerning the applicant and any person 
                        associated with such applicant as the 
                        Commission, by rule, may prescribe as necessary 
                        or appropriate in the public interest or for 
                        the protection of investors.
          ``(2) Review of application.--
                  ``(A) Initial determination.--Not later than 90 days 
                after the date on which the application for 
                registration is filed with the Commission under 
                paragraph (1) (or within such longer period as to which 
                the applicant consents) the Commission shall--
                          ``(i) by order, grant registration; or
                          ``(ii) institute proceedings to determine 
                        whether registration should be denied.
                  ``(B) Conduct of proceedings.--
                          ``(i) Content.--Proceedings referred to in 
                        subparagraph (A)(ii) shall--
                                  ``(I) include notice of the grounds 
                                for denial under consideration and an 
                                opportunity for hearing; and
                                  ``(II) be concluded not later than 
                                120 days after the date on which the 
                                application for registration is filed 
                                with the Commission under paragraph 
                                (1).
                          ``(ii) Determination.--At the conclusion of 
                        such proceedings, the Commission, by order, 
                        shall grant or deny such application for 
                        registration.
                          ``(iii) Extension authorized.--The Commission 
                        may extend the time for conclusion of such 
                        proceedings for not longer than 90 days, if it 
                        finds good cause for such extension and 
                        publishes its reasons for so finding, or for 
                        such longer period as to which the applicant 
                        consents.
                  ``(C) Grounds for decision.--The Commission shall 
                grant registration under this subsection--
                          ``(i) if the Commission finds that the 
                        requirements of this section are satisfied; and
                          ``(ii) unless the Commission finds (in which 
                        case the Commission shall deny such 
                        registration) that--
                                  ``(I) the applicant has failed to 
                                certify to the Commission's 
                                satisfaction that it has adequate 
                                financial and managerial resources to 
                                consistently provide proxy advice based 
                                on accurate information and to 
                                materially comply with the procedures 
                                and methodologies disclosed under 
                                paragraph (1)(B) and with subsections 
                                (f) and (g); or
                                  ``(II) if the applicant were so 
                                registered, its registration would be 
                                subject to suspension or revocation 
                                under subsection (e).
          ``(3) Public availability of information.--Subject to section 
        24, the Commission shall make the information and documents 
        submitted to the Commission by a proxy advisory firm in its 
        completed application for registration, or in any amendment 
        submitted under paragraph (1) or (2) of subsection (c), 
        publicly available on the Commission's website, or through 
        another comparable, readily accessible means.
  ``(c) Update of Registration.--
          ``(1) Update.--Each registered proxy advisory firm shall 
        promptly amend and update its application for registration 
        under this section if any information or document provided 
        therein becomes materially inaccurate, except that a registered 
        proxy advisory firm is not required to amend the information 
        required to be filed under subsection (b)(1)(B)(i) by filing 
        information under this paragraph, but shall amend such 
        information in the annual submission of the organization under 
        paragraph (2) of this subsection.
          ``(2) Certification.--Not later than 90 calendar days after 
        the end of each calendar year, each registered proxy advisory 
        firm shall file with the Commission an amendment to its 
        registration, in such form as the Commission, by rule, may 
        prescribe as necessary or appropriate in the public interest or 
        for the protection of investors--
                  ``(A) certifying that the information and documents 
                in the application for registration of such registered 
                proxy advisory firm continue to be accurate in all 
                material respects; and
                  ``(B) listing any material change that occurred to 
                such information or documents during the previous 
                calendar year.
  ``(d) Censure, Denial, or Suspension of Registration; Notice and 
Hearing.--The Commission, by order, shall censure, place limitations on 
the activities, functions, or operations of, suspend for a period not 
exceeding 12 months, or revoke the registration of any registered proxy 
advisory firm if the Commission finds, on the record after notice and 
opportunity for hearing, that such censure, placing of limitations, 
suspension, or revocation is necessary for the protection of investors 
and in the public interest and that such registered proxy advisory 
firm, or any person associated with such an organization, whether prior 
to or subsequent to becoming so associated--
          ``(1) has committed or omitted any act, or is subject to an 
        order or finding, enumerated in subparagraph (A), (D), (E), 
        (H), or (G) of section 15(b)(4), has been convicted of any 
        offense specified in section 15(b)(4)(B), or is enjoined from 
        any action, conduct, or practice specified in subparagraph (C) 
        of section 15(b)(4), during the 10-year period preceding the 
        date of commencement of the proceedings under this subsection, 
        or at any time thereafter;
          ``(2) has been convicted during the 10-year period preceding 
        the date on which an application for registration is filed with 
        the Commission under this section, or at any time thereafter, 
        of--
                  ``(A) any crime that is punishable by imprisonment 
                for one or more years, and that is not described in 
                section 15(b)(4)(B); or
                  ``(B) a substantially equivalent crime by a foreign 
                court of competent jurisdiction;
          ``(3) is subject to any order of the Commission barring or 
        suspending the right of the person to be associated with a 
        registered proxy advisory firm;
          ``(4) fails to furnish the certifications required under 
        subsections (b)(2)(C)(ii)(I) and (c)(2);
          ``(5) has engaged in one or more prohibited acts enumerated 
        in paragraph (1); or
          ``(6) fails to maintain adequate financial and managerial 
        resources to consistently offer advisory services with 
        integrity, including by failing to comply with subsections (f) 
        or (g).
  ``(e) Termination of Registration.--
          ``(1) Voluntary withdrawal.--A registered proxy advisory firm 
        may, upon such terms and conditions as the Commission may 
        establish as necessary in the public interest or for the 
        protection of investors, which terms and conditions shall 
        include at a minimum that the registered proxy advisory firm 
        will no longer conduct such activities as to bring it within 
        the definition of proxy advisory firm in section 3(a)(83) of 
        the Securities Exchange Act of 1934, withdraw from registration 
        by filing a written notice of withdrawal to the Commission.
          ``(2) Commission authority.--In addition to any other 
        authority of the Commission under this title, if the Commission 
        finds that a registered proxy advisory firm is no longer in 
        existence or has ceased to do business as a proxy advisory 
        firm, the Commission, by order, shall cancel the registration 
        under this section of such registered proxy advisory firm.
  ``(f) Management of Conflicts of Interest.--
          ``(1) Organization policies and procedures.--Each registered 
        proxy advisory firm shall establish, maintain, and enforce 
        written policies and procedures reasonably designed, taking 
        into consideration the nature of the business of such 
        registered proxy advisory firm and associated persons, to 
        address and manage any conflicts of interest that can arise 
        from such business.
          ``(2) Commission authority.--The Commission shall issue final 
        rules to prohibit, or require the management and disclosure of, 
        any conflicts of interest relating to the offering of proxy 
        advisory services by a registered proxy advisory firm, 
        including, without limitation, conflicts of interest relating 
        to--
                  ``(A) the manner in which a registered proxy advisory 
                firm is compensated by the client, or any affiliate of 
                the client, for providing proxy advisory services;
                  ``(B) the provision of consulting, advisory, or other 
                services by a registered proxy advisory firm, or any 
                person associated with such registered proxy advisory 
                firm, to the client;
                  ``(C) business relationships, ownership interests, or 
                any other financial or personal interests between a 
                registered proxy advisory firm, or any person 
                associated with such registered proxy advisory firm, 
                and any client, or any affiliate of such client;
                  ``(D) transparency around the formulation of proxy 
                voting policies;
                  ``(E) the execution of proxy votes if such votes are 
                based upon recommendations made by the proxy advisory 
                firm in which someone other than the issuer is a 
                proponent;
                  ``(F) issuing recommendations where proxy advisory 
                firms provide advisory services to a company; and
                  ``(G) any other potential conflict of interest, as 
                the Commission deems necessary or appropriate in the 
                public interest or for the protection of investors.
  ``(g) Reliability of Proxy Advisory Firm Services.--
          ``(1) In general.--Each registered proxy advisory firm shall 
        have staff sufficient to produce proxy voting recommendations 
        that are based on accurate and current information. Each 
        registered proxy advisory firm shall detail procedures 
        sufficient to permit companies receiving proxy advisory firm 
        recommendations access in a reasonable time to the draft 
        recommendations, with an opportunity to provide meaningful 
        comment thereon, including the opportunity to present details 
        to the person responsible for developing the recommendation in 
        person or telephonically. Each registered proxy advisory firm 
        shall employ an ombudsman to receive complaints about the 
        accuracy of voting information used in making recommendations 
        from the subjects of the proxy advisory firm's voting 
        recommendations, and shall resolve those complaints in a timely 
        fashion and in any event prior to voting on the matter to which 
        the recommendation relates.
          ``(2) Draft recommendations defined.--For purposes of this 
        subsection, the term `draft recommendations'--
                  ``(A) means the overall conclusions of proxy voting 
                recommendations prepared for the clients of a proxy 
                advisory firm, including any public data cited therein, 
                any company information or substantive analysis 
                impacting the recommendation, and the specific voting 
                recommendations on individual proxy ballot issues; and
                  ``(B) does not include the entirety of the proxy 
                advisory firm's final report to its clients.
  ``(h) Designation of Compliance Officer.--Each registered proxy 
advisory firm shall designate an individual responsible for 
administering the policies and procedures that are required to be 
established pursuant to subsections (f) and (g), and for ensuring 
compliance with the securities laws and the rules and regulations 
thereunder, including those promulgated by the Commission pursuant to 
this section.
  ``(i) Prohibited Conduct.--
          ``(1) Prohibited acts and practices.--The Commission shall 
        issue final rules to prohibit any act or practice relating to 
        the offering of proxy advisory services by a registered proxy 
        advisory firm that the Commission determines to be unfair or 
        coercive, including any act or practice relating to--
                  ``(A) conditioning a voting recommendation or other 
                proxy advisory firm recommendation on the purchase by 
                an issuer or an affiliate thereof of other services or 
                products, of the registered proxy advisory firm or any 
                person associated with such registered proxy advisory 
                firm; and
                  ``(B) modifying a voting recommendation or otherwise 
                departing from its adopted systematic procedures and 
                methodologies in the provision of proxy advisory 
                services, based on whether an issuer, or affiliate 
                thereof, subscribes or will subscribe to other services 
                or product of the registered proxy advisory firm or any 
                person associated with such organization.
          ``(2) Rule of construction.--Nothing in paragraph (1), or in 
        any rules or regulations adopted thereunder, may be construed 
        to modify, impair, or supersede the operation of any of the 
        antitrust laws (as defined in the first section of the Clayton 
        Act, except that such term includes section 5 of the Federal 
        Trade Commission Act, to the extent that such section 5 applies 
        to unfair methods of competition).
  ``(j) Statements of Financial Condition.--Each registered proxy 
advisory firm shall, on a confidential basis, file with the Commission, 
at intervals determined by the Commission, such financial statements, 
certified (if required by the rules or regulations of the Commission) 
by an independent public auditor, and information concerning its 
financial condition, as the Commission, by rule, may prescribe as 
necessary or appropriate in the public interest or for the protection 
of investors.
  ``(k) Annual Report.--Each registered proxy advisory firm shall, at 
the beginning of each fiscal year of such firm, report to the 
Commission on the number of shareholder proposals its staff reviewed in 
the prior fiscal year, the number of recommendations made in the prior 
fiscal year, the number of staff who reviewed and made recommendations 
on such proposals in the prior fiscal year, and the number of 
recommendations made in the prior fiscal year where the proponent of 
such recommendation was a client of or received services from the proxy 
advisory firm.
  ``(l) Transparent Policies.--Each registered proxy advisory firm 
shall file with the Commission and make publicly available its 
methodology for the formulation of proxy voting policies and voting 
recommendations.
  ``(m) Rules of Construction.--
          ``(1) No waiver of rights, privileges, or defenses.--
        Registration under and compliance with this section does not 
        constitute a waiver of, or otherwise diminish, any right, 
        privilege, or defense that a registered proxy advisory firm may 
        otherwise have under any provision of State or Federal law, 
        including any rule, regulation, or order thereunder.
          ``(2) No private right of action.--Nothing in this section 
        may be construed as creating any private right of action, and 
        no report filed by a registered proxy advisory firm in 
        accordance with this section or section 17 shall create a 
        private right of action under section 18 or any other provision 
        of law.
  ``(n) Regulations.--
          ``(1) New provisions.--Such rules and regulations as are 
        required by this section or are otherwise necessary to carry 
        out this section, including the application form required under 
        subsection (a)--
                  ``(A) shall be issued by the Commission, not later 
                than 180 days after the date of enactment of this 
                section; and
                  ``(B) shall become effective not later than 1 year 
                after the date of enactment of this section.
          ``(2) Review of existing regulations.--Not later than 270 
        days after the date of enactment of this section, the 
        Commission shall--
                  ``(A) review its existing rules and regulations which 
                affect the operations of proxy advisory firms;
                  ``(B) amend or revise such rules and regulations in 
                accordance with the purposes of this section, and issue 
                such guidance, as the Commission may prescribe as 
                necessary or appropriate in the public interest or for 
                the protection of investors; and
                  ``(C) direct Commission staff to withdraw the Egan 
                Jones Proxy Services (May 27, 2004) and Institutional 
                Shareholder Services, Inc. (September 15, 2004) no-
                action letters.
  ``(o) Applicability.--This section, other than subsection (n), which 
shall apply on the date of enactment of this section, shall apply on 
the earlier of--
          ``(1) the date on which regulations are issued in final form 
        under subsection (n)(1); or
          ``(2) 270 days after the date of enactment of this 
        section.''.
  (b) Conforming Amendment.--Section 17(a)(1) of the Securities 
Exchange Act of 1934 (15 U.S.C. 78q(a)(1)) is amended by inserting 
``proxy advisory firm,'' after ``nationally recognized statistical 
rating organization,''.

SEC. 483. COMMISSION ANNUAL REPORT.

  The Commission shall make an annual report publicly available on the 
Commission's Internet website. Such report shall, with respect to the 
year to which the report relates--
          (1) identify applicants for registration under section 15H of 
        the Securities Exchange Act of 1934, as added by this subtitle;
          (2) specify the number of and actions taken on such 
        applications;
          (3) specify the views of the Commission on the state of 
        competition, transparency, policies and methodologies, and 
        conflicts of interest among proxy advisory firms;
          (4) include the determination of the Commission with regard 
        to--
                  (A) the quality of proxy advisory services issued by 
                proxy advisory firms;
                  (B) the financial markets;
                  (C) competition among proxy advisory firms;
                  (D) the incidence of undisclosed conflicts of 
                interest by proxy advisory firms;
                  (E) the process for registering as a proxy advisory 
                firm; and
                  (F) such other matters relevant to the implementation 
                of this subtitle and the amendments made by this 
                subtitle, as the Commission determines necessary to 
                bring to the attention of the Congress;
          (5) identify problems, if any, that have resulted from the 
        implementation of this subtitle and the amendments made by this 
        subtitle; and
          (6) recommend solutions, including any legislative or 
        regulatory solutions, to any problems identified under 
        paragraphs (4) and (5).

                        Subtitle R--Senior Safe

SEC. 491. IMMUNITY.

  (a) Definitions.--In this subtitle--
          (1) the term ``Bank Secrecy Act Officer'' means an individual 
        responsible for ensuring compliance with the requirements 
        mandated by subchapter II of chapter 53 of title 31, United 
        States Code;
          (2) the term ``broker-dealer'' means a broker or dealer, as 
        those terms are defined, respectively, in section 3(a) of the 
        Securities Exchange Act of 1934 (15 U.S.C. 78c(a));
          (3) the term ``covered agency'' means--
                  (A) a State financial regulatory agency, including a 
                State securities or law enforcement authority and a 
                State insurance regulator;
                  (B) each of the Federal financial institutions 
                regulatory agencies;
                  (C) the Securities and Exchange Commission;
                  (D) a law enforcement agency;
                  (E) and State or local agency responsible for 
                administering adult protective service laws; and
                  (F) a State attorney general.
          (4) the term ``covered financial institution'' means--
                  (A) a credit union;
                  (B) a depository institution;
                  (C) an investment advisor;
                  (D) a broker-dealer;
                  (E) an insurance company;
                  (F) a State attorney general; and
                  (G) a transfer agent.
          (5) the term ``credit union'' means a Federal credit union, 
        State credit union, or State-chartered credit union, as those 
        terms are defined in section 101 of the Federal Credit Union 
        Act (12 U.S.C. 1752);
          (6) the term ``depository institution'' has the meaning given 
        the term in section 3(c) of the Federal Deposit Insurance Act 
        (12 U.S.C. 1813(c));
          (7) the term ``exploitation'' means the fraudulent or 
        otherwise illegal, unauthorized, or improper act or process of 
        an individual, including a caregiver or fiduciary, that--
                  (A) uses the resources of a senior citizen for 
                monetary personal benefit, profit, or gain; or
                  (B) results in depriving a senior citizen of rightful 
                access to or use of benefits, resources, belongings or 
                assets;
          (8) the term ``Federal financial institutions regulatory 
        agencies'' has the meaning given the term in section 1003 of 
        the Federal Financial Institutions Examination Council Act of 
        1978 (12 U.S.C. 3302);
          (9) the term ``investment adviser'' has the meaning given the 
        term in section 202 of the Investment Advisers Act of 1940 (15 
        U.S.C. 80b-2);
          (10) the term ``insurance company'' has the meaning given the 
        term in section 2(a) of the Investment Company Act of 1940 (15 
        U.S.C. 80a-2(a));
          (11) the term ``registered representative'' means an 
        individual who represents a broker-dealer in effecting or 
        attempting to affect a purchase or sale of securities;
          (12) the term ``senior citizen'' means an individual who is 
        not less than 65 years of age;
          (13) the term ``State insurance regulator'' has the meaning 
        given such term in section 315 of the Gramm-Leach-Bliley Act 
        (15 U.S.C. 6735);
          (14) the term ``State securities or law enforcement 
        authority'' has the meaning given the term in section 24(f)(4) 
        of the Securities Exchange Act of 1934 (15 U.S.C. 78x(f)(4)); 
        and
          (15) the term ``transfer agent'' has the meaning given the 
        term in section 3(a) of the Securities Exchange Act of 1934 (15 
        U.S.C. 78c(a)).
  (b) Immunity From Suit.--
          (1) Immunity for individuals.--An individual who has received 
        the training described in section 1092 shall not be liable, 
        including in any civil or administrative proceeding, for 
        disclosing the possible exploitation of a senior citizen to a 
        covered agency if the individual, at the time of the 
        disclosure--
                  (A) served as a supervisor, compliance officer 
                (including a Bank Secrecy Act Officer), or registered 
                representative for a covered financial institution; and
                  (B) made the disclosure with reasonable care 
                including reasonable efforts to avoid disclosure other 
                than to a covered agency.
          (2) Immunity for covered financial institutions.--A covered 
        financial institution shall not be liable, including in any 
        civil or administrative proceeding, for a disclosure made by an 
        individual described in paragraph (1) if--
                  (A) the individual was employed by, or, in the case 
                of a registered representative, affiliated or 
                associated with, the covered financial institution at 
                the time of the disclosure; and
                  (B) before the time of the disclosure, the covered 
                financial institution provided the training described 
                in section 492 to each individual described in section 
                492(a).

SEC. 492. TRAINING REQUIRED.

  (a) In General.--A covered financial institution may provide training 
described in subsection (b)(1) to each officer or employee of, or 
registered representative affiliated or associated with, the covered 
financial institution who--
          (1) is described in section 491(b)(1)(A);
          (2) may come into contact with a senior citizen as a regular 
        part of the duties of the officer, employee, or registered 
        representative; or
          (3) may review or approve the financial documents, records, 
        or transactions of a senior citizen in connection with 
        providing financial services to a senior citizen.
  (b) Training.--
          (1) In general.--The training described in this paragraph 
        shall--
                  (A) instruct any individual attending the training on 
                how to identify and report the suspected exploitation 
                of a senior citizen;
                  (B) discuss the need to protect the privacy and 
                respect the integrity of each individual customer of a 
                covered financial institution; and
                  (C) be appropriate to the job responsibilities of the 
                individual attending the training.
          (2) Timing.--The training required under subsection (a) shall 
        be provided as soon as reasonably practicable but not later 
        than 1 year after the date on which an officer, employee, or 
        registered representative begins employment with or becomes 
        affiliated or associated with the covered financial 
        institution.
          (3) Bank secrecy act officer.--An individual who is 
        designated as a compliance officer under an anti-money 
        laundering program established pursuant to section 5318(h) of 
        title 31, United States Code, shall be deemed to have received 
        the training described under this subsection.

SEC. 493. RELATIONSHIP TO STATE LAW.

  Nothing in this Act shall be construed to preempt or limit any 
provision of State law, except only to the extent that section 1091 
provides a greater level of protection against liability to an 
individual described in section 491(b)(1) or to a covered financial 
institution described in section 491(b)(2) than is provided under State 
law.

       Subtitle S--National Securities Exchange Regulatory Parity

SEC. 496. APPLICATION OF EXEMPTION.

  Section 18(b)(1) of the Securities Act of 1933 (15 U.S.C. 77r(b)(1)), 
as amended by section 456(b), is further amended--
          (1) by striking subparagraph (A);
          (2) in subparagraph (B), by striking ``that the Commission 
        determines by rule (on its own initiative or on the basis of a 
        petition) are substantially similar to the listing standards 
        applicable to securities described in subparagraph (A)'' and 
        inserting ``that have been approved by the Commission'';
          (3) in subparagraph (C), by striking ``or (B)''; and
          (4) by redesignating subparagraphs (B), (C), and (D) as 
        subparagraphs (A), (B), and (C), respectively.

           Subtitle T--Private Company Flexibility and Growth

SEC. 497. SHAREHOLDER THRESHOLD FOR REGISTRATION.

  The Securities Exchange Act of 1934 (15 U.S.C. 78a et seq.) is 
amended--
          (1) in section 12(g)--
                  (A) in paragraph (1)--
                          (i) by striking ``shall--'' and all that 
                        follows through ``register such security'' and 
                        inserting ``shall, not later than 120 days 
                        after the last day of its first fiscal year 
                        ended after the effective date of this 
                        subsection on which the issuer has total assets 
                        exceeding $10,000,000 (or such greater amount 
                        of assets as the Commission may establish by 
                        rule) and a class of equity security (other 
                        than an exempted security) held of record by 
                        2,000 or more persons (or such greater number 
                        of persons as the Commission may establish by 
                        rule), register such security''; and
                          (ii) by adding at the end the following: 
                        ``The dollar figure in this paragraph shall be 
                        indexed for inflation every 5 years by the 
                        Commission to reflect the change in the 
                        Consumer Price Index for All Urban Consumers 
                        published by the Bureau of Labor Statistics, 
                        rounded to the nearest $100,000.''; and
                  (B) in paragraph (4), by striking ``300 persons'' and 
                all that follows through ``1,200 persons persons'' and 
                inserting ``1,200 persons''; and
          (2) in section 15(d)(1), by striking ``300 persons'' and all 
        that follows through ``1,200 persons persons'' and inserting 
        ``1,200 persons''.

        Subtitle U--Small Company Capital Formation Enhancements

SEC. 498. JOBS ACT-RELATED EXEMPTION.

  Section 3(b) of the Securities Act of 1933 (15 U.S.C. 77c(b)) is 
amended--
          (1) in paragraph (2)(A), by striking ``$50,000,000'' and 
        inserting ``$75,000,000, adjusted for inflation by the 
        Commission every 2 years to the nearest $10,000 to reflect the 
        change in the Consumer Price Index for All Urban Consumers 
        published by the Bureau of Labor Statistics''; and
          (2) in paragraph (5)--
                  (A) by striking ``such amount as'' and inserting: 
                ``such amount, in addition to the adjustment for 
                inflation provided for under such paragraph (2)(A), 
                as''; and
                  (B) by striking ``such amount, it'' and inserting 
                ``such amount, in addition to the adjustment for 
                inflation provided for under such paragraph (2)(A), 
                it''.

                Subtitle V--Encouraging Public Offerings

SEC. 499. EXPANDING TESTING THE WATERS AND CONFIDENTIAL SUBMISSIONS.

  The Securities Act of 1933 (15 U.S.C. 77a et seq.) is amended--
          (1) in section 5(d), by striking ``an emerging growth company 
        or any person authorized to act on behalf of an emerging growth 
        company'' and inserting ``an issuer or any person authorized to 
        act on behalf of an issuer''; and
          (2) in section 6(e)--
                  (A) in the heading, by striking ``Emerging Growth 
                Companies'' and inserting ``Draft Registration 
                Statements''; and
                  (B) by amending paragraph (1) to read as follows:
          ``(1) In general.--Any issuer, prior to its initial public 
        offering date, may confidentially submit to the Commission a 
        draft registration statement, for confidential nonpublic review 
        by the staff of the Commission prior to public filing, provided 
        that the initial confidential submission and all amendments 
        thereto shall be publicly filed with the Commission not later 
        than 15 days before the date on which the issuer conducts a 
        road show, as such term is defined in section 230.433(h)(4) of 
        title 17, Code of Federal Regulations, or any successor 
        thereto.''.

  TITLE V--REGULATORY RELIEF FOR MAIN STREET AND COMMUNITY FINANCIAL 
                              INSTITUTIONS

         Subtitle A--Preserving Access to Manufactured Housing

SEC. 501. MORTGAGE ORIGINATOR DEFINITION.

  Section 103 of the Truth in Lending Act (15 U.S.C. 1602) is amended--
          (1) by redesignating the second subsection (cc) and 
        subsection (dd) as subsections (dd) and (ee), respectively; and
          (2) in paragraph (2)(C) of subsection (dd), as so 
        redesignated, by striking ``an employee of a retailer of 
        manufactured homes who is not described in clause (i) or (iii) 
        of subparagraph (A) and who does not advise a consumer on loan 
        terms (including rates, fees, and other costs)'' and inserting 
        ``a retailer of manufactured or modular homes or its employees 
        unless such retailer or its employees receive compensation or 
        gain for engaging in activities described in subparagraph (A) 
        that is in excess of any compensation or gain received in a 
        comparable cash transaction''.

SEC. 502. HIGH-COST MORTGAGE DEFINITION.

  Section 103 of the Truth in Lending Act (15 U.S.C. 1602), as amended 
by section 501, is further amended--
          (1) by redesignating subsection (aa) (relating to disclosure 
        of greater amount or percentage), as so designated by section 
        1100A of the Consumer Financial Protection Act of 2010, as 
        subsection (bb);
          (2) by redesignating subsection (bb) (relating to high cost 
        mortgages), as so designated by section 1100A of the Consumer 
        Financial Protection Act of 2010, as subsection (aa), and 
        moving such subsection to immediately follow subsection (z); 
        and
          (3) in subsection (aa)(1)(A), as so redesignated--
                  (A) in clause (i)(I), by striking ``(8.5 percentage 
                points, if the dwelling is personal property and the 
                transaction is for less than $50,000)'' and inserting 
                ``(10 percentage points if the dwelling is personal 
                property or is a transaction that does not include the 
                purchase of real property on which a dwelling is to be 
                placed, and the transaction is for less than $75,000 
                (as such amount is adjusted by the Consumer Law 
                Enforcement Agency to reflect the change in the 
                Consumer Price Index))''; and
                  (B) in clause (ii)--
                          (i) in subclause (I), by striking ``or'' at 
                        the end; and
                          (ii) by adding at the end the following:
                                  ``(III) in the case of a transaction 
                                for less than $75,000 (as such amount 
                                is adjusted by the Consumer Law 
                                Enforcement Agency to reflect the 
                                change in the Consumer Price Index) in 
                                which the dwelling is personal property 
                                (or is a consumer credit transaction 
                                that does not include the purchase of 
                                real property on which a dwelling is to 
                                be placed) the greater of 5 percent of 
                                the total transaction amount or $3,000 
                                (as such amount is adjusted by the 
                                Consumer Law Enforcement Agency to 
                                reflect the change in the Consumer 
                                Price Index); or''.

                      Subtitle B--Mortgage Choice

SEC. 506. DEFINITION OF POINTS AND FEES.

  (a) Amendment to Section 103 of TILA.--Paragraph (4) of section 
103(aa) of the Truth in Lending Act, as redesignated by section 502, is 
amended--
          (1) by striking ``paragraph (1)(B)'' and inserting 
        ``paragraph (1)(A) and section 129C'';
          (2) in subparagraph (C)--
                  (A) by inserting ``and insurance'' after ``taxes'';
                  (B) in clause (ii), by inserting ``, except as 
                retained by a creditor or its affiliate as a result of 
                their participation in an affiliated business 
                arrangement (as defined in section 3(7) of the Real 
                Estate Settlement Procedures Act of 1974 (12 U.S.C. 
                2602(7))'' after ``compensation''; and
                  (C) by striking clause (iii) and inserting the 
                following:
                  ``(iii) the charge is--
                          ``(I) a bona fide third-party charge not 
                        retained by the mortgage originator, creditor, 
                        or an affiliate of the creditor or mortgage 
                        originator; or
                          ``(II) a charge set forth in section 
                        106(e)(1);''; and
          (3) in subparagraph (D)--
                  (A) by striking ``accident,''; and
                  (B) by striking ``or any payments'' and inserting 
                ``and any payments''.
  (b) Amendment to Section 129C of TILA.--Section 129C of the Truth in 
Lending Act (15 U.S.C. 1639c) is amended--
          (1) in subsection (a)(5)(C), by striking ``103'' and all that 
        follows through ``or mortgage originator'' and inserting 
        ``103(aa)(4)''; and
          (2) in subsection (b)(2)(C)(i), by striking ``103'' and all 
        that follows through ``or mortgage originator)'' and inserting 
        ``103(aa)(4)''.

         Subtitle C--Financial Institution Customer Protection

SEC. 511. REQUIREMENTS FOR DEPOSIT ACCOUNT TERMINATION REQUESTS AND 
                    ORDERS.

  (a) Termination Requests or Orders Must Be Material.--
          (1) In general.--An appropriate Federal banking agency may 
        not formally or informally request or order a depository 
        institution to terminate a specific customer account or group 
        of customer accounts or to otherwise restrict or discourage a 
        depository institution from entering into or maintaining a 
        banking relationship with a specific customer or group of 
        customers unless--
                  (A) the agency has a material reason for such request 
                or order; and
                  (B) such reason is not based solely on reputation 
                risk.
          (2) Treatment of national security threats.--If an 
        appropriate Federal banking agency believes a specific customer 
        or group of customers is, or is acting as a conduit for, an 
        entity which--
                  (A) poses a threat to national security;
                  (B) is involved in terrorist financing;
                  (C) is an agency of the government of Iran, North 
                Korea, Syria, or any country listed from time to time 
                on the State Sponsors of Terrorism list;
                  (D) is located in, or is subject to the jurisdiction 
                of, any country specified in subparagraph (C); or
                  (E) does business with any entity described in 
                subparagraph (C) or (D), unless the appropriate Federal 
                banking agency determines that the customer or group of 
                customers has used due diligence to avoid doing 
                business with any entity described in subparagraph (C) 
                or (D),
        such belief shall satisfy the requirement under paragraph (1).
  (b) Notice Requirement.--
          (1) In general.--If an appropriate Federal banking agency 
        formally or informally requests or orders a depository 
        institution to terminate a specific customer account or a group 
        of customer accounts, the agency shall--
                  (A) provide such request or order to the institution 
                in writing; and
                  (B) accompany such request or order with a written 
                justification for why such termination is needed, 
                including any specific laws or regulations the agency 
                believes are being violated by the customer or group of 
                customers, if any.
          (2) Justification requirement.--A justification described 
        under paragraph (1)(B) may not be based solely on the 
        reputation risk to the depository institution.
  (c) Customer Notice.--
          (1) Notice required.--Except as provided under paragraph (2), 
        if an appropriate Federal banking agency orders a depository 
        institution to terminate a specific customer account or a group 
        of customer accounts, the depository institution shall inform 
        the customer or customers of the justification for the 
        customer's account termination described under subsection (b).
          (2) Notice prohibited in cases of national security.--If an 
        appropriate Federal banking agency requests or orders a 
        depository institution to terminate a specific customer account 
        or a group of customer accounts based on a belief that the 
        customer or customers pose a threat to national security, or 
        are otherwise described under subsection (a)(2), neither the 
        depository institution nor the appropriate Federal banking 
        agency may inform the customer or customers of the 
        justification for the customer's account termination.
  (d) Reporting Requirement.--Each appropriate Federal banking agency 
shall issue an annual report to the Congress stating--
          (1) the aggregate number of specific customer accounts that 
        the agency requested or ordered a depository institution to 
        terminate during the previous year; and
          (2) the legal authority on which the agency relied in making 
        such requests and orders and the frequency on which the agency 
        relied on each such authority.
  (e) Definitions.--For purposes of this section:
          (1) Appropriate federal banking agency.--The term 
        ``appropriate Federal banking agency'' means--
                  (A) the appropriate Federal banking agency, as 
                defined under section 3 of the Federal Deposit 
                Insurance Act (12 U.S.C. 1813); and
                  (B) the National Credit Union Administration, in the 
                case of an insured credit union.
          (2) Depository institution.--The term ``depository 
        institution'' means--
                  (A) a depository institution, as defined under 
                section 3 of the Federal Deposit Insurance Act (12 
                U.S.C. 1813); and
                  (B) an insured credit union.

SEC. 512. AMENDMENTS TO THE FINANCIAL INSTITUTIONS REFORM, RECOVERY, 
                    AND ENFORCEMENT ACT OF 1989.

  Section 951 of the Financial Institutions Reform, Recovery, and 
Enforcement Act of 1989 (12 U.S.C. 1833a) is amended--
          (1) in subsection (c)(2), by striking ``affecting a federally 
        insured financial institution'' and inserting ``against a 
        federally insured financial institution or by a federally 
        insured financial institution against an unaffiliated third 
        person''; and
          (2) in subsection (g)--
                  (A) in the heading, by striking ``Subpoenas'' and 
                inserting ``Investigations''; and
                  (B) by amending paragraph (1)(C) to read as follows:
                  ``(C) summon witnesses and require the production of 
                any books, papers, correspondence, memoranda, or other 
                records which the Attorney General deems relevant or 
                material to the inquiry, if the Attorney General--
                          ``(i) requests a court order from a court of 
                        competent jurisdiction for such actions and 
                        offers specific and articulable facts showing 
                        that there are reasonable grounds to believe 
                        that the information or testimony sought is 
                        relevant and material for conducting an 
                        investigation under this section; or
                          ``(ii) either personally or through 
                        delegation no lower than the Deputy Attorney 
                        General, issues and signs a subpoena for such 
                        actions and such subpoena is supported by 
                        specific and articulable facts showing that 
                        there are reasonable grounds to believe that 
                        the information or testimony sought is relevant 
                        for conducting an investigation under this 
                        section.''.

           Subtitle D--Portfolio Lending and Mortgage Access

SEC. 516. SAFE HARBOR FOR CERTAIN LOANS HELD ON PORTFOLIO.

  (a) In General.--Section 129C of the Truth in Lending Act (15 U.S.C. 
1639c) is amended by adding at the end the following:
  ``(j) Safe Harbor for Certain Loans Held on Portfolio.--
          ``(1) Safe harbor for creditors that are depository 
        institutions.--
                  ``(A) In general.--A creditor that is a depository 
                institution shall not be subject to suit for failure to 
                comply with subsection (a), (c)(1), or (f)(2) of this 
                section or section 129H with respect to a residential 
                mortgage loan, and the banking regulators shall treat 
                such loan as a qualified mortgage, if--
                          ``(i) the creditor has, since the origination 
                        of the loan, held the loan on the balance sheet 
                        of the creditor; and
                          ``(ii) all prepayment penalties with respect 
                        to the loan comply with the limitations 
                        described under subsection (c)(3).
                  ``(B) Exception for certain transfers.--In the case 
                of a depository institution that transfers a loan 
                originated by that institution to another depository 
                institution by reason of the bankruptcy or failure of 
                the originating depository institution or the purchase 
                of the originating depository institution, the 
                depository institution transferring such loan shall be 
                deemed to have complied with the requirement under 
                subparagraph (A)(i).
          ``(2) Safe harbor for mortgage originators.--A mortgage 
        originator shall not be subject to suit for a violation of 
        section 129B(c)(3)(B) for steering a consumer to a residential 
        mortgage loan if--
                  ``(A) the creditor of such loan is a depository 
                institution and has informed the mortgage originator 
                that the creditor intends to hold the loan on the 
                balance sheet of the creditor for the life of the loan; 
                and
                  ``(B) the mortgage originator informs the consumer 
                that the creditor intends to hold the loan on the 
                balance sheet of the creditor for the life of the loan.
          ``(3) Definitions.--For purposes of this subsection:
                  ``(A) Banking regulators.--The term `banking 
                regulators' means the Federal banking agencies, the 
                Consumer Law Enforcement Agency, and the National 
                Credit Union Administration.
                  ``(B) Depository institution.--The term `depository 
                institution' has the meaning given that term under 
                section 19(b)(1) of the Federal Reserve Act (12 U.S.C. 
                505(b)(1)).
                  ``(C) Federal banking agencies.--The term `Federal 
                banking agencies' has the meaning given that term under 
                section 3 of the Federal Deposit Insurance Act.''.
  (b) Rule of Construction.--Nothing in the amendment made by this 
section may be construed as preventing a balloon loan from qualifying 
for the safe harbor provided under section 129C(j) of the Truth in 
Lending Act if the balloon loan otherwise meets all of the requirements 
under such subsection (j), regardless of whether the balloon loan meets 
the requirements described under clauses (i) through (iv) of section 
129C(b)(2)(E) of such Act.

    Subtitle E--Application of the Expedited Funds Availability Act

SEC. 521. APPLICATION OF THE EXPEDITED FUNDS AVAILABILITY ACT.

  (a) In General.--The Expedited Funds Availability Act (12 U.S.C. 4001 
et seq.) is amended--
          (1) in section 602(20) (12 U.S.C. 4001(20)) by inserting ``, 
        located in the United States,'' after ``ATM'';
          (2) in section 602(21) (12 U.S.C. 4001(21)) by inserting 
        ``American Samoa, the Commonwealth of the Northern Mariana 
        Islands,'' after ``Puerto Rico,'';
          (3) in section 602(23) (12 U.S.C. 4001(23)) by inserting 
        ``American Samoa, the Commonwealth of the Northern Mariana 
        Islands,'' after ``Puerto Rico,''; and
          (4) in section 603(d)(2)(A) (12 U.S.C. 4002(d)(2)(A)), by 
        inserting ``American Samoa, the Commonwealth of the Northern 
        Mariana Islands,'' after ``Puerto Rico,''.
  (b) Effective Date.--This section shall take effect on January 1, 
2017.

        Subtitle F--Small Bank Holding Company Policy Statement

SEC. 526. CHANGES REQUIRED TO SMALL BANK HOLDING COMPANY POLICY 
                    STATEMENT ON ASSESSMENT OF FINANCIAL AND MANAGERIAL 
                    FACTORS.

  (a) In General.--Before the end of the 6-month period beginning on 
the date of the enactment of this Act, the Board of Governors of the 
Federal Reserve System shall revise the Small Bank Holding Company 
Policy Statement on Assessment of Financial and Managerial Factors (12 
C.F.R. part 225--appendix C) to raise the consolidated asset threshold 
under such policy statement from $1,000,000,000 (as adjusted by Public 
Law 113-250) to $10,000,000,000.
  (b) Conforming Amendment.--Subparagraph (C) of section 171(b)(5) of 
the Dodd-Frank Wall Street Reform and Consumer Protection Act (12 
U.S.C. 5371(b)(5)) is amended to read as follows:
                  ``(C) any bank holding company or savings and loan 
                holding company that is subject to the application of 
                the Small Bank Holding Company Policy Statement on 
                Assessment of Financial and Managerial Factors of the 
                Board of Governors (12 C.F.R. part 225--appendix C).''.

           Subtitle G--Community Institution Mortgage Relief

SEC. 531. COMMUNITY FINANCIAL INSTITUTION MORTGAGE RELIEF.

  (a) Exemption From Escrow Requirements for Loans Held by Smaller 
Creditors.--Section 129D of the Truth in Lending Act (15 U.S.C. 1639d) 
is amended--
          (1) by adding at the end the following:
  ``(k) Safe Harbor for Loans Held by Smaller Creditors.--
          ``(1) In general.--A creditor shall not be in violation of 
        subsection (a) with respect to a loan if--
                  ``(A) the creditor has consolidated assets of 
                $10,000,000,000 or less; and
                  ``(B) the creditor holds the loan on the balance 
                sheet of the creditor for the 3-year period beginning 
                on the date of the origination of the loan.
          ``(2) Exception for certain transfers.--In the case of a 
        creditor that transfers a loan to another person by reason of 
        the bankruptcy or failure of the creditor, the purchase of the 
        creditor, or a supervisory act or recommendation from a State 
        or Federal regulator, the creditor shall be deemed to have 
        complied with the requirement under paragraph (1)(B).''; and
          (2) by striking the term ``Board'' each place such term 
        appears and inserting ``Consumer Law Enforcement Agency''.
  (b) Modification to Exemption for Small Servicers of Mortgage 
Loans.--Section 6 of the Real Estate Settlement Procedures Act of 1974 
(12 U.S.C. 2605) is amended by adding at the end the following:
  ``(n) Small Servicer Exemption.--The Consumer Law Enforcement Agency 
shall, by regulation, provide exemptions to, or adjustments for, the 
provisions of this section for a servicer that annually services 20,000 
or fewer mortgage loans, in order to reduce regulatory burdens while 
appropriately balancing consumer protections.''.

   Subtitle H--Financial Institutions Examination Fairness and Reform

SEC. 536. TIMELINESS OF EXAMINATION REPORTS.

  (a) In General.--The Federal Financial Institutions Examination 
Council Act of 1978 (12 U.S.C. 3301 et seq.) is amended by adding at 
the end the following:

``SEC. 1012. TIMELINESS OF EXAMINATION REPORTS.

  ``(a) In General.--
          ``(1) Final examination report.--A Federal financial 
        institutions regulatory agency shall provide a final 
        examination report to a financial institution not later than 60 
        days after the later of--
                  ``(A) the exit interview for an examination of the 
                institution; or
                  ``(B) the provision of additional information by the 
                institution relating to the examination.
          ``(2) Exit interview.--If a financial institution is not 
        subject to a resident examiner program, the exit interview 
        shall occur not later than the end of the 9-month period 
        beginning on the commencement of the examination, except that 
        such period may be extended by the Federal financial 
        institutions regulatory agency by providing written notice to 
        the institution and the Independent Examination Review Director 
        describing with particularity the reasons that a longer period 
        is needed to complete the examination.
  ``(b) Examination Materials.--Upon the request of a financial 
institution, the Federal financial institutions regulatory agency shall 
include with the final report an appendix listing all examination or 
other factual information relied upon by the agency in support of a 
material supervisory determination.

``SEC. 1013. EXAMINATION STANDARDS.

  ``(a) In General.--In the examination of a financial institution--
          ``(1) a commercial loan shall not be placed in non-accrual 
        status solely because the collateral for such loan has 
        deteriorated in value;
          ``(2) a modified or restructured commercial loan shall be 
        removed from non-accrual status if the borrower demonstrates 
        the ability to perform on such loan over a maximum period of 6 
        months, except that with respect to loans on a quarterly, 
        semiannual, or longer repayment schedule such period shall be a 
        maximum of 3 consecutive repayment periods;
          ``(3) a new appraisal on a performing commercial loan shall 
        not be required unless an advance of new funds is involved; and
          ``(4) in classifying a commercial loan in which there has 
        been deterioration in collateral value, the amount to be 
        classified shall be the portion of the deficiency relating to 
        the decline in collateral value and repayment capacity of the 
        borrower.
  ``(b) Well Capitalized Institutions.--The Federal financial 
institutions regulatory agencies may not require a financial 
institution that is well capitalized to raise additional capital in 
lieu of an action prohibited under subsection (a).
  ``(c) Consistent Loan Classifications.--The Federal financial 
institutions regulatory agencies shall develop and apply identical 
definitions and reporting requirements for non-accrual loans.

``SEC. 1014. OFFICE OF INDEPENDENT EXAMINATION REVIEW.

  ``(a) Establishment.--There is established in the Council an Office 
of Independent Examination Review (the `Office').
  ``(b) Head of Office.--There is established the position of the 
Independent Examination Review Director (the `Director'), as the head 
of the Office. The Director shall be appointed by the Council and shall 
be independent from any member agency of the Council.
  ``(c) Staffing.--The Director is authorized to hire staff to support 
the activities of the Office.
  ``(d) Duties.--The Director shall--
          ``(1) receive and, at the Director's discretion, investigate 
        complaints from financial institutions, their representatives, 
        or another entity acting on behalf of such institutions, 
        concerning examinations, examination practices, or examination 
        reports;
          ``(2) hold meetings, at least once every three months and in 
        locations designed to encourage participation from all sections 
        of the United States, with financial institutions, their 
        representatives, or another entity acting on behalf of such 
        institutions, to discuss examination procedures, examination 
        practices, or examination policies;
          ``(3) review examination procedures of the Federal financial 
        institutions regulatory agencies to ensure that the written 
        examination policies of those agencies are being followed in 
        practice and adhere to the standards for consistency 
        established by the Council;
          ``(4) conduct a continuing and regular review of examination 
        quality assurance for all examination types conducted by the 
        Federal financial institutions regulatory agencies;
          ``(5) adjudicate any supervisory appeal initiated under 
        section 1015; and
          ``(6) report annually to the Committee on Financial Services 
        of the House of Representatives, the Committee on Banking, 
        Housing, and Urban Affairs of the Senate, and the Council, on 
        the reviews carried out pursuant to paragraphs (3) and (4), 
        including compliance with the requirements set forth in section 
        1012 regarding timeliness of examination reports, and the 
        Council's recommendations for improvements in examination 
        procedures, practices, and policies.
  ``(e) Confidentiality.--The Director shall keep confidential all 
meetings with, discussions with, and information provided by financial 
institutions.

``SEC. 1015. RIGHT TO INDEPENDENT REVIEW OF MATERIAL SUPERVISORY 
                    DETERMINATIONS.

  ``(a) In General.--A financial institution shall have the right to 
obtain an independent review of a material supervisory determination 
contained in a final report of examination.
  ``(b) Notice.--
          ``(1) Timing.--A financial institution seeking review of a 
        material supervisory determination under this section shall 
        file a written notice with the Independent Examination Review 
        Director (the `Director') within 60 days after receiving the 
        final report of examination that is the subject of such review.
          ``(2) Identification of determination.--The written notice 
        shall identify the material supervisory determination that is 
        the subject of the independent examination review, and a 
        statement of the reasons why the institution believes that the 
        determination is incorrect or should otherwise be modified.
          ``(3) Information to be provided to institution.--Any 
        information relied upon by the agency in the final report that 
        is not in the possession of the financial institution may be 
        requested by the financial institution and shall be delivered 
        promptly by the agency to the financial institution.
  ``(c) Right to Hearing.--
          ``(1) In general.--The Director shall determine the merits of 
        the appeal on the record or, at the financial institution's 
        election, shall refer the appeal to an Administrative Law Judge 
        to conduct a confidential hearing pursuant to the procedures 
        set forth under sections 556 and 557 of title 5, United States 
        Code, which hearing shall take place not later than 60 days 
        after the petition for review was received by the Director, and 
        to issue a proposed decision to the Director based upon the 
        record established at such hearing.
          ``(2) Standard of review.--In rendering a determination or 
        recommendation under this subsection, neither the 
        Administrative Law Judge nor the Director shall defer to the 
        opinions of the examiner or agency, but shall conduct a de novo 
        review to independently determine the appropriateness of the 
        agency's decision based upon the relevant statutes, 
        regulations, and other appropriate guidance, as well as 
        evidence adduced at any hearing.
  ``(d) Final Decision.--A decision by the Director on an independent 
review under this section shall--
          ``(1) be made not later than 60 days after the record has 
        been closed; and
          ``(2) be deemed final agency action and shall bind the agency 
        whose supervisory determination was the subject of the review 
        and the financial institution requesting the review.
  ``(e) Right to Judicial Review.--A financial institution shall have 
the right to petition for review of final agency action under this 
section by filing a Petition for Review within 60 days of the 
Director's decision in the United States Court of Appeals for the 
District of Columbia Circuit or the Circuit in which the financial 
institution is located.
  ``(f) Report.--The Director shall report annually to the Committee on 
Financial Services of the House of Representatives and the Committee on 
Banking, Housing, and Urban Affairs of the Senate on actions taken 
under this section, including the types of issues that the Director has 
reviewed and the results of those reviews. In no case shall such a 
report contain information about individual financial institutions or 
any confidential or privileged information shared by financial 
institutions.
  ``(g) Retaliation Prohibited.--A Federal financial institutions 
regulatory agency may not--
          ``(1) retaliate against a financial institution, including 
        service providers, or any institution-affiliated party (as 
        defined under section 3 of the Federal Deposit Insurance Act), 
        for exercising appellate rights under this section; or
          ``(2) delay or deny any agency action that would benefit a 
        financial institution or any institution-affiliated party on 
        the basis that an appeal under this section is pending under 
        this section.
  ``(h) Rule of Construction.--Nothing in this section may be 
construed--
          ``(1) to affect the right of a Federal financial institutions 
        regulatory agency to take enforcement or other supervisory 
        actions related to a material supervisory determination under 
        review under this section; or
          ``(2) to prohibit the review under this section of a material 
        supervisory determination with respect to which there is an 
        ongoing enforcement or other supervisory action.''.
  (b) Additional Amendments.--
          (1) Riegle community development and regulatory improvement 
        act of 1994.--Section 309 of the Riegle Community Development 
        and Regulatory Improvement Act of 1994 (12 U.S.C. 4806) is 
        amended--
                  (A) in subsection (a), by inserting after 
                ``appropriate Federal banking agency'' the following: 
                ``, the Consumer Law Enforcement Agency,'';
                  (B) in subsection (b)--
                          (i) in paragraph (2), by striking ``the 
                        appellant from retaliation by agency 
                        examiners'' and inserting ``the insured 
                        depository institution or insured credit union 
                        from retaliation by the agencies referred to in 
                        subsection (a)''; and
                          (ii) by adding at the end the following 
                        flush-left text:
``For purposes of this subsection and subsection (e), retaliation 
includes delaying consideration of, or withholding approval of, any 
request, notice, or application that otherwise would have been 
approved, but for the exercise of the institution's or credit union's 
rights under this section.'';
                  (C) in subsection (e)(2)--
                          (i) in subparagraph (B), by striking ``and'' 
                        at the end;
                          (ii) in subparagraph (C), by striking the 
                        period and inserting ``; and''; and
                          (iii) by adding at the end the following:
                  ``(D) ensure that appropriate safeguards exist for 
                protecting the insured depository institution or 
                insured credit union from retaliation by any agency 
                referred to in subsection (a) for exercising its rights 
                under this subsection.''; and
                  (D) in subsection (f)(1)(A)--
                          (i) in clause (ii), by striking ``and'' at 
                        the end;
                          (ii) in clause (iii), by striking ``and'' at 
                        the end; and
                          (iii) by adding at the end the following:
                          ``(iv) any issue specifically listed in an 
                        exam report as a matter requiring attention by 
                        the institution's management or board of 
                        directors; and
                          ``(v) any suspension or removal of an 
                        institution's status as eligible for expedited 
                        processing of applications, requests, notices, 
                        or filings on the grounds of a supervisory or 
                        compliance concern, regardless of whether that 
                        concern has been cited as a basis for another 
                        material supervisory determination or matter 
                        requiring attention in an examination report, 
                        provided that the conduct at issue did not 
                        involve violation of any criminal law; and''.
          (2) Federal credit union act.--Section 205(j) of the Federal 
        Credit Union Act (12 U.S.C. 1785(j)) is amended by inserting 
        ``the Consumer Law Enforcement Agency,'' before ``the 
        Administration'' each place such term appears.
          (3) Federal financial institutions examination council act of 
        1978.--The Federal Financial Institutions Examination Council 
        Act of 1978 (12 U.S.C. 3301 et seq.) is amended--
                  (A) in section 1003, by amending paragraph (1) to 
                read as follows:
          ``(1) the term `Federal financial institutions regulatory 
        agencies'--
                  ``(A) means the Office of the Comptroller of the 
                Currency, the Board of Governors of the Federal Reserve 
                System, the Federal Deposit Insurance Corporation, and 
                the National Credit Union Administration; and
                  ``(B) for purposes of sections 1012, 1013, 1014, and 
                1015, includes the Consumer Law Enforcement Agency;''; 
                and
                  (B) in section 1005, by striking ``One-fifth'' and 
                inserting ``One-fourth''.

  Subtitle I--National Credit Union Administration Budget Transparency

SEC. 541. BUDGET TRANSPARENCY FOR THE NCUA.

  Section 209(b) of the Federal Credit Union Act (12 U.S.C. 1789) is 
amended--
          (1) by redesignating paragraphs (1) and (2) as paragraphs (2) 
        and (3), respectively;
          (2) by inserting before paragraph (2), as so redesignated, 
        the following:
          ``(1) on an annual basis and prior to the submission of the 
        detailed business-type budget required under paragraph (2)--
                  ``(A) make publicly available and cause to be printed 
                in the Federal Register a draft of such detailed 
                business-type budget; and
                  ``(B) hold a public hearing, with public notice 
                provided of such hearing, wherein the public can submit 
                comments on the draft of such detailed business-type 
                budget;''; and
          (3) in paragraph (2), as so redesignated--
                  (A) by inserting ``detailed'' after ``submit a''; and
                  (B) by inserting ``, and where such budget shall 
                address any comments submitted by the public pursuant 
                to paragraph (1)(B)'' after ``Control Act''.

   Subtitle J--Taking Account of Institutions With Low Operation Risk

SEC. 546. REGULATIONS APPROPRIATE TO BUSINESS MODELS.

  (a) In General.--For any regulatory action occurring after the date 
of the enactment of this Act, each Federal financial institutions 
regulatory agency shall--
          (1) take into consideration the risk profile and business 
        models of each type of institution or class of institutions 
        subject to the regulatory action;
          (2) determine the necessity, appropriateness, and impact of 
        applying such regulatory action to such institutions or classes 
        of institutions; and
          (3) tailor such regulatory action in a manner that limits the 
        regulatory compliance impact, cost, liability risk, and other 
        burdens, as appropriate, for the risk profile and business 
        model of the institution or class of institutions involved.
  (b) Other Considerations.--In carrying out the requirements of 
subsection (a), each Federal financial institutions regulatory agency 
shall consider--
          (1) the impact that such regulatory action, both by itself 
        and in conjunction with the aggregate effect of other 
        regulations, has on the ability of the applicable institution 
        or class of institutions to serve evolving and diverse customer 
        needs;
          (2) the potential impact of examination manuals, regulatory 
        actions taken with respect to third-party service providers, or 
        other regulatory directives that may be in conflict or 
        inconsistent with the tailoring of such regulatory action 
        described in subsection (a)(3); and
          (3) the underlying policy objectives of the regulatory action 
        and statutory scheme involved.
  (c) Notice of Proposed and Final Rulemaking.--Each Federal financial 
institutions regulatory agency shall disclose in every notice of 
proposed rulemaking and in any final rulemaking for a regulatory action 
how the agency has applied subsections (a) and (b).
  (d) Reports to Congress.--
          (1) Individual agency reports.--
                  (A) In general.--Not later than 1 year after the date 
                of the enactment of this Act and annually thereafter, 
                each Federal financial institutions regulatory agency 
                shall report to the Committee on Financial Services of 
                the House of Representatives and the Committee on 
                Banking, Housing, and Urban Affairs of the Senate on 
                the specific actions taken to tailor the regulatory 
                actions of the agency pursuant to the requirements of 
                this Act.
                  (B) Appearance before the committees.--The head of 
                each Federal financial institution regulatory agency 
                shall appear before the Committee on Financial Services 
                of the House of Representatives and the Committee on 
                Banking, Housing, and Urban Affairs of the Senate after 
                each report is made pursuant to subparagraph (A) to 
                testify on the contents of such report.
          (2) FIEC reports.--
                  (A) In general.--Not later than 3 months after each 
                report is submitted under paragraph (1), the Financial 
                Institutions Examination Council shall report to the 
                Committee on Financial Services of the House of 
                Representatives and the Committee on Banking, Housing, 
                and Urban Affairs of the Senate on--
                          (i) the extent to which regulatory actions 
                        tailored pursuant to this Act result in 
                        different treatment of similarly situated 
                        institutions of diverse charter types; and
                          (ii) the reasons for such differential 
                        treatment.
                  (B) Appearance before the committees.--The Chairman 
                of the Financial Institutions Examination Council shall 
                appear before the Committee on Financial Services of 
                the House of Representatives and the Committee on 
                Banking, Housing, and Urban Affairs of the Senate after 
                each report is made pursuant to subparagraph (A) to 
                testify on the contents of such report.
  (e) Limited Look-Back Application.--
          (1) In general.--Each Federal financial institutions 
        regulatory agency shall conduct a review of all regulations 
        adopted during the period beginning on the date that is seven 
        years before the date of the introduction of this Act in the 
        House of Representatives and ending on the date of the 
        enactment of this Act, and apply the requirements of this Act 
        to such regulations.
          (2) Revision.--If the application of the requirements of this 
        Act to any such regulation requires such regulation to be 
        revised, the applicable Federal financial institutions 
        regulatory agency shall revise such regulation within 3 years 
        of the enactment of this Act.
  (f) Definitions.--In this Act, the following definitions shall apply:
          (1) Federal financial institutions regulatory agencies.--The 
        term ``Federal financial institutions regulatory agencies'' 
        means the Office of the Comptroller of the Currency, the Board 
        of Governors of the Federal Reserve System, the Federal Deposit 
        Insurance Corporation, the National Credit Union 
        Administration, and the Consumer Law Enforcement Agency.
          (2) Regulatory action.--The term ``regulatory action'' means 
        any proposed, interim, or final rule or regulation, guidance, 
        or published interpretation.

      Subtitle K--Federal Savings Association Charter Flexibility

SEC. 551. OPTION FOR FEDERAL SAVINGS ASSOCIATIONS TO OPERATE AS A 
                    COVERED SAVINGS ASSOCIATION.

  The Home Owners' Loan Act is amended by inserting after section 5 (12 
U.S.C. 1464) the following:

``SEC. 5A. ELECTION TO OPERATE AS A COVERED SAVINGS ASSOCIATION.

  ``(a) Definition.--In this section, the term `covered savings 
association' means a Federal savings association that makes an election 
approved under subsection (b).
  ``(b) Election.--
          ``(1) In general.--Upon issuance of the rules described in 
        subsection (f), a Federal savings association may elect to 
        operate as a covered savings association by submitting a notice 
        to the Comptroller of such election.
          ``(2) Approval.--A Federal savings association shall be 
        deemed to be approved to operate as a covered savings 
        association on the date that is 60 days after the date on which 
        the Comptroller receives the notice under paragraph (1), unless 
        the Comptroller notifies the Federal savings association 
        otherwise.
  ``(c) Rights and Duties.--Notwithstanding any other provision of law 
and except as otherwise provided in this section, a covered savings 
association shall--
          ``(1) have the same rights and privileges as a national bank 
        that has its main office situated in the same location as the 
        home office of the covered savings association; and
          ``(2) be subject to the same duties, restrictions, penalties, 
        liabilities, conditions, and limitations that would apply to 
        such a national bank.
  ``(d) Treatment of Covered Savings Associations.--A covered savings 
association shall be treated as a Federal savings association for the 
purposes--
          ``(1) of governance of the covered savings association, 
        including incorporation, bylaws, boards of directors, 
        shareholders, and distribution of dividends;
          ``(2) of consolidation, merger, dissolution, conversion 
        (including conversion to a stock bank or to another charter), 
        conservatorship, and receivership; and
          ``(3) determined by regulation of the Comptroller.
  ``(e) Existing Branches.--A covered savings association may continue 
to operate any branch or agency the covered savings association 
operated on the date on which an election under subsection (b) is 
approved.
  ``(f) Rulemaking.--The Comptroller shall issue rules to carry out 
this section--
          ``(1) that establish streamlined standards and procedures 
        that clearly identify required documentation or timelines for 
        an election under subsection (b);
          ``(2) that require a Federal savings association that makes 
        an election under subsection (b) to identify specific assets 
        and subsidiaries--
                  ``(A) that do not conform to the requirements for 
                assets and subsidiaries of a national bank; and
                  ``(B) that are held by the Federal savings 
                association on the date on which the Federal savings 
                association submits a notice of such election;
          ``(3) that establish--
                  ``(A) a transition process for bringing such assets 
                and subsidiaries into conformance with the requirements 
                for a national bank; and
                  ``(B) procedures for allowing the Federal savings 
                association to provide a justification for 
                grandfathering such assets and subsidiaries after 
                electing to operate as a covered savings association;
          ``(4) that establish standards and procedures to allow a 
        covered savings association to terminate an election under 
        subsection (b) after an appropriate period of time or to make a 
        subsequent election;
          ``(5) that clarify requirements for the treatment of covered 
        savings associations, including the provisions of law that 
        apply to covered savings associations; and
          ``(6) as the Comptroller deems necessary and in the interests 
        of safety and soundness.''.

                Subtitle L--SAFE Transitional Licensing

SEC. 556. ELIMINATING BARRIERS TO JOBS FOR LOAN ORIGINATORS.

  (a) In General.--The S.A.F.E. Mortgage Licensing Act of 2008 (12 
U.S.C. 5101 et seq.) is amended by adding at the end the following:

``SEC. 1518. EMPLOYMENT TRANSITION OF LOAN ORIGINATORS.

  ``(a) Temporary Authority to Originate Loans for Loan Originators 
Moving From a Depository Institution to a Non-depository Institution.--
          ``(1) In general.--Upon employment by a State-licensed 
        mortgage company, an individual who is a registered loan 
        originator shall be deemed to have temporary authority to act 
        as a loan originator in an application State for the period 
        described in paragraph (2) if the individual--
                  ``(A) has not had an application for a loan 
                originator license denied, or had such a license 
                revoked or suspended in any governmental jurisdiction;
                  ``(B) has not been subject to or served with a cease 
                and desist order in any governmental jurisdiction or as 
                described in section 1514(c);
                  ``(C) has not been convicted of a felony that would 
                preclude licensure under the law of the application 
                State;
                  ``(D) has submitted an application to be a State-
                licensed loan originator in the application State; and
                  ``(E) was registered in the Nationwide Mortgage 
                Licensing System and Registry as a loan originator 
                during the 12-month period preceding the date of 
                submission of the information required under section 
                1505(a).
          ``(2) Period.--The period described in paragraph (1) shall 
        begin on the date that the individual submits the information 
        required under section 1505(a) and shall end on the earliest 
        of--
                  ``(A) the date that the individual withdraws the 
                application to be a State-licensed loan originator in 
                the application State;
                  ``(B) the date that the application State denies, or 
                issues a notice of intent to deny, the application;
                  ``(C) the date that the application State grants a 
                State license; or
                  ``(D) the date that is 120 days after the date on 
                which the individual submits the application, if the 
                application is listed on the Nationwide Mortgage 
                Licensing System and Registry as incomplete.
  ``(b) Temporary Authority to Originate Loans for State-licensed Loan 
Originators Moving Interstate.--
          ``(1) In general.--A State-licensed loan originator shall be 
        deemed to have temporary authority to act as a loan originator 
        in an application State for the period described in paragraph 
        (2) if the State-licensed loan originator--
                  ``(A) meets the requirements of subparagraphs (A), 
                (B), (C), and (D) of subsection (a)(1);
                  ``(B) is employed by a State-licensed mortgage 
                company in the application State; and
                  ``(C) was licensed in a State that is not the 
                application State during the 30-day period preceding 
                the date of submission of the information required 
                under section 1505(a) in connection with the 
                application submitted to the application State.
          ``(2) Period.--The period described in paragraph (1) shall 
        begin on the date that the State-licensed loan originator 
        submits the information required under section 1505(a) in 
        connection with the application submitted to the application 
        State and end on the earliest of--
                  ``(A) the date that the State-licensed loan 
                originator withdraws the application to be a State-
                licensed loan originator in the application State;
                  ``(B) the date that the application State denies, or 
                issues a notice of intent to deny, the application;
                  ``(C) the date that the application State grants a 
                State license; or
                  ``(D) the date that is 120 days after the date on 
                which the State-licensed loan originator submits the 
                application, if the application is listed on the 
                Nationwide Mortgage Licensing System and Registry as 
                incomplete.
  ``(c) Applicability.--
          ``(1) Any person employing an individual who is deemed to 
        have temporary authority to act as a loan originator in an 
        application State pursuant to this section shall be subject to 
        the requirements of this title and to applicable State law to 
        the same extent as if such individual was a State-licensed loan 
        originator licensed by the application State.
          ``(2) Any individual who is deemed to have temporary 
        authority to act as a loan originator in an application State 
        pursuant to this section and who engages in residential 
        mortgage loan origination activities shall be subject to the 
        requirements of this title and to applicable State law to the 
        same extent as if such individual was a State-licensed loan 
        originator licensed by the application State.
  ``(d) Definitions.--In this section, the following definitions shall 
apply:
          ``(1) State-licensed mortgage company.--The term `State-
        licensed mortgage company' means an entity licensed or 
        registered under the law of any State to engage in residential 
        mortgage loan origination and processing activities.
          ``(2) Application state.--The term `application State' means 
        a State in which a registered loan originator or a State-
        licensed loan originator seeks to be licensed.''.
  (b) Table of Contents Amendment.--The table of contents in section 
1(b) of the Housing and Economic Recovery Act of 2008 (42 U.S.C. 4501 
note) is amended by inserting after the item relating to section 1517 
the following:

``Sec. 1518. Employment transition of loan originators.''.

  (c) Amendment to Civil Liability of the Consumer Law Enforcement 
Agency and Other Officials.--Section 1513 of the S.A.F.E. Mortgage 
Licensing Act of 2008 (12 U.S.C. 5112) is amended by striking ``are 
loan originators or are applying for licensing or registration as loan 
originators'' and inserting ``are applying for licensing or 
registration using the Nationwide Mortgage Licensing System and 
Registry''.

                       Subtitle M--Right to Lend

SEC. 561. SMALL BUSINESS LOAN DATA COLLECTION REQUIREMENT.

  (a) Repeal.--Section 704B of the Equal Credit Opportunity Act (15 
U.S.C. 1691c-2) is repealed.
  (b) Conforming Amendments.--Section 701(b) of the Equal Credit 
Opportunity Act (15 U.S.C. 1691(b)) is amended--
          (1) in paragraph (3), by inserting ``or'' at the end;
          (2) in paragraph (4), by striking ``; or'' and inserting a 
        period; and
          (3) by striking paragraph (5).
  (c) Clerical Amendment.--The table of sections for title VII of the 
Consumer Credit Protection Act is amended by striking the item relating 
to section 704B.

              Subtitle N--Community Bank Reporting Relief

SEC. 566. SHORT FORM CALL REPORT.

  (a) In General.--Section 7(a) of the Federal Deposit Insurance Act 
(12 U.S.C. 1817(a)) is amended by adding at the end the following:
          ``(12) Short form reporting.--
                  ``(A) In general.--The appropriate Federal banking 
                agencies shall issue regulations allowing for a reduced 
                reporting requirement for covered depository 
                institutions when making the first and third report of 
                condition for a year, as required pursuant to paragraph 
                (3).
                  ``(B) Covered depository institution defined.--For 
                purposes of this paragraph, the term `covered 
                depository institution' means an insured depository 
                institution that--
                          ``(i) is well capitalized (as defined under 
                        section 38(b)); and
                          ``(ii) satisfies such other criteria as the 
                        appropriate Federal banking agencies determine 
                        appropriate.''.
  (b) Report to Congress.--Not later than 180 days after the date of 
the enactment of this Act, and every 365 days thereafter until the 
appropriate Federal banking agencies (as defined under section 3 of the 
Federal Deposit Insurance Act) have issued the regulations required 
under section 7(a)(12)(A) of the Federal Deposit Insurance Act, such 
agencies shall submit to the Committee on Financial Services of the 
House of Representatives and the Committee on Banking, Housing, and 
Urban Affairs of the Senate a report describing the progress made in 
issuing such regulations.

          Subtitle O--Homeowner Information Privacy Protection

SEC. 571. STUDY REGARDING PRIVACY OF INFORMATION COLLECTED UNDER THE 
                    HOME MORTGAGE DISCLOSURE ACT OF 1975.

  (a) Study.--The Comptroller General of the United States shall 
conduct a study to determine whether the data required to be published, 
made available, or disclosed under the final rule, in connection with 
other publicly available data sources, including data made publicly 
available under Regulation C (12 C.F.R. 1003) before the effective date 
of the final rule, could allow for or increase the probability of--
          (1) exposure of the identity of mortgage applicants or 
        mortgagors through reverse engineering;
          (2) exposure of mortgage applicants or mortgagors to identity 
        theft or the loss of sensitive personal financial information;
          (3) the marketing or sale of unfair or deceptive financial 
        products to mortgage applicants or mortgagors based on such 
        data;
          (4) personal financial loss or emotional distress resulting 
        from the exposure of mortgage applicants or mortgagors to 
        identify theft or the loss of sensitive personal financial 
        information; and
          (5) the potential legal liability facing the Consumer Law 
        Enforcement Agency and market participants in the event the 
        data required to be published, made available, or disclosed 
        under the final rule leads or contributes to identity theft or 
        the capture of sensitive personal financial information.
  (b) Report.--The Comptroller General of the United States shall 
submit to the Committee on Financial Services of the House of 
Representatives and the Committee on Banking, Housing, and Urban 
Affairs of the Senate a report that includes--
          (1) the findings and conclusions of the Comptroller General 
        with respect to the study required under subsection (a); and
          (2) any recommendations for legislative or regulatory actions 
        that--
                  (A) would enhance the privacy of a consumer when 
                accessing mortgage credit; and
                  (B) are consistent with consumer protections and safe 
                and sound banking operations.
  (c) Suspension of Data Sharing Requirements.--Notwithstanding any 
other provision of law, including the final rule--
          (1) depository institutions shall not be required to publish, 
        disclose, or otherwise make available to the public, pursuant 
        to the Home Mortgage Disclosure Act of 1975 (or regulations 
        issued under such Act) any data that was not required to be 
        published, disclosed, or otherwise made available pursuant to 
        such Act (or regulations issued under such Act) on the day 
        before the date of the enactment of the Dodd-Frank Wall Street 
        Reform and Consumer Protection Act; and
          (2) the Consumer Law Enforcement Agency and the Financial 
        Institutions Examination Council shall not publish, disclose, 
        or otherwise make available to the public any such information 
        received from a depository institution pursuant to the final 
        rule.
  (d) Definitions.--For purposes of this section:
          (1) Depository institution.--The term ``depository 
        institution'' has the meaning given that term under section 303 
        of the Home Mortgage Disclosure Act of 1975 (12 U.S.C. 2802).
          (2) Final rule.--The term ``final rule'' means the final rule 
        issued by the Bureau of Consumer Financial Protection titled 
        ``Home Mortgage Disclosure (Regulation C)'' (October 28, 2015; 
        80 Fed. Reg. 66128).

            Subtitle P--Home Mortgage Disclosure Adjustment

SEC. 576. DEPOSITORY INSTITUTIONS SUBJECT TO MAINTENANCE OF RECORDS AND 
                    DISCLOSURE REQUIREMENTS.

  (a) In General.--Section 304 of the Home Mortgage Disclosure Act of 
1975 (12 U.S.C. 2803) is amended--
          (1) by redesignating subsection (i) as paragraph (2) and 
        adjusting the margin appropriately; and
          (2) by inserting before such paragraph (2) the following:
  ``(i) Exemptions.--
          ``(1) In general.--With respect to a depository institution, 
        the requirements of subsections (a) and (b) shall not apply--
                  ``(A) with respect to closed-end mortgage loans, if 
                such depository institution originated less than 100 
                closed-end mortgage loans in each of the two preceding 
                calendar years; and
                  ``(B) with respect to open-end lines of credit, if 
                such depository institution originated less than 200 
                open-end lines of credit in each of the two preceding 
                calendar years.''.
  (b) Technical Correction.--Section 304(i)(2) of such Act, as 
redesignated by subsection (a), is amended by striking ``section 
303(2)(A)'' and inserting ``section 303(3)(A)''.

           Subtitle Q--Protecting Consumers' Access to Credit

SEC. 581. RATE OF INTEREST AFTER TRANSFER OF LOAN.

  (a) Amendment to the Revised Statutes.--Section 5197 of the Revised 
Statutes of the United States (12 U.S.C. 85) is amended by adding at 
the end the following new sentence: ``A loan that is valid when made as 
to its maximum rate of interest in accordance with this section shall 
remain valid with respect to such rate regardless of whether the loan 
is subsequently sold, assigned, or otherwise transferred to a third 
party, and may be enforced by such third party notwithstanding any 
State law to the contrary.''.
  (b) Amendment to the Home Owners' Loan Act.--Section 4(g)(1) of the 
Home Owners' Loan Act (12 U.S.C. 1463(g)(1)) is amended by adding at 
the end the following new sentence: ``A loan that is valid when made as 
to its maximum rate of interest in accordance with this subsection 
shall remain valid with respect to such rate regardless of whether the 
loan is subsequently sold, assigned, or otherwise transferred to a 
third party, and may be enforced by such third party notwithstanding 
any State law to the contrary.''.
  (c) Amendment to the Federal Credit Union Act.--Section 205(g)(1) of 
the Federal Credit Union Act (12 U.S.C. 1785(g)(1)) is amended by 
adding at the end the following new sentence: ``A loan that is valid 
when made as to its maximum rate of interest in accordance with this 
subsection shall remain valid with respect to such rate regardless of 
whether the loan is subsequently sold, assigned, or otherwise 
transferred to a third party, and may be enforced by such third party 
notwithstanding any State law to the contrary.''.
  (d) Amendment to the Federal Deposit Insurance Act.--Section 27(a) of 
the Federal Deposit Insurance Act (12 U.S.C. 1831d(a)) is amended by 
adding at the end the following new sentence: ``A loan that is valid 
when made as to its maximum rate of interest in accordance with this 
section shall remain valid with respect to such rate regardless of 
whether the loan is subsequently sold, assigned, or otherwise 
transferred to a third party, and may be enforced by such third party 
notwithstanding any State law to the contrary.''.

                 Subtitle R--NCUA Overhead Transparency

SEC. 586. FUND TRANSPARENCY.

  Section 203 of the Federal Credit Union Act (12 U.S.C. 1783) is 
amended by adding at the end the following:
  ``(g) Fund Transparency.--
          ``(1) In general.--The Board shall accompany each annual 
        budget submitted pursuant to section 209(b) with a report 
        containing--
                  ``(A) a detailed analysis of how the expenses of the 
                Administration are assigned between prudential 
                activities and insurance-related activities and the 
                extent to which those expenses are paid from the fees 
                collected pursuant to section 105 or from the Fund; and
                  ``(B) the Board's supporting rationale for any 
                proposed use of amounts in the Fund contained in such 
                budget, including detailed breakdowns and supporting 
                rationales for any such proposed use related to titles 
                of this Act other than this title.
          ``(2) Public disclosure.--The Board shall make each report 
        described under paragraph (1) available to the public.''.

             Subtitle S--Housing Opportunities Made Easier

SEC. 591. CLARIFICATION OF DONATED SERVICES TO NON-PROFITS.

  Section 129E(i) of the Truth in Lending Act (15 U.S.C. 1639e(i)) is 
amended by adding at the end the following:
          ``(4) Rule of construction related to appraisal donations.--
        For purposes of paragraph (1), if a fee appraiser voluntarily 
        donates appraisal services to an organization described in 
        section 170(c)(2) of the Internal Revenue Code of 1986, such 
        voluntary donation shall be deemed customary and reasonable.''.

  TITLE VI--REGULATORY RELIEF FOR STRONGLY CAPITALIZED, WELL MANAGED 
                         BANKING ORGANIZATIONS

SEC. 601. CAPITAL ELECTION.

  (a) In General.--A banking organization may make an election under 
this section to be treated as a qualifying banking organization for 
purposes of the regulatory relief described under section 602.
  (b) Requirements.--A banking organization may qualify to be treated 
as a qualifying banking organization if--
          (1) the banking organization has an average leverage ratio of 
        at least 10 percent;
          (2) with respect to a depository institution holding company, 
        each insured depository institution subsidiary of the holding 
        company simultaneously makes the election described under 
        subsection (a); and
          (3) with respect to an insured depository institution, any 
        parent depository institution holding company of the 
        institution simultaneously makes the election described under 
        subsection (a).
  (c) Election Process.--To make an election under this section, a 
banking organization shall submit an election to the appropriate 
Federal banking agency (and any applicable State bank supervisor that 
regulates the banking organization) containing--
          (1) a notice of such election;
          (2) the banking organization's average leverage ratio, as 
        well as the organization's quarterly leverage ratio for each of 
        the most recently completed four calendar quarters;
          (3) if the banking organization is a depository institution 
        holding company, the information described under paragraph (2) 
        for each of the organization's insured depository institution 
        subsidiaries; and
          (4) if the banking organization is an insured depository 
        institution, the information described under paragraph (2) for 
        any parent depository institution holding company of the 
        institution.
  (d) Effective Date of Election.--
          (1) In general.--An election made under this section shall 
        take effect at the end of the 30-day period beginning on the 
        date that the appropriate Federal banking agency receives the 
        application described under subsection (c), unless the 
        appropriate Federal banking agency determines that the banking 
        organization has not met the requirements described under 
        subsection (b).
          (2) Notice of failure to meet requirements.--If the 
        appropriate Federal banking agency determines that a banking 
        organization submitting an election notice under subsection (c) 
        does not meet the requirements described under subsection (b), 
        the agency shall--
                  (A) notify the banking organization (and any 
                applicable State bank supervisor that regulates the 
                banking organization), in writing, of such 
                determination as soon as possible after such 
                determination is made, but in no case later than the 
                end of the 30-day period beginning on the date that the 
                appropriate Federal banking agency receives the 
                election; and
                  (B) include in such notification the specific reasons 
                for such determination and steps that the banking 
                organization can take to meet such requirements.
  (e) Treatment of Certain New Banking Organizations.--In the case of a 
banking organization that is a newly-chartered insured depository 
institution or a banking organization that becomes a banking 
organization because it controls a newly-chartered insured depository 
institution, such banking organization may be treated as a qualifying 
banking organization immediately upon becoming a banking organization, 
if--
          (1) an election to be treated as a qualifying banking 
        organization was included in the application filed with the 
        appropriate Federal banking agency in connection with becoming 
        a banking organization; and
          (2) as of the date the banking organization becomes a banking 
        organization, the banking organization's tangible equity 
        divided by the banking organization's leverage exposure, 
        expressed as a percentage, is at least 10 percent.
  (f) Failure to Maintain Quarterly Leverage Ratio and Loss of 
Election.--
          (1) Effect of failure to maintain quarterly leverage ratio.--
                  (A) In general.--If, with respect to the most 
                recently completed calendar quarter, the appropriate 
                Federal banking agency determines that a qualifying 
                banking organization's quarterly leverage ratio is 
                below 10 percent--
                          (i) the appropriate Federal banking agency 
                        shall notify the qualifying banking 
                        organization and any applicable State bank 
                        supervisor that regulates the banking 
                        organization of such determination;
                          (ii) the appropriate Federal banking agency 
                        may prohibit the banking organization from 
                        making a capital distribution; and
                          (iii) the banking organization shall, within 
                        3 months of the first such determination, 
                        submit a capital restoration plan to the 
                        appropriate Federal banking agency.
                  (B) Loss of election after one-year remediation 
                period.--If a banking organization described under 
                subparagraph (A) does not, within the 1-year period 
                beginning on the date of such determination, raise the 
                organization's quarterly leverage ratio for a calendar 
                quarter ending in such 1-year period to at least 10 
                percent, the banking organization's election under this 
                section shall be terminated, and the appropriate 
                Federal banking agency shall notify any applicable 
                State bank supervisor that regulates the banking 
                organization of such termination.
                  (C) Effect of subsidiary on parent organization.--
                With respect to a qualifying banking organization 
                described under subparagraph (A) that is an insured 
                depository institution, any parent depository 
                institution holding company of the qualifying banking 
                organization shall--
                          (i) if the appropriate Federal banking agency 
                        determines it appropriate, be prohibited from 
                        making a capital distribution (other than a 
                        capital contribution to such qualifying banking 
                        organization described under subparagraph (A)); 
                        and
                          (ii) if the qualifying banking organization 
                        has an election terminated under subparagraph 
                        (B), any such parent depository institution 
                        holding company shall also have its election 
                        under this section terminated.
          (2) Immediate loss of election if the quarterly leverage 
        ratio falls below 6 percent.--
                  (A) In general.--If, with respect to the most 
                recently completed calendar quarter, the appropriate 
                Federal banking agency determines that a qualifying 
                banking organization's quarterly leverage ratio is 
                below 6 percent, the banking organization's election 
                under this section shall be terminated, and the 
                appropriate Federal banking agency shall notify any 
                applicable State bank supervisor that regulates the 
                banking organization of such termination.
                  (B) Effect of subsidiary on parent organization.--
                With respect to a qualifying banking organization 
                described under subparagraph (A) that is an insured 
                depository institution, any parent depository 
                institution holding company of the qualifying banking 
                organization shall also have its election under this 
                section terminated.
          (3) Ability to make future elections.--If a banking 
        organization has an election under this section terminated, the 
        banking organization may not apply for another election under 
        this section until the banking organization has maintained a 
        quarterly leverage ratio of at least 10 percent for 8 
        consecutive calendar quarters.

SEC. 602. REGULATORY RELIEF.

  (a) In General.--A qualifying banking organization shall be exempt 
from the following:
          (1) Any Federal law, rule, or regulation addressing capital 
        or liquidity requirements or standards.
          (2) Any Federal law, rule, or regulation that permits an 
        appropriate Federal banking agency to object to a capital 
        distribution.
          (3) Any consideration by an appropriate Federal banking 
        agency of the following:
                  (A) Any risk the qualifying banking organization may 
                pose to ``the stability of the financial system of the 
                United States'', under section 5(c)(2) of the Bank 
                Holding Company Act of 1956.
                  (B) The ``extent to which a proposed acquisition, 
                merger, or consolidation would result in greater or 
                more concentrated risks to the stability of the United 
                States banking or financial system'', under section 
                3(c)(7) of the Bank Holding Company Act of 1956, so 
                long as the banking organization, after such proposed 
                acquisition, merger, or consolidation, would maintain a 
                quarterly leverage ratio of at least 10 percent.
                  (C) Whether the performance of an activity by the 
                banking organization could possibly pose a ``risk to 
                the stability of the United States banking or financial 
                system'', under section 4(j)(2)(A) of the Bank Holding 
                Company Act of 1956.
                  (D) Whether the acquisition of control of shares of a 
                company engaged in an activity described in section 
                4(j)(1)(A) of the Bank Holding Company Act of 1956 
                could possibly pose a ``risk to the stability of the 
                United States banking or financial system'', under 
                section 4(j)(2)(A) of the Bank Holding Company Act of 
                1956, so long as the banking organization, after 
                acquiring control of such company, would maintain a 
                quarterly leverage ratio of at least 10 percent.
                  (E) Whether a merger would pose a ``risk to the 
                stability of the United States banking or financial 
                system'', under section 18(c)(5) of the Federal Deposit 
                Insurance Act, so long as the banking organization, 
                after such proposed merger, would maintain a quarterly 
                leverage ratio of at least 10 percent.
                  (F) Any risk the qualifying banking organization may 
                pose to ``the stability of the financial system of the 
                United States'', under section 10(b)(4) of the Home 
                Owners' Loan Act.
          (4) Subsections (i)(8) and (k)(6)(B)(ii) of section 4 and 
        section 14 of the Bank Holding Company Act of 1956.
          (5) Section 18(c)(13) of the Federal Deposit Insurance Act.
          (6) Section 163 of the Financial Stability Act of 2010.
          (7) Section 10(e)(2)(E) of the Home Owners' Loan Act.
          (8) Any Federal law, rule, or regulation implementing 
        standards of the type provided for in subsections (b), (c), 
        (d), (e), (g), (h), (i), and (j) of section 165 of the 
        Financial Stability Act of 2010.
          (9) Any Federal law, rule, or regulation providing 
        limitations on mergers, consolidations, or acquisitions of 
        assets or control, to the extent such limitations relate to 
        capital or liquidity standards or concentrations of deposits or 
        assets, so long as the banking organization, after such 
        proposed merger, consolidation, or acquisition, would maintain 
        a quarterly leverage ratio of at least 10 percent.
  (b) Qualifying Banking Organizations Treated as Well Capitalized.--A 
qualifying banking organization shall be deemed to be ``well 
capitalized'' for purposes of--
          (1) section 216 of the Federal Credit Union Act; and
          (2) sections 29, 38, 44, and 46 of the Federal Deposit 
        Insurance Act.
  (c) Treatment of Certain Risk-weighted Asset Requirements for 
Qualifying Banking Organizations.--
          (1) Acquisition size criteria treatment.--A qualifying 
        banking organization shall be deemed to meet the criteria 
        described under section 4(j)(4)(D) of the Bank Holding Company 
        Act of 1956, so long as after the proposed transaction the 
        acquiring qualifying banking organization would maintain a 
        quarterly leverage ratio of at least 10 percent.
          (2) Use of leverage exposure.--With respect to a qualifying 
        banking organization, in determining whether a proposal 
        qualifies with the criteria described under subparagraphs 
        (A)(iii) and (B)(i) of section 4(j)(4) of the Bank Holding 
        Company Act of 1956, the Board of Governors of the Federal 
        Reserve System shall consider the leverage exposure of an 
        insured depository institution instead of the total risk-
        weighted assets of such institution.

SEC. 603. CONTINGENT CAPITAL STUDY.

  (a) Study.--The Board of Governors of the Federal Reserve System, the 
Federal Deposit Insurance Corporation, and the Office of the 
Comptroller of the Currency shall each carry out a study, which shall 
include holding public hearings, on how to design a requirement that 
banking organizations issue contingent capital with a market-based 
conversion trigger.
  (b) Report.--Not later than the end of the 1-year period beginning on 
the date of the enactment of this Act, each agency described under 
subsection (a) shall submit a report to the Congress containing--
          (1) all findings and determinations made by the agency in 
        carrying out the study required under subsection (a); and
          (2) the agency's recommendations on how the Congress should 
        design a requirement that banking organizations issue 
        contingent capital with a market-based conversion trigger.

SEC. 604. STUDY ON ALTERING THE CURRENT PROMPT CORRECTIVE ACTION RULES.

  (a) Study.--The Comptroller General of the United States shall 
conduct a study to assess the benefits and feasibility of altering the 
current prompt corrective action rules and replacing the Basel-based 
capital ratios with the nonperforming asset coverage ratio or NACR as 
the trigger for specific required supervisory interventions. The 
Comptroller General shall ensure that such study includes the 
following:
          (1) An assessment of the performance of an NACR forward-
        looking measure of a banking organization's solvency condition 
        relative to the regulatory capital ratios currently used by 
        prompt corrective action rules.
          (2) An analysis of the performance of alternative definitions 
        of nonperforming assets.
          (3) An assessment of the impact of two alternative 
        intervention thresholds:
                  (A) An initial (high) intervention threshold, below 
                which appropriate Federal banking agency examiners are 
                required to intervene and assess a banking 
                organization's condition and prescribe remedial 
                measures.
                  (B) A lower threshold, below which banking 
                organizations must increase their capital, seek an 
                acquirer, or face mandatory resolution within 90 days.
  (b) Report.--Not later than the end of the 1-year period beginning on 
the date of the enactment of this Act, the Comptroller General shall 
submit a report to the Congress containing--
          (1) all findings and determinations made in carrying out the 
        study required under subsection (a); and
          (2) recommendations on the most suitable definition of 
        nonperforming assets, as well as the two numerical thresholds 
        that trigger specific required supervisory interventions.

SEC. 605. DEFINITIONS.

  For purposes of this title:
          (1) Appropriate federal banking agency.--The term 
        ``appropriate Federal banking agency''--
                  (A) has the meaning given such term under section 3 
                of the Federal Deposit Insurance Act; and
                  (B) means the National Credit Union Administration, 
                in the case of an insured credit union.
          (2) Banking organization.--The term ``banking organization'' 
        means--
                  (A) an insured depository institution;
                  (B) an insured credit union;
                  (C) a depository institution holding company;
                  (D) a company that is treated as a bank holding 
                company for purposes of section 8 of the International 
                Banking Act; and
                  (E) a U.S. intermediate holding company established 
                by a foreign banking organization pursuant to section 
                252.153 of title 12, Code of Federal Regulations.
          (3) Foreign exchange swap .--The term ``foreign exchange 
        swap'' has the meaning given that term under section 1a of the 
        Commodity Exchange Act.
          (4) Insured credit union.--The term ``insured credit union'' 
        has the meaning given that term under section 101 of the 
        Federal Credit Union Act.
          (5) Leverage exposure.--The term ``leverage exposure''--
                  (A) with respect to a banking organization other than 
                an insured credit union or a traditional banking 
                organization, has the meaning given the term ``total 
                leverage exposure'' under section 3.10(c)(4)(ii), 
                217.10(c)(4), or 324.10(c)(4) of title 12, Code of 
                Federal Regulations, as applicable, as in effect on the 
                date of the enactment of this Act;
                  (B) with respect to a traditional banking 
                organization other than an insured credit union, means 
                total assets (minus any items deducted from common 
                equity tier 1 capital) as calculated in accordance with 
                generally accepted accounting principles and as 
                reported on the traditional banking organization's 
                applicable regulatory filing with the banking 
                organization's appropriate Federal banking agency; and
                  (C) with respect to a banking organization that is an 
                insured credit union, has the meaning given the term 
                ``total assets'' under section 702.2 of title 12, Code 
                of Federal Regulations, as in effect on the date of the 
                enactment of this Act.
          (6) Leverage ratio definitions.--
                  (A) Average leverage ratio.--With respect to a 
                banking organization, the term ``average leverage 
                ratio'' means the average of the banking organization's 
                quarterly leverage ratios for each of the most recently 
                completed four calendar quarters.
                  (B) Quarterly leverage ratio.--With respect to a 
                banking organization and a calendar quarter, the term 
                ``quarterly leverage ratio'' means the organization's 
                tangible equity divided by the organization's leverage 
                exposure, expressed as a percentage, on the last day of 
                such quarter.
          (7) NACR.--The term ``NACR'' means--
                  (A) book equity less nonperforming assets plus loan 
                loss reserves, divided by
                  (B) total banking organization assets.
          (8) Nonperforming assets.--The term ``nonperforming assets'' 
        means--
                  (A) 20 percent of assets that are past due 30 to 89 
                days, plus
                  (B) 50 percent of assets that are past due 90 days or 
                more, plus
                  (C) 100 percent of nonaccrual assets and other real 
                estate owned.
          (9) Qualifying banking organization.--The term ``qualifying 
        banking organization'' means a banking organization that has 
        made an election under section 601 and with respect to which 
        such election is in effect.
          (10) Security-based swap .--The term ``security-based swap'' 
        has the meaning given that term under section 3 of the 
        Securities Exchange Act of 1934.
          (11) Swap.--The term ``swap'' has the meaning given that term 
        under section 1a of the Commodity Exchange Act.
          (12) Tangible equity.--The term ``tangible equity''--
                  (A) with respect to a banking organization other than 
                a credit union, means the sum of--
                          (i) common equity tier 1 capital;
                          (ii) additional tier 1 capital consisting of 
                        instruments issued on or before the date of 
                        enactment of this Act; and
                          (iii) with respect to a depository 
                        institution holding company that had less than 
                        $15,000,000,000 in total consolidated assets as 
                        of December 31, 2009, or March 31, 2010, or a 
                        banking organization that was a mutual holding 
                        company as of May 19, 2010, trust preferred 
                        securities issued prior to May 19, 2010, to the 
                        extent such organization was permitted, as of 
                        the date of the enactment of this Act, to 
                        consider such securities as tier 1 capital 
                        under existing regulations of the appropriate 
                        Federal banking agency; and
                  (B) with respect to a banking organization that is a 
                credit union, has the meaning given the term ``net 
                worth'' under section 702.2 of title 12, Code of 
                Federal Regulations, as in effect on the date of the 
                enactment of this Act.
          (13) Traditional banking organization.--The term 
        ``traditional banking organization'' means a banking 
        organization that--
                  (A) has zero trading assets and zero trading 
                liabilities;
                  (B) does not engage in swaps or security-based swaps, 
                other than swaps or security-based swaps referencing 
                interest rates or foreign exchange swaps; and
                  (C) has a total notional exposure of swaps and 
                security-based swaps of not more than $8,000,000,000.
          (14) Other banking terms.--The terms ``insured depository 
        institution'' and ``depository institution holding company'' 
        have the meaning given those terms, respectively, under section 
        3 of the Federal Deposit Insurance Act.
          (15) Other capital terms.--With respect to a banking 
        organization, the terms ``additional tier 1 capital'' and 
        ``common equity tier 1 capital'' have the meaning given such 
        terms, respectively, under section 3.20, 217.20, or 324.20 of 
        title 12, Code of Federal Regulations, as applicable, as in 
        effect on the date of the enactment of this Act.

   TITLE VII--EMPOWERING AMERICANS TO ACHIEVE FINANCIAL INDEPENDENCE

       Subtitle A--Separation of Powers and Liberty Enhancements

SEC. 711. CONSUMER LAW ENFORCEMENT AGENCY.

  (a) Making the Bureau an Independent Consumer Law Enforcement 
Agency.--The Consumer Financial Protection Act of 2010 (12 U.S.C. 5481 
et seq.) is amended--
          (1) in section 1011--
                  (A) in the heading of such section, by striking 
                ``bureau of consumer financial protection'' and 
                inserting ``consumer law enforcement agency'';
                  (B) in subsection (a)--
                          (i) in the heading of such subsection, by 
                        striking ``Bureau'' and inserting ``Agency'';
                          (ii) by striking ``in the Federal Reserve 
                        System,'';
                          (iii) by striking ``independent bureau'' and 
                        inserting ``independent agency''; and
                          (iv) by striking ``Bureau of Consumer 
                        Financial Protection'' and inserting ``Consumer 
                        Law Enforcement Agency (hereinafter in this 
                        section referred to as the `Agency')'';
                  (C) in subsection (b)(5), by amending subparagraph 
                (A) to read as follows:
                  ``(A) shall be appointed by the President; and'';
                  (D) in subsection (c), by striking paragraph (3);
                  (E) in subsection (e), by striking ``, including in 
                cities in which the Federal reserve banks, or branches 
                of such banks, are located,''; and
                  (F) by striking ``Bureau'' each place such term 
                appears and inserting ``Agency''; and
          (2) in section 1012--
                  (A) in subsection (a)(10), by striking 
                ``examinations,''; and
                  (B) by striking subsection (c).
  (b) Deeming of Name.--Any reference in a law, regulation, document, 
paper, or other record of the United States to the Bureau of Consumer 
Financial Protection shall be deemed a reference to the Consumer Law 
Enforcement Agency.
  (c) Conforming Amendments.--
          (1) Dodd-frank wall street reform and consumer protection 
        act.--The Dodd-Frank Wall Street Reform and Consumer Protection 
        Act (12 U.S.C. 5301 et seq.) is amended--
                  (A) in the table of contents in section 1(b)--
                          (i) by striking ``Bureau of Consumer 
                        Financial Protection'' each place such term 
                        appears and inserting ``Consumer Law 
                        Enforcement Agency''; and
                          (ii) in the table of contents relating to 
                        title X, in the items relating to subtitle B, 
                        subtitle C, and section 1027, by striking 
                        ``Bureau'' each place such term appears and 
                        inserting ``Agency'';
                  (B) in section 2, by amending paragraph (4) to read 
                as follows:
          ``(4) Agency.--The term `Agency' means the Consumer Law 
        Enforcement Agency established under title X.'';
                  (C) in section 342 by striking ``Bureau'' each place 
                such term appears in headings and text and inserting 
                ``Agency'';
                  (D) in section 1400(b)--
                          (i) by striking ``Bureau of Consumer 
                        Financial Protection'' and inserting ``Consumer 
                        Law Enforcement Agency''; and
                          (ii) in the subsection heading, by striking 
                        ``Bureau of Consumer Financial Protection'' and 
                        inserting ``Consumer Law Enforcement Agency'';
                  (E) in section 1411(a)(1), by striking ``Bureau'' and 
                inserting ``Agency''; and
                  (F) in section 1447, by striking ``Director of the 
                Bureau'' each place such term appears and inserting 
                ``Director of the Consumer Law Enforcement Agency''.
          (2) Alternative mortgage transaction parity act of 1982.--The 
        Alternative Mortgage Transaction Parity Act of 1982 (12 U.S.C. 
        3801 et seq.) is amended--
                  (A) by striking ``Bureau of Consumer Financial 
                Protection'' each place such term appears and inserting 
                ``Consumer Law Enforcement Agency''; and
                  (B) in the subsection heading of subsection (d) of 
                section 804 (12 U.S.C. 3803(d)), by striking ``Bureau'' 
                and inserting ``Agency''.
          (3) Electronic fund transfer act.--The Electronic Fund 
        Transfer Act (15 U.S.C. 1693 et seq.) is amended--
                  (A) by amending the second paragraph (4) (defining 
                the term ``Bureau'') to read as follows:
          ``(4) the term `Agency' means the Consumer Law Enforcement 
        Agency;'';
                  (B) in section 916(d)(1), by striking ``Bureau of 
                Consumer Financial Protection'' and inserting 
                ``Consumer Law Enforcement Agency''; and
                  (C) by striking ``Bureau'' each place that term 
                appears in heading or text and inserting ``Agency''.
          (4) Equal credit opportunity act.--The Equal Credit 
        Opportunity Act (15 U.S.C. 1691 et seq.) is amended--
                  (A) in section 702 (15 U.S.C. 1691a), by amending 
                subsection (c) to read as follows:
  ``(c) The term `Agency' means the Consumer Law Enforcement Agency.''; 
and
                  (B) by striking ``Bureau'' each place that term 
                appears in heading or text and inserting ``Agency''.
          (5) Expedited funds availability act.--The Expedited Funds 
        Availability Act (12 U.S.C. 4001 et seq.) is amended--
                  (A) by striking ``Bureau of Consumer Financial 
                Protection'' each place such term appears and inserting 
                ``Consumer Law Enforcement Agency''; and
                  (B) in the heading of section 605(f)(1), by striking 
                ``board and bureau'' and inserting ``Board and 
                agency''.
          (6) Fair and accurate credit transactions act of 2003.--The 
        Fair and Accurate Credit Transactions Act of 2003 (Public Law 
        108-159) is amended by striking ``Bureau'' each place such term 
        appears and inserting ``Agency''.
          (7) Fair credit reporting act.--The Fair Credit Reporting Act 
        (15 U.S.C. 1681 et seq.) is amended--
                  (A) by amending section 603(w) to read as follows:
  ``(w) Agency.--The term `Agency' means the Consumer Law Enforcement 
Agency.''; and
                  (B) by striking ``Bureau'' each place such term 
                appears, other than in sections 626 and 603(v), and 
                inserting ``Agency''.
          (8) Fair debt collection practices act.--The Fair Debt 
        Collection Practices Act (15 U.S.C. 1692 et seq.) is amended--
                  (A) by amending section 803(1) to read as follows:
          ``(1) The term `Agency' means the Consumer Law Enforcement 
        Agency.''; and
                  (B) by striking ``Bureau'' each place such term 
                appears in heading or text and inserting ``Agency''.
          (9) Federal deposit insurance act.--The Federal Deposit 
        Insurance Act (12 U.S.C. 1811 et seq.) is amended--
                  (A) in the second paragraph (6) (with the heading 
                ``Referral to bureau of consumer financial 
                protection'') of section 8(t) (12 U.S.C. 1818(t))--
                          (i) in the paragraph heading, by striking 
                        ``bureau of consumer financial protection''; 
                        and inserting ``Consumer law enforcement 
                        agency''; and
                          (ii) by striking ``Bureau of Consumer 
                        Financial Protection'' and inserting ``Consumer 
                        Law Enforcement Agency'';
                  (B) by amending clause (vi) of section 11(t)(2)(A) 
                (12 U.S.C. 1821(t)(2)(A)(vi)) to read as follows:
                          ``(vi) The Consumer Law Enforcement 
                        Agency.'';
                  (C) in section 18(x) (12 U.S.C. 1828(x)), by striking 
                ``Bureau of Consumer Financial Protection'' each place 
                such term appears and inserting ``Consumer Law 
                Enforcement Agency'';
                  (D) by striking ``Bureau'' each place such term 
                appears and inserting ``Agency''; and
                  (E) in section 43(e) (12 U.S.C. 1831t(e)), by 
                amending paragraph (5) to read as follows:
          ``(5) Agency.--The term `Agency' means the Consumer Law 
        Enforcement Agency.''.
          (10) Federal financial institutions examination council act 
        of 1978.--The Federal Financial Institutions Examination 
        Council Act of 1978 (12 U.S.C. 3301 et seq.) is amended--
                  (A) in section 1004(a)(4), by striking ``Consumer 
                Financial Protection Bureau'' and inserting ``Consumer 
                Law Enforcement Agency''; and
                  (B) in section 1011, by striking ``Bureau of Consumer 
                Financial Protection'' and inserting ``Consumer Law 
                Enforcement Agency''.
          (11) Financial institutions reform, recovery, and enforcement 
        act of 1989.--The Financial Institutions Reform, Recovery, and 
        Enforcement Act of 1989 (Public Law 101-73; 103 Stat. 183) is 
        amended--
                  (A) in section 1112(b) (12 U.S.C. 3341), by striking 
                ``Bureau of Consumer Financial Protection'' and 
                inserting ``Consumer Law Enforcement Agency'';
                  (B) in section 1124 (12 U.S.C. 3353), by striking 
                ``Bureau of Consumer Financial Protection'' each place 
                such term appears and inserting ``Consumer Law 
                Enforcement Agency'';
                  (C) in section 1125 (12 U.S.C. 3354), by striking 
                ``Bureau of Consumer Financial Protection'' each place 
                such term appears and inserting ``Consumer Law 
                Enforcement Agency''; and
                  (D) in section 1206(a) (12 U.S.C. 1833b(a)), by 
                striking ``Federal Housing Finance Board'' and all that 
                follows through ``Farm Credit Administration'' and 
                inserting ``Federal Housing Finance Board, the Consumer 
                Law Enforcement Agency, and the Farm Credit 
                Administration''.
          (12) Financial literacy and education improvement act.--
        Section 513 of the Financial Literacy and Education Improvement 
        Act (20 U.S.C. 9702) is amended by striking ``Bureau of 
        Consumer Financial Protection'' each place such term appears 
        and inserting ``Consumer Law Enforcement Agency''.
          (13) Gramm-Leach-Bliley act.--Title V of the Gramm-Leach-
        Bliley Act (15 U.S.C. 6801 et seq.) is amended--
                  (A) by striking ``Bureau of Consumer Financial 
                Protection'' each place such term appears and inserting 
                ``Consumer Law Enforcement Agency''; and
                  (B) in section 505(a)(8) (15 U.S.C. 6805(a)(8)), by 
                striking ``Bureau'' and inserting ``Agency''.
          (14) Home mortgage disclosure act of 1975.--The Home Mortgage 
        Disclosure Act of 1975 (12 U.S.C. 2801 et seq.) is amended--
                  (A) by striking ``Bureau of Consumer Financial 
                Protection'' each place such term appears and inserting 
                ``Consumer Law Enforcement Agency'';
                  (B) by striking ``Bureau'' each place such term 
                appears and inserting ``Agency''; and
                  (C) in section 303, by amending paragraph (1) to read 
                as follows:
          ``(1) the term `Agency' means the Consumer Law Enforcement 
        Agency;''.
          (15) Homeowners protection act of 1998.--Section 10(a)(4) of 
        the Homeowners Protection Act of 1998 (12 U.S.C. 4909(a)(4)) is 
        amended by striking ``Bureau of Consumer Financial Protection'' 
        and inserting ``Consumer Law Enforcement Agency''.
          (16) Home ownership and equity protection act of 1994.--
        Section 158(a) of the Home Ownership and Equity Protection Act 
        of 1994 (15 U.S.C. 1601 note) is amended by striking ``Bureau'' 
        and inserting ``Consumer Law Enforcement Agency''.
          (17) Interstate land sales full disclosure act.--The 
        Interstate Land Sales Full Disclosure Act (12 U.S.C. 1701 et 
        seq.) is amended--
                  (A) by striking ``Bureau of Consumer Financial 
                Protection'' each place such term appears and inserting 
                ``Agency'';
                  (B) in section 1402, by amending paragraph (12) to 
                read as follows:
          ``(12) `Agency' means the Consumer Law Enforcement Agency.''; 
        and
                  (C) in section 1416, by striking ``Bureau'' each 
                place such term appears and inserting ``Agency''.
          (18) Real estate settlement procedures act of 1974.--The Real 
        Estate Settlement Procedures Act of 1974 (12 U.S.C. 2601 et 
        seq.) is amended--
                  (A) by striking ``Bureau of Consumer Financial 
                Protection'' each place such term appears and inserting 
                ``Consumer Law Enforcement Agency'';
                  (B) by striking ``Bureau'' each place such term 
                appears and inserting ``Agency''; and
                  (C) in section 3, by amending paragraph (9) to read 
                as follows:
          ``(9) the term `Agency' means the Consumer Law Enforcement 
        Agency.''.
          (19) Revised statues of the united states.--Section 
        5136C(b)(3)(B) of the Revised Statutes of the United States (12 
        U.S.C. 25b(b)(3)(B)) is amended by striking ``Bureau of 
        Consumer Financial Protection'' and inserting ``Consumer Law 
        Enforcement Agency''.
          (20) Right to financial privacy act of 1978.--The Right to 
        Financial Privacy Act of 1978 (12 U.S.C. 3401 et seq.) is 
        amended--
                  (A) by amending subparagraph (B) of section 1101(7) 
                (12 U.S.C. 3401(7)(B)) to read as follows:
                  ``(B) the Consumer Law Enforcement Agency;''; and
                  (B) by striking ``Bureau of Consumer Financial 
                Protection'' each place such term appears in heading or 
                text and inserting ``Consumer Law Enforcement Agency''.
          (21) S.A.F.E. mortgage licensing act of 2008.--The S.A.F.E. 
        Mortgage Licensing Act of 2008 (12 U.S.C. 5101 et seq.) is 
        amended--
                  (A) in section 1507, by striking ``Bureau, and the 
                Bureau of Consumer Financial Protection'' each place 
                such term appears and inserting ``Consumer Law 
                Enforcement Agency'';
                  (B) by striking ``Bureau of Consumer Financial 
                Protection'' each place such term appears and inserting 
                ``Consumer Law Enforcement Agency'';
                  (C) by striking ``Bureau'' each place such appears, 
                other than in sections 1505(a)(1), 1507(a)(2)(A), and 
                1511(b), and inserting ``Agency'';
                  (D) in section 1503, by amending paragraph (1) to 
                read as follows:
          ``(1) Agency.--The term `Agency' means the Consumer Law 
        Enforcement Agency.'';
                  (E) in the heading of section 1508, by striking 
                ``bureau of consumer financial protection'' and 
                inserting ``consumer law enforcement agency''; and
                  (F) in the heading of section 1514, by striking 
                ``bureau'' and inserting ``agency''.
          (22) Telemarketing and consumer fraud and abuse prevention 
        act.--The Telemarketing and Consumer Fraud and Abuse Prevention 
        Act (15 U.S.C. 6101 et seq.) is amended by striking ``Bureau of 
        Consumer Financial Protection'' each place such term appears in 
        heading or text and inserting ``Consumer Law Enforcement 
        Agency''.
          (23) Title 5, united states code.--Title 5, United States 
        Code, is amended--
                  (A) in section 552a(w)--
                          (i) in the subsection heading, by striking 
                        ``Bureau of Consumer Financial Protection'' and 
                        inserting ``Consumer Law Enforcement Agency'';
                          (ii) by striking ``Bureau of Consumer 
                        Financial Protection'' and inserting ``Consumer 
                        Law Enforcement Agency'';
                  (B) in section 609(d)(2), by striking ``Consumer 
                Financial Protection Bureau of the Federal Reserve 
                System'' and inserting ``Consumer Law Enforcement 
                Agency''; and
                  (C) in section 3132(a)(1)(D), as amended by section 
                151(a)(1), is further amended by inserting ``the 
                Consumer Law Enforcement Agency,'' before ``and the 
                National Credit Union Administration''.
          (24) Title 10, united states code.--
                  (A) Section 987.--Section 987(h)(3)(E) of title 10, 
                United States Code, is amended by striking ``Bureau of 
                Consumer Financial Protection'' and inserting 
                ``Consumer Law Enforcement Agency''.
                  (B) NDAA fy 2015.--Section 557(a) of the Carl Levin 
                and Howard P. ``Buck'' McKeon National Defense 
                Authorization Act for Fiscal Year 2015 (Public Law 113-
                29; 128 Stat. 3381; 10 U.S.C. 1144 note), is amended by 
                striking ``Consumer Financial Protection Bureau'' each 
                place such term appears and inserting ``Consumer Law 
                Enforcement Agency''.
          (25) Title 44, united states code.--Title 44, United States 
        Code, is amended--
                  (A) in section 3502(5), by striking ``the Bureau of 
                Consumer Financial Protection, the Office of Financial 
                Research,'' and inserting ``the Consumer Law 
                Enforcement Agency,''; and
                  (B) in section 3513(c), by striking ``Bureau of 
                Consumer Financial Protection'' and inserting 
                ``Consumer Law Enforcement Agency''.
          (26) Truth in lending act.--The Truth in Lending Act (15 
        U.S.C. 1601 et seq.) is amended--
                  (A) by amending section 103(b) (15 U.S.C. 1602(b)) to 
                read as follows:
  ``(b) Agency.--The term `Agency' means the Consumer Law Enforcement 
Agency.'';
                  (B) by amending section 103(c) (15 U.S.C. 1602(c)) to 
                read as follows:
  ``(c) Board.--The term `Board' means the Board of Governors of the 
Federal Reserve System.''; and
                  (C) in section 128(f) (15 U.S.C. 1638(f)), by 
                striking ``Board'' each place such term appears and 
                inserting ``Agency'';
                  (D) in sections 129B (15 U.S.C. 1639b) and 129C (15 
                U.S.C. 1639c), by striking ``Board'' each place such 
                term appears and inserting ``Agency'';
                  (E) in section 140A (15 U.S.C. 1651), by striking 
                ``in consultation with the Bureau'' and inserting ``in 
                consultation with the Federal Trade Commission'';
                  (F) by striking ``National Credit Union 
                Administration Bureau'' each place such term appears 
                and inserting ``National Credit Union Administration 
                Board'';
                  (G) by striking ``Bureau'' each place such term 
                appears in heading or text and inserting ``Agency''; 
                and
                  (H) by striking ``bureau'' and inserting ``Agency'' 
                in the paragraph headings for--
                          (i) section 122(d)(2) (15 U.S.C. 1632(d)(2));
                          (ii) section 127(c)(5) (15 U.S.C. 
                        1637(c)(5));
                          (iii) section 127(r)(3) (15 U.S.C. 
                        1637(r)(3)); and
                          (iv) section 127A(a)(14) (15 U.S.C. 
                        1637a(a)(14)).
          (27) Truth in savings act.--The Truth in Savings Act (12 
        U.S.C. 4301 et seq.) is amended--
                  (A) by amending paragraph (4) of section 274 (12 
                U.S.C. 4313(4)) to read as follows:
          ``(4) Agency.--The term `Agency' means the Consumer Law 
        Enforcement Agency.'';
                  (B) by striking ``National Credit Union 
                Administration Bureau'' each place such term appears 
                and inserting ``National Credit Union Administration 
                Board''; and
                  (C) by striking ``Bureau'' each place such term 
                appears and inserting ``Agency''.

SEC. 712. AUTHORITY OF THE OFFICE OF INFORMATION AND REGULATORY 
                    AFFAIRS.

  Section 1022 of the Consumer Financial Protection Act of 2010 (12 
U.S.C. 5512) is amended by adding at the end the following:
  ``(e) Authority of the Office of Information and Regulatory 
Affairs.--The Office of Information and Regulatory Affairs shall have 
the same duties and authorities with respect to the Consumer Law 
Enforcement Agency as the Office of Information and Regulatory Affairs 
has with respect to any other agency that is not an independent 
regulatory agency (as such terms are defined, respectively, under 
section 3502 of title 44, United States Code).''.

SEC. 713. BRINGING THE AGENCY INTO THE REGULAR APPROPRIATIONS PROCESS.

  Section 1017 of the Consumer Financial Protection Act of 2010 (12 
U.S.C. 5497) is amended--
          (1) in subsection (a)--
                  (A) by amending the heading of such subsection to 
                read as follows: ``Budget, Financial Management, and 
                Audit.--'';
                  (B) by striking paragraphs (1), (2), and (3);
                  (C) by redesignating paragraphs (4) and (5) as 
                paragraphs (1) and (2), respectively; and
                  (D) by striking subparagraphs (E) and (F) of 
                paragraph (1), as so redesignated;
          (2) by striking subsections (b) and (c);
          (3) by redesignating subsections (d) and (e) as subsections 
        (b) and (c), respectively; and
          (4) in subsection (c), as so redesignated--
                  (A) by striking paragraphs (1), (2), and (3) and 
                inserting the following:
          ``(1) Authorization of appropriations.--There is authorized 
        to be appropriated to the Agency for each of fiscal years 2017 
        and 2018 an amount equal to the aggregate amount of funds 
        transferred by the Board of Governors to the Bureau of Consumer 
        Financial Protection during fiscal year 2015.''; and
                  (B) by redesignating paragraph (4) as paragraph (2).

SEC. 714. CONSUMER LAW ENFORCEMENT AGENCY INSPECTOR GENERAL REFORM.

  (a) Appointment of Inspector General.--The Inspector General Act of 
1978 (5 U.S.C. App.) is amended--
          (1) in section 8G--
                  (A) in subsection (a)(2), by striking ``and the 
                Bureau of Consumer Financial Protection'';
                  (B) in subsection (c), by striking ``For purposes of 
                implementing this section'' and all that follows 
                through the end of the subsection; and
                  (C) in subsection (g)(3), by striking ``and the 
                Bureau of Consumer Financial Protection''; and
          (2) in section 12--
                  (A) in paragraph (1), by inserting ``the Consumer Law 
                Enforcement Agency;'' after ``the President of the 
                Export-Import Bank;''; and
                  (B) in paragraph (2), by inserting ``the Consumer Law 
                Enforcement Agency,'' after ``the Export-Import 
                Bank,''.
  (b) Requirements for the Inspector General for the Consumer Law 
Enforcement Agency.--
          (1) Establishment.--Section 1011 of the Consumer Financial 
        Protection Act of 2010 (12 U.S.C. 5491), as amended by section 
        311, is further amended by adding at the end the following:
  ``(i) Inspector General.--There is established the position of the 
Inspector General of the Agency.''; and
          (2) Hearings.--Section 1016 of the Consumer Financial 
        Protection Act of 2010 (12 U.S.C. 5496) is amended by inserting 
        after subsection (c) the following:
  ``(d) Additional Requirement for Inspector General.--On a separate 
occasion from that described in subsection (a), the Inspector General 
of the Agency shall appear, upon invitation, before the Committee on 
Banking, Housing, and Urban Affairs of the Senate and the Committee on 
Financial Services of the House of Representatives at semi-annual 
hearings regarding the reports required under subsection (b) and the 
reports required under section 5 of the Inspector General Act of 1978 
(5 U.S.C. App.).''.
          (3) Participation in the council of inspectors general on 
        financial oversight.--Section 989E(a)(1) of the Dodd-Frank Wall 
        Street Reform and Consumer Protection Act is amended by adding 
        at the end the following:
                  ``(J) The Consumer Law Enforcement Agency.''.
          (4) Deadline for appointment.--Not later than 60 days after 
        the date of the enactment of this Act, the President shall 
        appoint an Inspector General for the Consumer Law Enforcement 
        Agency in accordance with section 3 of the Inspector General 
        Act of 1978 (5 U.S.C. App.).
  (c) Transition Period.--The Inspector General of the Board of 
Governors of the Federal Reserve System and the Bureau of Consumer 
Financial Protection shall serve in that position until the 
confirmation of an Inspector General for the Consumer Law Enforcement 
Agency. At that time, the Inspector General of the Board of Governors 
of the Federal Reserve System and the Bureau of Consumer Financial 
Protection shall become the Inspector General of the Board of Governors 
of the Federal Reserve System.

SEC. 715. PRIVATE PARTIES AUTHORIZED TO COMPEL THE AGENCY TO SEEK 
                    SANCTIONS BY FILING CIVIL ACTIONS; ADJUDICATIONS 
                    DEEMED ACTIONS.

  Section 1053 of the Consumer Financial Protection Act of 2010 (12 
U.S.C. 5563) is amended by adding at the end the following:
  ``(f) Private Parties Authorized to Compel the Agency to Seek 
Sanctions by Filing Civil Actions.--
          ``(1) Termination of administrative proceeding.--In the case 
        of any person who is a party to a proceeding brought by the 
        Agency under this section, to which chapter 5 of title 5, 
        United States Code, applies, and against whom an order imposing 
        a cease and desist order or a penalty may be issued at the 
        conclusion of the proceeding, that person may, not later than 
        20 days after receiving notice of such proceeding, and at that 
        person's discretion, require the Agency to terminate the 
        proceeding.
          ``(2) Civil action authorized.--If a person requires the 
        Agency to terminate a proceeding pursuant to paragraph (1), the 
        Agency may bring a civil action against that person for the 
        same remedy that might be imposed.
  ``(g) Adjudications Deemed Actions.--Any administrative adjudication 
commenced under this section shall be deemed an `action' for purposes 
of section 1054(g).''.

SEC. 716. CIVIL INVESTIGATIVE DEMANDS TO BE APPEALED TO COURTS.

  Section 1052 of the Consumer Financial Protection Act of 2010 (12 
U.S.C. 5562) is amended--
          (1) in subsection (c)--
                  (A) in paragraph (2), by inserting after ``shall 
                state'' the following: ``with specificity''; and
                  (B) by adding at the end the following:
          ``(14) Meeting requirement.--The recipient of a civil 
        investigative demand shall meet and confer with an Agency 
        investigator within 30 calendar days after receipt of the 
        demand to discuss and attempt to resolve all issues regarding 
        compliance with the civil investigative demand, unless the 
        Agency grants an extension requested by such recipient.'';
          (2) in subsection (f)--
                  (A) by amending paragraph (1) to read as follows:
          ``(1) In general.--Not later than 45 days after the service 
        of any civil investigative demand upon any person under 
        subsection (c), or at any time before the return date specified 
        in the demand, whichever period is shorter, or within such 
        period exceeding 45 days after service or in excess of such 
        return date as may be prescribed in writing, subsequent to 
        service, by any Agency investigator named in the demand, such 
        person may file, in the district court of the United States for 
        any judicial district in which such person resides, is found, 
        or transacts business, a petition for an order modifying or 
        setting aside the demand.''; and
                  (B) in paragraph (2), by striking ``at the Bureau''; 
                and
          (3) in subsection (h)--
                  (A) by striking ``(1) In general.--''; and
                  (B) by striking paragraph (2).

SEC. 717. AGENCY DUAL MANDATE AND ECONOMIC ANALYSIS.

  (a) Purpose.--Section 1021(a) of the Consumer Financial Protection 
Act of 2010 (12 U.S.C. 5511(a)) is amended by adding at the end the 
following: ``In addition, the Director shall seek to implement and, 
where applicable, enforce Federal consumer financial law consistently 
for the purpose of strengthening participation in markets by covered 
persons, without Government interference or subsidies, to increase 
competition and enhance consumer choice.''.
  (b) Office of Economic Analysis.--
          (1) In general.--Section 1013 of the Consumer Financial 
        Protection Act of 2010 (12 U.S.C. 5493) is amended by adding at 
        the end the following:
  ``(h) Office of Economic Analysis.--
          ``(1) Establishment.--The Director shall, not later than the 
        end of the 60-day period beginning on the date of the enactment 
        of this subsection, establish an Office of Economic Analysis.
          ``(2) Direct reporting.--The head of the Office of Economic 
        Analysis shall report directly to the Director.
          ``(3) Review and assessment of proposed rules and 
        regulations.--The Office of Economic Analysis shall--
                  ``(A) review all proposed rules and regulations of 
                the Agency;
                  ``(B) assess the impact of such rules and regulations 
                on consumer choice, price, and access to credit 
                products; and
                  ``(C) publish a report on such reviews and 
                assessments in the Federal Register.
          ``(4) Measuring existing rules and regulations.--The Office 
        of Economic Analysis shall--
                  ``(A) review each rule and regulation issued by the 
                Commission after 1, 2, 6, and 11 years;
                  ``(B) measure the rule or regulation's success in 
                solving the problem that the rule or regulation was 
                intended to solve when issued; and
                  ``(C) publish a report on such review and measurement 
                in the Federal Register.
          ``(5) Cost-benefit analysis related to administrative 
        enforcement and civil actions.--The Office of Economic Analysis 
        shall--
                  ``(A) carry out a cost-benefit analysis of any 
                proposed administrative enforcement action, civil 
                lawsuit, or consent order of the Agency; and
                  ``(B) assess the impact of such complaint, lawsuit, 
                or order on consumer choice, price, and access to 
                credit products.''.
          (2) Consideration of review and assessment; rulemaking 
        requirements.--Section 1022(b) of the Consumer Financial 
        Protection Act of 2010 (12 U.S.C. 5512(b)) is amended by adding 
        at the end the following:
          ``(5) Consideration of review and assessment by the office of 
        economic analysis.--Before issuing any rule or regulation, the 
        Director shall consider the review and assessment of such rule 
        or regulation carried out by the Office of Economic Analysis.
          ``(6) Identification of problems and metrics for judging 
        success.--
                  ``(A) In general.--The Director shall, in each 
                proposed rulemaking of the Agency--
                          ``(i) identify the problem that the 
                        particular rule or regulations is seeking to 
                        solve; and
                          ``(ii) specify the metrics by which the 
                        Agency will measure the success of the rule or 
                        regulation in solving such problem.
                  ``(B) Required metrics.--The metrics specified under 
                subparagraph (A)(ii) shall include a measurement of 
                changes to consumer access to, and cost of, consumer 
                financial products and services.''.
          (3) Consideration of cost-benefit review related to 
        administrative actions.--The Dodd-Frank Wall Street Reform and 
        Consumer Protection Act (12 U.S.C. 5301 et seq.) is amended--
                  (A) in subtitle E of title X, by adding at the end 
                the following:

``SEC. 1059. CONSIDERATION OF COST-BENEFIT ANALYSIS RELATED TO 
                    ADMINISTRATIVE ENFORCEMENT AND CIVIL ACTIONS.

  ``Before initiating any administrative enforcement action or civil 
lawsuit or entering into a consent order, the Director shall consider 
the cost-benefit analysis of such action, lawsuit, or order carried out 
by the Office of Economic Analysis.''; and
                  (B) in the table of contents under section 1(b), by 
                inserting after the item relating to section 1058 the 
                following:

``Sec. 1059. Consideration of cost-benefit analysis related to 
administrative enforcement and civil actions.''.

  (c) Avoidance of Duplicative or Unnecessary Analyses.--The Consumer 
Law Enforcement Agency may perform any of the analyses required by the 
amendments made by this section in conjunction with, or as part of, any 
other agenda or analysis required by any other provision of law, if 
such other agenda or analysis satisfies the provisions of this section.

SEC. 718. NO DEFERENCE TO AGENCY INTERPRETATION.

  The Consumer Financial Protection Act of 2010 (12 U.S.C. 5481 et 
seq.) is amended--
          (1) in section 1022(b)(4)--
                  (A) by striking ``(A) In general.--''; and
                  (B) by striking subparagraph (B); and
          (2) in section 1061(b)(5)(E)--
                  (A) by striking ``affords to the--'' and all that 
                follows through ``(i) Federal Trade Commission'' and 
                inserting ``affords to the Federal Trade Commission'';
                  (B) by striking ``; or'' and inserting a period; and
                  (C) by striking clause (ii).

                Subtitle B--Administrative Enhancements

SEC. 721. ADVISORY OPINIONS.

  Section 1022(b) of the Consumer Financial Protection Act of 2010 (12 
U.S.C. 5512(b)), as amended by section 717, is further amended by 
adding at the end the following:
          ``(7) Advisory opinions.--
                  ``(A) Establishing procedures.--
                          ``(i) In general.--The Director shall 
                        establish a procedure and, as necessary, 
                        promulgate rules to provide written opinions in 
                        response to inquiries concerning the 
                        conformance of specific conduct with Federal 
                        consumer financial law. In establishing the 
                        procedure, the Director shall consult with the 
                        prudential regulators and such other Federal 
                        departments and agencies as the Director 
                        determines appropriate, and obtain the views of 
                        all interested persons through a public notice 
                        and comment period.
                          ``(ii) Scope of request.--A request for an 
                        opinion under this paragraph must relate to 
                        specific proposed or prospective conduct by a 
                        covered person contemplating the proposed or 
                        prospective conduct.
                          ``(iii) Submission.--A request for an opinion 
                        under this paragraph may be submitted to the 
                        Director either by or on behalf of a covered 
                        person.
                          ``(iv) Right to withdraw inquiry.--Any 
                        inquiry under this paragraph may be withdrawn 
                        at any time prior to the Director issuing an 
                        opinion in response to such inquiry, and any 
                        opinion based on an inquiry that has been 
                        withdrawn shall have no force or effect.
                  ``(B) Issuance of opinions.--
                          ``(i) In general.--The Director shall, within 
                        90 days of receiving the request for an opinion 
                        under this paragraph, either--
                                  ``(I) issue an opinion stating 
                                whether the described conduct would 
                                violate Federal consumer financial law;
                                  ``(II) if permissible under clause 
                                (iii), deny the request; or
                                  ``(III) explain why it is not 
                                feasible to issue an opinion.
                          ``(ii) Extension.--Notwithstanding clause 
                        (i), if the Director determines that the Agency 
                        requires additional time to issue an opinion, 
                        the Director may make a single extension of the 
                        deadline of 90 days or less.
                          ``(iii) Denial of requests.--The Director 
                        shall not issue an opinion, and shall so inform 
                        the requestor, if the request for an opinion--
                                  ``(I) asks a general question of 
                                interpretation;
                                  ``(II) asks about a hypothetical 
                                situation;
                                  ``(III) asks about the conduct of 
                                someone other than the covered person 
                                on whose behalf the request is made;
                                  ``(IV) asks about past conduct that 
                                the covered person on whose behalf the 
                                request is made does not plan to 
                                continue in the future; or
                                  ``(V) fails to provide necessary 
                                supporting information requested by the 
                                Agency within a reasonable time 
                                established by the Agency.
                          ``(iv) Amendment and revocation.--An advisory 
                        opinion issued under this paragraph may be 
                        amended or revoked at any time.
                          ``(v) Public disclosure.--An opinion rendered 
                        pursuant to this paragraph shall be placed in 
                        the Agency's public record 90 days after the 
                        requesting party has received the advice, 
                        subject to any limitations on public disclosure 
                        arising from statutory restrictions, Agency 
                        regulations, or the public interest. The Agency 
                        shall redact any personal, confidential, or 
                        identifying information about the covered 
                        person or any other persons mentioned in the 
                        advisory opinion, unless the covered person 
                        consents to such disclosure.
                          ``(vi) Report to congress.--The Agency shall, 
                        concurrent with the semi-annual report required 
                        under section 1016(b), submit information 
                        regarding the number of requests for an 
                        advisory opinion received, the subject of each 
                        request, the number of requests denied pursuant 
                        to clause (iii), and the time needed to respond 
                        to each request.
                  ``(C) Reliance on opinion.--Any person may rely on an 
                opinion issued by the Director pursuant to this 
                paragraph that has not been amended or withdrawn. No 
                liability under Federal consumer financial law shall 
                attach to conduct consistent with an advisory opinion 
                that had not been amended or withdrawn at the time the 
                conduct was undertaken.
                  ``(D) Confidentiality.--Any document or other 
                material that is received by the Agency or any other 
                Federal department or agency in connection with an 
                inquiry under this paragraph shall be exempt from 
                disclosure under section 552 of title 5, United States 
                Code (commonly referred to as the `Freedom of 
                Information Act') and may not, except with the consent 
                of the covered person making such inquiry, be made 
                publicly available, regardless of whether the Director 
                responds to such inquiry or the covered person 
                withdraws such inquiry before receiving an opinion.
                  ``(E) Assistance for small businesses.--
                          ``(i) In general.--The Agency shall assist, 
                        to the maximum extent practicable, small 
                        businesses in preparing inquiries under this 
                        paragraph.
                          ``(ii) Small business defined.--For purposes 
                        of this subparagraph, the term `small business' 
                        has the meaning given the term `small business 
                        concern' under section 3 of the Small Business 
                        Act (15 U.S.C. 632).
                  ``(F) Inquiry fee.--
                          ``(i) In general.--The Director shall develop 
                        a system to charge a fee for each inquiry made 
                        under this paragraph in an amount sufficient, 
                        in the aggregate, to pay for the cost of 
                        carrying out this paragraph.
                          ``(ii) Notice and comment.--Not later than 45 
                        days after the date of the enactment of this 
                        paragraph, the Director shall publish a 
                        description of the fee system described in 
                        clause (i) in the Federal Register and shall 
                        solicit comments from the public for a period 
                        of 60 days after publication.
                          ``(iii) Finalization.--The Director shall 
                        publish a final description of the fee system 
                        and implement such fee system not later than 30 
                        days after the end of the public comment period 
                        described in clause (ii).''.

SEC. 722. REFORM OF CONSUMER FINANCIAL CIVIL PENALTY FUND.

  (a) Segregated Accounts.--Section 1017(b) of the Consumer Financial 
Protection Act of 2010, as redesignated by section 713, is amended by 
redesignating paragraph (2) as paragraph (3), and by inserting after 
paragraph (1) the following new paragraph:
          ``(2) Segregated accounts in civil penalty fund.--
                  ``(A) In general.--The Agency shall establish and 
                maintain a segregated account in the Civil Penalty Fund 
                each time the Agency obtains a civil penalty against 
                any person in any judicial or administrative action 
                under Federal consumer financial laws.
                  ``(B) Deposits in segregated accounts.--The Agency 
                shall deposit each civil penalty collected into the 
                segregated account established for such penalty under 
                subparagraph (A).''.
  (b) Payment to Victims.--Paragraph (3) of section 1017(b) of such 
Act, as redesignated by subsection (a), is amended to read as follows:
          ``(3) Payment to victims.--
                  ``(A) In general.--
                          ``(i) Identification of class.--Not later 
                        than 60 days after the date of deposit of 
                        amounts in a segregated account in the Civil 
                        Penalty Fund, the Agency shall identify the 
                        class of victims of the violation of Federal 
                        consumer financial laws for which such amounts 
                        were collected and deposited under paragraph 
                        (2).
                          ``(ii) Payments.--The Agency, within 2 years 
                        after the date on which such class of victims 
                        is identified, shall locate and make payments 
                        from such amounts to each victim.
                  ``(B) Funds deposited in treasury.--
                          ``(i) In general.--The Agency shall deposit 
                        into the general fund of the Treasury any 
                        amounts remaining in a segregated account in 
                        the Civil Penalty Fund at the end of the 2-year 
                        period for payments to victims under 
                        subparagraph (A).
                          ``(ii) Impossible or impractical payments.--
                        If the Agency determines before the end of the 
                        2-year period for payments to victims under 
                        subparagraph (A) that such victims cannot be 
                        located or payments to such victims are 
                        otherwise not practicable, the Agency shall 
                        deposit into the general fund of the Treasury 
                        the amounts in the segregated account in the 
                        Civil Penalty Fund.''.
  (c) Effective Date.--
          (1) In general.--The amendments made by this section shall 
        apply with respect to civil penalties collected after the date 
        of enactment of this Act.
          (2) Amounts in consumer financial civil penalty fund on date 
        of enactment.--With respect to amounts in the Consumer 
        Financial Civil Penalty Fund on the date of enactment of this 
        Act that were not allocated for consumer education and 
        financial literacy programs on or before September 30, 2015, 
        the Consumer Law Enforcement Agency shall separate such amounts 
        into segregated accounts in accordance with, and for purposes 
        of, section 1017(d) of the Consumer Financial Protection Act of 
        2010, as amended by this section. The date of deposit of such 
        amounts shall be deemed to be the date of enactment of this 
        Act.

SEC. 723. AGENCY PAY FAIRNESS.

  (a) In General.--Section 1013(a)(2) of the Consumer Financial 
Protection Act of 2010 (12 U.S.C. 5493(a)(2)) is amended to read as 
follows:
          ``(2) Compensation.--The rates of basic pay for all employees 
        of the Agency shall be set and adjusted by the Director in 
        accordance with the General Schedule set forth in section 5332 
        of title 5, United States Code.''.
  (b) Effective Date.--The amendment made by subsection (a) shall apply 
to service by an employee of the Consumer Law Enforcement Agency 
following the 90-day period beginning on the date of enactment of this 
Act.

SEC. 724. ELIMINATION OF MARKET MONITORING FUNCTIONS.

  The Consumer Financial Protection Act of 2010 (12 U.S.C. 5481 et 
seq.) is amended--
          (1) in section 1021(c)--
                  (A) by striking paragraph (3); and
                  (B) by redesignating paragraphs (4), (5), and (6) as 
                paragraphs (3), (4), and (5), respectively;
          (2) in section 1022, by striking subsection (c); and
          (3) in section 1026(b), by striking ``, and to assess and 
        detect risks to consumers and consumer financial markets''.

SEC. 725. REFORMS TO MANDATORY FUNCTIONAL UNITS.

  The Consumer Financial Protection Act of 2010 (12 U.S.C. 5481 et 
seq.) is amended--
          (1) in section 1013--
                  (A) in subsection (b)--
                          (i) in paragraph (1), by striking ``shall 
                        establish'' and inserting ``may establish'';
                          (ii) in paragraph (2), by striking ``shall 
                        establish'' and inserting ``may establish''; 
                        and
                          (iii) paragraph (3)(D)--
                                  (I) by striking ``To facilitate 
                                preparation of the reports required 
                                under subparagraph (C), supervision and 
                                enforcement activities, and monitoring 
                                of the market for consumer financial 
                                products and services, the'' and 
                                inserting ``The''; and
                                  (II) by adding at the end the 
                                following: ``Information collected 
                                under this paragraph may not be made 
                                publicly available.'';
                  (B) in subsection (c)--
                          (i) in paragraph (1), by striking ``shall 
                        establish'' and inserting ``may establish''; 
                        and
                          (ii) in paragraph (3), by striking ``There is 
                        established the'' and inserting ``At any time 
                        when the Office of Fair Lending and Equal 
                        Opportunity exists within the Agency, there 
                        shall be a'';
                  (C) in subsection (d)--
                          (i) in paragraph (1), by striking ``shall 
                        establish'' and inserting ``may establish'';
                          (ii) in paragraph (3)--
                                  (I) in subparagraph (A), by inserting 
                                ``, if such Office exists within the 
                                Agency,'' after ``Community Affairs 
                                Office''; and
                                  (II) in subparagraph (B), by striking 
                                ``established by the Director'' and 
                                inserting ``, if established by the 
                                Director,''; and
                          (iii) in paragraph (4), by striking ``Not 
                        later than 24 months after the designated 
                        transfer date, and annually thereafter,'' and 
                        inserting ``Annually, at any time when the 
                        Office of Financial Education exists within the 
                        Agency,'';
                  (D) in subsection (e)(1), by striking ``shall 
                establish'' and inserting ``may establish'';
                  (E) by striking subsection (f);
                  (F) by redesignating subsections (g) and (h) as 
                subsections (f) and (g), respectively; and
                  (G) in subsection (f), as so redesignated--
                          (i) in paragraph (1)--
                                  (I) by striking ``Before the end of 
                                the 180-day period beginning on the 
                                designated transfer date, the Director 
                                shall'' and inserting ``The Director 
                                may''; and
                                  (II) by striking ``on protection from 
                                unfair, deceptive, and abusive 
                                practices and'';
                          (ii) in paragraph (2), by striking ``The 
                        Office'' and inserting ``At any time when the 
                        Office of Financial Protection for Older 
                        Americans exists within the Agency, the 
                        Office''; and
                          (iii) in paragraph (3)--
                                  (I) in subparagraph (A)--
                                          (aa) by striking clause (i);
                                          (bb) by redesignating clauses 
                                        (ii) and (iii) as clauses (i) 
                                        and (ii), respectively; and
                                          (cc) in clause (ii), as so 
                                        redesignated, by striking ``to 
                                        respond to consumer problems 
                                        caused by unfair, deceptive, or 
                                        abusive practices'';
                                  (II) in subparagraph (B), by striking 
                                ``and alert the Commission and State 
                                regulators of certifications or 
                                designations that are identified as 
                                unfair, deceptive, or abusive''; and
                                  (III) in subparagraph (D)--
                                          (aa) by striking clause (i); 
                                        and
                                          (bb) by redesignating clauses 
                                        (ii) and (iii) as clauses (i) 
                                        and (ii), respectively;
          (2) in section 1029(e), by inserting after ``Affairs,'' the 
        following: ``if established under this title,''; and
          (3) in section 1035--
                  (A) in subsection (a), by striking ``shall 
                designate'' and inserting ``may designate''; and
                  (B) in subsection (b), by striking ``The Secretary'' 
                and inserting ``If the Secretary designates the 
                Ombudsman under subsection (a), the Secretary''.

SEC. 726. REPEAL OF MANDATORY ADVISORY BOARD.

  (a) In General.--Section 1014 of the Consumer Financial Protection 
Act of 2010 (12 U.S.C. 5494) is repealed.
  (b) Clerical Amendment.--The table of contents in section 1(b) of the 
Dodd-Frank Wall Street Reform and Consumer Protection Act is amended by 
striking the item relation to section 1014.
  (c) Rule of Construction.--Nothing in this section may be construed 
as limiting the authority of the Director of the Consumer Law 
Enforcement Agency to establish advisory committees pursuant to the 
Federal Advisory Committee Act.

SEC. 727. ELIMINATION OF SUPERVISION AUTHORITY.

  (a) In General.--The Consumer Financial Protection Act of 2010 (12 
U.S.C. 5481 et seq.) is amended--
          (1) in section 1002(15)(B)(ii)(I), by striking ``examination 
        or'';
          (2) in section 1013(a)(1)(B), by striking ``compliance 
        examiners, compliance supervision analysts,'';
          (3) in section 1016(c)--
                  (A) in paragraph (5), by striking ``supervisory 
                and''; and
                  (B) in paragraph (6), by striking ``orders, and 
                supervisory actions'' and inserting ``and orders'';
          (4) in section 1024--
                  (A) in the heading, by striking ``supervision of'' 
                and inserting ``authority with respect to certain'';
                  (B) in subsection (a)--
                          (i) in paragraph (1)(B), by striking ``as 
                        defined by rule in accordance with paragraph 
                        (2)'' and inserting ``as of the date of the 
                        enactment of the Financial CHOICE Act of 
                        2017'';
                          (ii) by striking paragraph (2);
                          (iii) by redesignating paragraph (3) as 
                        paragraph (2); and
                          (iv) in subparagraph (A) of paragraph (2), as 
                        so redesignated, by striking ``1025(a) or'';
                  (C) by striking subsection (b);
                  (D) by redesignating subsections (c), (d), (e), and 
                (f) as subsections (b), (c), (d), and (e), 
                respectively;
                  (E) in subsection (c), as so redesignated--
                          (i) in the heading, by striking ``and 
                        Examination Authority''; and
                          (ii) by striking ``, conduct examinations,'' 
                        each place such term appears;
                  (F) in subsection (d), as so redesignated--
                          (i) by inserting ``rulemaking and 
                        enforcement, but not supervisory,'' before 
                        ``authority of the Bureau''; and
                          (ii) by striking ``conducting any examination 
                        or requiring any report from a service provider 
                        subject to this subsection'' and inserting 
                        ``carrying out any authority pursuant to this 
                        subsection with respect to a service 
                        provider'';
          (5) by striking section 1025;
          (6) in section 1026--
                  (A) by amending subsection (a) to read as follows:
  ``(a) Scope of Coverage.--This section shall apply to any covered 
person that is an insured depository institution or an insured credit 
union.'';
                  (B) in subsection (b)(3), by striking ``report of 
                examination or related'';
                  (C) by striking subsection (c);
                  (D) by redesignating subsections (d) and (e) as 
                subsections (c) and (d), respectively; and
                  (E) in subsection (d), as so redesignated--
                          (i) by striking ``section 1025'' and 
                        inserting ``this section''; and
                          (ii) by striking ``When conducting any 
                        examination or requiring any report from a 
                        service provider subject to this subsection'' 
                        and inserting ``In carrying out any authority 
                        pursuant to this subsection with respect to a 
                        service provider'';
          (7) in section 1027--
                  (A) by striking ``supervisory,'' each place such term 
                appears;
                  (B) in subsection (e)(1), by striking ``supervisory 
                or''; and
                  (C) in subsection (p), by striking ``section 
                1024(c)(1)'' and inserting ``section 1024(b)(1)'';
          (8) in section 1034--
                  (A) by striking subsections (b) and (c); and
                  (B) by redesignating subsection (d) as subsection 
                (b);
          (9) in section 1053--
                  (A) in subsection (b)(1)(A), by striking ``sections 
                1024, 1025, and 1026'' and inserting ``sections 1024 
                and 1026''; and
                  (B) in subsection (c)(3)(B)(ii)(II), by striking ``, 
                by examination or otherwise,'';
          (10) in section 1054(a), by striking ``sections 1024, 1025, 
        and 1026'' and inserting ``sections 1024 and 1026'';
          (11) in section 1061--
                  (A) in subsection (a)(1)--
                          (i) in subparagraph (A), by striking ``; 
                        and'' at the end and inserting a period; and
                          (ii) by striking subparagraph (B); and
                  (B) in subsection (c)--
                          (i) by amending paragraph (1) to read as 
                        follows:
          ``(1) Examination.--A transferor agency that is a prudential 
        regulator shall have exclusive authority (relative to the 
        Bureau) to require reports from and conduct examinations for 
        compliance with Federal consumer financial laws with respect to 
        a person described in section 1026(a).'';
                          (ii) in paragraph (2)--
                                  (I) by striking subparagraph (A); and
                                  (II) by redesignating subparagraphs 
                                (B) and (C) as subparagraphs (A) and 
                                (B), respectively;
          (12) in section 1063, by striking ``sections 1024, 1025, and 
        1026'' each place such term appears and inserting ``sections 
        1024 and 1026''; and
          (13) in section 1067, by striking subsection (e).
  (b) Home Mortgage Disclosure Act of 1975.--Section 305(d) of the Home 
Mortgage Disclosure Act of 1975 (12 U.S.C. 2804(d)) is amended by 
striking ``examine and''.
  (c) Omnibus Appropriations Act, 2009.--Section 626 of the Omnibus 
Appropriations Act, 2009 (15 U.S.C. 1638 note) is repealed.
  (d) Clerical Amendment.--The table of contents in section 1(b) of the 
Dodd-Frank Wall Street Reform and Consumer Protection Act is amended--
          (1) in the item relating to section 1024, by striking 
        ``SUPERVISION OF'' and inserting ``AUTHORITY WITH RESPECT TO 
        CERTAIN''; and
          (2) by striking the item relating to section 1025.

SEC. 728. TRANSFER OF OLD OTS BUILDING FROM OCC TO GSA.

  Not later than 180 days after the date of enactment of this Act, the 
Comptroller of the Currency shall transfer administrative jurisdiction 
over the Federal property located at 1700 G Street, Northwest, in the 
District of Columbia to the Administrator of General Services.

SEC. 729. LIMITATION ON AGENCY AUTHORITY.

  Section 1027 of the Consumer Financial Protection Act of 2010 (12 
U.S.C. 5517) is amended--
          (1) in subsection (g)(3)(A), by striking ``may not exercise 
        any rulemaking or enforcement authority'' and inserting ``may 
        not exercise any rulemaking, enforcement, or other authority'';
          (2) in subsection (i)(1), by striking ``shall have no 
        authority to exercise any power to enforce this title'' and 
        inserting ``may not exercise any rulemaking, enforcement, or 
        other authority''; and
          (3) in subsection (j)(1), by striking ``shall have no 
        authority to exercise any power to enforce this title'' and 
        inserting ``may not exercise any rulemaking, enforcement, or 
        other authority''.

                    Subtitle C--Policy Enhancements

SEC. 731. CONSUMER RIGHT TO FINANCIAL PRIVACY.

  (a) Requirement of the Agency to Obtain Permission Before Collecting 
Nonpublic Personal Information.--Section 1022 of the Consumer Financial 
Protection Act of 2010 (12 U.S.C. 5512), as amended by section 724(3), 
is further amended by inserting after subsection (b) the following:
  ``(c) Consumer Privacy.--
          ``(1) In general.--The Agency may not request, obtain, 
        access, collect, use, retain, or disclose any nonpublic 
        personal information about a consumer unless--
                  ``(A) the Agency clearly and conspicuously discloses 
                to the consumer, in writing or in an electronic form, 
                what information will be requested, obtained, accessed, 
                collected, used, retained, or disclosed; and
                  ``(B) before such information is requested, obtained, 
                accessed, collected, used, retained, or disclosed, the 
                consumer informs the Agency that such information may 
                be requested, obtained, accessed, collected, used, 
                retained, or disclosed.
          ``(2) Application of requirement to contractors of the 
        agency.--Paragraph (1) shall apply to any person directed or 
        engaged by the Agency to collect information to the extent such 
        information is being collected on behalf of the Agency.
          ``(3) Definition of nonpublic personal information.--In this 
        subsection, the term `nonpublic personal information' has the 
        meaning given the term in section 509 of the Gramm-Leach-Bliley 
        Act (15 U.S.C. 6809).''.
  (b) Removal of Exemption for the Agency From the Right to Financial 
Privacy Act.--Section 1113 of the Right to Financial Privacy Act of 
1978 (12 U.S.C. 3413) is amended by striking subsection (r).

SEC. 732. REPEAL OF COUNCIL AUTHORITY TO SET ASIDE AGENCY RULES AND 
                    REQUIREMENT OF SAFETY AND SOUNDNESS CONSIDERATIONS 
                    WHEN ISSUING RULES.

  (a) Repeal of Authority.--
          (1) In general.--Section 1023 of the Consumer Financial 
        Protection Act of 2010 (12 U.S.C. 5513) is hereby repealed.
          (2) Conforming amendment.--Section 1022(b)(2)(C) of the 
        Consumer Financial Protection Act of 2010 (12 U.S.C. 
        5512(b)(2)(C)) is amended by striking ``, except that nothing 
        in this clause shall be construed as altering or limiting the 
        procedures under section 1023 that may apply to any rule 
        prescribed by the Bureau''.
          (3) Clerical amendment.--The table of contents under section 
        1(b) of the Dodd-Frank Wall Street Reform and Consumer 
        Protection Act is amended by striking the item relating to 
        section 1023.
  (b) Safety and Soundness Check.--Section 1022(b)(2)(A) of the 
Consumer Financial Protection Act of 2010 (12 U.S.C. 5512(b)(2)(A)) is 
amended--
          (1) in clause (i), by striking ``and'' at the end;
          (2) in clause (ii), by adding ``and'' at the end; and
          (3) by adding at the end the following:
                          ``(iii) the impact of such rule on the 
                        financial safety or soundness of an insured 
                        depository institution;''.

SEC. 733. REMOVAL OF AUTHORITY TO REGULATE SMALL-DOLLAR CREDIT.

  The Consumer Financial Protection Act of 2010 (12 U.S.C. 5481 et 
seq.) is amended--
          (1) in section 1024(a)(1)--
                  (A) in subparagraph (C), by adding ``or'' at the end;
                  (B) in subparagraph (D), by striking ``; or'' and 
                inserting a period; and
                  (C) by striking subparagraph (E); and
          (2) in section 1027, by adding at the end the following:
  ``(t) No Authority to Regulate Small-dollar Credit.--The Agency may 
not exercise any rulemaking, enforcement, or other authority with 
respect to payday loans, vehicle title loans, or other similar 
loans.''.

SEC. 734. REFORMING INDIRECT AUTO FINANCING GUIDANCE.

  (a) Nullification of Auto Lending Guidance.--Bulletin 2013-02 of the 
Bureau of Consumer Financial Protection (published March 21, 2013) 
shall have no force or effect.
  (b) Guidance Requirements.--Section 1022(b) of the Consumer Financial 
Protection Act of 2010 (12 U.S.C. 5512(b)), as amended by section 721, 
is further amended by adding at the end the following:
          ``(8) Guidance on indirect auto financing.--In proposing and 
        issuing guidance primarily related to indirect auto financing, 
        the Agency shall--
                  ``(A) provide for a public notice and comment period 
                before issuing the guidance in final form;
                  ``(B) make available to the public, including on the 
                website of the Agency, all studies, data, 
                methodologies, analyses, and other information relied 
                on by the Agency in preparing such guidance;
                  ``(C) redact any information that is exempt from 
                disclosure under paragraph (3), (4), (6), (7), or (8) 
                of section 552(b) of title 5, United States Code;
                  ``(D) consult with the Board of Governors of the 
                Federal Reserve System, the Federal Trade Commission, 
                and the Department of Justice; and
                  ``(E) conduct a study on the costs and impacts of 
                such guidance to consumers and women-owned, minority-
                owned, veteran-owned, and small businesses, including 
                consumers and small businesses in rural areas.''.
  (c) Rule of Construction.--Nothing in this section shall be construed 
to apply to guidance issued by the Consumer Law Enforcement Agency that 
is not primarily related to indirect auto financing.

SEC. 735. PROHIBITION OF GOVERNMENT PRICE CONTROLS FOR PAYMENT CARD 
                    TRANSACTIONS.

  (a) In General.--Section 1075 of the Consumer Financial Protection 
Act of 2010 is hereby repealed and the provisions of law amended by 
such section are revived or restored as if such section had not been 
enacted.
  (b) Clerical Amendment.--The table of contents under section 1(b) of 
the Dodd-Frank Wall Street Reform and Consumer Protection Act is 
amended by striking the item relating to section 1075.

SEC. 736. REMOVAL OF AGENCY UDAAP AUTHORITY.

  (a) In General.--The Consumer Financial Protection Act of 2010 (12 
U.S.C. 5481 et seq.) is amended--
          (1) in section 1021(b)(2), by striking ``unfair, deceptive, 
        or abusive acts and practices and'';
          (2) by striking section 1031;
          (3) in section 1036(a)--
                  (A) in paragraph (1)--
                          (i) by striking ``provider'' and all that 
                        follows through ``to offer'' and inserting 
                        ``provider to offer'';
                          (ii) by striking subparagraph (B); and
                  (B) in paragraph (2)(C), by striking ``; or'' at the 
                end and inserting a period; and
                  (C) by striking paragraph (3); and
          (4) in section 1061(b)(5)--
                  (A) in subparagraph (B), by striking clause (ii);
                  (B) by striking subparagraph (D); and
                  (C) by redesignating subparagraph (E) (as amended by 
                section 718(2)) as subparagraph (D); and
          (5) in section 1076(b)(2), by striking ``determine--'' and 
        all that follows through ``(B) provide for'' and inserting 
        ``determine, provide for''.
  (b) Telemarketing and Consumer Fraud and Abuse Prevention Act.--
Section 3(c) of the Telemarketing and Consumer Fraud and Abuse 
Prevention Act (15 U.S.C. 6102) is amended--
          (1) in paragraph (1), by striking ``; and'' at the end and 
        inserting a period;
          (2) by striking paragraph (2); and
          (3) by striking ``subsection (a)--'' and all that follows 
        through ``(1) shall'' and inserting ``subsection (a) shall''.
  (c) Clerical Amendment.--The table of contents in section 1(b) of the 
Dodd-Frank Wall Street Reform and Consumer Protection Act is amended by 
striking the item relating to section 1031.

SEC. 737. PRESERVATION OF UDAP AUTHORITY FOR FEDERAL BANKING 
                    REGULATORS.

  (a) In General.--Section 18(f) of the Federal Trade Commission Act 
(15 U.S.C. 57a(f)) is amended to read as follows:
  ``(f) Unfair or Deceptive Acts or Practices by Depository 
Institutions.--
          ``(1) In general.--In order to prevent unfair or deceptive 
        acts or practices in or affecting commerce (including acts or 
        practices which are unfair or deceptive to consumers) by 
        depository institutions, each Federal banking regulator shall 
        prescribe regulations to carry out the purposes of this 
        section, including regulations defining with specificity such 
        unfair or deceptive acts or practices, and containing 
        requirements prescribed for the purpose of preventing such acts 
        or practices.
          ``(2) Promulgating substantially similar regulations.--
        Whenever the Commission prescribes a rule under subsection 
        (a)(1)(B), then within 60 days after such rule takes effect 
        each Federal banking regulator shall promulgate substantially 
        similar regulations prohibiting acts or practices of depository 
        institutions which are substantially similar to those 
        prohibited by rules of the Commission and which impose 
        substantially similar requirements, unless--
                  ``(A) the Federal banking regulator finds that such 
                acts or practices of depository institutions are not 
                unfair or deceptive; or
                  ``(B) the Board of Governors of the Federal Reserve 
                System finds that implementation of similar regulations 
                with respect to depository institutions would seriously 
                conflict with essential monetary and payments systems 
                policies of such Board, and publishes any such finding, 
                and the reasons therefor, in the Federal Register.
          ``(3) Enforcement.--
                  ``(A) In general.--Compliance with regulations 
                prescribed under this subsection shall be enforced--
                          ``(i) under section 8 of the Federal Deposit 
                        Insurance Act, with respect to a depository 
                        institution other than a Federal credit union; 
                        and
                          ``(ii) under sections 120 and 206 of the 
                        Federal Credit Union Act, with respect to a 
                        Federal credit union.
                  ``(B) Deeming of violation.--For the purpose of the 
                exercise by a Federal banking regulator of the 
                regulator's powers under any Act referred to in 
                subparagraph (A), a violation of any regulation 
                prescribed under this subsection shall be deemed to be 
                a violation of a requirement imposed under that Act.
                  ``(C) Enforcement through any existing authority.--In 
                addition to its powers under any provision of law 
                specifically referred to in subparagraph (A), each 
                Federal banking regulator may exercise, for the purpose 
                of enforcing compliance with any regulation prescribed 
                under this subsection, any other authority conferred on 
                the regulator by law.
          ``(4) Rule of construction.--The authority of the Board of 
        Governors of the Federal Reserve System to issue regulations 
        under this subsection does not impair the authority of any 
        other Federal banking regulator to make rules respecting the 
        regulator's own procedures in enforcing compliance with 
        regulations prescribed under this subsection.
          ``(5) Report to congress.--Each Federal banking regulator 
        exercising authority under this subsection shall transmit to 
        the Congress each year a detailed report on its activities 
        under this subsection during the preceding calendar year.
          ``(6) Definitions.--For purposes of this Act:
                  ``(A) Bank.--The term `bank' means--
                          ``(i) national banks and Federal branches and 
                        Federal agencies of foreign banks;
                          ``(ii) member banks of the Federal Reserve 
                        System (other than national banks), branches 
                        and agencies of foreign banks (other than 
                        Federal branches, Federal agencies, and insured 
                        State branches of foreign banks), commercial 
                        lending companies owned or controlled by 
                        foreign banks, and organizations operating 
                        under section 25 or 25A of the Federal Reserve 
                        Act; and
                          ``(iii) banks insured by the Federal Deposit 
                        Insurance Corporation (other than banks 
                        referred to in clause (i) or (ii) and insured 
                        State branches of foreign banks.
                  ``(B) Depository institution.--The term `depository 
                institution' means a bank, a savings and loan 
                institution, or a Federal credit union.
                  ``(C) Federal banking regulator.--The term `Federal 
                banking regulator'--
                          ``(i) has the meaning given the term 
                        `appropriate Federal banking agency' under 
                        section 3 of the Federal Deposit Insurance Act; 
                        and
                          ``(ii) means the National Credit Union 
                        Administration, in the case of a Federal credit 
                        union.
                  ``(D) Federal credit union.--The term `Federal credit 
                union' has the same meaning as in section 101 of the 
                Federal Credit Union Act.
                  ``(E) Savings and loan institution.--The term 
                `savings and loan institution' has the same meaning as 
                in section 3 of the Federal Deposit Insurance Act.
                  ``(F) Other terms.--The terms used in this paragraph 
                that are not defined in this Act or otherwise defined 
                in section 3(s) of the Federal Deposit Insurance Act 
                shall have the meaning given to them in section 1(b) of 
                the International Banking Act of 1978.''.
  (b) Conforming Amendments.--The Federal Trade Commission Act (15 
U.S.C. 41 et seq.) is amended--
          (1) in section 6(j)(6), by striking ``section 18(f)(3) (15 
        U.S.C. 57a(f)(3)), a Federal credit union described in section 
        18(f)(4) (15 U.S.C. 57a(f)(4))'' and inserting ``section 18(f), 
        a Federal credit union described in section 18(f)'';
          (2) in section 21(b)(6)(C), by striking ``section 18(f)(3) of 
        the Federal Trade Commission Act (15 U.S.C. 57a(f)(3)), or a 
        Federal credit union described in section 18(f)(4) of the 
        Federal Trade Commission Act (15 U.S.C. 57a(f)(4))'' and 
        inserting ``18(f), or a Federal credit union described in 
        section 18(f)'';
          (3) by striking ``section 18(f)(2)'' each place such term 
        appears and inserting ``section 18(f)'';
          (4) by striking ``section 18(f)(3)'' each place such term 
        appears and inserting ``section 18(f)''; and
          (5) by striking ``section 18(f)(4)'' each place such term 
        appears and inserting ``section 18(f)''.

SEC. 738. REPEAL OF AUTHORITY TO RESTRICT ARBITRATION.

  (a) In General.--Section 1028 of the Consumer Financial Protection 
Act of 2010 (12 U.S.C. 5518) is hereby repealed.
  (b) Clerical Amendment.--The table of contents under section 1(b) of 
the Dodd-Frank Wall Street Reform and Consumer Protection Act is 
amended by striking the item relating to section 1028.

                TITLE VIII--CAPITAL MARKETS IMPROVEMENTS

       Subtitle A--SEC Reform, Restructuring, and Accountability

SEC. 801. AUTHORIZATION OF APPROPRIATIONS.

  Section 35 of the Securities Exchange Act of 1934 (15 U.S.C. 78kk) is 
amended by striking paragraphs (1) through (5) and inserting the 
following:
          ``(1) for fiscal year 2017, $1,555,000,000;
          ``(2) for fiscal year 2018, $1,605,000,000;
          ``(3) for fiscal year 2019, $1,655,000,000;
          ``(4) for fiscal year 2020, $1,705,000,000;
          ``(5) for fiscal year 2021, $1,755,000,000; and
          ``(6) for fiscal year 2022, $1,805,000,000.''.

SEC. 802. REPORT ON UNOBLIGATED APPROPRIATIONS.

  Section 23 of the Securities Exchange Act of 1934 (15 U.S.C. 78w) is 
amended by adding at the end the following:
  ``(e) Report on Unobligated Appropriations.--If, at the end of any 
fiscal year, there remain unobligated any funds that were appropriated 
to the Commission for such fiscal year, the Commission shall, not later 
than 30 days after the last day of such fiscal year, submit to the 
Committee on Financial Services and the Committee on Appropriations of 
the House of Representatives and the Committee on Banking, Housing, and 
Urban Affairs and the Committee on Appropriations of the Senate a 
report stating the amount of such unobligated funds. If there is any 
material change in the amount stated in the report, the Commission 
shall, not later than 7 days after determining the amount of the 
change, submit to such committees a supplementary report stating the 
amount of and reason for the change.''.

SEC. 803. SEC RESERVE FUND ABOLISHED.

  Section 4 of the Securities Exchange Act of 1934 (15 U.S.C. 78d) is 
amended by striking subsection (i).

SEC. 804. FEES TO OFFSET APPROPRIATIONS.

  (a) Section 31 of the Securities Exchange Act of 1934.--Section 31 of 
the Securities Exchange Act of 1934 (15 U.S.C. 78ee) is amended--
          (1) by striking subsection (a) and inserting the following:
  ``(a) Collection.--The Commission shall, in accordance with this 
section, collect transaction fees and assessments.'';
          (2) in subsection (i)--
                  (A) in paragraph (1)(A), by inserting ``except as 
                provided in paragraph (2),'' before ``shall''; and
                  (B) by striking paragraph (2) and inserting the 
                following:
          ``(2) General revenue.--Any fees collected for a fiscal year 
        pursuant to this section, sections 13(e) and 14(g) of this 
        title, and section 6(b) of the Securities Act of 1933 in excess 
        of the amount provided in appropriation Acts for collection for 
        such fiscal year pursuant to such sections shall be deposited 
        and credited as general revenue of the Treasury.'';
          (3) in subsection (j)--
                  (A) by striking ``the regular appropriation to the 
                Commission by Congress for such fiscal year'' each 
                place it appears and inserting ``the target offsetting 
                collection amount for such fiscal year''; and
                  (B) in paragraph (2), by striking ``subsection (l)'' 
                and inserting ``subsection (l)(2)''; and
          (4) by striking subsection (l) and inserting the following:
  ``(l) Definitions.--For purposes of this section:
          ``(1) Target offsetting collection amount.--The target 
        offsetting collection amount for a fiscal year is--
                  ``(A) for fiscal year 2017, $1,400,000,000; and
                  ``(B) for each succeeding fiscal year, the target 
                offsetting collection amount for the prior fiscal year, 
                adjusted by the rate of inflation.
          ``(2) Baseline estimate of the aggregate dollar amount of 
        sales.--The baseline estimate of the aggregate dollar amount of 
        sales for any fiscal year is the baseline estimate of the 
        aggregate dollar amount of sales of securities (other than 
        bonds, debentures, other evidences of indebtedness, security 
        futures products, and options on securities indexes (excluding 
        a narrow-based security index)) to be transacted on each 
        national securities exchange and by or through any member of 
        each national securities association (otherwise than on a 
        national securities exchange) during such fiscal year as 
        determined by the Commission, after consultation with the 
        Congressional Budget Office and the Office of Management and 
        Budget, using the methodology required for making projections 
        pursuant to section 257 of the Balanced Budget and Emergency 
        Deficit Control Act of 1985.''.
  (b) Section 6(b) of the Securities Act of 1933.--Section 6(b) of the 
Securities Act of 1933 (15 U.S.C. 77f(b)) is amended--
          (1) by striking ``target fee collection amount'' each place 
        it appears and inserting ``target offsetting collection 
        amount'';
          (2) in paragraph (4), by striking the last sentence and 
        inserting the following: ``Subject to paragraphs (6)(B) and 
        (7), an adjusted rate prescribed under paragraph (2) shall take 
        effect on the later of--
                  ``(A) the first day of the fiscal year to which such 
                rate applies; or
                  ``(B) five days after the date on which a regular 
                appropriation to the Commission for such fiscal year is 
                enacted.'';
          (3) in paragraph (5), by inserting ``of the Securities 
        Exchange Act of 1934'' after ``sections 13(e) and 14(g)'';
          (4) by redesignating paragraph (6) as paragraph (8);
          (5) by inserting after paragraph (5) the following:
          ``(6) Offsetting collections.--Fees collected pursuant to 
        this subsection for any fiscal year--
                  ``(A) except as provided in section 31(i)(2) of the 
                Securities Exchange Act of 1934, shall be deposited and 
                credited as offsetting collections to the account 
                providing appropriations to the Commission; and
                  ``(B) except as provided in paragraph (7), shall not 
                be collected for any fiscal year except to the extent 
                provided in advance in appropriation Acts.
          ``(7) Lapse of appropriation.--If on the first day of a 
        fiscal year a regular appropriation to the Commission has not 
        been enacted, the Commission shall continue to collect fees (as 
        offsetting collections) under this subsection at the rate in 
        effect during the preceding fiscal year, until 5 days after the 
        date such a regular appropriation is enacted.''; and
          (6) in subparagraph (A) of paragraph (8) (as so 
        redesignated)--
                  (A) by striking the subparagraph heading and 
                inserting ``Target offsetting collection amount.--''; 
                and
                  (B) in the heading of the right column of the table, 
                by striking ``fee'' and inserting ``offsetting''.
  (c) Section 13(e) of the Securities Exchange Act of 1934.--Section 
13(e) of the Securities Exchange Act of 1934 (15 U.S.C. 78m(e)) is 
amended--
          (1) by striking paragraph (5) and inserting the following:
          ``(5) Offsetting collections.--Fees collected pursuant to 
        this subsection for any fiscal year--
                  ``(A) except as provided in section 31(i)(2), shall 
                be deposited and credited as offsetting collections to 
                the account providing appropriations to the Commission; 
                and
                  ``(B) except as provided in paragraph (8), shall not 
                be collected for any fiscal year except to the extent 
                provided in advance in appropriations Acts.''; and
          (2) by adding at the end the following:
          ``(8) Lapse of appropriation.--If on the first day of a 
        fiscal year a regular appropriation to the Commission has not 
        been enacted, the Commission shall continue to collect fees (as 
        offsetting collections) under this subsection at the rate in 
        effect during the preceding fiscal year, until 5 days after the 
        date such a regular appropriation is enacted.''.
  (d) Section 14(g) of the Securities Exchange Act of 1934.--Section 
14(g) of the Securities Exchange Act of 1934 (15 U.S.C. 78n(g)) is 
amended--
          (1) by striking paragraph (5) and inserting the following:
          ``(5) Offsetting collections.--Fees collected pursuant to 
        this subsection for any fiscal year--
                  ``(A) except as provided in section 31(i)(2), shall 
                be deposited and credited as offsetting collections to 
                the account providing appropriations to the Commission; 
                and
                  ``(B) except as provided in paragraph (8), shall not 
                be collected for any fiscal year except to the extent 
                provided in advance in appropriations Acts.'';
          (2) by redesignating paragraph (8) as paragraph (9); and
          (3) by inserting after paragraph (7) the following:
          ``(8) Lapse of appropriation.--If on the first day of a 
        fiscal year a regular appropriation to the Commission has not 
        been enacted, the Commission shall continue to collect fees (as 
        offsetting collections) under this subsection at the rate in 
        effect during the preceding fiscal year, until 5 days after the 
        date such a regular appropriation is enacted.''.
  (e) Effective Date.--The amendments made by this section--
          (1) shall apply beginning on October 1, 2017, except that for 
        fiscal year 2018, the Securities and Exchange Commission shall 
        publish--
                  (A) the rates established under section 31 of the 
                Securities Exchange Act of 1934, as amended by this 
                section, not later than 30 days after the date on which 
                an Act making a regular appropriation to the Commission 
                for fiscal year 2018 is enacted; and
                  (B) the rate established under section 6(b) of the 
                Securities Act of 1933, as amended by this section, not 
                later than August 31, 2017; and
          (2) shall not apply with respect to fees for any fiscal year 
        before fiscal year 2018.

SEC. 805. COMMISSION RELOCATION FUNDING PROHIBITION.

  The Securities and Exchange Commission may not obligate any funds for 
the purpose of constructing a new headquarters of the Commission.

SEC. 806. IMPLEMENTATION OF RECOMMENDATIONS.

  Section 967 of the Dodd-Frank Wall Street Reform and Consumer 
Protection Act is amended by adding at the end the following:
  ``(d) Implementation of Recommendations.--Not later than 6 months 
after the date of enactment of this subsection, the Securities and 
Exchange Commission shall complete an implementation of the 
recommendations contained in the report of the independent consultant 
issued under subsection (b) on March 10, 2011. To the extent that 
implementation of certain recommendations requires legislation, the 
Commission shall submit a report to Congress containing a request for 
legislation granting the Commission such authority it needs to fully 
implement such recommendations.''.

SEC. 807. OFFICE OF CREDIT RATINGS TO REPORT TO THE DIVISION OF TRADING 
                    AND MARKETS.

  Section 15E(p)(1) of the Securities Exchange Act of 1934 (15 U.S.C. 
78o-7(p)(1)) is amended--
          (1) in subparagraph (A), by striking ``within the 
        Commission'' and inserting ``within the Division of Trading and 
        Markets''; and
          (2) in subparagraph (B), by striking ``report to the 
        Chairman'' and inserting ``report to the head of the Division 
        of Trading and Markets''.

SEC. 808. OFFICE OF MUNICIPAL SECURITIES TO REPORT TO THE DIVISION OF 
                    TRADING AND MARKETS.

  Section 979 of the Dodd-Frank Wall Street Reform and Consumer 
Protection Act (15 U.S.C. 78o-4a) is amended--
          (1) in subsection (a), by inserting ``, within the Division 
        of Trading and Markets,'' after ``There shall be in the 
        Commission''; and
          (2) in subsection (b), by striking ``report to the Chairman'' 
        and inserting ``report to the head of the Division of Trading 
        and Markets''.

SEC. 809. INDEPENDENCE OF COMMISSION OMBUDSMAN.

  Section 4(g)(8) of the Securities Exchange Act of 1934 (15 U.S.C. 
78d(g)(8)) is amended--
          (1) in subparagraph (A), by striking ``the Investor Advocate 
        shall appoint'' and all that follows through ``Investor 
        Advocate'' and inserting ``the Chairman shall appoint an 
        Ombudsman, who shall report to the Commission''; and
          (2) in subparagraph (D)--
                  (A) by striking ``report to the Investor Advocate'' 
                and inserting ``report to the Commission''; and
                  (B) by striking the last sentence.

SEC. 810. INVESTOR ADVISORY COMMITTEE IMPROVEMENTS.

  Section 39 of the Securities Exchange Act of 1934 (15 U.S.C. 78pp) is 
amended--
          (1) in subsection (a)(2)(B), by striking ``submit'' and 
        inserting, ``in consultation with the Small Business Capital 
        Formation Advisory Committee established under section 40, 
        submit'';
          (2) in subsection (b)--
                  (A) in paragraph (1)--
                          (i) in subparagraph (C), by striking ``and'';
                          (ii) in subparagraph (D)(iv), by striking the 
                        period at the end and inserting ``; and''; and
                          (iii) by adding at the end the following:
                  ``(E) a member of the Small Business Capital 
                Formation Advisory Committee who shall be a nonvoting 
                member.'';
                  (B) by amending paragraph (2) to read as follows:
          ``(2) Term.--
                  ``(A) Length of term for members of the committee.--
                Each member of the Committee appointed under paragraph 
                (1), other than the Investor Advocate, shall serve for 
                a term of 4 years.
                  ``(B) Limitation on multiple terms.--A member of the 
                Committee may not serve for more than one term, except 
                for the Investor Advocate, a representative of State 
                securities commissions, and the member of the Small 
                Business Capital Formation Advisory Committee.''; and
                  (C) in paragraph (3), by striking ``paragraph 
                (1)(B)'' and inserting ``paragraph (1)'';
          (3) in subsection (c), by amending paragraph (2) to read as 
        follows:
          ``(2) Term.--
                  ``(A) Length of term.--Each member elected under 
                paragraph (1) shall serve for a term of 3 years in the 
                capacity for which the member was elected under 
                paragraph (1).
                  ``(B) Limitation on multiple terms.--A member elected 
                under paragraph (1) may not serve for more than one 
                term in the capacity for which the member was elected 
                under paragraph (1).''; and
          (4) by striking subsections (i) and (j).

SEC. 811. DUTIES OF INVESTOR ADVOCATE.

  Section 4(g)(4) of the Securities Exchange Act of 1934 (15 U.S.C. 
78d(g)(4)) is amended--
          (1) in subparagraph (D)(ii), by striking ``and'';
          (2) in subparagraph (E), by striking the period at the end 
        and inserting a semicolon; and
          (3) by adding at the end the following:
                  ``(F) not take a position on any legislation pending 
                before Congress other than a legislative change 
                proposed by the Investor Advocate pursuant to 
                subparagraph (E);
                  ``(G) consult with the Advocate for Small Business 
                Capital Formation on proposed recommendations made 
                under subparagraph (E); and
                  ``(H) advise the Advocate for Small Business Capital 
                Formation on issues related to small business 
                investors.''.

SEC. 812. ELIMINATION OF EXEMPTION OF SMALL BUSINESS CAPITAL FORMATION 
                    ADVISORY COMMITTEE FROM FEDERAL ADVISORY COMMITTEE 
                    ACT.

  Section 40 of the Securities Exchange Act of 1934 (as added by Public 
Law 114-284) is amended by striking subsection (h).

SEC. 813. INTERNAL RISK CONTROLS.

  The Securities Exchange Act of 1934 (15 U.S.C. 78a et seq.) is 
amended--
          (1) by inserting after section 4G, as added by this Act, the 
        following:

``SEC. 4H. INTERNAL RISK CONTROLS.

  ``(a) In General.--Each of the following entities, in consultation 
with the Chief Economist, shall develop comprehensive internal risk 
control mechanisms to safeguard and govern the storage of all market 
data by such entity, all market data sharing agreements of such entity, 
and all academic research performed at such entity using market data:
          ``(1) The Commission.
          ``(2) Each national security association required to register 
        under section 15A.
  ``(b) Consolidated Audit Trail.--The Commission may not approve a 
national market system plan pursuant to part 242.613 of title 17, Code 
of Federal Regulations (or any successor regulation), unless the 
operator of the consolidated audit trail created by such plan has 
developed, in consultation with the Chief Economist, comprehensive 
internal risk control mechanisms to safeguard and govern the storage of 
all market data by such operator, all market data sharing agreements of 
such operator, and all academic research performed at such operator 
using market data.'';
          (2) in section 3(a), by redesignating the second paragraph 
        (80) (relating to funding portals) as paragraph (81); and
          (3) in section 3(a), by adding at the end the following:
          ``(82) Chief economist.--The term `Chief Economist' means the 
        Director of the Division of Economic and Risk Analysis, or an 
        employee of the Commission with comparable authority, as 
        determined by the Commission.''.

SEC. 814. APPLICABILITY OF NOTICE AND COMMENT REQUIREMENTS OF THE 
                    ADMINISTRATIVE PROCEDURE ACT TO GUIDANCE VOTED ON 
                    BY THE COMMISSION.

  The Securities Exchange Act of 1934 (15 U.S.C. 78a et seq.) is 
amended by inserting after section 4H, as added by this Act, the 
following:

``SEC. 4I. APPLICABILITY OF NOTICE AND COMMENT REQUIREMENTS OF THE 
                    ADMINISTRATIVE PROCEDURE ACT TO GUIDANCE VOTED ON 
                    BY THE COMMISSION.

  ``The notice and comment requirements of section 553 of title 5, 
United States Code, shall also apply with respect to any Commission 
statement or guidance, including interpretive rules, general statements 
of policy, or rules of Commission organization, procedure, or practice, 
that has the effect of implementing, interpreting, or prescribing law 
or policy and that is voted on by the Commission.''.

SEC. 815. LIMITATION ON PILOT PROGRAMS.

  (a) In General.--Section 4 of the Securities Exchange Act of 1934 (15 
U.S.C. 78d), as amended by section 371(e), is further amended by adding 
at the end the following:
  ``(k) Limitation on Pilot Programs.--
          ``(1) In general.--Any pilot program established by self-
        regulatory organizations, either individually or jointly, and 
        filed with the Commission, including under section 11A or 19, 
        shall terminate after the end of the 5-year period beginning on 
        the date that the Commission approved such program, unless the 
        Commission issues a rule to permanently continue such program 
        or approves such program on a permanent basis.
          ``(2) Extension.--With respect to a particular pilot program 
        described under paragraph (1), the Commission may extend the 5-
        year period described under such paragraph for an additional 3 
        years if the Commission determines such extension is necessary 
        or appropriate in the public interest or for the protection of 
        investors.
          ``(3) Lack of statutory authority.--If, with respect to a 
        pilot program described under paragraph (1), the Commission 
        determines that the pilot program should continue permanently, 
        but the Commission lacks sufficient statutory authority to 
        permanently continue the program, the Commission shall, not 
        later than 1 year before such pilot program is scheduled to 
        terminate pursuant to paragraph (1), notify the Committee on 
        Financial Services of the House of Representatives and the 
        Committee on Banking, Housing, and Urban Affairs of the Senate 
        that the Commission believes the program should continue 
        permanently but does not have sufficient statutory authority to 
        continue the program.''.
  (b) Treatment of Existing Pilot Programs.--For purposes of section 
4(k) of Securities Exchange Act of 1934, as added by subsection (a), 
the date on which the Commission approved a pilot program that was in 
existence on the date of the enactment of this Act shall be deemed to 
be the date of the enactment of this Act.

SEC. 816. PROCEDURE FOR OBTAINING CERTAIN INTELLECTUAL PROPERTY.

  (a) Persons Under Securities Act of 1933.--Section 8 of the 
Securities Act of 1933 (15 U.S.C. 77h) is amended by adding at the end 
the following:
  ``(g) Procedure for Obtaining Certain Intellectual Property.--The 
Commission is not authorized to compel under this title a person to 
produce or furnish source code, including algorithmic trading source 
code or similar intellectual property, to the Commission unless the 
Commission first issues a subpoena.''.
  (b) Persons Under the Securities Exchange Act of 1934.--Section 23 of 
the Securities Exchange Act of 1934 (15 U.S.C. 78w) is amended by 
adding at the end the following:
  ``(e) Procedure for Obtaining Certain Intellectual Property.--The 
Commission is not authorized to compel under this title a person to 
produce or furnish source code, including algorithmic trading source 
code or similar intellectual property, to the Commission unless the 
Commission first issues a subpoena.''.
  (c) Investment Companies.--Section 31 of the Investment Company Act 
of 1940 (15 U.S.C. 80a-30) is amended by adding at the end the 
following:
  ``(e) Procedure for Obtaining Certain Intellectual Property.--The 
Commission is not authorized to compel under this title an investment 
company to produce or furnish source code, including algorithmic 
trading source code or similar intellectual property, to the Commission 
unless the Commission first issues a subpoena.''.
  (d) Investment Advisers.--Section 204 of the Investment Advisers Act 
of 1940 (15 U.S.C. 80b-4) is amended--
          (1) by adding at the end the following:
  ``(f) Procedure for Obtaining Certain Intellectual Property.--The 
Commission is not authorized to compel under this title an investment 
adviser to produce or furnish source code, including algorithmic 
trading source code or similar intellectual property, to the Commission 
unless the Commission first issues a subpoena.''; and
          (2) in the second subsection (d), by striking ``(d)'' and 
        inserting ``(e)''.

SEC. 817. PROCESS FOR CLOSING INVESTIGATIONS.

  (a) In General.--Not later than 180 days after the date of the 
enactment of this Act, the Securities and Exchange Commission shall 
establish a process for closing investigations (including preliminary 
or informal investigations) that is designed to ensure that the 
Commission, in a timely manner--
          (1) makes a determination of whether or not to institute an 
        administrative or judicial action in a matter or refer the 
        matter to the Attorney General for potential criminal 
        prosecution; and
          (2) if the Commission determines not to institute such an 
        action or refer the matter to the Attorney General, informs the 
        persons who are the subject of the investigation that the 
        investigation is closed.
  (b) Rule of Construction.--Nothing in this section shall be construed 
to affect the authority of the Commission to re-open an investigation 
if the Commission obtains new evidence after the investigation is 
closed, subject to any applicable statute of limitations.

SEC. 818. ENFORCEMENT OMBUDSMAN.

  (a) In General.--Section 4 of the Securities Exchange Act of 1934 (15 
U.S.C. 78d), as amended by section 803, is further amended by adding at 
the end the following:
  ``(i) Enforcement Ombudsman.--
          ``(1) Establishment.--The Commission shall have an 
        Enforcement Ombudsman, who shall be appointed by and report 
        directly to the Commission.
          ``(2) Duties.--The Enforcement Ombudsman shall--
                  ``(A) act as a liaison between the Commission and any 
                person who is the subject of an investigation 
                (including a preliminary or informal investigation) by 
                the Commission or an administrative or judicial action 
                brought by the Commission in resolving problems that 
                such persons may have with the Commission or the 
                conduct of Commission staff; and
                  ``(B) establish safeguards to maintain the 
                confidentiality of communications between the persons 
                described in subparagraph (A) and the Enforcement 
                Ombudsman.
          ``(3) Limitation.--In carrying out the duties of the 
        Enforcement Ombudsman under paragraph (2), the Enforcement 
        Ombudsman shall utilize personnel of the Commission to the 
        extent practicable. Nothing in this subsection shall be 
        construed as replacing, altering, or diminishing the activities 
        of any ombudsman or similar office of any other agency.
          ``(4) Report.--The Enforcement Ombudsman shall submit to the 
        Commission and to the Committee on Financial Services of the 
        House of Representatives and the Committee on Banking, Housing, 
        and Urban Affairs of the Senate an annual report that describes 
        the activities and evaluates the effectiveness of the 
        Enforcement Ombudsman during the preceding year.''.
  (b) Deadline for Initial Appointment.--The Securities and Exchange 
Commission shall appoint the initial Enforcement Ombudsman under 
subsection (i) of section 4 of the Securities Exchange Act of 1934, as 
added by subsection (a), not later than 180 days after the date of the 
enactment of this Act.

SEC. 819. ADEQUATE NOTICE.

  Section 21 of the Securities Exchange Act of 1934 (15 U.S.C. 78u) is 
amended by adding at the end the following:
  ``(k) Adequate Notice Required Before Bringing an Enforcement 
Action.--
          ``(1) In general.--No person shall be subject to an 
        enforcement action by the Commission for an alleged violation 
        of the securities laws or the rules and regulations issued 
        thereunder if such person did not have adequate notice of such 
        law, rule, or regulation.
          ``(2) Publishing of interpretation deemed adequate notice.--
        With respect to an enforcement action, adequate notice of a 
        securities law or a rule or regulation issued thereunder shall 
        be deemed to have been provided to a person if the Commission 
        approved a statement or guidance, in accordance with Section 
        4I, with respect to the conduct that is the subject of the 
        enforcement action, prior to the time that the person engaged 
        in the conduct that is the subject of the enforcement 
        action.''.

SEC. 820. ADVISORY COMMITTEE ON COMMISSION'S ENFORCEMENT POLICIES AND 
                    PRACTICES.

  (a) Establishment.--Not later than 6 months after the date of the 
enactment of this Act, the Chairman shall establish an advisory 
committee on the Commission's enforcement policies and practices (in 
this section referred to as the ``Committee'').
  (b) Duties.--
          (1) Analysis and recommendations.--
                  (A) In general.--The Committee shall conduct an 
                analysis of the policies and practices of the 
                Commission relating to the enforcement of the 
                securities laws and make recommendations to the 
                Commission regarding changes to such policies and 
                practices.
                  (B) Specific matters included.--In carrying out 
                subparagraph (A), the Committee shall analyze and make 
                recommendations to the Commission regarding matters 
                including the following:
                          (i) How the Commission's enforcement 
                        objectives and strategies may be more 
                        effective.
                          (ii) The Commission's enforcement practices 
                        and procedures from the point of view of due 
                        process, the relationship of enforcement action 
                        to notice of legal requirements, the 
                        attribution of responsibility for violations, 
                        and the protection of reputation and rights of 
                        privacy.
                          (iii) The Commission's enforcement policies 
                        and practices in light of its statutory 
                        responsibility to protect investors, maintain 
                        fair, orderly, and efficient markets, and 
                        facilitate capital formation.
                          (iv) The appropriate blend of regulation, 
                        publicity, and formal enforcement action and on 
                        methods of furthering voluntary compliance.
                          (v) Criteria for the selection and 
                        disposition of enforcement actions, the 
                        adequacy of sanctions authorized by law, and 
                        the suitability and effectiveness of sanctions 
                        imposed by the Commission proceedings.
          (2) Report.--Not later than 1 year after the establishment of 
        the Committee under subsection (a), the Committee shall submit 
        to the Commission and the appropriate congressional committees 
        a report containing the results of the analysis and the 
        recommendations required by paragraph (1)(A).
  (c) Membership.--
          (1) Number and appointment.--The Committee shall be composed 
        of not less than 3 and not greater than 7 members appointed by 
        the Chairman.
          (2) Chairperson.--The Chairperson of the Committee shall be 
        designated by the Chairman at the time of appointment of the 
        members.
  (d) Support.--The Commission shall provide the Committee with the 
administrative, professional, and technical support required by the 
Committee to carry out its responsibilities under this section.
  (e) Termination of Committee.--The Committee established by 
subsection (a) shall terminate on the date that the report required by 
subsection (b)(2) is submitted.
  (f) Consideration and Adoption of Recommendations by Commission.--Not 
later than 180 days after the Committee submits the report required by 
subsection (b)(2), the Commission shall--
          (1) consider the analysis and recommendations included in 
        such report;
          (2) adopt such recommendations, with any modifications, as 
        the Commission considers appropriate; and
          (3) submit to the appropriate congressional committees a 
        report that--
                  (A) lists each recommendation included in such report 
                that the Commission does not adopt or adopts with 
                material modifications; and
                  (B) for each recommendation listed under subparagraph 
                (A), explains why the Commission does not consider it 
                appropriate or does not have sufficient authority to 
                adopt the recommendation or to adopt the recommendation 
                without material modification.
  (g) Definitions.--In this section:
          (1) Appropriate congressional committees.--The term 
        ``appropriate congressional committees'' means the Committee on 
        Financial Services of the House of Representatives and the 
        Committee on Banking, Housing, and Urban Affairs of the Senate.
          (2) Chairman.--The term ``Chairman'' means the Chairman of 
        the Commission.
          (3) Commission.--The term ``Commission'' means the Securities 
        and Exchange Commission.
          (4) Securities laws.--The term ``securities laws'' has the 
        meaning given such term in section 3(a) of the Securities 
        Exchange Act of 1934 (15 U.S.C. 78c(a)).

SEC. 821. PROCESS TO PERMIT RECIPIENT OF WELLS NOTIFICATION TO APPEAR 
                    BEFORE COMMISSION STAFF IN-PERSON.

  (a) In General.--Not later than 180 days after the date of the 
enactment of this Act, the Securities and Exchange Commission shall 
establish a process under which, in any instance in which the 
Commission staff provides a written Wells notification to an individual 
informing the individual that the Commission staff has made a 
preliminary determination to recommend that the Commission bring an 
administrative or judicial action against the individual, the 
individual shall have the right to make an in-person presentation 
before the Commission staff concerning such recommendation and to be 
represented by counsel at such presentation, at the individual's own 
expense.
  (b) Attendance by Commissioners.--Such process shall provide that 
each Commissioner of the Commission, or a designee of the Commissioner, 
may attend any such presentation.
  (c) Report by Commission Staff.--Such process shall provide that, 
before any Commission vote on whether to bring the administrative or 
judicial action against the individual, the Commission staff shall 
provide to each Commissioner a written report on any such presentation, 
including any factual or legal arguments made by the individual and any 
supporting documents provided by the individual.

SEC. 822. PUBLICATION OF ENFORCEMENT MANUAL.

  (a) In General.--Not later than 1 year after the date of the 
enactment of this Act, the Securities and Exchange Commission shall 
approve, by vote of the Commission, and publish an updated manual that 
sets forth the policies and practices that the Commission will follow 
in the enforcement of the securities laws (as defined in section 3(a) 
of the Securities Exchange Act of 1934 (15 U.S.C. 78c(a))). Such manual 
shall include policies and practices required by this Act, and by the 
amendments made by this Act, and shall be developed so as to ensure 
transparency in such enforcement and uniform application of such laws 
by the Commission.
  (b) Enforcement Plan and Report.--Beginning on the date that is one 
year after the date of enactment of this Act, and each year thereafter, 
and the Securities and Exchange Commission shall transmit to Congress 
and publish on its Internet website an annual enforcement plan and 
report that shall--
          (1) detail the priorities of the Commission with regard to 
        enforcement and examination activities for the forthcoming 
        year;
          (2) report on the Commission's enforcement and examination 
        activities for the previous year, including an assessment of 
        how such activities comported with the priorities identified 
        for that year pursuant to paragraph (1);
          (3) contain an analysis of litigated decisions found not in 
        favor of the Commission over the preceding year;
          (4) contain a description of any emerging trends the 
        Commission has focused on as part of its enforcement program, 
        including whether and how the Commission has alerted or 
        communicated with those who may be subject to the Commission's 
        regulation of emerging trends;
          (5) contain a description of legal theories or standards 
        employed by the Commission in enforcement over the preceding 
        year that had not previously been employed, and a summary 
        justifying each such theory or standard; and
          (6) provide an opportunity and mechanism for public comment.

SEC. 823. PRIVATE PARTIES AUTHORIZED TO COMPEL THE SECURITIES AND 
                    EXCHANGE COMMISSION TO SEEK SANCTIONS BY FILING 
                    CIVIL ACTIONS.

  Title I of the Securities Exchange Act of 1934 (15 U.S.C. 78a et 
seq.) is amended by adding at the end the following:

``SEC. 41. PRIVATE PARTIES AUTHORIZED TO COMPEL THE COMMISSION TO SEEK 
                    SANCTIONS BY FILING CIVIL ACTIONS.

  ``(a) Termination of Administrative Proceeding.--In the case of any 
person who is a party to a proceeding brought by the Commission under a 
securities law, to which section 554 of title 5, United States Code, 
applies, and against whom an order imposing a cease and desist order 
and a penalty may be issued at the conclusion of the proceeding, that 
person may, not later than 20 days after receiving notice of such 
proceeding, and at that person's discretion, require the Commission to 
terminate the proceeding.
  ``(b) Civil Action Authorized.--If a person requires the Commission 
to terminate a proceeding pursuant to subsection (a), the Commission 
may bring a civil action against that person for the same remedy that 
might be imposed.
  ``(c) Standard of Proof in Administrative Proceeding.--
Notwithstanding any other provision of law, in the case of a proceeding 
brought by the Commission under a securities law, to which section 554 
of title 5, United States Code, applies, a legal or equitable remedy 
may be imposed on the person against whom the proceeding was brought 
only on a showing by the Commission of clear and convincing evidence 
that the person has violated the relevant provision of law.''.

SEC. 824. CERTAIN FINDINGS REQUIRED TO APPROVE CIVIL MONEY PENALTIES 
                    AGAINST ISSUERS.

  The Securities Exchange Act of 1934 (15 U.S.C. 78a et seq.) is 
amended by inserting after section 4E the following:

``SEC. 4F. CERTAIN FINDINGS REQUIRED TO APPROVE CIVIL MONEY PENALTIES 
                    AGAINST ISSUERS.

  ``The Commission may not seek against or impose on an issuer a civil 
money penalty for violation of the securities laws unless the publicly 
available text of the order approving the seeking or imposition of such 
penalty contains findings, supported by an analysis by the Division of 
Economic and Risk Analysis and certified by the Chief Economist, of 
whether--
          ``(1) the alleged violation resulted in direct economic 
        benefit to the issuer; and
          ``(2) the penalty will harm the shareholders of the 
        issuer.''.

SEC. 825. REPEAL OF AUTHORITY OF THE COMMISSION TO PROHIBIT PERSONS 
                    FROM SERVING AS OFFICERS OR DIRECTORS.

  (a) Under Securities Act of 1933.--Subsection (f) of section 8A of 
the Securities Act of 1933 (15 U.S.C. 77h-1) is repealed.
  (b) Under Securities Exchange Act of 1934.--Subsection (f) of section 
21C of the Securities Exchange Act of 1934 (15 U.S.C. 78u-3) is 
repealed.

SEC. 826. SUBPOENA DURATION AND RENEWAL.

  Section 21(b) of the Securities Exchange Act of 1934 (15 U.S.C. 
78u(b)) is amended--
          (1) by inserting ``Subpoena.--'' after the enumerator;
          (2) by striking ``For the purpose of'' and inserting the 
        following:
          ``(1) In general.--For the purpose of''; and
          (3) by adding at the end the following:
          ``(2) Omnibus orders of investigation.--
                  ``(A) Duration and renewal.--An omnibus order of 
                investigation shall not be for an indefinite duration 
                and may be renewed only by Commission action.
                  ``(B) Definition.--In paragraph (A), the term 
                `omnibus order of investigation' means an order of the 
                Commission authorizing 1 of more members of the 
                Commission or its staff to issue subpoenas under 
                paragraph (1) to multiple persons in relation to a 
                particular subject matter area.''.

SEC. 827. ELIMINATION OF AUTOMATIC DISQUALIFICATIONS.

  The Securities Exchange Act of 1934 (15 U.S.C. 78a et seq.), as 
amended by this Act, is further amended by inserting after section 4F 
the following:

``SEC. 4G. ELIMINATION OF AUTOMATIC DISQUALIFICATIONS.

  ``(a) In General.--Notwithstanding any other provision of law, a non-
natural person may not be disqualified or otherwise made ineligible to 
use an exemption or registration provision, engage in an activity, or 
qualify for any similar treatment under a provision of the securities 
laws or the rules issued by the Commission under the securities laws by 
reason of having, or a person described in subsection (b) having, been 
convicted of any felony or misdemeanor or made the subject of any 
judicial or administrative order, judgment, or decree arising out of a 
governmental action (including an order, judgment, or decree agreed to 
in a settlement), or having, or a person described in subsection (b) 
having, been suspended or expelled from membership in, or suspended or 
barred from association with a member of, a registered national 
securities exchange or a registered national or affiliated securities 
association for any act or omission to act constituting conduct 
inconsistent with just and equitable principles of trade, unless the 
Commission, by order, on the record after notice and an opportunity for 
hearing, makes a determination that such non-natural person should be 
so disqualified or otherwise made ineligible for purposes of such 
provision.
  ``(b) Person Described.--A person is described in this subsection if 
the person is--
          ``(1) a natural person who is a director, officer, employee, 
        partner, member, or shareholder of the non-natural person 
        referred to in subsection (a) or is otherwise associated or 
        affiliated with such non-natural person in any way; or
          ``(2) a non-natural person who is associated or affiliated 
        with the non-natural person referred to in subsection (a) in 
        any way.
  ``(c) Rule of Construction.--Nothing in this section shall be 
construed to limit any authority of the Commission, by order, on the 
record after notice and an opportunity for hearing, to prohibit a 
person from using an exemption or registration provision, engaging in 
an activity, or qualifying for any similar treatment under a provision 
of the securities laws, or the rules issued by the Commission under the 
securities laws, by reason of a circumstance referred to in subsection 
(a) or any similar circumstance.''.

SEC. 828. DENIAL OF AWARD TO CULPABLE WHISTLEBLOWERS.

  Section 21F(c) of the Securities Exchange Act of 1934 (15 U.S.C. 78u-
6(c)) is amended--
          (1) in paragraph (2)--
                  (A) in subparagraph (C), by striking ``or'' at the 
                end;
                  (B) in subparagraph (D), by striking the period and 
                inserting ``; or''; and
                  (C) by adding at the end the following:
                  ``(E) to any whistleblower who is responsible for, or 
                complicit in, the violation of the securities laws for 
                which the whistleblower provided information to the 
                Commission.''; and
          (2) by adding at the end the following:
          ``(3) Definition.--For purposes of paragraph (2)(E), a person 
        is responsible for, or complicit in, a violation of the 
        securities laws if, with the intent to promote or assist the 
        violation, the person--
                  ``(A) procures, induces, or causes another person to 
                commit the offense;
                  ``(B) aids or abets another person in committing the 
                offense; or
                  ``(C) having a duty to prevent the violation, fails 
                to make an effort the person is required to make.''.

SEC. 829. CONFIDENTIALITY OF RECORDS OBTAINED FROM FOREIGN SECURITIES 
                    AND LAW ENFORCEMENT AUTHORITIES.

  Section 24(d) of the Securities Exchange Act of 1934 (15 U.S.C. 
78x(d)) is amended to read as follows:
  ``(d) Records Obtained From Foreign Securities and Law Enforcement 
Authorities.--Except as provided in subsection (g), the Commission 
shall not be compelled to disclose records obtained from a foreign 
securities authority, or from a foreign law enforcement authority as 
defined in subsection (f)(4), if--
          ``(1) the foreign securities authority or foreign law 
        enforcement authority has in good faith determined and 
        represented to the Commission that the records are confidential 
        under the laws of the country of such authority; and
          ``(2) the Commission obtains such records pursuant to--
                  ``(A) such procedure as the Commission may authorize 
                for use in connection with the administration or 
                enforcement of the securities laws; or
                  ``(B) a memorandum of understanding.
For purposes of section 552 of title 5, United States Code, this 
subsection shall be considered a statute described in subsection 
(b)(3)(B) of such section 552.''.

SEC. 830. CLARIFICATION OF AUTHORITY TO IMPOSE SANCTIONS ON PERSONS 
                    ASSOCIATED WITH A BROKER OR DEALER.

  Section 15(b)(6)(A)(i) of the Securities Exchange Act of 1934 (15 
U.S.C. 78o(b)(6)(A)(i)) is amended by striking ``enumerated'' and all 
that follows and inserting ``enumerated in subparagraph (A), (D), (E), 
(G), or (H) of paragraph (4) of this subsection;''.

SEC. 831. COMPLAINT AND BURDEN OF PROOF REQUIREMENTS FOR CERTAIN 
                    ACTIONS FOR BREACH OF FIDUCIARY DUTY.

  Section 36(b) of the Investment Company Act of 1940 (15 U.S.C. 80a-
35(b)) is amended by adding at the end the following:
          ``(7) In any such action brought by a security holder of a 
        registered investment company on behalf of such company--
                  ``(A) the complaint shall state with particularity 
                all facts establishing a breach of fiduciary duty, and, 
                if an allegation of any such facts is based on 
                information and belief, the complaint shall state with 
                particularity all facts on which that belief is formed; 
                and
                  ``(B) such security holder shall have the burden of 
                proving a breach of fiduciary duty by clear and 
                convincing evidence.''.

SEC. 832. CONGRESSIONAL ACCESS TO INFORMATION HELD BY THE PUBLIC 
                    COMPANY ACCOUNTING OVERSIGHT BOARD.

  Section 105(b)(5) of the Sarbanes-Oxley Act of 2002 (15 U.S.C. 
7215(b)(5)) is amended--
          (1) in subparagraph (A), by striking ``subparagraphs (B) and 
        (C)'' and inserting ``subparagraphs (B), (C) and (D)''; and
          (2) by adding at the end the following:
                  ``(D) Availability to the congressional committees.--
                The Board shall make available to the Committees 
                specified under section 101(h)--
                          ``(i) such information as the Committees 
                        shall request; and
                          ``(ii) with respect to any confidential or 
                        privileged information provided in response to 
                        a request under clause (i), including any 
                        information subject to section 104(g) and 
                        subparagraph (A), or any confidential or 
                        privileged information provided orally in 
                        response to such a request, such information 
                        shall maintain the protections provided in 
                        subparagraph (A), and shall retain its 
                        confidential and privileged status in the hands 
                        of the Board and the Committees.''.

SEC. 833. ABOLISHING INVESTOR ADVISORY GROUP.

  The Public Company Accounting Oversight Board shall abolish the 
Investor Advisory Group.

SEC. 834. REPEAL OF REQUIREMENT FOR PUBLIC COMPANY ACCOUNTING OVERSIGHT 
                    BOARD TO USE CERTAIN FUNDS FOR MERIT SCHOLARSHIP 
                    PROGRAM.

  (a) In General.--Section 109(c) of the Sarbanes-Oxley Act of 2002 (15 
U.S.C. 7219(c)) is amended by striking paragraph (2).
  (b) Conforming Amendments.--Section 109 of the Sarbanes-Oxley Act of 
2002 (15 U.S.C. 7219) is amended--
          (1) in subsection (c), by striking ``Uses of Funds'' and all 
        that follows through ``The budget'' and inserting ``Uses of 
        Funds.--The budget''; and
          (2) in subsection (f), by striking ``subsection (c)(1)'' and 
        inserting ``subsection (c)''.

SEC. 835. REALLOCATION OF FINES FOR VIOLATIONS OF RULES OF MUNICIPAL 
                    SECURITIES RULEMAKING BOARD.

  (a) In General.--Section 15B(c)(9) of the Securities Exchange Act of 
1934 (15 U.S.C. 78o-4(c)(9)) is amended to read as follows:
  ``(9) Fines collected for violations of the rules of the Board shall 
be deposited and credited as general revenue of the Treasury, except as 
otherwise provided in section 308 of the Sarbanes-Oxley Act of 2002 or 
section 21F of this title.''.
  (b) Effective Date.--The amendment made by subsection (a) shall apply 
to fines collected after the date of enactment of this Act.

 Subtitle B--Eliminating Excessive Government Intrusion in the Capital 
                                Markets

SEC. 841. REPEAL OF DEPARTMENT OF LABOR FIDUCIARY RULE AND REQUIREMENTS 
                    PRIOR TO RULEMAKING RELATING TO STANDARDS OF 
                    CONDUCT FOR BROKERS AND DEALERS.

  (a) Repeal of Department of Labor Fiduciary Rule.--The final rule of 
the Department of Labor titled ``Definition of the Term `Fiduciary'; 
Conflict of Interest Rule--Retirement Investment Advice'' and related 
prohibited transaction exemptions published April 8, 2016 (81 Fed. Reg. 
20946) shall have no force or effect.
  (b) Stay on Rules Defining Certain Fiduciaries.--After the date of 
enactment of this Act, the Secretary of Labor shall not prescribe any 
regulation under the Employee Retirement Income Security Act of 1974 
(29 U.S.C. 1001 et seq.) defining the circumstances under which an 
individual is considered a fiduciary until the date that is 60 days 
after the Securities and Exchange Commission issues a final rule 
relating to standards of conduct for brokers and dealers pursuant to 
the second subsection (k) of section 15 of the Securities Exchange Act 
of 1934 (15 U.S.C. 78o(k)).
  (c) Requirement After Stay.--If, after the stay described under 
subsection (b), the Secretary of Labor prescribes a regulation 
described under such subsection, the Secretary of Labor shall prescribe 
a substantially identical definition of what constitutes fiduciary 
investment advice and impose substantially identical standards of care 
and conditions as the Securities and Exchange Commission has imposed on 
brokers, dealers, or investment advisers.
  (d) Requirements Prior to Rulemaking Relating to Standards of Conduct 
for Brokers and Dealers.--The second subsection (k) of section 15 of 
the Securities Exchange Act of 1934 (15 U.S.C. 78o(k)), as added by 
section 913(g)(1) of the Dodd-Frank Wall Street Reform and Consumer 
Protection Act (12 U.S.C. 5301 et seq.), is amended by adding at the 
end the following:
          ``(3) Requirements prior to rulemaking.--The Commission shall 
        not promulgate a rule pursuant to paragraph (1) before 
        providing a report to the Committee on Financial Services of 
        the House of Representatives and the Committee on Banking, 
        Housing, and Urban Affairs of the Senate describing whether--
                  ``(A) retail investors (and such other customers as 
                the Commission may provide) are being harmed due to 
                brokers or dealers operating under different standards 
                of conduct than those that apply to investment advisors 
                under section 211 of the Investment Advisers Act of 
                1940 (15 U.S.C. 80b-11);
                  ``(B) alternative remedies will reduce any confusion 
                or harm to retail investors due to brokers or dealers 
                operating under different standards of conduct than 
                those standards that apply to investment advisors under 
                section 211 of the Investment Advisers Act of 1940 (15 
                U.S.C. 80b-11), including--
                          ``(i) simplifying the titles used by brokers, 
                        dealers, and investment advisers; and
                          ``(ii) enhancing disclosure surrounding the 
                        different standards of conduct currently 
                        applicable to brokers, dealers, and investment 
                        advisers;
                  ``(C) the adoption of a uniform fiduciary standard of 
                conduct for brokers, dealers, and investment advisors 
                would adversely impact the commissions of brokers and 
                dealers, the availability of proprietary products 
                offered by brokers and dealers, and the ability of 
                brokers and dealers to engage in principal transactions 
                with customers; and
                  ``(D) the adoption of a uniform fiduciary standard of 
                conduct for brokers or dealers and investment advisors 
                would adversely impact retail investor access to 
                personalized and cost-effective investment advice, 
                recommendations about securities, or the availability 
                of such advice and recommendations.
          ``(4) Economic analysis.--The Commission's conclusions 
        contained in the report described in paragraph (3) shall be 
        supported by economic analysis.
          ``(5) Requirements for promulgating a rule.--The Commission 
        shall publish in the Federal Register alongside the rule 
        promulgated pursuant to paragraph (1) formal findings that such 
        rule would reduce confusion or harm to retail customers (and 
        such other customers as the Commission may by rule provide) due 
        to different standards of conduct applicable to brokers, 
        dealers, and investment advisors.
          ``(6) Requirements under investment advisers act of 1940.--In 
        proposing rules under paragraph (1) for brokers or dealers, the 
        Commission shall consider the differences in the registration, 
        supervision, and examination requirements applicable to 
        brokers, dealers, and investment advisors.''.

SEC. 842. EXEMPTION FROM RISK RETENTION REQUIREMENTS FOR NONRESIDENTIAL 
                    MORTGAGE.

  (a) In General.--Section 15G of the Securities Exchange Act of 1934 
(15 U.S.C. 78o-11) is amended--
          (1) in subsection (a)--
                  (A) in paragraph (3)(B), by striking ``and'' at the 
                end;
                  (B) in paragraph (4)(B), by striking the period and 
                inserting ``; and''; and
                  (C) by adding at the end the following:
          ``(5) the term `asset-backed security' refers only to an 
        asset-backed security that is comprised wholly of residential 
        mortgages.'';
          (2) in subsection (b)--
                  (A) by striking paragraph (1); and
                  (B) by striking ``(2) Residential mortgages.--'';
          (3) by striking subsection (h) and redesignating subsection 
        (i) as subsection (h); and
          (4) in subsection (h) (as so redesignated)--
                  (A) by striking ``effective--'' and all that follows 
                through ``(1) with respect to'' and inserting 
                ``effective with respect to'';
                  (B) in paragraph (1), by striking ``; and'' and 
                inserting a period; and
                  (C) by striking paragraph (2).
  (b) Conforming Amendment.--Section 941 of the Dodd-Frank Wall Street 
Reform and Consumer Protection Act is amended by striking subsection 
(c).

SEC. 843. FREQUENCY OF SHAREHOLDER APPROVAL OF EXECUTIVE COMPENSATION.

  Section 14A(a) of the Securities Exchange Act of 1934 (15 U.S.C. 78n-
1(a)) is amended--
          (1) in paragraph (1), by striking ``Not less frequently than 
        once every 3 years'' and inserting ``Each year in which there 
        has been a material change to the compensation of executives of 
        an issuer from the previous year''; and
          (2) by striking paragraph (2) and redesignating paragraph (3) 
        as paragraph (2).

SEC. 844. SHAREHOLDER PROPOSALS.

  (a) Resubmission Thresholds.--The Securities and Exchange Commission 
shall revise section 240.14a-8(i)(12) of title 17, Code of Federal 
Regulations to--
          (1) in paragraph (i), adjust the 3 percent threshold to 6 
        percent;
          (2) in paragraph (ii), adjust the 6 percent threshold to 15 
        percent; and
          (3) in paragraph (iii), adjust the 10 percent threshold to 30 
        percent.
  (b) Holding Requirement.--The Securities and Exchange Commission 
shall revise the holding requirement for a shareholder to be eligible 
to submit a shareholder proposal to an issuer in section 240.14a-
8(b)(1) of title 17, Code of Federal Regulations, to--
          (1) eliminate the option to satisfy the holding requirement 
        by holding a certain dollar amount;
          (2) require the shareholder to hold 1 percent of the issuer's 
        securities entitled to be voted on the proposal, or such 
        greater percentage as determined by the Commission; and
          (3) adjust the 1 year holding period to 3 years.
  (c) Shareholder Proposals Issued by Proxies.--Section 14 of the 
Securities Exchange Act of 1934 (15 U.S.C. 78n) is amended by adding at 
the end the following:
  ``(j) Shareholder Proposals by Proxies Not Permitted.--An issuer may 
not include in its proxy materials a shareholder proposal submitted by 
a person in such person's capacity as a proxy, representative, agent, 
or person otherwise acting on behalf of a shareholder.''.

SEC. 845. PROHIBITION ON REQUIRING A SINGLE BALLOT.

  Section 14 of the Securities Exchange Act of 1934 (15 U.S.C. 78n) is 
amended by adding at the end the following:
  ``(k) Prohibition on Requiring a Single Ballot.--The Commission may 
not require that a solicitation of a proxy, consent, or authorization 
to vote a security of an issuer in an election of members of the board 
of directors of the issuer be made using a single ballot or card that 
lists both individuals nominated by (or on behalf of) the issuer and 
individuals nominated by (or on behalf of) other proponents and permits 
the person granting the proxy, consent, or authorization to select from 
among individuals in both groups.''.

SEC. 846. REQUIREMENT FOR MUNICIPAL ADVISOR FOR ISSUERS OF MUNICIPAL 
                    SECURITIES.

  Section 15B(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78o-
4(d)) is amended by adding at the end the following:
  ``(3) An issuer of municipal securities shall not be required to 
retain a municipal advisor prior to issuing any such securities.''.

SEC. 847. SMALL ISSUER EXEMPTION FROM INTERNAL CONTROL EVALUATION.

  Section 404(c) of the Sarbanes-Oxley Act of 2002 (15 U.S.C. 7262(c)) 
is amended to read as follows:
  ``(c) Exemption for Smaller Issuers.--Subsection (b) shall not apply 
with respect to any audit report prepared for an issuer that has total 
market capitalization of less than $500,000,000, nor to any issuer that 
is a depository institution with assets of less than $1,000,000,000.''.

SEC. 848. STREAMLINING OF APPLICATIONS FOR AN EXEMPTION FROM THE 
                    INVESTMENT COMPANY ACT OF 1940.

  Section 6(c) of the Investment Company Act of 1940 (15 U.S.C. 80a-
6(c)) is amended--
          (1) by striking ``(c) The Commission'' and inserting the 
        following:
  ``(c) General Exemptive Authority.--
          ``(1) In general.--The Commission''; and
          (2) by adding at the end the following:
          ``(2) Application process.--
                  ``(A) In general.--A person who wishes to receive an 
                exemption from the Commission pursuant to paragraph (1) 
                shall file an application with the Commission in such 
                form and manner and containing such information as the 
                Commission may require.
                  ``(B) Publication; rejection of invalid 
                applications.--
                          ``(i) In general.--Not later than the end of 
                        the 5-day period beginning on the date that the 
                        Commission receives an application under 
                        subparagraph (A), the Commission shall either--
                                  ``(I) publish the application, 
                                including by publication on the website 
                                of the Commission; or
                                  ``(II) if the Commission determines 
                                that the application does not comply 
                                with the proper form, manner, or 
                                information requirements described 
                                under subparagraph (A), reject such 
                                application and notify the applicant of 
                                the specific reasons the application 
                                was rejected.
                          ``(ii) Failure to publish application.--If 
                        the Commission does not reject an application 
                        under clause (i)(II), but fails to publish the 
                        application by the end of the time period 
                        specified under clause (i), such application 
                        shall be deemed to have been published on the 
                        date that is the end of such time period.
          ``(3) Determination by commission.--
                  ``(A) In general.--Not later than 45 days after the 
                date that the Commission publishes an application 
                pursuant to paragraph (2)(B), the Commission shall, by 
                order--
                          ``(i) approve the application;
                          ``(ii) if the Commission determines that the 
                        application would have been approved had the 
                        applicant provided additional supporting 
                        documentation or made certain amendments to the 
                        application--
                                  ``(I) provide the applicant with the 
                                specific additional supporting 
                                documentation or amendments that the 
                                Commission believes are necessary for 
                                the applicant to provide in order for 
                                the application to be approved; and
                                  ``(II) request that the applicant 
                                withdraw the application and re-submit 
                                the application with such additional 
                                supporting documentation and 
                                amendments; or
                          ``(iii) deny the application.
                  ``(B) Extension of time period.--The Commission may 
                extend the time period described under subparagraph (A) 
                by not more than an additional 45 days, if--
                          ``(i) the Commission determines that a longer 
                        period is appropriate and publishes the reasons 
                        for such determination; or
                          ``(ii) the applicant consents to the longer 
                        period.
                  ``(C) Time period for withdrawal.--If the Commission 
                makes a request under subparagraph (A)(ii) for an 
                applicant to withdraw an application, such application 
                shall be deemed to be denied if the applicant informs 
                the Commission that the applicant will not withdraw the 
                application or if the applicant does not withdraw the 
                application before the end of the 30-day period 
                beginning on the date the Commission makes such 
                request.
          ``(4) Proceedings; notice and hearing.--If an application is 
        denied pursuant to paragraph (3), the Commission shall provide 
        the applicant with--
                  ``(A) a written explanation for why the application 
                was not approved; and
                  ``(B) an opportunity for hearing, if requested by the 
                applicant not later than 20 days after the date of such 
                denial, with such hearing to be commenced not later 
                than 30 days after the date of such denial.
          ``(5) Result of failure to institute or commence 
        proceedings.--An application shall be deemed to have been 
        approved by the Commission, if--
                  ``(A) the Commission fails to either approve, request 
                the withdrawal of, or deny the application, as required 
                under paragraph (3)(A), within the time period required 
                under paragraph (3)(A), as such time period may have 
                been extended pursuant to paragraph (3)(B); or
                  ``(B) the applicant requests an opportunity for 
                hearing, pursuant to paragraph (4)(B), but the 
                Commission does not commence such hearing within the 
                time period required under paragraph (4)(B).
          ``(6) Rulemaking.--Not later than 180 days after the date of 
        enactment of this paragraph, the Commission shall issue rules 
        to carry out this subsection.''.

SEC. 849. RESTRICTION ON RECOVERY OF ERRONEOUSLY AWARDED COMPENSATION.

  Section 10D(b)(2) of the Securities Exchange Act of 1934 (15 U.S.C. 
78j-4(b)(2)) is amended by inserting before the period the following: 
``, where such executive officer had control or authority over the 
financial reporting that resulted in the accounting restatement''.

SEC. 850. EXEMPTIVE AUTHORITY FOR CERTAIN PROVISIONS RELATING TO 
                    REGISTRATION OF NATIONALLY RECOGNIZED STATISTICAL 
                    RATING ORGANIZATIONS.

  Section 15E of the Securities Exchange Act of 1934 (15 U.S.C. 78o-7) 
is amended by adding at the end the following:
  ``(w) Commission Exemptive Authority.--The Commission, by rules and 
regulations upon its own motion, or by order upon application, may 
conditionally or unconditionally exempt any person from any provision 
or provisions of this title or of any rule or regulation thereunder, if 
and to the extent it determines that such rule, regulation, or 
requirement is creating a barrier to entry into the market for 
nationally recognized statistical rating organizations or impeding 
competition among such organizations, or that such an exemption is 
necessary or appropriate in the public interest and is consistent with 
the protection of investors.''.

SEC. 851. RISK-BASED EXAMINATIONS OF NATIONALLY RECOGNIZED STATISTICAL 
                    RATING ORGANIZATIONS.

  Section 15E(p)(3) of the Securities Exchange Act of 1934 (15 U.S.C. 
78o-7(p)(3)) is amended--
          (1) in subparagraph (A)--
                  (A) in the heading, by striking ``Annual'' and 
                inserting ``Risk-based'';
                  (B) by striking ``an examination'' and inserting 
                ``examinations''; and
                  (C) by striking ``at least annually''; and
          (2) in subparagraph (B), in the matter preceding clause (i), 
        by inserting ``, as appropriate,'' after ``Each examination 
        under subparagraph (A) shall include''.

SEC. 852. TRANSPARENCY OF CREDIT RATING METHODOLOGIES.

  Section 15E(s) of the Securities Exchange Act of 1934 (15 U.S.C. 78o-
7(s)) is amended--
          (1) in paragraph (2)(B), by inserting before the semicolon 
        the following: ``rated by the nationally recognized statistical 
        rating agency''; and
          (2) in paragraph (3)--
                  (A) in subparagraph (A)(ix), by inserting before the 
                period the following: ``, except that the Commission 
                may not require the inclusion of references to 
                statutory or regulatory requirements or statutory 
                provision headings or enumerators for any specific 
                disclosure'';
                  (B) in subparagraph (B)(iv), by inserting before the 
                period the following: ``, except that the Commission 
                may not require the inclusion of references to 
                statutory or regulatory requirements or statutory 
                provision headings or enumerators for any specific 
                disclosure''; and
                  (C) by adding at the end the following:
                  ``(C) No mandate on the organization of 
                disclosures.--The Commission may not mandate the 
                specific organization of the disclosures required under 
                this paragraph.''.

SEC. 853. REPEAL OF CERTAIN ATTESTATION REQUIREMENTS RELATING TO CREDIT 
                    RATINGS.

  Section 15E of the Securities Exchange Act of 1934 (15 U.S.C. 78o-7) 
is amended--
          (1) in subsection (c)(3)(B)--
                  (A) in clause (i), by adding ``and'' at the end;
                  (B) in clause (ii), by striking ``; and'' and 
                inserting a period; and
                  (C) by striking clause (iii); and
          (2) in subsection (q)(2)--
                  (A) in subparagraph (D), by adding ``and'' at the 
                end;
                  (B) in subparagraph (E), by striking ``; and'' and 
                inserting a period; and
                  (C) by striking subparagraph (F).

SEC. 854. LOOK-BACK REVIEW BY NRSRO.

  Section 15E(h)(4)(A) of the Securities Exchange Act of 1934 (15 
U.S.C. 78o-7(h)(4)(A)) is amended--
          (1) by striking ``Each nationally'' and inserting the 
        following:
                          ``(i) In general.--Each nationally'';
          (2) by striking ``underwriter'' and inserting ``lead 
        underwriter'';
          (3) by striking ``in any capacity'';
          (4) by striking ``during the 1-year period preceding the date 
        an action was taken with respect to the credit rating'';
          (5) by redesignating clauses (i) and (ii) as subclauses (I) 
        and (II), respectively, and adjusting the margin of such 
        subclauses accordingly;
          (6) in subclause (I), as so redesignated, by inserting before 
        the semicolon the following: ``during the 1-year period 
        preceding the departure of the employee from the nationally 
        recognized statistical rating organization''; and
          (7) by adding at the end the following:
                          ``(ii) Maintenance of ratings actions.--In 
                        the case of maintenance of ratings actions, the 
                        requirement under clause (i) shall only apply 
                        to employees of a person subject to a credit 
                        rating of the nationally recognized statistical 
                        rating organization or an issuer of a security 
                        or money market instrument subject to a credit 
                        rating of the nationally recognized statistical 
                        rating organization.''.

SEC. 855. APPROVAL OF CREDIT RATING PROCEDURES AND METHODOLOGIES.

  Section 15E(r)(1)(A) of the Securities Exchange Act of 1934 (15 
U.S.C. 78o-7(r)(1)(A)) is amended by inserting ``, or the Chief Credit 
Officer'' after ``performing a function similar to that of a board''.

SEC. 856. EXCEPTION FOR PROVIDING CERTAIN MATERIAL INFORMATION RELATING 
                    TO A CREDIT RATING.

  Section 15E(h)(3) of the Securities Exchange Act of 1934 (15 U.S.C. 
78o-7(h)(3)) is amended by adding at the end the following:
                  ``(C) Exception for providing certain material 
                information.--Rules issued under this paragraph may not 
                prohibit a person who participates in sales or 
                marketing of a product or service of a nationally 
                recognized statistical rating organization from 
                providing material information, or information believed 
                in good faith to be material, to the issuance or 
                maintenance of a credit rating to a person who 
                participates in determining or monitoring the credit 
                rating, or developing or approving procedures or 
                methodologies used for determining the credit rating, 
                so long as the information provided is not intended to 
                influence the determination of a credit rating, or the 
                procedures or methodologies used to determine credit 
                ratings.''.

SEC. 857. REPEALS.

  (a) Repeals.--The following provisions of title IX of the Dodd-Frank 
Wall Street Reform and Consumer Protection Act are repealed, and the 
provisions of law amended or repealed by such sections are restored or 
revived as if such sections had not been enacted:
          (1) Section 912.
          (2) Section 914.
          (3) Section 917.
          (4) Section 918.
          (5) Section 919A.
          (6) Section 919B.
          (7) Section 919C.
          (8) Section 921.
          (9) Section 929T.
          (10) Section 929X.
          (11) Section 929Y.
          (12) Section 929Z.
          (13) Section 931.
          (14) Section 933.
          (15) Section 937.
          (16) Section 939B.
          (17) Section 939C.
          (18) Section 939D.
          (19) Section 939E.
          (20) Section 939F.
          (21) Section 939G.
          (22) Section 939H.
          (23) Section 946.
          (24) Subsection (b) of section 953.
          (25) Section 955.
          (26) Section 956.
          (27) Section 964.
          (28) Section 965.
          (29) Section 968.
          (30) Section 971.
          (31) Section 972.
          (32) Section 976.
          (33) Section 977.
          (34) Section 978.
          (35) Section 984.
          (36) Section 989.
          (37) Section 989A.
          (38) Section 989F.
          (39) Subsection (b) of section 989G.
          (40) Section 989I.
  (b) Conforming Amendments.--The Dodd-Frank Wall Street Reform and 
Consumer Protection Act (12 U.S.C. 5301) is amended--
          (1) in the table of contents in section 1(b), by striking the 
        items relating to the sections described under paragraphs (1) 
        through (23), (25) through (38), and (40) of subsection (a);
          (2) in section 953, by striking ``(a) Disclosure of Pay 
        Versus Performance.--''; and
          (3) in section 989G, by striking ``(a) Exemption.--''.

SEC. 858. EXEMPTION OF AND REPORTING BY PRIVATE EQUITY FUND ADVISERS.

  Section 203 of the Investment Advisers Act of 1940 (15 U.S.C. 80b-3) 
is amended by adding at the end the following:
  ``(o) Exemption of and Reporting by Private Equity Fund Advisers.--
          ``(1) In general.--Except as provided in this subsection, no 
        investment adviser shall be subject to the registration or 
        reporting requirements of this title with respect to the 
        provision of investment advice relating to a private equity 
        fund.
          ``(2) Maintenance of records and access by commission.--Not 
        later than 6 months after the date of enactment of this 
        subsection, the Commission shall issue final rules--
                  ``(A) to require investment advisers described in 
                paragraph (1) to maintain such records and provide to 
                the Commission such annual or other reports as the 
                Commission, taking into account fund size, governance, 
                investment strategy, risk, and other factors, 
                determines necessary and appropriate in the public 
                interest and for the protection of investors; and
                  ``(B) to define the term `private equity fund' for 
                purposes of this subsection.''.

SEC. 859. RECORDS AND REPORTS OF PRIVATE FUNDS.

  The Investment Advisers Act of 1940 (15 U.S.C. 80b-1 et seq.) is 
amended--
          (1) in section 204(b)--
                  (A) in paragraph (1)--
                          (i) in subparagraph (A), by striking 
                        ``investors,'' and all that follows and 
                        inserting ``investors.'';
                          (ii) by striking subparagraph (B); and
                          (iii) by striking ``this title--'' and all 
                        that follows through ``to maintain'' and 
                        inserting ``this title to maintain'';
                  (B) in paragraph (3)(H)--
                          (i) by striking ``, in consultation with the 
                        Council,''; and
                          (ii) by striking ``or for the assessment of 
                        systemic risk'';
                  (C) in paragraph (4), by striking ``, or for the 
                assessment of systemic risk'';
                  (D) in paragraph (5), by striking ``or for the 
                assessment of systemic risk'';
                  (E) in paragraph (6)(A)(ii), by striking ``, or for 
                the assessment of systemic risk'';
                  (F) by striking paragraph (7) and redesignating 
                paragraphs (8) through (11) as paragraphs (7) through 
                (10), respectively; and
                  (G) in paragraph (8) (as so redesignated), by 
                striking ``paragraph (8)'' and inserting ``paragraph 
                (7)''; and
          (2) in section 211(e)--
                  (A) by striking ``after consultation with the Council 
                but''; and
                  (B) by striking ``subsection 204(b)'' and inserting 
                ``section 204(b)''.

SEC. 860. DEFINITION OF ACCREDITED INVESTOR.

  (a) In General.--Section 2(a)(15) of the Securities Act of 1933 (15 
U.S.C. 77b(a)(15)) is amended--
          (1) by redesignating clauses (i) and (ii) as subparagraphs 
        (A) and (F), respectively; and
          (2) in subparagraph (A) (as so redesignated), by striking ``; 
        or'' at the end and inserting a semicolon, and inserting after 
        such subparagraph the following:
                  ``(B) any natural person whose individual net worth, 
                or joint net worth with that person's spouse, exceeds 
                $1,000,000 (which amount, along with the amounts set 
                forth in subparagraph (C), shall be adjusted for 
                inflation by the Commission every 5 years to the 
                nearest $10,000 to reflect the change in the Consumer 
                Price Index for All Urban Consumers published by the 
                Bureau of Labor Statistics) where, for purposes of 
                calculating net worth under this subparagraph--
                          ``(i) the person's primary residence shall 
                        not be included as an asset;
                          ``(ii) indebtedness that is secured by the 
                        person's primary residence, up to the estimated 
                        fair market value of the primary residence at 
                        the time of the sale of securities, shall not 
                        be included as a liability (except that if the 
                        amount of such indebtedness outstanding at the 
                        time of sale of securities exceeds the amount 
                        outstanding 60 days before such time, other 
                        than as a result of the acquisition of the 
                        primary residence, the amount of such excess 
                        shall be included as a liability); and
                          ``(iii) indebtedness that is secured by the 
                        person's primary residence in excess of the 
                        estimated fair market value of the primary 
                        residence at the time of the sale of securities 
                        shall be included as a liability;
                  ``(C) any natural person who had an individual income 
                in excess of $200,000 in each of the 2 most recent 
                years or joint income with that person's spouse in 
                excess of $300,000 in each of those years and has a 
                reasonable expectation of reaching the same income 
                level in the current year;
                  ``(D) any natural person who, by reason of their net 
                worth or income, is an accredited investor under 
                section 230.215 of title 17, Code of Federal 
                Regulations (as in effect on the day before the date of 
                enactment of this subparagraph);
                  ``(E) any natural person who is currently licensed or 
                registered as a broker or investment adviser by the 
                Commission, the Financial Industry Regulatory 
                Authority, or an equivalent self-regulatory 
                organization (as defined in section 3(a)(26) of the 
                Securities Exchange Act of 1934), or the securities 
                division of a State or the equivalent State division 
                responsible for licensing or registration of 
                individuals in connection with securities activities;
                  ``(F) any natural person the Commission determines, 
                by regulation, to have demonstrable education or job 
                experience to qualify such person as having 
                professional knowledge of a subject related to a 
                particular investment, and whose education or job 
                experience is verified by the Financial Industry 
                Regulatory Authority or an equivalent self-regulatory 
                organization (as defined in section 3(a)(26) of the 
                Securities Exchange Act of 1934); or''.
  (b) Repeal.--
          (1) In general.--Section 413 of the Dodd-Frank Wall Street 
        Reform and Consumer Protection Act (Public Law 111-203) is 
        hereby repealed.
          (2) Clerical amendment.--The table of contents in section 
        1(b) of the Dodd-Frank Wall Street Reform and Consumer 
        Protection Act is amended by striking the items relating to 
        section 413.

SEC. 861. REPEAL OF CERTAIN PROVISIONS REQUIRING A STUDY AND REPORT TO 
                    CONGRESS.

  (a) Repeal.--The following provisions of the Dodd-Frank Wall Street 
Reform and Consumer Protection Act are repealed:
          (1) Section 412.
          (2) Section 415.
          (3) Section 416.
          (4) Section 417.
  (b) Clerical Amendment.--The table of contents in section 1(b) of the 
Dodd-Frank Wall Street Reform and Consumer Protection Act is amended by 
striking the items relating to sections 412, 415, 416, and 417.

SEC. 862. REPEAL.

  (a) Repeal.--The following sections of title XV of the Dodd-Frank 
Wall Street Reform and Consumer Protection Act are repealed, and the 
provisions of law amended or repealed by such sections are restored or 
revived as if such sections had not been enacted:
          (1) Section 1502.
          (2) Section 1503.
          (3) Section 1504.
          (4) Section 1505.
          (5) Section 1506.
  (b) Clerical Amendment.--The table of contents in section 1(b) of the 
Dodd-Frank Wall Street Reform and Consumer Protection Act is amended by 
striking the items relating to sections 1502, 1503, 1504, 1505, and 
1506.

             Subtitle C--Harmonization of Derivatives Rules

SEC. 871. COMMISSIONS REVIEW AND HARMONIZATION OF RULES RELATING TO THE 
                    REGULATION OF OVER-THE-COUNTER SWAPS MARKETS.

  The Securities and Exchange Commission and the Commodity Futures 
Trading Commission shall review each rule, order, and interpretive 
guidance issued by either such Commission pursuant to title VII of the 
Dodd-Frank Wall Street Reform and Consumer Protection Act (15 U.S.C. 
8301 et seq.) and, where the Commissions find inconsistencies in any 
such rules, orders, or interpretive guidance, shall jointly issue new 
rules, orders, or interpretive guidance to resolve such 
inconsistencies.

SEC. 872. TREATMENT OF TRANSACTIONS BETWEEN AFFILIATES.

  (a) Commodity Exchange Act.--Section 1a(47) of the Commodity Exchange 
Act (7 U.S.C. 1a(47)) is amended by adding at the end the following:
                  ``(G) Treatment of swap transactions between 
                affiliates.--
                          ``(i) Exemption from swap rules.--Except as 
                        provided under clause (ii), the Commission may 
                        not regulate a swap under this Act if all of 
                        the following apply to such swap:
                                  ``(I) Affiliation.--One counterparty, 
                                directly or indirectly, holds a 
                                majority ownership interest in the 
                                other counterparty, or a third party, 
                                directly or indirectly, holds a 
                                majority ownership interest in both 
                                counterparties.
                                  ``(II) Financial statements.--The 
                                affiliated counterparty that holds the 
                                majority interest in the other 
                                counterparty or the third party that, 
                                directly or indirectly, holds the 
                                majority interests in both affiliated 
                                counterparties, reports its financial 
                                statements on a consolidated basis 
                                under generally accepted accounting 
                                principles or International Financial 
                                Reporting Standards, or other similar 
                                standards, and the financial statements 
                                include the financial results of the 
                                majority-owned affiliated counterparty 
                                or counterparties.
                          ``(ii) Requirements for exempted swaps.--With 
                        respect to a swap described under clause (i):
                                  ``(I) Reporting requirement.--If at 
                                least one counterparty is a swap dealer 
                                or major swap participant, that 
                                counterparty shall report the swap 
                                pursuant to section 4r, within such 
                                time period as the Commission may by 
                                rule or regulation prescribe--
                                          ``(aa) to a swap data 
                                        repository; or
                                          ``(bb) if there is no swap 
                                        data repository that would 
                                        accept the agreement, contract 
                                        or transaction, to the 
                                        Commission.
                                  ``(II) Risk management requirement.--
                                If at least one counterparty is a swap 
                                dealer or major swap participant, the 
                                swap shall be subject to a centralized 
                                risk management program pursuant to 
                                section 4s(j) that is reasonably 
                                designed to monitor and to manage the 
                                risks associated with the swap.
                                  ``(III) Anti-evasion requirement.--
                                The swap shall not be structured to 
                                evade the Dodd-Frank Wall Street Reform 
                                and Consumer Protection Act in 
                                violation of any rule promulgated by 
                                the Commission pursuant to section 
                                721(c) of such Act.''.
  (b) Securities Exchange Act of 1934.--Section 3(a)(68) of the 
Securities Exchange Act of 1934 (15 U.S.C. 78c(a)(68)) is amended by 
inserting before subsection (b) the following:
                  ``(F) Treatment of security-based swap transactions 
                between affiliates.--
                          ``(i) Exemption from security-based swap 
                        rules.--Except as provided under clause (ii), 
                        the Commission may not regulate a security-
                        based swap under this Act if all of the 
                        following apply to such security-based swap:
                                  ``(I) Affiliation.--One counterparty, 
                                directly or indirectly, holds a 
                                majority ownership interest in the 
                                other counterparty, or a third party, 
                                directly or indirectly, holds a 
                                majority ownership interest in both 
                                counterparties.
                                  ``(II) Financial statements.--The 
                                affiliated counterparty that holds the 
                                majority interest in the other 
                                counterparty or the third party that, 
                                directly or indirectly, holds the 
                                majority interests in both affiliated 
                                counterparties, reports its financial 
                                statements on a consolidated basis 
                                under generally accepted accounting 
                                principles or International Financial 
                                Reporting Standards, or other similar 
                                standards, and the financial statements 
                                include the financial results of the 
                                majority-owned affiliated counterparty 
                                or counterparties.
                          ``(ii) Requirements for exempted security-
                        based swaps.--With respect to a security-based 
                        swap described under clause (i):
                                  ``(I) Reporting requirement.--If at 
                                least one counterparty is a security-
                                based swap dealer or major security-
                                based swap participant, that 
                                counterparty shall report the security-
                                based swap pursuant to section 13A, 
                                within such time period as the 
                                Commission may by rule or regulation 
                                prescribe--
                                          ``(aa) to a security-based 
                                        swap data repository; or
                                          ``(bb) if there is no 
                                        security-based swap data 
                                        repository that would accept 
                                        the agreement, contract or 
                                        transaction, to the Commission.
                                  ``(II) Risk management requirement.--
                                If at least one counterparty is a 
                                security-based swap dealer or major 
                                security-based swap participant, the 
                                security-based swap shall be subject to 
                                a centralized risk management program 
                                pursuant to section 15F(j) that is 
                                reasonably designed to monitor and to 
                                manage the risks associated with the 
                                security-based swap.
                                  ``(III) Anti-evasion requirement.--
                                The security-based swap shall not be 
                                structured to evade the Dodd-Frank Wall 
                                Street Reform and Consumer Protection 
                                Act in violation of any rule 
                                promulgated by the Commission pursuant 
                                to section 761(b)(3) of such Act.''.

       TITLE IX--REPEAL OF THE VOLCKER RULE AND OTHER PROVISIONS

SEC. 901. REPEALS.

  (a) In General.--The following sections of title VI of the Dodd-Frank 
Wall Street Reform and Consumer Protection Act are repealed, and the 
provisions of law amended or repealed by such sections are restored or 
revived as if such sections had not been enacted:
          (1) Section 603.
          (2) Section 618.
          (3) Section 619.
          (4) Section 620.
          (5) Section 621.
  (b) Clerical Amendment.--The table of contents under section 1(b) of 
the Dodd-Frank Wall Street Reform and Consumer Protection Act is 
amended by striking the items relating to sections 603, 618, 619, 620, 
and 621.

            TITLE X--FED OVERSIGHT REFORM AND MODERNIZATION

SEC. 1001. REQUIREMENTS FOR POLICY RULES OF THE FEDERAL OPEN MARKET 
                    COMMITTEE.

  The Federal Reserve Act (12 U.S.C. 221 et seq.) is amended by 
inserting after section 2B the following new section:

``SEC. 2C. DIRECTIVE POLICY RULES OF THE FEDERAL OPEN MARKET COMMITTEE.

  ``(a) Definitions.--In this section the following definitions shall 
apply:
          ``(1) Appropriate congressional committees.--The term 
        `appropriate congressional committees' means the Committee on 
        Financial Services of the House of Representatives and the 
        Committee on Banking, Housing, and Urban Affairs of the Senate.
          ``(2) Directive policy rule.--The term `Directive Policy 
        Rule' means a policy rule developed by the Federal Open Market 
        Committee that meets the requirements of subsection (c) and 
        that provides the basis for the Open Market Operations 
        Directive.
          ``(3) GDP.--The term `GDP' means the gross domestic product 
        of the United States as computed and published by the 
        Department of Commerce.
          ``(4) Intermediate policy input.--The term `Intermediate 
        Policy Input'--
                  ``(A) may include any variable determined by the 
                Federal Open Market Committee as a necessary input to 
                guide open-market operations;
                  ``(B) shall include an estimate of, and the method of 
                calculation for, the current rate of inflation or 
                current inflation expectations; and
                  ``(C) shall include, specifying whether the variable 
                or estimate is historical, current, or a forecast and 
                the method of calculation, at least one of--
                          ``(i) an estimate of real GDP, nominal GDP, 
                        or potential GDP;
                          ``(ii) an estimate of the monetary aggregate 
                        compiled by the Board of Governors of the 
                        Federal Reserve System and Federal reserve 
                        banks; or
                          ``(iii) an interactive variable or a net 
                        estimate composed of the estimates described in 
                        clauses (i) and (ii).
          ``(5) Legislative day.--The term `legislative day' means a 
        day on which either House of Congress is in session.
          ``(6) Open market operations directive.--The term `Open 
        Market Operations Directive' means an order to achieve a 
        specified Policy Instrument Target provided to the Federal 
        Reserve Bank of New York by the Federal Open Market Committee 
        pursuant to powers authorized under section 14 of this Act that 
        guide open-market operations.
          ``(7) Policy instrument.--The term `Policy Instrument' 
        means--
                  ``(A) the nominal Federal funds rate;
                  ``(B) the nominal rate of interest paid on 
                nonborrowed reserves; or
                  ``(C) the discount window primary credit interest 
                rate most recently published on the Federal Reserve 
                Statistical Release on selected interest rates (daily 
                or weekly), commonly referred to as the H.15 release.
          ``(8) Policy instrument target.--The term `Policy Instrument 
        Target' means the target for the Policy Instrument specified in 
        the Open Market Operations Directive.
          ``(9) Reference policy rule.--The term `Reference Policy 
        Rule' means a calculation of the nominal Federal funds rate as 
        equal to the sum of the following:
                  ``(A) The rate of inflation over the previous four 
                quarters.
                  ``(B) One-half of the percentage deviation of the 
                real GDP from an estimate of potential GDP.
                  ``(C) One-half of the difference between the rate of 
                inflation over the previous four quarters and two 
                percent.
                  ``(D) Two percent.
  ``(b) Submitting a Directive Policy Rule.--Not later than 48 hours 
after the end of a meeting of the Federal Open Market Committee, the 
Chairman of the Federal Open Market Committee shall submit to the 
appropriate congressional committees and the Comptroller General of the 
United States a Directive Policy Rule and a statement that identifies 
the members of the Federal Open Market Committee who voted in favor of 
the Directive Policy Rule.
  ``(c) Requirements for a Directive Policy Rule.--A Directive Policy 
Rule shall--
          ``(1) identify the Policy Instrument the Directive Policy 
        Rule is designed to target;
          ``(2) describe the strategy or rule of the Federal Open 
        Market Committee for the systematic quantitative adjustment of 
        the Policy Instrument Target to respond to a change in the 
        Intermediate Policy Inputs;
          ``(3) include a function that comprehensively models the 
        interactive relationship between the Intermediate Policy 
        Inputs;
          ``(4) include the coefficients of the Directive Policy Rule 
        that generate the current Policy Instrument Target and a range 
        of predicted future values for the Policy Instrument Target if 
        changes occur in any Intermediate Policy Input;
          ``(5) describe the procedure for adjusting the supply of bank 
        reserves to achieve the Policy Instrument Target;
          ``(6) include a statement as to whether the Directive Policy 
        Rule substantially conforms to the Reference Policy Rule and, 
        if applicable--
                  ``(A) an explanation of the extent to which it 
                departs from the Reference Policy Rule;
                  ``(B) a detailed justification for that departure; 
                and
                  ``(C) a description of the circumstances under which 
                the Directive Policy Rule may be amended in the future;
          ``(7) include a certification that the Directive Policy Rule 
        is expected to support the economy in achieving stable prices 
        and maximum natural employment over the long term;
          ``(8) include a calculation that describes with mathematical 
        precision the expected annual inflation rate over a 5-year 
        period; and
          ``(9) include a plan to use the most accurate data, subject 
        to all historical revisions, for inputs into the Directive 
        Policy Rule and the Reference Policy Rule.
  ``(d) GAO Report.--The Comptroller General of the United States shall 
compare the Directive Policy Rule submitted under subsection (b) with 
the rule that was most recently submitted to determine whether the 
Directive Policy Rule has materially changed. If the Directive Policy 
Rule has materially changed, the Comptroller General shall, not later 
than 7 days after each meeting of the Federal Open Market Committee, 
prepare and submit a compliance report to the appropriate congressional 
committees specifying whether the Directive Policy Rule submitted after 
that meeting and the Federal Open Market Committee are in compliance 
with this section.
  ``(e) Changing Market Conditions.--
          ``(1) Rule of construction.--Nothing in this Act shall be 
        construed to require that the plans with respect to the 
        systematic quantitative adjustment of the Policy Instrument 
        Target described under subsection (c)(2) be implemented if the 
        Federal Open Market Committee determines that such plans cannot 
        or should not be achieved due to changing market conditions.
          ``(2) GAO approval of update.--Upon determining that plans 
        described in paragraph (1) cannot or should not be achieved, 
        the Federal Open Market Committee shall submit an explanation 
        for that determination and an updated version of the Directive 
        Policy Rule to the Comptroller General of the United States and 
        the appropriate congressional committees not later than 48 
        hours after making the determination. The Comptroller General 
        shall, not later than 48 hours after receiving such updated 
        version, prepare and submit to the appropriate congressional 
        committees a compliance report determining whether such updated 
        version and the Federal Open Market Committee are in compliance 
        with this section.
  ``(f) Directive Policy Rule and Federal Open Market Committee Not in 
Compliance.--
          ``(1) In general.--If the Comptroller General of the United 
        States determines that the Directive Policy Rule and the 
        Federal Open Market Committee are not in compliance with this 
        section in the report submitted pursuant to subsection (d), or 
        that the updated version of the Directive Policy Rule and the 
        Federal Open Market Committee are not in compliance with this 
        section in the report submitted pursuant to subsection (e)(2), 
        the Chairman of the Board of Governors of the Federal Reserve 
        System shall, if requested by the chairman of either of the 
        appropriate congressional committees, not later than 7 
        legislative days after such request, testify before such 
        committee as to why the Directive Policy Rule, the updated 
        version, or the Federal Open Market Committee is not in 
        compliance.
          ``(2) GAO audit.--Notwithstanding subsection (b) of section 
        714 of title 31, United States Code, upon submitting a report 
        of noncompliance pursuant to subsection (d) or subsection 
        (e)(2) and after the period of 7 legislative days described in 
        paragraph (1), the Comptroller General shall audit the conduct 
        of monetary policy by the Board of Governors of the Federal 
        Reserve System and the Federal Open Market Committee upon 
        request of the appropriate congressional committee. Such 
        committee may specify the parameters of such audit.
  ``(g) Congressional Hearings.--The Chairman of the Board of Governors 
of the Federal Reserve System shall, if requested by the chairman of 
either of the appropriate congressional committees and not later than 7 
legislative days after such request, appear before such committee to 
explain any change to the Directive Policy Rule.''.

SEC. 1002. FEDERAL OPEN MARKET COMMITTEE BLACKOUT PERIOD.

  Section 12A of the Federal Reserve Act (12 U.S.C. 263) is amended by 
adding at the end the following new subsection:
  ``(d) Blackout Period.--
          ``(1) In general.--During a blackout period, the only public 
        communications that may be made by members and staff of the 
        Committee with respect to macroeconomic or financial 
        developments or about current or prospective monetary policy 
        issues are the following:
                  ``(A) The dissemination of published data, surveys, 
                and reports that have been cleared for publication by 
                the Board of Governors of the Federal Reserve System.
                  ``(B) Answers to technical questions specific to a 
                data release.
                  ``(C) Communications with respect to the prudential 
                or supervisory functions of the Board of Governors.
          ``(2) Blackout period defined.--For purposes of this 
        subsection, and with respect to a meeting of the Committee 
        described under subsection (a), the term `blackout period' 
        means the time period that--
                  ``(A) begins immediately after midnight on the day 
                that is one week prior to the date on which such 
                meeting takes place; and
                  ``(B) ends at midnight on the day after the date on 
                which such meeting takes place.
          ``(3) Exemption for chairman of the board of governors.--
        Nothing in this section shall prohibit the Chairman of the 
        Board of Governors of the Federal Reserve System from 
        participating in or issuing public communications.''.

SEC. 1003. PUBLIC TRANSCRIPTS OF FOMC MEETINGS.

  Section 12A of the Federal Reserve Act (12 U.S.C. 263), as amended by 
section 1002, is further amended by adding at the end the following:
  ``(e) Public Transcripts of Meetings.--The Committee shall--
          ``(1) record all meetings of the Committee; and
          ``(2) make the full transcript of such meetings available to 
        the public.''.

SEC. 1004. MEMBERSHIP OF FEDERAL OPEN MARKET COMMITTEE.

  Section 12A(a) of the Federal Reserve Act (12 U.S.C. 263(a)) is 
amended--
          (1) in the first sentence, by striking ``five'' and inserting 
        ``six'';
          (2) in the second sentence, by striking ``One by the board of 
        directors'' and all that follows through the period at the end 
        and inserting the following: ``One by the boards of directors 
        of the Federal Reserve Banks of New York and Boston; one by the 
        boards of directors of the Federal Reserve Banks of 
        Philadelphia and Cleveland; one by the boards of directors of 
        the Federal Reserve Banks of Richmond and Atlanta; one by the 
        boards of directors of the Federal Reserve Banks of Chicago and 
        St. Louis; one by the boards of directors of the Federal 
        Reserve Banks of Minneapolis and Kansas City; and one by the 
        boards of directors of the Federal Reserve Banks of Dallas and 
        San Francisco.''; and
          (3) by inserting after the second sentence the following: 
        ``In odd numbered calendar years, one representative shall be 
        elected from each of the Federal Reserve Banks of Boston, 
        Philadelphia, Richmond, Chicago, Minneapolis, and Dallas. In 
        even-numbered calendar years, one representative shall be 
        elected from each of the Federal Reserve Banks of New York, 
        Cleveland, Atlanta, St. Louis, Kansas City, and San 
        Francisco.''.

SEC. 1005. FREQUENCY OF TESTIMONY OF THE CHAIRMAN OF THE BOARD OF 
                    GOVERNORS OF THE FEDERAL RESERVE SYSTEM TO 
                    CONGRESS.

  (a) In General.--Section 2B of the Federal Reserve Act (12 U.S.C. 
225b) is amended--
          (1) by striking ``semi-annual'' each place it appears and 
        inserting ``quarterly''; and
          (2) in subsection (a)(2)--
                  (A) by inserting ``and October 20'' after ``July 20'' 
                each place it appears; and
                  (B) by inserting ``and May 20'' after ``February 20'' 
                each place it appears.
  (b) Conforming Amendment.--Paragraph (12) of section 10 of the 
Federal Reserve Act (12 U.S.C. 247b(12)) is amended by striking ``semi-
annual'' and inserting ``quarterly''.

SEC. 1006. VICE CHAIRMAN FOR SUPERVISION REPORT REQUIREMENT.

  Paragraph (12) of section 10 of the Federal Reserve Act (12 U.S.C. 
247(b)) is amended--
          (1) by redesignating such paragraph as paragraph (11); and
          (2) in such paragraph, by adding at the end the following: 
        ``In each such appearance, the Vice Chairman for Supervision 
        shall provide written testimony that includes the status of all 
        pending and anticipated rulemakings that are being made by the 
        Board of Governors of the Federal Reserve System. If, at the 
        time of any appearance described in this paragraph, the 
        position of Vice Chairman for Supervision is vacant, the Vice 
        Chairman for the Board of Governors of the Federal Reserve 
        System (who has the responsibility to serve in the absence of 
        the Chairman) shall appear instead and provide the required 
        written testimony. If, at the time of any appearance described 
        in this paragraph, both Vice Chairman positions are vacant, the 
        Chairman of the Board of Governors of the Federal Reserve 
        System shall appear instead and provide the required written 
        testimony.''.

SEC. 1007. SALARIES, FINANCIAL DISCLOSURES, AND OFFICE STAFF OF THE 
                    BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM.

  (a) In General.--Section 11 of the Federal Reserve Act (12 U.S.C. 
248) is amended--
          (1) by redesignating the second subsection (s) (relating to 
        ``Assessments, Fees, and Other Charges for Certain Companies'') 
        as subsection (t); and
          (2) by inserting before subsection (w), as added by section 
        371(a), the following new subsections:
  ``(u) Ethics Standards for Members and Employees.--
          ``(1) Prohibited and restricted financial interests and 
        transactions.--The members and employees of the Board of 
        Governors of the Federal Reserve System shall be subject to the 
        provisions under section 4401.102 of title 5, Code of Federal 
        Regulations, to the same extent as such provisions apply to an 
        employee of the Securities and Exchange Commission.
          ``(2) Treatment of brokerage accounts and availability of 
        account statements.--The members and employees of the Board of 
        Governors of the Federal Reserve System shall--
                  ``(A) disclose all brokerage accounts that the member 
                or employee maintains, as well as any accounts in which 
                the member or employee controls trading or has a 
                financial interest (including managed accounts, trust 
                accounts, investment club accounts, and accounts of 
                spouses or minor children who live with the member or 
                employee); and
                  ``(B) with respect to any securities account that the 
                member or employee is required to disclose to the Board 
                of Governors, authorize the brokers and dealers of such 
                account to send duplicate account statements directly 
                to Board of Governors.
          ``(3) Prohibitions related to outside employment and 
        activities.--The members and employees of the Board of 
        Governors of the Federal Reserve System shall be subject to the 
        prohibitions related to outside employment and activities 
        described under section 4401.103(c) of title 5, Code of Federal 
        Regulations, to the same extent as such prohibitions apply to 
        an employee of the Securities and Exchange Commission.
          ``(4) Additional ethics standards.--The members and employees 
        of the Board of Governors of the Federal Reserve System shall 
        be subject to--
                  ``(A) the employee responsibilities and conduct 
                regulations of the Office of Personnel Management under 
                part 735 of title 5, Code of Federal Regulations;
                  ``(B) the canons of ethics contained in subpart C of 
                part 200 of title 17, Code of Federal Regulations, to 
                the same extent as such subpart applies to the 
                employees of the Securities and Exchange Commission; 
                and
                  ``(C) the regulations concerning the conduct of 
                members and employees and former members and employees 
                contained in subpart M of part 200 of title 17, Code of 
                Federal Regulations, to the same extent as such subpart 
                applies to the employees of the Securities and Exchange 
                Commission.
  ``(v) Disclosure of Staff Salaries and Financial Information.--The 
Board of Governors of the Federal Reserve System shall make publicly 
available, on the website of the Board of Governors, a searchable 
database that contains the names of all members, officers, and 
employees of the Board of Governors who receive an annual salary in 
excess of the annual rate of basic pay for GS-15 of the General 
Schedule, and--
          ``(1) the yearly salary information for such individuals, 
        along with any nonsalary compensation received by such 
        individuals; and
          ``(2) any financial disclosures required to be made by such 
        individuals.''.
  (b) Office Staff for Each Member of the Board of Governors.--
Subsection (l) of section 11 of the Federal Reserve Act (12 U.S.C. 248) 
is amended by adding at the end the following: ``Each member of the 
Board of Governors of the Federal Reserve System may employ, at a 
minimum, 2 individuals, with such individuals selected by such member 
and the salaries of such individuals set by such member. A member may 
employ additional individuals as determined necessary by the Board of 
Governors.''.

SEC. 1008. AMENDMENTS TO POWERS OF THE BOARD OF GOVERNORS OF THE 
                    FEDERAL RESERVE SYSTEM.

  (a) In General.--Section 13(3) of the Federal Reserve Act (12 U.S.C. 
343(3)), as amended by section 111(b)(3), is further amended--
          (1) in subparagraph (A)--
                  (A) by inserting ``that pose a threat to the 
                financial stability of the United States'' after 
                ``unusual and exigent circumstances''; and
                  (B) by inserting ``and by the affirmative vote of not 
                less than nine presidents of the Federal reserve 
                banks'' after ``five members'';
          (2) in subparagraph (B)--
                  (A) in clause (i), by inserting at the end the 
                following: ``Federal reserve banks may not accept 
                equity securities issued by the recipient of any loan 
                or other financial assistance under this paragraph as 
                collateral. Not later than 6 months after the date of 
                enactment of this sentence, the Board shall, by rule, 
                establish--
                                  ``(I) a method for determining the 
                                sufficiency of the collateral required 
                                under this paragraph;
                                  ``(II) acceptable classes of 
                                collateral;
                                  ``(III) the amount of any discount on 
                                the value of the collateral that the 
                                Federal reserve banks will apply for 
                                purposes of calculating the sufficiency 
                                of collateral under this paragraph; and
                                  ``(IV) a method for obtaining 
                                independent appraisals of the value of 
                                collateral the Federal reserve banks 
                                receive.''; and
                  (B) in clause (ii)--
                          (i) by striking the second sentence; and
                          (ii) by inserting after the first sentence 
                        the following: ``A borrower shall not be 
                        eligible to borrow from any emergency lending 
                        program or facility unless the Board and all 
                        Federal banking regulators with jurisdiction 
                        over the borrower certify that, at the time the 
                        borrower initially borrows under the program or 
                        facility, the borrower is not insolvent.'';
          (3) by inserting ``financial institution'' before 
        ``participant'' each place such term appears;
          (4) in subparagraph (D)(i), by inserting ``financial 
        institution'' before ``participants''; and
          (5) by adding at the end the following new subparagraphs:
                  ``(E) Penalty rate.--
                          ``(i) In general.--Not later than 6 months 
                        after the date of enactment of this 
                        subparagraph, the Board shall, with respect to 
                        a recipient of any loan or other financial 
                        assistance under this paragraph, establish by 
                        rule a minimum interest rate on the principal 
                        amount of any loan or other financial 
                        assistance.
                          ``(ii) Minimum interest rate defined.--In 
                        this subparagraph, the term `minimum interest 
                        rate' shall mean the sum of--
                                  ``(I) the average of the secondary 
                                discount rate of all Federal Reserve 
                                banks over the most recent 90-day 
                                period; and
                                  ``(II) the average of the difference 
                                between a distressed corporate bond 
                                yield index (as defined by rule of the 
                                Board) and a bond yield index of debt 
                                issued by the United States (as defined 
                                by rule of the Board) over the most 
                                recent 90-day period.
                  ``(F) Financial institution participant defined.--For 
                purposes of this paragraph, the term `financial 
                institution participant'--
                          ``(i) means a company that is predominantly 
                        engaged in financial activities (as defined in 
                        section 102(a) of the Dodd-Frank Wall Street 
                        Reform and Consumer Protection Act (12 U.S.C. 
                        5311(a))); and
                          ``(ii) does not include an agency described 
                        in subparagraph (W) of section 5312(a)(2) of 
                        title 31, United States Code, or an entity 
                        controlled or sponsored by such an agency.''.
  (b) Conforming Amendment.--Section 11(r)(2)(A) of the Federal Reserve 
Act (12 U.S.C. 248(r)(2)(A)) is amended--
          (1) in clause (ii)(IV), by striking ``; and'' and inserting a 
        semicolon;
          (2) in clause (iii), by striking the period at the end and 
        inserting ``; and''; and
          (3) by adding at the end the following new clause:
          ``(iv) the available members secure the affirmative vote of 
        not less than nine presidents of the Federal reserve banks.''.

SEC. 1009. INTEREST RATES ON BALANCES MAINTAINED AT A FEDERAL RESERVE 
                    BANK BY DEPOSITORY INSTITUTIONS ESTABLISHED BY 
                    FEDERAL OPEN MARKET COMMITTEE.

  Subparagraph (A) of section 19(b)(12) of the Federal Reserve Act (12 
U.S.C. 461(b)(12)(A)) is amended by inserting ``established by the 
Federal Open Market Committee'' after ``rate or rates''.

SEC. 1010. AUDIT REFORM AND TRANSPARENCY FOR THE BOARD OF GOVERNORS OF 
                    THE FEDERAL RESERVE SYSTEM.

  (a) In General.--Notwithstanding section 714 of title 31, United 
States Code, or any other provision of law, the Comptroller General of 
the United States shall annually complete an audit of the Board of 
Governors of the Federal Reserve System and the Federal reserve banks 
under subsection (b) of such section 714 within 12 months after the 
date of the enactment of this Act.
  (b) Report.--
          (1) In general.--Not later than 90 days after each audit 
        required pursuant to subsection (a) is completed, the 
        Comptroller General--
                  (A) shall submit to Congress a report on such audit; 
                and
                  (B) shall make such report available to the Speaker 
                of the House, the majority and minority leaders of the 
                House of Representatives, the majority and minority 
                leaders of the Senate, the Chairman and Ranking Member 
                of the committee and each subcommittee of jurisdiction 
                in the House of Representatives and the Senate, and any 
                other Member of Congress who requests the report.
          (2) Contents.--The report under paragraph (1) shall include a 
        detailed description of the findings and conclusion of the 
        Comptroller General with respect to the audit that is the 
        subject of the report, together with such recommendations for 
        legislative or administrative action as the Comptroller General 
        may determine to be appropriate.
  (c) Repeal of Certain Limitations.--Subsection (b) of section 714 of 
title 31, United States Code, is amended by striking the second 
sentence.
  (d) Technical and Conforming Amendments.--
          (1) In general.--Section 714 of title 31, United States Code, 
        is amended--
                  (A) in subsection (d)(3), by striking ``or (f)'' each 
                place such term appears;
                  (B) in subsection (e), by striking ``the third 
                undesignated paragraph of section 13'' and inserting 
                ``section 13(3)''; and
                  (C) by striking subsection (f).
          (2) Federal reserve act.--Subsection (s) (relating to 
        ``Federal Reserve Transparency and Release of Information'') of 
        section 11 of the Federal Reserve Act (12 U.S.C. 248) is 
        amended--
                  (A) in paragraph (4)(A), by striking ``has the same 
                meaning as in section 714(f)(1)(A) of title 31, United 
                States Code'' and inserting ``means a program or 
                facility, including any special purpose vehicle or 
                other entity established by or on behalf of the Board 
                of Governors of the Federal Reserve System or a Federal 
                reserve bank, authorized by the Board of Governors 
                under section 13(3), that is not subject to audit under 
                section 714(e) of title 31, United States Code'';
                  (B) in paragraph (6), by striking ``or in section 
                714(f)(3)(C) of title 31, United States Code, the 
                information described in paragraph (1) and information 
                concerning the transactions described in section 714(f) 
                of such title,'' and inserting ``the information 
                described in paragraph (1)''; and
                  (C) in paragraph (7), by striking ``and section 
                13(3)(C), section 714(f)(3)(C) of title 31, United 
                States Code, and'' and inserting ``, section 13(3)(C), 
                and''.

SEC. 1011. ESTABLISHMENT OF A CENTENNIAL MONETARY COMMISSION.

  (a) Findings.--Congress finds the following:
          (1) The Constitution endows Congress with the power ``to coin 
        money, regulate the value thereof''.
          (2) Following the financial crisis known as the Panic of 
        1907, Congress established the National Monetary Commission to 
        provide recommendations for the reform of the financial and 
        monetary systems of the United States.
          (3) Incorporating several of the recommendations of the 
        National Monetary Commission, Congress created the Federal 
        Reserve System in 1913. As currently organized, the Federal 
        Reserve System consists of the Board of Governors in 
        Washington, District of Columbia, and the Federal reserve banks 
        organized into 12 districts around the United States. The 
        stockholders of the 12 Federal reserve banks include national 
        and certain State-chartered commercial banks, which operate on 
        a fractional reserve basis.
          (4) Originally, Congress gave the Federal Reserve System a 
        monetary mandate to provide an elastic currency, within the 
        context of a gold standard, in response to seasonal 
        fluctuations in the demand for currency.
          (5) Congress also gave the Federal Reserve System a financial 
        stability mandate to serve as the lender of last resort to 
        solvent but illiquid banks during a financial crisis.
          (6) In 1977, Congress changed the monetary mandate of the 
        Federal Reserve System to a dual mandate for maximum employment 
        and stable prices.
          (7) Empirical studies and historical evidence, both within 
        the United States and in other countries, demonstrate that 
        price stability is desirable because both inflation and 
        deflation damage the economy.
          (8) The economic challenge of recent years--most notably the 
        bursting of the housing bubble, the financial crisis of 2008, 
        and the ensuing anemic recovery--have occurred at great cost in 
        terms of lost jobs and output.
          (9) Policymakers are reexamining the structure and 
        functioning of financial institutions and markets to determine 
        what, if any, changes need to be made to place the financial 
        system on a stronger, more sustainable path going forward.
          (10) The Federal Reserve System has taken extraordinary 
        actions in response to the recent economic challenges.
          (11) The Federal Open Market Committee has engaged in 
        multiple rounds of quantitative easing, providing unprecedented 
        liquidity to financial markets, while committing to holding 
        short-term interest rates low for a seemingly indefinite 
        period, and pursuing a policy of credit allocation by 
        purchasing Federal agency debt and mortgage-backed securities.
          (12) In the wake of the recent extraordinary actions of the 
        Federal Reserve System, Congress--consistent with its 
        constitutional responsibilities and as it has done periodically 
        throughout the history of the United States--has once again 
        renewed its examination of monetary policy.
          (13) Central in such examination has been a renewed look at 
        what is the most proper mandate for the Federal Reserve System 
        to conduct monetary policy in the 21st century.
  (b) Establishment of a Centennial Monetary Commission.--There is 
established a commission to be known as the ``Centennial Monetary 
Commission'' (in this section referred to as the ``Commission'').
  (c) Study and Report on Monetary Policy.--
          (1) Study.--The Commission shall--
                  (A) examine how United States monetary policy since 
                the creation of the Board of Governors of the Federal 
                Reserve System in 1913 has affected the performance of 
                the United States economy in terms of output, 
                employment, prices, and financial stability over time;
                  (B) evaluate various operational regimes under which 
                the Board of Governors of the Federal Reserve System 
                and the Federal Open Market Committee may conduct 
                monetary policy in terms achieving the maximum 
                sustainable level of output and employment and price 
                stability over the long term, including--
                          (i) discretion in determining monetary policy 
                        without an operational regime;
                          (ii) price level targeting;
                          (iii) inflation rate targeting;
                          (iv) nominal gross domestic product targeting 
                        (both level and growth rate);
                          (v) the use of monetary policy rules; and
                          (vi) the gold standard;
                  (C) evaluate the use of macro-prudential supervision 
                and regulation as a tool of monetary policy in terms of 
                achieving the maximum sustainable level of output and 
                employment and price stability over the long term;
                  (D) evaluate the use of the lender-of-last-resort 
                function of the Board of Governors of the Federal 
                Reserve System as a tool of monetary policy in terms of 
                achieving the maximum sustainable level of output and 
                employment and price stability over the long term;
                  (E) recommend a course for United States monetary 
                policy going forward, including--
                          (i) the legislative mandate;
                          (ii) the operational regime;
                          (iii) the securities used in open-market 
                        operations; and
                          (iv) transparency issues; and
                  (F) consider the effects of the GDP output and 
                employment targets of the ``dual mandate'' (both from 
                the creation of the dual mandate in 1977 until the 
                present time and estimates of the future effect of the 
                dual mandate ) on--
                          (i) United States economic activity;
                          (ii) actions of the Board of Governors of the 
                        Federal Reserve System; and
                          (iii) Federal debt.
          (2) Report.--Not later than 1 year after the date of the 
        enactment of this section, the Commission shall submit to 
        Congress and make publicly available a report containing a 
        statement of the findings and conclusions of the Commission in 
        carrying out the study under paragraph (1), together with the 
        recommendations the Commission considers appropriate. In making 
        such report, the Commission shall specifically report on the 
        considerations required under paragraph (1)(F).
  (d) Membership.--
          (1) Number and appointment.--
                  (A) Appointed voting members.--The Commission shall 
                contain 12 voting members as follows:
                          (i) Six members appointed by the Speaker of 
                        the House of Representatives, with four members 
                        from the majority party and two members from 
                        the minority party.
                          (ii) Six members appointed by the President 
                        Pro Tempore of the Senate, with four members 
                        from the majority party and two members from 
                        the minority party.
                  (B) Chairman.--The Speaker of the House of 
                Representatives and the majority leader of the Senate 
                shall jointly designate one of the members of the 
                Commission as Chairman.
                  (C) Non-voting members.--The Commission shall contain 
                2 non-voting members as follows:
                          (i) One member appointed by the Secretary of 
                        the Treasury.
                          (ii) One member who is the president of a 
                        district Federal reserve bank appointed by the 
                        Chair of the Board of Governors of the Federal 
                        Reserve System.
          (2) Period of appointment.--Each member shall be appointed 
        for the life of the Commission.
          (3) Timing of appointment.--All members of the Commission 
        shall be appointed not later than 30 days after the date of the 
        enactment of this section.
          (4) Vacancies.--A vacancy in the Commission shall not affect 
        its powers, and shall be filled in the manner in which the 
        original appointment was made.
          (5) Meetings.--
                  (A) Initial meeting.--The Commission shall hold its 
                initial meeting and begin the operations of the 
                Commission as soon as is practicable.
                  (B) Further meetings.--The Commission shall meet upon 
                the call of the Chair or a majority of its members.
          (6) Quorum.--Seven voting members of the Commission shall 
        constitute a quorum but a lesser number may hold hearings.
          (7) Member of congress defined.--In this subsection, the term 
        ``Member of Congress'' means a Senator or a Representative in, 
        or Delegate or Resident Commissioner to, the Congress.
  (e) Powers.--
          (1) Hearings and sessions.--The Commission or, on the 
        authority of the Commission, any subcommittee or member 
        thereof, may, for the purpose of carrying out this section, 
        hold hearings, sit and act at times and places, take testimony, 
        receive evidence, or administer oaths as the Commission or such 
        subcommittee or member thereof considers appropriate.
          (2) Contract authority.--To the extent or in the amounts 
        provided in advance in appropriation Acts, the Commission may 
        contract with and compensate government and private agencies or 
        persons to enable the Commission to discharge its duties under 
        this section, without regard to section 3709 of the Revised 
        Statutes (41 U.S.C. 5).
          (3) Obtaining official data.--
                  (A) In general.--The Commission is authorized to 
                secure directly from any executive department, bureau, 
                agency, board, commission, office, independent 
                establishment, or instrumentality of the Government, 
                any information, including suggestions, estimates, or 
                statistics, for the purposes of this section.
                  (B) Requesting official data.--The head of such 
                department, bureau, agency, board, commission, office, 
                independent establishment, or instrumentality of the 
                government shall, to the extent authorized by law, 
                furnish such information upon request made by--
                          (i) the Chair;
                          (ii) the Chair of any subcommittee created by 
                        a majority of the Commission; or
                          (iii) any member of the Commission designated 
                        by a majority of the commission to request such 
                        information.
          (4) Assistance from federal agencies.--
                  (A) General services administration.--The 
                Administrator of General Services shall provide to the 
                Commission on a reimbursable basis administrative 
                support and other services for the performance of the 
                functions of the Commission.
                  (B) Other departments and agencies.--In addition to 
                the assistance prescribed in subparagraph (A), at the 
                request of the Commission, departments and agencies of 
                the United States shall provide such services, funds, 
                facilities, staff, and other support services as may be 
                authorized by law.
          (5) Postal service.--The Commission may use the United States 
        mails in the same manner and under the same conditions as other 
        departments and agencies of the United States.
  (f) Commission Personnel.--
          (1) Appointment and compensation of staff.--
                  (A) In general.--Subject to rules prescribed by the 
                Commission, the Chair may appoint and fix the pay of 
                the executive director and other personnel as the Chair 
                considers appropriate.
                  (B) Applicability of civil service laws.--The 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 that title 
                relating to classification and General Schedule pay 
                rates, except that an individual so appointed may not 
                receive pay in excess of level V of the Executive 
                Schedule.
          (2) Consultants.--The Commission may procure temporary and 
        intermittent services under section 3109(b) of title 5, United 
        States Code, but at rates for individuals not to exceed the 
        daily equivalent of the rate of pay for a person occupying a 
        position at level IV of the Executive Schedule.
          (3) Staff of federal agencies.--Upon request of the 
        Commission, the head of any Federal department or agency may 
        detail, on a reimbursable basis, any of the personnel of such 
        department or agency to the Commission to assist it in carrying 
        out its duties under this section.
  (g) Termination of Commission.--
          (1) In general.--The Commission shall terminate 6 months 
        after the date on which the report is submitted under 
        subsection (c)(2).
          (2) Administrative activities before termination.--The 
        Commission may use the period between the submission of its 
        report and its termination for the purpose of concluding its 
        activities, including providing testimony to the committee of 
        Congress concerning its report.
  (h) Authorization of Appropriations.--There is authorized to be 
appropriated to carry out this section $1,000,000, which shall remain 
available until the date on which the Commission terminates.

   TITLE XI--IMPROVING INSURANCE COORDINATION THROUGH AN INDEPENDENT 
                                ADVOCATE

SEC. 1101. REPEAL OF THE FEDERAL INSURANCE OFFICE; CREATION OF THE 
                    OFFICE OF THE INDEPENDENT INSURANCE ADVOCATE.

  (a) Establishment.--Section 313 of title 31, United States Code, is 
amended to read as follows (and conforming the table of contents for 
chapter 3 of such title accordingly):

``Sec. 313. Office of the Independent Insurance Advocate

  ``(a) Establishment.--There is established in the Department of the 
Treasury a bureau to be known as the Office of the Independent 
Insurance Advocate (in this section referred to as the `Office').
  ``(b) Independent Insurance Advocate.--
          ``(1) Establishment of position.--The chief officer of the 
        Office of the Independent Insurance Advocate shall be known as 
        the Independent Insurance Advocate. The Independent Insurance 
        Advocate shall perform the duties of such office under the 
        general direction of the Secretary of the Treasury.
          ``(2) Appointment.--The Independent Insurance Advocate shall 
        be appointed by the President, by and with the advice and 
        consent of the Senate, from among persons having insurance 
        expertise.
          ``(3) Term.--
                  ``(A) In general.--The Independent Insurance Advocate 
                shall serve a term of 6 years, unless sooner removed by 
                the President upon reasons which shall be communicated 
                to the Senate.
                  ``(B) Service after expiration.--If a successor is 
                not nominated and confirmed by the end of the term of 
                service of the Independent Insurance Advocate, the 
                person serving as Independent Insurance Advocate shall 
                continue to serve until such time a successor is 
                appointed and confirmed.
                  ``(C) Vacancy.--An Independent Insurance Advocate who 
                is appointed to serve the remainder of a predecessor's 
                uncompleted term shall be eligible thereafter to be 
                appointed to a full 6 year term.
                  ``(D) Acting official on financial stability 
                oversight council.--In the event of a vacancy in the 
                office of the Independent Insurance Advocate, and 
                pending the appointment and confirmation of a 
                successor, or during the absence or disability of the 
                Independent Insurance Advocate, the Independent Member 
                shall appoint a federal official appointed by the 
                President and confirmed by the Senate from a member 
                agency of the Financial Stability Oversight Council, 
                not otherwise serving on the Council, who shall serve 
                as a member of the Council and act in the place of the 
                Independent Insurance Advocate until such vacancy, 
                absence, or disability concludes.
          ``(4) Employment.--The Independent Insurance Advocate shall 
        be an employee of the Federal Government within the definition 
        of employee under section 2105 of title 5, United States Code.
  ``(c) Independence; Oversight.--
          ``(1) Independence.--The Secretary of the Treasury may not 
        delay or prevent the issuance of any rule or the promulgation 
        of any regulation by the Independent Insurance Advocate, and 
        may not intervene in any matter or proceeding before the 
        Independent Insurance Advocate, unless otherwise specifically 
        provided by law.
          ``(2) Oversight by inspector general.--The Office of the 
        Independent Insurance Advocate shall be an office in the 
        establishment of the Department of the Treasury for purposes of 
        the Inspector General Act of 1978 (5 U.S.C. App.).
  ``(d) Retention of Existing State Regulatory Authority.--Nothing in 
this section or section 314 shall be construed to establish or provide 
the Office or the Department of the Treasury with general supervisory 
or regulatory authority over the business of insurance.
  ``(e) Budget.--
          ``(1) Annual transmittal.--For each fiscal year, the 
        Independent Insurance Advocate shall transmit a budget estimate 
        and request to the Secretary of the Treasury, which shall 
        specify the aggregate amount of funds requested for such fiscal 
        year for the operations of the Office of the Independent 
        Insurance Advocate.
          ``(2) Inclusions.--In transmitting the proposed budget to the 
        President for approval, the Secretary of the Treasury shall 
        include--
                  ``(A) an aggregate request for the Independent 
                Insurance Advocate; and
                  ``(B) any comments of the Independent Insurance 
                Advocate with respect to the proposal.
          ``(3) President's budget.--The President shall include in 
        each budget of the United States Government submitted to the 
        Congress--
                  ``(A) a separate statement of the budget estimate 
                prepared in accordance with paragraph (1);
                  ``(B) the amount requested by the President for the 
                Independent Insurance Advocate; and
                  ``(C) any comments of the Independent Insurance 
                Advocate with respect to the proposal if the 
                Independent Insurance Advocate concludes that the 
                budget submitted by the President would substantially 
                inhibit the Independent Insurance Advocate from 
                performing the duties of the office.
  ``(f) Assistance.--The Secretary of the Treasury shall provide the 
Independent Insurance Advocate such services, funds, facilities and 
other support services as the Independent Insurance Advocate may 
request and as the Secretary may approve.
  ``(g) Personnel.--
          ``(1) Employees.--The Independent Insurance Advocate may fix 
        the number of, and appoint and direct, the employees of the 
        Office, in accordance with the applicable provisions of title 
        5, United States Code. The Independent Insurance Advocate is 
        authorized to employ attorneys, analysts, economists, and other 
        employees as may be deemed necessary to assist the Independent 
        Insurance Advocate to carry out the duties and functions of the 
        Office. Unless otherwise provided expressly by law, any 
        individual appointed under this paragraph shall be an employee 
        as defined in section 2105 of title 5, United States Code, and 
        subject to the provisions of such title and other laws 
        generally applicable to the employees of the Executive Branch.
          ``(2) Compensation.--Employees of the Office shall be paid in 
        accordance with the provisions of chapter 51 and subchapter III 
        of chapter 53 of title 5, United States Code, relating to 
        classification and General Schedule pay rates.
          ``(3) Procurement of temporary and intermittent services.--
        The Independent Insurance Advocate may procure temporary and 
        intermittent services under section 3109(b) of title 5, United 
        States Code, at rates for individuals which do not exceed the 
        daily equivalent of the annual rate of basic pay prescribed for 
        Level V of the Executive Schedule under section 5316 of such 
        title.
          ``(4) Details.--Any employee of the Federal Government may be 
        detailed to the Office with or without reimbursement, and such 
        detail shall be without interruption or loss of civil service 
        status or privilege. An employee of the Federal Government 
        detailed to the Office shall report to and be subject to 
        oversight by the Independent Insurance Advocate during the 
        assignment to the office, and may be compensated by the branch, 
        department, or agency from which the employee was detailed.
          ``(5) Intergovernmental personnel.--The Independent Insurance 
        Advocate may enter into agreements under subchapter VI of 
        chapter 33 of title 5, United States Code, with State and local 
        governments, institutions of higher education, Indian tribal 
        governments, and other eligible organizations for the 
        assignment of intermittent, part-time, and full-time personnel, 
        on a reimbursable or non-reimbursable basis.
  ``(h) Ethics.--
          ``(1) Designated ethics official.--The Legal Counsel of the 
        Financial Stability Oversight Council, or in the absence of a 
        Legal Counsel of the Council, the designated ethics official of 
        any Council member agency, as chosen by the Independent 
        Insurance Advocate, shall be the ethics official for the 
        Independent Insurance Advocate.
          ``(2) Restriction on representation.--In addition to any 
        restriction under section 205(c) of title18, United States 
        Code, except as provided in subsections (d) through (i) of 
        section 205 of such title, the Independent Insurance Advocate 
        (except in the proper discharge of official duties) shall not, 
        with or without compensation, represent anyone to or before any 
        officer or employee of--
                  ``(A) the Financial Stability Oversight Council on 
                any matter; or
                  ``(B) the Department of Justice with respect to 
                litigation involving a matter described in subparagraph 
                (A).
          ``(3) Compensation for services provided by another.--For 
        purposes of section 203 of title 18, United States Code, and if 
        a special government employee--
                  ``(A) the Independent Insurance Advocate shall not be 
                subject to the restrictions of subsection (a)(1) of 
                section 203,of title 18, United States Code, for 
                sharing in compensation earned by another for 
                representations on matters covered by such section; and
                  ``(B) a person shall not be subject to the 
                restrictions of subsection (a)(2) of such section for 
                sharing such compensation with the Independent 
                Insurance Advocate.
  ``(i) Advisory, Technical, and Professional Committees.--The 
Independent Insurance Advocate may appoint such special advisory, 
technical, or professional committees as may be useful in carrying out 
the functions of the Office and the members of such committees may be 
staff of the Office, or other persons, or both.
  ``(j) Mission and Functions.--
          ``(1) Mission.--In carrying out the functions under this 
        subsection, the mission of the Office shall be to act as an 
        independent advocate on behalf of the interests of United 
        States policyholders on prudential aspects of insurance matters 
        of importance, and to provide perspective on protecting their 
        interests, separate and apart from any other Federal agency or 
        State insurance regulator.
          ``(2) Office.--The Office shall have the authority--
                  ``(A) to coordinate Federal efforts on prudential 
                aspects of international insurance matters, including 
                representing the United States, as appropriate, in the 
                International Association of Insurance Supervisors (or 
                a successor entity) and assisting the Secretary in 
                negotiating covered agreements (as such term is defined 
                in subsection (q)) in coordination with States 
                (including State insurance commissioners) and the 
                United States Trade Representative;
                  ``(B) to consult with the States (including State 
                insurance regulators) regarding insurance matters of 
                national importance and prudential insurance matters of 
                international importance;
                  ``(C) to assist the Secretary in administering the 
                Terrorism Insurance Program established in the 
                Department of the Treasury under the Terrorism Risk 
                Insurance Act of 2002 (15 U.S.C. 6701 note);
                  ``(D) to observe all aspects of the insurance 
                industry, including identifying issues or gaps in the 
                regulation of insurers that could contribute to a 
                systemic crisis in the insurance industry or the United 
                States financial system; and
                  ``(E) to make determinations and exercise the 
                authority under subsection (m) with respect to covered 
                agreements and State insurance measures.
          ``(3) Membership on financial stability oversight council.--
                  ``(A) In general.--The Independent Insurance Advocate 
                shall serve, pursuant to section 111(b)(1)(J) of the 
                Financial Stability Act of 2010 (12 U.S.C. 
                5321(b)(1)(J)), as a member on the Financial Stability 
                Oversight Council.
                  ``(B) Authority.--To assist the Financial Stability 
                Oversight Council with its responsibilities to monitor 
                international insurance developments, advise the 
                Congress, and make recommendations, the Independent 
                Insurance Advocate shall have the authority--
                          ``(i) to regularly consult with international 
                        insurance supervisors and international 
                        financial stability counterparts;
                          ``(ii) to consult with the Board of Governors 
                        of the Federal Reserve System and the States 
                        with respect to representing the United States, 
                        as appropriate, in the International 
                        Association of Insurance Supervisors (including 
                        to become a non-voting member thereof), 
                        particularly on matters of systemic risk;
                          ``(iii) to participate at the Financial 
                        Stability Board of The Group of Twenty and to 
                        join with other members from the United States 
                        including on matters related to insurance; and
                          ``(iv) to participate with the United States 
                        delegation to the Organization for Economic 
                        Cooperation and Development and observe and 
                        participate at the Insurance and Private 
                        Pensions Committee.
          ``(4) Limitations on participation in supervisory colleges.--
        The Office may not engage in any activities that it is not 
        specifically authorized to engage in under this section or any 
        other provision of law, including participation in any 
        supervisory college or other meetings or fora for cooperation 
        and communication between the involved insurance supervisors 
        established for the fundamental purpose of facilitating the 
        effectiveness of supervision of entities which belong to an 
        insurance group.
  ``(k) Scope.--The authority of the Office as specified and limited in 
this section shall extend to all lines of insurance except--
          ``(1) health insurance, as determined by the Secretary in 
        coordination with the Secretary of Health and Human Services 
        based on section 2791 of the Public Health Service Act (42 
        U.S.C. 300gg-91);
          ``(2) long-term care insurance, except long-term care 
        insurance that is included with life or annuity insurance 
        components, as determined by the Secretary in coordination with 
        the Secretary of Health and Human Services, and in the case of 
        long-term care insurance that is included with such components, 
        the Secretary shall coordinate with the Secretary of Health and 
        Human Services in performing the functions of the Office; and
          ``(3) crop insurance, as established by the Federal Crop 
        Insurance Act (7 U.S.C. 1501 et seq.).
  ``(l) Access to Information.--In carrying out the functions required 
under subsection (j), the Office may coordinate with any relevant 
Federal agency and any State insurance regulator (or other relevant 
Federal or State regulatory agency, if any, in the case of an affiliate 
of an insurer) and any publicly available sources for the provision to 
the Office of publicly available information. Notwithstanding any other 
provision of law, each such relevant Federal agency and State insurance 
regulator or other Federal or State regulatory agency is authorized to 
provide to the Office such data or information.
  ``(m) Preemption Pursuant to Covered Agreements.--
          ``(1) Standards.--A State insurance measure shall be 
        preempted pursuant to this section or section 314 if, and only 
        to the extent that the Independent Insurance Advocate 
        determines, in accordance with this subsection, that the 
        measure--
                  ``(A) results in less favorable treatment of a non-
                United States insurer domiciled in a foreign 
                jurisdiction that is subject to a covered agreement 
                than a United States insurer domiciled, licensed, or 
                otherwise admitted in that State; and
                  ``(B) is inconsistent with a covered agreement.
          ``(2) Determination.--
                  ``(A) Notice of potential inconsistency.--Before 
                making any determination under paragraph (1), the 
                Independent Insurance Advocate shall--
                          ``(i) notify and consult with the appropriate 
                        State regarding any potential inconsistency or 
                        preemption;
                          ``(ii) notify and consult with the United 
                        States Trade Representative regarding any 
                        potential inconsistency or preemption;
                          ``(iii) cause to be published in the Federal 
                        Register notice of the issue regarding the 
                        potential inconsistency or preemption, 
                        including a description of each State insurance 
                        measure at issue and any applicable covered 
                        agreement;
                          ``(iv) provide interested parties a 
                        reasonable opportunity to submit written 
                        comments to the Office; and
                          ``(v) consider any comments received.
                  ``(B) Scope of review.--For purposes of this 
                subsection, any determination of the Independent 
                Insurance Advocate regarding State insurance measures, 
                and any preemption under paragraph (1) as a result of 
                such determination, shall be limited to the subject 
                matter contained within the covered agreement involved 
                and shall achieve a level of protection for insurance 
                or reinsurance consumers that is substantially 
                equivalent to the level of protection achieved under 
                State insurance or reinsurance regulation.
                  ``(C) Notice of determination of inconsistency.--Upon 
                making any determination under paragraph (1), the 
                Director shall--
                          ``(i) notify the appropriate State of the 
                        determination and the extent of the 
                        inconsistency;
                          ``(ii) establish a reasonable period of time, 
                        which shall not be less than 30 days, before 
                        the determination shall become effective; and
                          ``(iii) notify the Committees on Financial 
                        Services and Ways and Means of the House of 
                        Representatives and the Committees on Banking, 
                        Housing, and Urban Affairs and Finance of the 
                        Senate.
          ``(3) Notice of effectiveness.--Upon the conclusion of the 
        period referred to in paragraph (2)(C)(ii), if the basis for 
        such determination still exists, the determination shall become 
        effective and the Independent Insurance Advocate shall--
                  ``(A) cause to be published a notice in the Federal 
                Register that the preemption has become effective, as 
                well as the effective date; and
                  ``(B) notify the appropriate State.
          ``(4) Limitation.--No State may enforce a State insurance 
        measure to the extent that such measure has been preempted 
        under this subsection.
          ``(5) Applicability of administrative procedures act.--
        Determinations of inconsistency made pursuant to paragraph (2) 
        shall be subject to the applicable provisions of subchapter II 
        of chapter 5 of title 5, United States Code (relating to 
        administrative procedure), and chapter 7 of such title 
        (relating to judicial review), except that in any action for 
        judicial review of a determination of inconsistency, the court 
        shall determine the matter de novo.
  ``(n) Consultation.--The Independent Insurance Advocate shall consult 
with State insurance regulators, individually or collectively, to the 
extent the Independent Insurance Advocate determines appropriate, in 
carrying out the functions of the Office.
  ``(o) Notices and Requests for Comment.--In addition to the other 
functions and duties specified in this section, the Independent 
Insurance Advocate may prescribe such notices and requests for comment 
in the Federal Register as are deemed necessary related to and 
governing the manner in which the duties and authorities of the 
Independent Insurance Advocate are carried out;
  ``(p) Savings Provisions.--Nothing in this section shall--
          ``(1) preempt--
                  ``(A) any State insurance measure that governs any 
                insurer's rates, premiums, underwriting, or sales 
                practices;
                  ``(B) any State coverage requirements for insurance;
                  ``(C) the application of the antitrust laws of any 
                State to the business of insurance; or
                  ``(D) any State insurance measure governing the 
                capital or solvency of an insurer, except to the extent 
                that such State insurance measure results in less 
                favorable treatment of a non-United State insurer than 
                a United States insurer; or
          ``(2) affect the preemption of any State insurance measure 
        otherwise inconsistent with and preempted by Federal law.
  ``(q) Retention of Authority of Federal Financial Regulatory 
Agencies.--Nothing in this section or section 314 shall be construed to 
limit the authority of any Federal financial regulatory agency, 
including the authority to develop and coordinate policy, negotiate, 
and enter into agreements with foreign governments, authorities, 
regulators, and multinational regulatory committees and to preempt 
State measures to affect uniformity with international regulatory 
agreements.
  ``(r) Retention of Authority of United States Trade Representative.--
Nothing in this section or section 314 shall be construed to affect the 
authority of the Office of the United States Trade Representative 
pursuant to section 141 of the Trade Act of 1974 (19 U.S.C. 2171) or 
any other provision of law, including authority over the development 
and coordination of United States international trade policy and the 
administration of the United States trade agreements program.
  ``(s) Congressional Testimony.--The Independent Insurance Advocate 
shall appear before the Committee on Financial Services of the House of 
Representatives and the Committee on Banking, Housing, and Urban 
Affairs at semi-annual hearings and shall provide testimony, which 
shall include submitting written testimony in advance of such 
appearances to such committees and to the Committee on Ways and Means 
of the House of Representatives and the Committee on Finance of the 
Senate, on the following matters:
          ``(1) Office activities.--The efforts, activities, 
        objectives, and plans of the Office.
          ``(2) Section 313(l) actions.--Any actions taken by the 
        Office pursuant to subsection (l) (regarding preemption 
        pursuant to covered agreements).
          ``(3) Insurance industry.--The state of, and developments in, 
        the insurance industry.
          ``(4) U.S. and global insurance and reinsurance markets.--The 
        breadth and scope of the global insurance and reinsurance 
        markets and the critical role such markets plays in supporting 
        insurance in the United States and the ongoing impacts of part 
        II of the Nonadmitted and Reinsurance Reform Act of 2010 on the 
        ability of State regulators to access reinsurance information 
        for regulated companies in their jurisdictions.
          ``(5) Other.--Any other matters as deemed relevant by the 
        Independent Insurance Advocate or requested by such Committees.
  ``(t) Report Upon End of Term of Office.--Not later than two months 
prior to the expiration of the term of office, or discontinuation of 
service, of each individual serving as the Independent Insurance 
Advocate, the Independent Insurance Advocate shall submit a report to 
the Committees on Financial Services and Ways and Means of the House of 
Representatives and the Committees on Banking, Housing, and Urban 
Affairs and Finance of the Senate setting forth recommendations 
regarding the Financial Stability Oversight Council and the role, 
duties, and functions of the Independent Insurance Advocate.
  ``(u) Definitions.--In this section and section 314, the following 
definitions shall apply:
          ``(1) Affiliate.--The term `affiliate' means, with respect to 
        an insurer, any person who controls, is controlled by, or is 
        under common control with the insurer.
          ``(2) Covered agreement.--The term `covered agreement' means 
        a written bilateral or multilateral agreement regarding 
        prudential measures with respect to the business of insurance 
        or reinsurance that--
                  ``(A) is entered into between the United States and 
                one or more foreign governments, authorities, or 
                regulatory entities; and
                  ``(B) relates to the recognition of prudential 
                measures with respect to the business of insurance or 
                reinsurance that achieves a level of protection for 
                insurance or reinsurance consumers that is 
                substantially equivalent to the level of protection 
                achieved under State insurance or reinsurance 
                regulation.
          ``(3) Insurer.--The term `insurer' means any person engaged 
        in the business of insurance, including reinsurance.
          ``(4) Federal financial regulatory agency.--The term `Federal 
        financial regulatory agency' means the Department of the 
        Treasury, the Board of Governors of the Federal Reserve System, 
        the Office of the Comptroller of the Currency, the Office of 
        Thrift Supervision, the Securities and Exchange Commission, the 
        Commodity Futures Trading Commission, the Federal Deposit 
        Insurance Corporation, the Federal Housing Finance Agency, or 
        the National Credit Union Administration.
          ``(5) Financial stability oversight council.--The term 
        `Financial Stability Oversight Council ' means the Financial 
        Stability Oversight Council established under section 111(a) of 
        the Dodd-Frank Wall Street Reform and Consumer Protection Act 
        (12 U.S.C. 5321(a)).
          ``(6) Member agency.--The term `member agency' has the 
        meaning given such term in section 111(a) of the Dodd-Frank 
        Wall Street Reform and Consumer Protection Act (12 U.S.C. 
        5321(a)).
          ``(7) Non-united states insurer.--The term `non-United States 
        insurer' means an insurer that is organized under the laws of a 
        jurisdiction other than a State, but does not include any 
        United States branch of such an insurer.
          ``(8) Office.--The term `Office' means the Office of the 
        Independent Insurance Advocate established by this section.
          ``(9) State insurance measure.--The term `State insurance 
        measure' means any State law, regulation, administrative 
        ruling, bulletin, guideline, or practice relating to or 
        affecting prudential measures applicable to insurance or 
        reinsurance.
          ``(10) State insurance regulator.--The term `State insurance 
        regulator' means any State regulatory authority responsible for 
        the supervision of insurers.
          ``(11) Substantially equivalent to the level of protection 
        achieved.--The term `substantially equivalent to the level of 
        protection achieved' means the prudential measures of a foreign 
        government, authority, or regulatory entity achieve a similar 
        outcome in consumer protection as the outcome achieved under 
        State insurance or reinsurance regulation.
          ``(12) United states insurer.--The term `United States 
        insurer' means--
                  ``(A) an insurer that is organized under the laws of 
                a State; or
                  ``(B) a United States branch of a non-United States 
                insurer.''.
  (b) Pay at Level III of Executive Schedule.--Section 5314 of title 5, 
United States Code, is amended by adding at the end the following new 
item:
          ``Independent Insurance Advocate, Department of the 
        Treasury.''.
  (c) Voting Member of FSOC.--Paragraph (1) of section 111(b) of the 
Dodd-Frank Wall Street Reform and Consumer Protection Act (12 U.S.C. 
5321(b)(1)) is amended by striking subparagraph (J) and inserting the 
following new subparagraph:
                  ``(J) the Independent Insurance Advocate appointed 
                pursuant to section 313 of title 31, United States 
                Code.''.
  (d) Independence.--Section 111 of Public Law 93-495 (12 U.S.C. 250) 
is amended--
          (1) by inserting ``the Independent Insurance Advocate of the 
        Department of the Treasury,'' after ``Federal Housing Finance 
        Agency,''; and
          (2) by inserting ``or official'' before ``submitting them''.
  (e) Transfer of Employees.--All employees of the Department of 
Treasury who are performing staff functions for the independent member 
of the Financial Stability Oversight Council under section 111(b)(2)(J) 
of the Dodd-Frank Wall Street Reform and Consumer Protection Act (12 
U.S.C. 5321(b)(2)(J)) on a full-time equivalent basis as of the date of 
enactment of this Act shall be eligible for transfer to the Office of 
the Independent Insurance Advocate established pursuant to the 
amendment made by subsection (a) of this section for appointment as an 
employee and shall be transferred at the joint discretion of the 
Independent Insurance Advocate and the eligible employee. Any employee 
eligible for transfer that is not appointed within 360 days from the 
date of enactment of this Act shall be eligible for detail under 
section 313(f)(4) of title 31, United States Code.
  (f) Temporary Service; Transition.--Notwithstanding the amendment 
made by subsection (a) of this section, during the period beginning on 
the date of the enactment of this Act and ending on the date on which 
the Independent Insurance Advocate is appointed and confirmed pursuant 
to section 313(b)(2) of title 31, United States Code, as amended by 
such amendment, the person serving, on such date of enactment, as the 
independent member of the Financial Stability Oversight Council 
pursuant to section 111(b)(1)(J) of the Dodd-Frank Wall Street Reform 
and Consumer Protection Act (12 U.S.C. 5321(b)(1)(J)) shall act for all 
purposes as, and with the full powers of, the Independent Insurance 
Advocate.
  (g) Comparability in Compensation Schedules.--Subsection (a) of 
section 1206 of the Financial Institutions Reform, Recovery, and 
Enforcement Act of 1989 (12 U.S.C. 1833b(a)) is amended by inserting 
``the Office of the Independent Insurance Advocate of the Department of 
the Treasury,'' before ``and the Farm Credit Administration,''.
  (h) Senior Executives.--Subparagraph (D) of section 3132(a)(1) of 
title 5, United States Code, is amended by inserting ``the Office of 
the Independent Insurance Advocate of the Department of the Treasury,'' 
after ``Finance Agency,''.

SEC. 1102. TREATMENT OF COVERED AGREEMENTS.

  Subsection (c) of section 314 of title 31, United States Code is 
amended--
          (1) by designating paragraphs (1) and (2) as paragraphs (2) 
        and (3), respectively; and
          (2) by inserting before paragraph (2), as so redesignated, 
        the following new paragraph:
          ``(1) the Secretary of the Treasury and the United States 
        Trade Representative have caused to be published in the Federal 
        Register, and made available for public comment for a period of 
        not fewer than 30 days and not greater than 90 days (which 
        period may run concurrently with the 90-day period for the 
        covered agreement referred to in paragraph (3)), the proposed 
        text of the covered agreement;''.

                    TITLE XII--TECHNICAL CORRECTIONS

SEC. 1201. TABLE OF CONTENTS; DEFINITIONAL CORRECTIONS.

  (a) Table of Contents.--The table of contents for the Dodd-Frank Wall 
Street Reform and Consumer Protection Act (Public Law 111-203; 124 
Stat. 1376) is amended by striking the items relating to section 407 
through 414 and inserting the following:

``Sec. 407. Exemption of and reporting by venture capital fund 
advisers.
``Sec. 408. Exemption of and reporting by certain private fund 
advisers.
``Sec. 409. Family offices.
``Sec. 410. State and Federal responsibilities; asset threshold for 
Federal registration of investment advisers.
``Sec. 411. Custody of client assets.
``Sec. 414. Rule of construction relating to the Commodity Exchange 
Act.
``Sec. 418. Qualified client standard.
``Sec. 419. Transition period.''.

  (b) Definitions.--Section 2 of the Dodd-Frank Wall Street Reform and 
Consumer Protection Act (12 U.S.C. 5301) is amended--
          (1) in paragraph (1)--
                  (A) by striking ``section 3'' and inserting ``section 
                3(w)''; and
                  (B) by striking ``(12 U.S.C. 1813)'' and inserting 
                ``(12 U.S.C. 1813(w))'';
          (2) in paragraph (6), by striking ``1 et seq.'' and inserting 
        ``1a''; and
          (3) in paragraph (18)(A)--
                  (A) by striking ```bank holding company',''; and
                  (B) by inserting ```includes','' before 
                ```including',''.

SEC. 1202. ANTITRUST SAVINGS CLAUSE CORRECTIONS.

  Section 6 of the Dodd-Frank Wall Street Reform and Consumer 
Protection Act (12 U.S.C. 5303) is amended, in the second sentence--
          (1) by inserting ``(15 U.S.C. 12(a))'' after ``Clayton Act''; 
        and
          (2) by striking ``Act, to'' and inserting ``Act (15 U.S.C. 
        45) to''.

SEC. 1203. TITLE I CORRECTIONS.

  Title I of the Dodd-Frank Wall Street Reform and Consumer Protection 
Act (12 U.S.C. 5311 et seq.) is amended--
          (1) in section 102(a)(6) (12 U.S.C. 5311(a)(6)), by inserting 
        ``(12 U.S.C. 1843(k))'' after ``of 1956'' each place that term 
        appears;
          (2) in section 111(c)(3) (12 U.S.C. 5321(c)(3)), by striking 
        ``that agency or department head'' and inserting ``the head of 
        that member agency or department'';
          (3) in section 112 (12 U.S.C. 5322)--
                  (A) in subsection (a)(2)--
                          (i) in subparagraph (C) (as redesignated by 
                        section 151)--
                                  (I) by striking ``to monitor'' and 
                                inserting ``monitor''; and
                                  (II) by striking ``to advise'' and 
                                inserting ``advise'';
                          (ii) in subparagraph (H) (as redesignated by 
                        section 151), by striking ``may''; and
                  (B) in subsection (d)(5), by striking ``subsection 
                and subtitle B'' each place such term appears and 
                inserting ``subtitle''; and
          (4) in section 171(b)(4)(D) (12 U.S.C. 5371(b)(4)(D)), by 
        adding a period at the end.

SEC. 1204. TITLE III CORRECTIONS.

  (a) In General.--Title III of the Dodd-Frank Wall Street Reform and 
Consumer Protection Act (12 U.S.C. 5401 et seq.) is amended--
          (1) in section 327(b)(5) (12 U.S.C. 5437(b)(5)), by striking 
        ``in'' and inserting ``into'';
          (2) in section 333(b)(2) (124 Stat. 1539), by inserting ``the 
        second place that term appears'' before ``and inserting''; and
          (3) in section 369(5) (124 Stat. 1559)--
                  (A) in subparagraph (D)(i)--
                          (i) in subclause (III), by redesignating 
                        items (aa), (bb), and (cc) as subitems (AA), 
                        (BB), and (CC), respectively, and adjusting the 
                        margins accordingly;
                          (ii) in subclause (IV), redesignating items 
                        (aa) and (bb) as subitems (AA) and (BB), 
                        respectively, and adjusting the margins 
                        accordingly;
                          (iii) in subclause (V), by redesignating 
                        items (aa), (bb), and (cc) as subitems (AA), 
                        (BB), and (CC), respectively, and adjusting the 
                        margins accordingly; and
                          (iv) by redesignating subclauses (III), (IV), 
                        and (V) as items (bb), (cc), and (dd), 
                        respectively, and adjusting the margins 
                        accordingly;
                  (B) in subparagraph (F)--
                          (i) in clause (ii), by adding ``and'' at the 
                        end;
                          (ii) in clause (iii), by striking ``; and'' 
                        and inserting a period; and
                          (iii) by striking clause (iv); and
                  (C) in subparagraph (G)(i), by inserting ``each place 
                such term appears'' before ``and inserting''.
  (b) Effective Dates.--
          (1) Section 333.--The amendment made by subsection (a)(2) of 
        this section shall take effect as though enacted as part of 
        subtitle C of title III of the Dodd-Frank Wall Street Reform 
        and Consumer Protection Act (124 Stat. 1538).
          (2) Section 369.--The amendments made by subsection (a)(3) of 
        this section shall take effect as though enacted as part of 
        subtitle E of title III of the Dodd-Frank Wall Street Reform 
        and Consumer Protection Act (124 Stat. 1546).

SEC. 1205. TITLE IV CORRECTION.

  Section 414 of the Dodd-Frank Wall Street Reform and Consumer 
Protection Act (124 Stat. 1578) is amended in the section heading by 
striking ``commodities'' and inserting ``commodity''.

SEC. 1206. TITLE VI CORRECTIONS.

  (a) In General.--Section 610 of the Dodd-Frank Wall Street Reform and 
Consumer Protection Act (124 Stat. 1596) is amended--
          (1) by striking subsection (b); and
          (2) by redesignating subsection (c) as subsection (b).
  (b) Effective Date.--The amendments made by subsection (a) of this 
section shall take effect as though enacted as part of section 610 of 
the Dodd-Frank Wall Street Reform and Consumer Protection Act (124 
Stat. 1611).

SEC. 1207. TITLE VII CORRECTIONS.

  (a) In General.--Title VII of the Dodd-Frank Wall Street Reform and 
Consumer Protection Act (15 U.S.C. 8301 et seq.) is amended--
          (1) in section 719(c)(1)(B) (15 U.S.C. 8307(c)(1)(B)), by 
        adding a period at the end;
          (2) in section 723(a)(1)(B) (124 Stat. 1675), by inserting 
        ``, as added by section 107 of the Commodity Futures 
        Modernization Act of 2000 (Appendix E of Public Law 106-554; 
        114 Stat. 2763A-382),'' after ``subsection (i)'';
          (3) in section 734(b)(1) (124 Stat. 1718), by striking ``is 
        amended'' and all that follows through ``(B) in'' and inserting 
        ``is amended in'';
          (4) in section 741(b)(10) (124 Stat. 1732), by striking 
        ``1a(19)(A)(iv)(II)'' each place it appears and inserting 
        ``1a(18)(A)(iv)(II)''; and
          (5) in section 749 (124 Stat. 1746)--
                  (A) in subsection (a)(2), by striking ``adding at the 
                end'' and inserting ``inserting after subsection (f)''; 
                and
                  (B) in subsection (h)(1)(B), by inserting ``the 
                second place that term appears'' before the semicolon.
  (b) Effective Date.--The amendments made by paragraphs (3), (4), and 
(5) of subsection (a) of this section shall take effect as though 
enacted as part of part II of subtitle A of title VII of the Dodd-Frank 
Wall Street Reform and Consumer Protection Act (124 Stat. 1658).

SEC. 1208. TITLE IX CORRECTIONS.

  Section 939(h)(1) of the Dodd-Frank Wall Street Reform and Consumer 
Protection Act (124 Stat. 1887) is amended--
          (1) in the matter preceding subparagraph (A), by inserting 
        ``The'' before ``Commission''; and
          (2) by striking ``feasability'' and inserting 
        ``feasibility''.

SEC. 1209. TITLE X CORRECTIONS.

  (a) In General.--Title X of the Dodd-Frank Wall Street Reform and 
Consumer Protection Act (12 U.S.C. 5481 et seq.) is amended--
          (1) in section 1002(12)(G) (12 U.S.C. 5481(12)(G)), by 
        striking ``Home Owners'' and inserting ``Homeowners'';
          (2) in section 1013(a)(1)(C) (12 U.S.C. 5493(a)(1)(C)), by 
        striking ``section 11(1)'' and inserting ``subsection (l) of 
        section 11'';
          (3) in section 1017(a)(2) (as so redesignated by section 713) 
        (12 U.S.C. 5497(a)(5))--
                  (A) in subparagraph (A), in the last sentence by 
                striking ``716(c) of title 31, United States Code'' and 
                inserting ``716 of title 31, United States Code''; and
                  (B) in subparagraph (C), by striking ``section 3709 
                of the Revised Statutes of the United States (41 U.S.C. 
                5)'' and inserting ``section 6101 of title 41, United 
                States Code'';
          (4) in section 1027(d)(1)(B) (12 U.S.C. 5517(d)(1)(B)), by 
        inserting a comma after ``(A)'';
          (5) in section 1029(d) (12 U.S.C. 5519(d)), by striking the 
        period after ``Commission Act'';
          (6) in section 1061(b)(7) (12 U.S.C. 5581(b)(7))--
                  (A) by striking ``Secretary of the Department of 
                Housing and Urban Development'' each place that term 
                appears and inserting ``Department of Housing and Urban 
                Development''; and
                  (B) in subparagraph (A), by striking ``(12 U.S.C. 
                5102 et seq.)'' and inserting ``(12 U.S.C. 5101 et 
                seq.)'';
          (7) in section 1063 (12 U.S.C. 5583)--
                  (A) in subsection (f)(1)(B), by striking ``that''; 
                and
                  (B) in subsection (g)(1)(A)--
                          (i) by striking ``(12 U.S.C. 5102 et seq.)'' 
                        and inserting ``(12 U.S.C. 5101 et seq.)''; and
                          (ii) by striking ``seq)'' and inserting 
                        ``seq.)'';
          (8) in section 1064(i)(1)(A)(iii) (12 U.S.C. 
        5584(i)(1)(A)(iii)), by inserting a period before ``If an'';
          (9) in section 1073(c)(2) (12 U.S.C. 5601(c)(2))--
                  (A) in the paragraph heading, by inserting ``and 
                education'' after ``financial literacy''; and
                  (B) by striking ``its duties'' and inserting ``their 
                duties'';
          (10) in section 1076(b)(1) (12 U.S.C. 5602(b)(1)), by 
        inserting before the period at the end the following: ``, the 
        Agency may, after notice and opportunity for comment, prescribe 
        regulations'';
          (11) in section 1077(b)(4)(F) (124 Stat. 2076), by striking 
        ``associates'' and inserting ``associate's'';
          (12) in section 1084(1) (124 Stat. 2081), by inserting a 
        comma after ``2009)'';
          (13) in section 1089 (124 Stat. 2092)--
                  (A) in paragraph (3)--
                          (i) in subparagraph (A), by striking ``and'' 
                        at the end; and
                          (ii) in subparagraph (B)(vi), by striking the 
                        period at the end and inserting ``; and''; and
                  (B) by redesignating paragraph (4) as subparagraph 
                (C) and adjusting the margins accordingly; and
          (14) in section 1098(6) (124 Stat. 2104), by inserting ``the 
        first place that term appears'' before ``and''.
  (b) Effective Date.--The amendments made by paragraphs (11), (12), 
(13), (14), and (15) of subsection (a) shall take effect as though 
enacted as part of subtitle H of title X of the Dodd-Frank Wall Street 
Reform and Consumer Protection Act (124 Stat. 2080).

SEC. 1210. TITLE XII CORRECTION.

  Title XII of the Dodd-Frank Wall Street Reform and Consumer 
Protection Act (124 Stat. 2129) is amended, in section 1208(b) (12 
U.S.C. 5626(b)), by inserting ``, as defined in section 103(10) of the 
Riegle Community Development and Regulatory Improvement Act of 1994 (12 
U.S.C. 4702(10)),'' after ``appropriated to the Fund''.

SEC. 1211. TITLE XIV CORRECTION.

  Title XIV of the Dodd-Frank Wall Street Reform and Consumer 
Protection Act (124 Stat. 2136) is amended, in section 1451(c) (12 
U.S.C. 1701x-1(c)), by striking ``pursuant''.

SEC. 1212. TECHNICAL CORRECTIONS TO OTHER STATUTES.

  (a) Alternative Mortgage Transaction Parity Act of 1982.--The 
Alternative Mortgage Transaction Parity Act of 1982 (12 U.S.C. 3801 et 
seq.) is amended--
          (1) in section 802(a)(3) (12 U.S.C. 3801(a)(3)), by striking 
        ``the Director of the Office of Thrift Supervision'' and 
        inserting ``the Consumer Law Enforcement Agency'';
          (2) in section 804 (12 U.S.C. 3803)--
                  (A) in subsection (a), by striking ``the Director of 
                the Office of Thrift Supervision'' each place such term 
                appears and inserting ``the Comptroller of the 
                Currency''; and
                  (B) in subsection (d)(1), by striking the comma after 
                ``Administration''.
  (b) Bank Holding Company Act Amendments of 1970.--Section 106(b)(1) 
of the Bank Holding Company Act Amendments of 1970 (12 U.S.C. 1972(1)) 
is amended, in the undesignated matter at the end, by striking 
``Federal Deposit Insurance Company'' and inserting ``Federal Deposit 
Insurance Corporation''.
  (c) Balanced Budget and Emergency Deficit Control Act.--Section 
255(g)(1)(A) of the Balanced Budget and Emergency Deficit Control Act 
of 1985 (2 U.S.C. 905(g)(1)(A)) is amended by striking ``Office of 
Thrift Supervision (20-4108-0-3-373).''.
  (d) Bretton Woods Agreements Act.--Section 68(a)(1) of the Bretton 
Woods Agreements Act (22 U.S.C. 286tt(a)(1)) is amended by striking 
``Fund ,'' and inserting ``Fund,''.
  (e) CAN-SPAM Act of 2003.--Section 7(b)(1)(D) of the CAN-SPAM Act of 
2003 (15 U.S.C. 7706(b)(1)(D)) is amended by striking ``Director of the 
Office of Thrift Supervision'' and inserting ``Comptroller of the 
Currency or the Board of Directors of Federal Deposit Insurance 
Corporation, as applicable,''.
  (f) Children's Online Privacy Protection Act of 1998.--Section 
1306(b)(2) of the Children's Online Privacy Protection Act of 1998 (15 
U.S.C. 6505(b)(2)) is amended by striking ``Director of the Office of 
Thrift Supervision'' and inserting ``Comptroller of the Currency and 
the Board of Directors of Federal Deposit Insurance Corporation, as 
applicable,''.
  (g) Community Reinvestment Act of 1977.--The Community Reinvestment 
Act of 1977 (12 U.S.C. 2901 et seq.) is amended--
          (1) in section 803(1)(C) (12 U.S.C. 2902(1)(C)), by striking 
        the period at the end and inserting a semicolon; and
          (2) in section 806 (12 U.S.C. 2905), by striking 
        ``companies,,'' and inserting ``companies,''.
  (h) Credit Repair Organizations Act.--Section 403(4) of the Credit 
Repair Organizations Act (15 U.S.C. 1679a(4)) is amended by striking 
``103(e)'' and inserting ``103(f)''.
  (i) Depository Institution Management Interlocks Act.--Section 205(9) 
of the Depository Institution Management Interlocks Act (12 U.S.C. 
3204(9)) is amended by striking ``Director of the Office of Thrift 
Supervision'' and inserting ``appropriate Federal banking agency''.
  (j) Economic Growth and Regulatory Paperwork Reduction Act of 1996.--
Section 2227(a)(1) of the Economic Growth and Regulatory Paperwork 
Reduction Act of 1996 (12 U.S.C. 252(a)(1)) is amended by striking 
``the Director of the Office of Thrift Supervision,''.
  (k) Electronic Fund Transfer Act.--The Electronic Fund Transfer Act 
(15 U.S.C. 1693 et seq.) is amended--
          (1) in section 903 (15 U.S.C. 1693a)--
                  (A) in paragraph (2), by striking ``103(i)'' and 
                inserting ``103(j)''; and
                  (B) by redesignating the first paragraph designated 
                as paragraph (4) (defining the term ``Board''), as 
                paragraph (3);
          (2) in section 904(a) (15 U.S.C. 1693b(a))--
                  (A) by redesignating the second paragraph designated 
                as paragraph (1) (relating to consultation with other 
                agencies), the second paragraph designated as paragraph 
                (2) (relating to the preparation of an analysis of 
                economic impact), paragraph (3), and paragraph (4), as 
                subparagraphs (A), (B), (C), and (D), respectively, and 
                adjusting the margins accordingly; and
                  (B) by striking ``In prescribing such regulations, 
                the Board shall:'' and inserting the following:
          ``(3) Regulations.--In prescribing regulations under this 
        subsection, the Agency and the Board shall--'';
          (3) in section 909(c) (15 U.S.C. 1693g(c)), by striking 
        ``103(e)'' and inserting ``103(f)'';
          (4) in section 918(a)(4) (15 U.S.C. 1693o(a)(4), by striking 
        ``Act and'' and inserting ``Act; and'';
          (5) by redesignating the section added by section 1073(4) of 
        the Dodd-Frank Wall Street Reform and Consumer Protection Act 
        (relating to remittance transfers) (15 U.S.C. 1693o-1) as 
        section 920 of the Electronic Fund Transfer Act;
          (6) by redesignating the section headed ``Relation to State 
        laws'' (15 U.S.C. 1693q) as section 921 of the Electronic Fund 
        Transfer Act;
          (7) by redesignating the section headed ``Exemption for State 
        regulation'' (15 U.S.C. 1693r) as section 922 of the Electronic 
        Fund Transfer Act; and
          (8) by redesignating the section headed ``Effective date'' 
        (15 U.S.C. 1693 note) as section 923 of the Electronic Fund 
        Transfer Act.
  (l) Emergency Economic Stabilization Act of 2008.--Section 101(b) of 
the Emergency Economic Stabilization Act of 2008 (12 U.S.C. 5211(b)) is 
amended by striking ``the Director of the Office of Thrift 
Supervision,''.
  (m) Equal Credit Opportunity Act.--The Equal Credit Opportunity Act 
(15 U.S.C. 1691 et seq.) is amended--
          (1) in section 703 (15 U.S.C. 1691b)--
                  (A) in each of subsections (c) and (d), by striking 
                ``paragraph'' each place that term appears and 
                inserting ``subsection''; and
                  (B) in subsection (g), by adding a period at the end;
          (2) in section 704 (15 U.S.C. 1691c)--
                  (A) in subsection (a)--
                          (i) by striking ``Consumer Protection 
                        Financial Protection Act of 2010 with'' and 
                        inserting ``Consumer Financial Protection Act 
                        of 2010, compliance with'';
                          (ii) in paragraph (1)--
                                  (I) by striking ``section 8'' and 
                                inserting ``Section 8''; and
                                  (II) in subparagraph (C), by striking 
                                ``banks;'' and inserting ``banks.'';
                          (iii) in each of paragraphs (6) and (7), by 
                        striking the semicolon at the end and inserting 
                        a period; and
                          (iv) in paragraph (8), by striking ``; and'' 
                        and inserting a period; and
                  (B) in subsection (c), in the second sentence, by 
                striking ``subchapter'' and inserting ``title''; and
          (3) in section 706(k) (15 U.S.C. 1691e(k)), by striking ``, 
        (2), or (3)'' and inserting ``or (2)''.
  (n) Expedited Funds Availability Act.--The Expedited Funds 
Availability Act (12 U.S.C. 4001 et seq.) is amended--
          (1) in section 605(f)(2)(A) (12 U.S.C. 4004(f)(2)(A)), by 
        striking ``,,'' and inserting a semicolon; and
          (2) in section 610(a)(2) (12 U.S.C. 4009(a)(2)), by striking 
        ``Director of the Office of Thrift Supervision'' and inserting 
        ``Comptroller of the Currency and the Board of Directors of the 
        Federal Deposit Insurance Corporation, as appropriate,''.
  (o) Fair Credit Reporting Act.--The Fair Credit Reporting Act (15 
U.S.C. 1681 et seq.) is amended--
          (1) in section 603 (15 U.S.C. 1681a)--
                  (A) in subsection (d)(2)(D), by striking ``(x)'' and 
                inserting ``(y)'';
                  (B) in subsection (q)(5), by striking ``103(i)'' and 
                inserting ``103(j)''; and
                  (C) in subsection (v), by striking ``Bureau'' and 
                inserting ``Federal Trade Commission'';
          (2) in section 604 (15 U.S.C. 1681b)--
                  (A) in subsection (b)--
                          (i) in paragraph (2)(B)(i), by striking 
                        ``section 615(a)(3)'' and inserting ``section 
                        615(a)(4)'';
                          (ii) in paragraph (3)(B)(ii), by striking 
                        ``clause (B)(i)(IV)'' and inserting ``clause 
                        (i)(IV)'';
                          (iii) in paragraph (4)(A)(ii), by inserting 
                        ``and'' after the semicolon; and
                          (iv) by striking ``section 609(c)(3)'' each 
                        place that term appears and inserting ``section 
                        609(c)''; and
                  (B) in subsection (g)(5), by striking ``paragraph 
                (2).--'' and all that follows through ``The Bureau'' 
                and inserting ``paragraph (2).--The Agency'';
          (3) in section 605 (15 U.S.C. 1681c)--
                  (A) in subsection (f), by striking ``who'' and 
                inserting ``which''; and
                  (B) in subsection (h)(2)(A)--
                          (i) by striking ``shall,,'' and inserting 
                        ``shall,''; and
                          (ii) by striking ``Commission,,'' and 
                        inserting ``Commission,'';
          (4) in section 605A(h)(1)(A) (15 U.S.C. 1681c-1(h)(1)(A)), by 
        striking ``103(i)'' and inserting ``103(j)'';
          (5) in section 607(e)(3)(A) (15 U.S.C. 1681e(e)(3)(A)), by 
        striking ``section 604(b)(4)(E)(i)'' and inserting ``section 
        604(b)(4)(D)(i)'';
          (6) in section 609 (15 U.S.C. 1681g)--
                  (A) in subsection (a)(3)(C)(i), by striking ``section 
                604(b)(4)(E)(i)'' and inserting ``section 
                604(b)(4)(D)(i)'';
                  (B) in subsection (c)(1)--
                          (i) in the paragraph heading, by striking 
                        ``Commission'' and inserting ``Bureau''; and
                          (ii) in subparagraph (B)(vi), by striking 
                        ``603(w)'' and inserting ``603(x)'';
                  (C) in subsection (e)(2)(B)(ii)(II), by striking 
                ``an''; and
                  (D) by striking ``The Commission'' each place that 
                term appears and inserting ``The Bureau'';
          (7) in section 610 (15 U.S.C. 1681h)--
                  (A) in subsection (b)(1), by inserting ``section'' 
                after ``under''; and
                  (B) in subsection (e), by inserting a comma after 
                ``on the report'';
          (8) in section 611 (15 U.S.C. 1681i), by striking ``The 
        Commission'' each place that term appears and inserting ``The 
        Agency'';
          (9) in section 612 (15 U.S.C. 1681j)--
                  (A) in subsection (a)(1)--
                          (i) by striking ``(w)'' and inserting 
                        ``(x)''; and
                          (ii) in subparagraph (C), by striking 
                        ``603(w)'' each place that term appears and 
                        inserting ``603(x)'';
                  (B) in subsection (g), by striking ``televison'' and 
                inserting ``television''; and
                  (C) by striking ``The Commission'' each place that 
                term appears and inserting ``The Bureau'';
          (10) in section 621 (15 U.S.C. 1681s)--
                  (A) in subsection (a)(1), in the first sentence, by 
                striking ``, subsection (b)'';
                  (B) in subsection (e)(2), by inserting a period after 
                ``provisions of this title''; and
                  (C) in subsection (f)(2), by striking ``The 
                Commission'' and inserting ``The Agency'' and
          (11) in section 623(a)(5) (15 U.S.C. 1681s-2(a)(5)), by 
        striking ``of accounts.--(A) in general.--A person'' and 
        inserting ``of accounts.--
                  ``(A) In general.--A person''.
  (p) Federal Credit Union Act.--Section 206(g)(7)(D)(iv) of the 
Federal Credit Union Act (12 U.S.C. 1786(g)(7)(D)(iv)) is amended by 
striking the semicolon at the end and inserting a period.
  (q) Federal Deposit Insurance Act.--The Federal Deposit Insurance Act 
(12 U.S.C. 1811 et seq.) is amended--
          (1) in section 3(q)(2)(C) (12 U.S.C. 1813(q)(2)(C)), by 
        adding ``and'' at the end;
          (2) in section 7 (12 U.S.C. 1817)--
                  (A) in subsection (b)(2)--
                          (i) in subparagraph (A), by striking ``(D)'' 
                        and inserting ``(C)''; and
                          (ii) by redesignating subparagraphs (D) and 
                        (E) as subparagraphs (C) and (D), respectively; 
                        and
                  (B) in subsection (e)(2)(C), by adding a period at 
                the end;
          (3) in section 8 (12 U.S.C. 1818)--
                  (A) in subsection (b)(3), by striking ``Act))'' and 
                inserting ``Act)''; and
                  (B) in subsection (t)(2)(C), by striking ``depositors 
                or'' and inserting ``depositors; or'';
          (4) in section 11 (12 U.S.C. 1821)--
                  (A) in subsection (d)(2)(I)(ii), by striking ``and 
                section 21A(b)(4)''; and
                  (B) in subsection (m), in each of paragraphs (16) and 
                (18), by striking the comma after ``Comptroller of the 
                Currency'' each place it appears; and
          (5) in section 26(a) (12 U.S.C. 1831c(a)), by striking 
        ``Holding Company Act'' each place that term appears and 
        inserting ``Holding Company Act of 1956''.
  (r) Federal Fire Prevention and Control Act of 1974.--Section 
31(a)(5)(B) of the Federal Fire Prevention and Control Act of 1974 (15 
U.S.C. 2227(a)(5)(B)) is amended by striking ``the Federal Deposit 
Insurance Corporation'' and all that follows through the period and 
inserting ``or the Federal Deposit Insurance Corporation under the 
affordable housing program under section 40 of the Federal Deposit 
Insurance Act.''.
  (s) Federal Home Loan Bank Act.--The Federal Home Loan Bank Act (12 
U.S.C. 1421 et seq.) is amended--
          (1) in section 10(h)(1) (12 U.S.C. 1430(h)(1)), by striking 
        ``Director of the Office of Thrift Supervision'' and inserting 
        ``Comptroller of the Currency or the Board of Directors of the 
        Federal Deposit Insurance Corporation, as applicable''; and
          (2) in section 22(a) (12 U.S.C. 1442(a))--
                  (A) in the matter preceding paragraph (1), by 
                striking ``Comptroller of the Currency'' and all that 
                follows through ``Supervision'' and inserting 
                ``Comptroller of the Currency, the Chairman of the 
                Board of Governors of the Federal Reserve System, the 
                Chairperson of the Federal Deposit Insurance 
                Corporation, and the Chairman of the National Credit 
                Union Administration''; and
                  (B) in the undesignated matter following paragraph 
                (2), by striking ``Comptroller of the Currency'' and 
                all that follows through ``Supervision'' and inserting 
                ``Comptroller of the Currency, the Chairman of the 
                Board of Governors of the Federal Reserve System, and 
                the Chairman of the National Credit Union 
                Administration''.
  (t) Federal Reserve Act.--Paragraph (8)(B) of section 11(s) of the 
Federal Reserve Act (headed ``Federal Reserve Transparency and Release 
of Information'') (12 U.S.C. 248) is amended by striking ``this 
section'' and inserting ``this subsection''.
  (u) Financial Institutions Reform, Recovery, and Enforcement Act of 
1989.--The Financial Institutions Reform, Recovery, and Enforcement Act 
of 1989 (Public Law 101-73; 103 Stat. 183) is amended in section 
1121(6) (12 U.S.C. 3350(6)), by striking ``the Office of Thrift 
Supervision,''.
  (v) Gramm-Leach-Bliley Act.--The Gramm-Leach-Bliley Act (Public Law 
106-102; 113 Stat. 1338) is amended--
          (1) in section 132(a) (12 U.S.C. 1828b(a)), by striking ``the 
        Director of the Office of Thrift Supervision,'';
          (2) in section 206(a) (15 U.S.C. 78c note), by striking 
        ``Except as provided in subsection (e), for'' and inserting 
        ``For'';
          (3) in section 502(e)(5) (15 U.S.C. 6802(e)(5)), by striking 
        ``a Federal'' and inserting ``, a Federal'';
          (4) in section 504(a)(2) (15 U.S.C. 6804(a)(2)), by striking 
        ``and, as appropriate, and with'' and inserting ``and, as 
        appropriate, with'';
          (5) in section 509(2) (15 U.S.C. 6809(2))--
                  (A) by striking subparagraph (D); and
                  (B) by redesignating subparagraphs (E) and (F) as 
                subparagraphs (D) and (E), respectively; and
          (6) in section 522(b)(1)(A)(iv) (15 U.S.C. 
        6822(b)(1)(A)(iv)), by striking ``Director of the Office of 
        Thrift Supervision'' and inserting ``Comptroller of the 
        Currency and the Board of Directors of the Federal Deposit 
        Insurance Corporation, as appropriate''.
  (w) Helping Families Save Their Homes Act of 2009.--Section 104 of 
the Helping Families Save Their Homes Act of 2009 (12 U.S.C. 1715z-25) 
is amended--
          (1) in subsection (a)--
                  (A) by striking ``and the Director of the Office of 
                Thrift Supervision, shall jointly'' and inserting 
                ``shall'';
                  (B) by striking ``and the Office of Thrift 
                Supervision''; and
                  (C) by striking ``each such'' and inserting ``such''; 
                and
          (2) in subsection (b)(1)--
                  (A) in subparagraph (A)--
                          (i) in the first sentence--
                                  (I) by striking ``and the Director of 
                                the Office of Thrift Supervision,''; 
                                and
                                  (II) by striking ``or the Director'';
                          (ii) in the second sentence, by striking 
                        ``and the Director of the Office of Thrift 
                        Supervision''; and
                  (B) in subparagraph (B), by striking ``and the 
                Director of the Office of Thrift Supervision''.
  (x) Home Mortgage Disclosure Act of 1975.--The Home Mortgage 
Disclosure Act of 1975 (12 U.S.C. 2801 et seq.) is amended--
          (1) in section 304--
                  (A) in subsection (b)(5)(A), by striking ``15 U.S.C. 
                1602(aa)(4)'' and inserting ``section 103(aa)(4) of the 
                Truth in Lending Act''; and
                  (B) in subsection (j)(3) (12 U.S.C. 2803(j)(3)), by 
                adding a period at the end; and
          (2) in section 305(b)(1)(A)(iii) (12 U.S.C. 
        2804(b)(1)(A)(iii)), by striking ``bank as,'' and inserting 
        ``bank, as''.
  (y) Home Owners' Loan Act.--The Home Owners' Loan Act (12 U.S.C. 1461 
et seq.) is amended--
          (1) in section 5 (12 U.S.C. 1464)--
                  (A) in subsection (d)(2)(E)(ii)--
                          (i) in the first sentence, by striking 
                        ``Except as provided in section 21A of the 
                        Federal Home Loan Bank Act, the'' and inserting 
                        ``The''; and
                          (ii) by striking ``, at the Director's 
                        discretion,'';
                  (B) in subsection (i)(6), by striking ``the Office of 
                Thrift Supervision or'';
                  (C) in subsection (m), by striking ``Director's'' 
                each place that term appears and inserting 
                ``appropriate Federal banking agency's'';
                  (D) in subsection (n)(9)(B), by striking 
                ``Director's'' and inserting ``Comptroller's''; and
                  (E) in subsection (s)--
                          (i) in paragraph (1)--
                                  (I) in the matter preceding 
                                subparagraph (A), by striking ``of such 
                                Act)'' and all that follows through 
                                ``shall require'' and inserting ``of 
                                such Act), the appropriate Federal 
                                banking agency shall require''; and
                                  (II) in subparagraph (B), by striking 
                                ``other methods'' and all that follows 
                                through ``determines'' and inserting 
                                ``other methods as the appropriate 
                                Federal banking agency determines'';
                          (ii) in paragraph (2)--
                                  (I) by striking ``determined'' and 
                                all that follows through ``may, 
                                consistent'' and inserting ``determined 
                                by appropriate federal banking agency 
                                case-by-case.--The appropriate Federal 
                                banking agency may, consistent''; and
                                  (II) by striking ``capital-to-
                                assets'' and all that follows through 
                                ``determines to be necessary'' and 
                                inserting ``capital-to-assets as the 
                                appropriate Federal banking agency 
                                determines to be necessary'';
          (2) in section 6(c) (12 U.S.C. 1465(c)), by striking 
        ``sections'' and inserting ``section'';
          (3) in section 10 (12 U.S.C. 1467a)--
                  (A) in subsection (b)(6), by striking ``time'' and 
                all that follows through ``release'' and inserting 
                ``time, upon the motion or application of the Board, 
                release'';
                  (B) in subsection (c)(2)(H)--
                          (i) in the matter preceding clause (i)--
                                  (I) by striking ``1841(p))'' and 
                                inserting ``1841(p)))''; and
                                  (II) by inserting ``(12 U.S.C. 
                                1843(k))'' before ``if--''; and
                          (ii) in clause (i), by inserting ``of 1956 
                        (12 U.S.C. 1843(l) and (m))'' after ``Company 
                        Act''; and
                  (C) in subsection (e)(7)(B)(iii)--
                          (i) by striking ``Board of the Office of 
                        Thrift Supervision'' and inserting ``Director 
                        of the Office of Thrift Supervision''; and
                          (ii) by inserting ``, as defined in section 2 
                        of the Dodd-Frank Wall Street Reform and 
                        Consumer Protection Act (12 U.S.C. 5301)'' 
                        after ``transfer date''; and
          (4) in section 13 (12 U.S.C. 1468b), by striking ``the a'' 
        and inserting ``a''.
  (z) Housing Act of 1948.--Section 502(c)(3) of the Housing Act of 
1948 (12 U.S.C. 1701c(c)(3)) is amended by striking ``Federal Home Loan 
Bank Agency'' and inserting ``Federal Housing Finance Agency''.
  (aa) Housing and Urban Development Act of 1968.--Section 106(h)(5) of 
the Housing and Urban Development Act of 1968 (12 U.S.C. 1701x(h)(5)) 
is amended by striking ``authorised'' and inserting ``authorized''.
  (bb) International Banking Act of 1978.--Section 15 of the 
International Banking Act of 1978 (12 U.S.C. 3109) is amended--
          (1) in each of subsections (a) and (b)--
                  (A) by striking ``, and Director of the Office of 
                Thrift Supervision'' each place that term appears; and
                  (B) by inserting ``and'' before ``Federal Deposit'' 
                each place that term appears;
          (2) in subsection (a), by striking ``Comptroller, 
        Corporation, or Director'' and inserting ``Comptroller of the 
        Currency, or Corporation''; and
          (3) in subsection (c)(4)--
                  (A) by inserting ``and'' before ``the Federal 
                Deposit''; and
                  (B) by striking ``, and the Director of the Office of 
                Thrift Supervision''.
  (cc) International Lending Supervision Act of 1983.--Section 912 of 
the International Lending Supervision Act of 1983 (12 U.S.C. 3911) is 
amended--
          (1) by amending the section heading to read as follows: 
        ``equal representation for federal deposit insurance 
        corporation'';
          (2) by striking ``(a) In General.--''; and
          (3) by striking subsection (b).
  (dd) Interstate Land Sales Full Disclosure Act.--The Interstate Land 
Sales Full Disclosure Act (15 U.S.C. 1701 et seq.) is amended in each 
of section 1411(b) (15 U.S.C. 1710(b)) and subsections (b)(4) and (d) 
of section 1418a (15 U.S.C. 1717a), by striking ``Secretary's'' each 
place that term appears and inserting ``Director's''.
  (ee) Legal Certainty for Bank Products Act of 2000.--Section 
403(b)(1) of the Legal Certainty for Bank Products Act of 2000 (7 
U.S.C. 27a(b)(1)) is amended by striking ``that section'' and inserting 
``section''.
  (ff) Public Law 93-495.--Section 111 of Public Law 93-495 (12 U.S.C. 
250) is amended by striking ``the Director of the Office of Thrift 
Supervision,''.
  (gg) Revised Statutes of the United States.--Section 5136C(i) of the 
Revised Statutes of the United States (12 U.S.C. 25b(i)) is amended by 
striking ``Powers.--'' and all that follows through ``In accordance'' 
and inserting ``Powers.--In accordance''.
  (hh) Riegle Community Development and Regulatory Improvement Act of 
1994.--Section 117(e) of the Riegle Community Development and 
Regulatory Improvement Act of 1994 (12 U.S.C. 4716(e)) is amended by 
striking ``the Director of the Office of Thrift Supervision,''.
  (ii) S.A.F.E. Mortgage Licensing Act of 2008.--Section 1514 of the 
S.A.F.E. Mortgage Licensing Act of 2008 (12 U.S.C. 5113) is amended in 
each of subsections (b)(5) and (c)(4)(C), by striking ``Secretary's'' 
each place that term appears and inserting ``Director's''.
  (jj) Securities Exchange Act of 1934.--The Securities Exchange Act of 
1934 (15 U.S.C. 78a et seq.) is amended--
          (1) in section 3C(g)(4)(B)(v) (15 U.S.C. 78c-3(g)(4)(B)(v)), 
        by striking ``of that Act'' and inserting ``of that section'';
          (2) in section 3D(d)(10)(A) (15 U.S.C. 78c-4(d)(10)(A)), by 
        striking ``taking'' and inserting ``take'';
          (3) in section 3E(b)(1) (15 U.S.C. 78c-5(b)(1)), by striking 
        ``though'' and inserting ``through'';
          (4) in section 4(g)(8)(A) (15 U.S.C. 78d(g)(8)(A)), by 
        striking ``(2)(A)(i)'' and inserting ``(2)(A)(ii)'';
          (5) in section 15 (15 U.S.C. 78o)--
                  (A) in each of subparagraphs (B)(ii) and (C) of 
                subsection (b)(4), by striking ``dealer municipal 
                advisor,,'' and inserting ``dealer, municipal 
                advisor,'';
                  (B) by redesignating subsection (j) (relating to the 
                authority of the Commission) as subsection (p) and 
                moving that subsection to the end;
                  (C) as amended by section 841(d), by redesignating 
                the section subsection (k) and second subsection (l) 
                (relating to standard of conduct and other matters, 
                respectively), as added by section 913(g)(1) of the 
                Dodd-Frank Wall Street Reform and Consumer Protection 
                Act (124 Stat. 1828), as subsections (q) and (r), 
                respectively and moving those subsections to the end; 
                and
                  (D) in subsection (m), by inserting ``the'' before 
                ``same extent'';
          (6) in section 15F(h) (15 U.S.C. 78o-10(h))--
                  (A) in paragraph (2)(A), by inserting ``a'' after 
                ``that acts as an advisor to'';
                  (B) in paragraph (2)(B), by inserting ``a'' after 
                ``offers to enter into''; and
                  (C) in paragraph (5)(A)(i)--
                          (i) by inserting ``(A)'' after ``(18)''; and
                          (ii) in subclause (VII), by striking ``act 
                        of'' and inserting ``Act of'';
          (7) in section 15G (15 U.S.C. 78o-11)--
                  (A) in subsection (b)(2), by inserting ``Board of 
                Directors of the'' before ``Federal Housing'';
                  (B) in subsection (e)(4)(A), by striking 
                ``subsection'' and inserting ``section'';
                  (C) in subsection (e)(4)(C)--
                          (i) by striking ``129C(c)(2)'' and inserting 
                        ``129C(b)(2)(A)''; and
                          (ii) by inserting ``(15 U.S.C. 
                        1639c(b)(2)(A))'' after ``Lending Act''; and
                  (D) in subsection (e)(5), by striking ``subsection'' 
                and inserting ``section''; and
          (8) in section 17A (15 U.S.C. 78q-1), by redesignating 
        subsection (g), as added by section 929W of the Dodd-Frank Wall 
        Street Reform and Consumer Protection Act (relating to due 
        diligence for the delivery of dividends, interest, and other 
        valuable property rights) as subsection (n) and moving that 
        subsection to the end.
  (kk) Telemarketing and Consumer Fraud and Abuse Prevention Act.--
Section 3(b) of the Telemarketing and Consumer Fraud and Abuse 
Prevention Act (15 U.S.C. 6102(b)) is amended by inserting before the 
period at the end the following: ``, provided, however, nothing in this 
section shall conflict with or supersede section 6 of the Federal Trade 
Commission Act (15 U.S.C. 46)''.
  (ll) Title 5.--Title 5, United States Code, is amended--
          (1) in section 3132(a)(1)(D), as amended by section 711, by 
        striking ``the Office of Thrift Supervision,, the Resolution 
        Trust Corporation,''; and
          (2) in section 5314, by striking ``Director of the Office of 
        Thrift Supervision.''.
  (mm) Title 31.--
          (1) Amendments.--Title 31, United States Code, is amended--
                  (A) by striking section 309; and
                  (B) in section 714(d)(3)(B) by striking ``a audit'' 
                and inserting ``an audit''.
          (2) Analysis.--The analysis for subchapter I of chapter 3 of 
        title 31, United States Code, is amended by striking the item 
        relating to section 309.
  (nn) Truth in Lending Act.--The Truth in Lending Act (15 U.S.C. 1601 
et seq.) is amended--
          (1) in section 105 (15 U.S.C. 1604), by inserting subsection 
        (h), as added by section 1472(c) of the Dodd-Frank Wall Street 
        Reform and Consumer Protection Act (124 Stat. 2187), before 
        subsection (i), as added by section 1100A(7) of that Act (124 
        Stat. 2108);
          (2) in section 106(f)(2)(B)(i) (15 U.S.C. 1605(f)(2)(B)(i)), 
        by striking ``103(w)'' and inserting ``103(x)'';
          (3) in section 121(b) (15 U.S.C. 1631(b)), by striking 
        ``103(f)'' and inserting ``103(g)'';
          (4) in section 122(d)(5) (15 U.S.C. 1632(d)(5)), by striking 
        ``section 603)'' and all that follows through ``promulgate'' 
        and inserting ``section 603), may promulgate'';
          (5) in section 125(e)(1) (15 U.S.C. 1635(e)(1)), by striking 
        ``103(w)'' and inserting ``103(x)'';
          (6) in section 129 (15 U.S.C. 1639)--
                  (A) in subsection (q), by striking ``(l)(2)'' and 
                inserting ``(p)(2)''; and
                  (B) in subsection (u)(3), by striking ``Board'' each 
                place that term appears and inserting ``Agency'';
          (7) in section 129C (15 U.S.C. 1639c)--
                  (A) in subsection (b)(2)(B), by striking the second 
                period at the end; and
                  (B) in subsection (c)(1)(B)(ii)(I), by striking ``a 
                original'' and inserting ``an original'';
          (8) in section 148(d) (15 U.S.C. 1665c(d)), by striking 
        ``Bureau'' and inserting ``Board'';
          (9) in section 149 (15 U.S.C. 1665d)--
                  (A) by striking ``the Director of the Office of 
                Thrift Supervision,'' each place that term appears;
                  (B) by striking ``National Credit Union 
                Administration Bureau'' and inserting ``National Credit 
                Union Administration Board'' each place that term 
                appears; and
                  (C) by striking ``Bureau of Directors of the Federal 
                Deposit Insurance Corporation'' and inserting ``Board 
                of Directors of the Federal Deposit Insurance 
                Corporation'' each place that term appears; and
          (10) in section 181(1) (15 U.S.C. 1667(1)), by striking 
        ``103(g)'' and inserting ``103(h)''.
  (oo) Truth in Savings Act.--The Truth in Savings Act (12 U.S.C. 4301 
et seq.) is amended in each of sections 269(a)(4) (12 U.S.C. 
4308(a)(4)), 270(a)(2) (12 U.S.C. 4309(a)(2)), and 274(6) (12 U.S.C. 
4313(6)), by striking ``Administration Bureau'' each place that term 
appears and inserting ``Administration Board''.

                          Purpose and Summary

    Introduced by Chairman Jeb Hensarling on April 26, 2017, 
H.R. 10, the Financial CHOICE Act of 2017 replaces harmful 
provisions of the Dodd-Frank Wall Street Reform and Consumer 
Protection Act (Dodd-Frank Act) (Pub. L. No. 111-203) with free 
market solutions that will grow the economy, end the phenomenon 
of ``too big to fail'' financial institutions, restore the 
Article I powers provided to the Congress, and strengthen tools 
to police fraud and deception. The CHOICE Act also contains key 
reforms to ensure that the Federal Reserve sets effective, 
rules-based monetary policy without political interference, 
while also increasing transparency and accountability for the 
Federal Reserve's regulatory functions.

                  Background and Need for Legislation

    It has been almost seven years since the passage of the 
Dodd-Frank Act. The proponents of the Dodd-Frank Act told us 
that it would lift our economy, but instead the United States 
continues to experience the slowest, weakest, most tepid 
recovery in its history. The economy does not work for working 
people. They have seen their paychecks stagnate. They have seen 
their savings decimated. We have seen millions who remain 
unemployed and underemployed and an economy working at roughly 
half of its potential. The Dodd-Frank Act has imposed more 
regulatory restrictions on the U.S. economy than all other 
Obama-era laws combined.
    There is a better way and it is the Financial CHOICE Act of 
2017. The legislation replaces onerous government fiat with 
market discipline; substitutes bankruptcy for taxpayer-funded 
bailouts; throws a deregulatory life preserver to our community 
financial institutions; replaces complexity with simplicity; 
holds both Washington and Wall Street accountable; and 
unleashes capital formation so the economy can move yet again 
for the betterment of our citizens. The legislation will 
unleash opportunities for economic growth, foster capital 
formation and provide Main Street job creators with regulatory 
relief so more Americans can go back to work, have good careers 
and give their families a better life. Under the Financial 
CHOICE Act there will be economic opportunity for all and bank 
bailouts for none.

         TITLE I--ENDING ``TOO BIG TO FAIL'' AND BANK BAILOUTS

    The problems with a system in which government regulators 
deem certain financial institutions ``too big to fail'' are 
self-evident. First, ``too big to fail'' creates perverse 
incentives: if government officials and regulators in any way 
create the impression that some institutions are ``systemically 
important,'' the inevitable conclusion that market participants 
will draw is that government will likely bail out its creditors 
in an emergency. That implicit guarantee allows the bank to 
borrow more cheaply than its smaller competitors. Second, the 
``too big to fail'' doctrine makes the financial system even 
more fragile, which in turn makes bailouts more likely: the 
prospect of government bailouts makes creditors indifferent to 
the bets that financial institutions are making with the funds 
they borrow, which promotes moral hazard and further increases 
risk in the financial system. Third, ``too big to fail'' 
violates the basic tenets of a free enterprise system. It 
interrupts the normal operation of markets and rewards the 
imprudent and reckless while punishing the prudent and 
productive; it undermines equal treatment and the Rule of Law 
by privatizing profits and socializing losses; and it 
undermines public faith in the economic system by failing to 
hold businesses and individuals accountable for the 
consequences of their actions. But far from ending bailouts, 
the Dodd-Frank Act institutionalized them and made them a 
permanent feature of the regulatory toolkit, in the form of the 
``Orderly Liquidation Authority'' set forth in Title II of the 
Act.
    If we learned nothing else from the financial crisis, it is 
that federal subsidies of the financial sector promote moral 
hazard and expose taxpayers to an unacceptable risk of loss. So 
long as market participants perceive that regulators and 
politicians have the legal wherewithal to ride to their rescue 
in times of crisis, they will be tempted to engage in the kind 
of reckless behavior that makes the financial system more 
fragile than it otherwise would be, which in turn makes it more 
likely that regulators will not only face a financial crisis 
but will once again resort to extraordinary measures to avoid 
it. The solution to this problem is to make it clear to market 
participants in advance that they alone will bear the 
consequences of the risks they choose to undertake. In order to 
end ``too big to fail'' and prevent future taxpayer bailouts of 
financial firms, the Financial CHOICE Act implements the 
following five policy changes:
    1. Repeal Title II's ``Orderly Liquidation Authority'' 
(OLA);
    2. Replace OLA with a new chapter of the federal bankruptcy 
code designed to accommodate the failure of a large, complex 
financial institution (H.R. 1667, the Financial Institution 
Bankruptcy Act of 2017);
    3. Prohibit the future use of the Exchange Stabilization 
Fund to bail out a financial firm or its creditors.
    4. Repeal the FDIC's authority to establish a widely 
available program to guarantee obligations of banks during 
times of severe economic stress; and
    5. Repeal the authority vested in the Financial Stability 
Oversight Council by Titles I and VIII of the Dodd-Frank Act to 
designate certain financial organizations as ``too big to 
fail,'' and rescinding previous FSOC designations.
    The Republican preference for bankruptcy over bailouts is 
grounded in three fundamental principles: First, the bankruptcy 
process is administered through the judicial system, by 
impartial bankruptcy judges charged by the Constitution to 
guarantee due process in public proceedings under well-settled 
rules and procedures. It is a process that is faithful to this 
country's belief in the Rule of Law. By contrast, the Dodd-
Frank's ``Orderly Liquidation Authority'' places vast amounts 
of discretion in a handful of unelected bureaucrats to seize an 
institution and wind it down, paying off some creditors in full 
and imposing losses on others, in a process that takes place 
behind closed doors and that effectively cannot be challenged 
by the institution, its creditors, or the public.
    Second, the bankruptcy process provides a certainty that 
the ``Orderly Liquidation Authority'' lacks. Management, 
shareholders, creditors, and--most importantly--market 
participants understand how the firm will be treated in 
bankruptcy, based upon centuries of well-settled legal 
precedents. Under the ``Orderly Liquidation Authority,'' the 
best that anyone can do is to surmise what the FDIC might do. 
And while the FDIC has sought to provide certainty about how it 
might resolve a firm under Title II by issuing its ``Single 
Point of Entry'' proposal, the FDIC has been clear that the 
``Single Point of Entry'' is a strategy that it might--or might 
not--follow. That lack of certainty re-creates the dangerous ad 
hoc rescue policies that were in place in the fall of 2008, and 
which precipitated the financial crisis. Bankruptcy provides 
certainty, and with it financial stability. Title II preserves 
the regulators' unfettered discretion, and with it, the same 
dangerous uncertainty that roiled financial markets and brought 
them down in 2008.
    Indeed, the decision whether to invoke the ``Orderly 
Liquidation Authority'' in the first place--as opposed to 
placing a large firm in bankruptcy--is entirely within the 
discretion of the regulators, subject to very limited judicial 
review, which is itself a huge source of uncertainty. As former 
Comptroller of the Currency John Dugan put it, ``It's hard to 
tell people exactly what's going to happen because we're 
saying, Well, it might be bankruptcy and it might not.''' In 
the words of noted financial analyst Josh Rosner in testimony 
before the Financial Services Committee, ``[i]t is very 
problematic if the same institution has the possibility of 
going through two different insolvency regimes, depending on 
the whim of regulators.''
    Third, and most importantly, bankruptcy does not depend on 
taxpayer-provided funds to bail out, liquidate, or reorganize a 
failing institution. Rather than learning from the mistakes 
that the government made in using government funds to bail out 
Bear Stearns, AIG, and host of other large financial 
institutions, the ``Orderly Liquidation Authority'' embraces 
that strategy and explicitly makes the taxpayer the source of 
funding to pay for the reorganization of a large financial 
institution by way of the ``Orderly Liquidation Fund,'' a 
facility that exists not to ``liquidate'' an insolvent 
institution, but to reorganize it by paying off its creditors 
and counterparties, just as the Federal Reserve did when it 
bailed out AIG.
    By contrast, the bankruptcy code does not provide 
government officials with a taxpayer-backed pot of money to 
wind down or reorganize a failing institution. Under the 
bankruptcy code, those funds come not from the government or 
the taxpayer but from the private sector. As a result, 
bankruptcy forces losses upon the creditors of the failing 
institution, rather than taxpayers. By committing government to 
bankruptcy as the method of resolving insolvent firms--rather 
than bailing out creditors of these firms--implicit government 
guarantees are ended, counterparty discipline is strengthened, 
and more vigilant due diligence is encouraged before a large 
firm becomes insolvent and bankruptcy is initiated.
    Because government commits to bankruptcy rather than 
bailout before a large firm becomes insolvent, creditors will 
become more careful about extending credit to large firms, 
knowing that they will bear the costs of failure and therefore 
limiting their exposure to these firms. Moreover, large firms 
will likely become smaller, because the credit they obtain is 
now priced according to their risk of failure, rather than the 
implicit government-guarantee backing a firm that is ``too big 
to fail.'' As a result, failure--when it does happen--will be 
more easily contained and less destabilizing.
    Another bailout title of the Dodd-Frank Act, which received 
little discussion prior to its inclusion in the law is Title 
VIII, which authorizes the FSOC to designate CCPs and payment 
systems as ``systemically important financial market 
utilities,'' or FMUs. However, Title VIII must be read in 
conjunction with Title VII of Dodd-Frank, which governs the 
regulation of the over-the-counter derivatives (OTC) market.
    Title VII of the Dodd-Frank Act required that certain 
standardized OTC derivatives contracts be cleared through 
central clearinghouses (CCPs) in order to mitigate systemic 
risk. This troublesome concentration of risk is compounded by 
the decision of Dodd-Frank's drafters to anoint CCPs as the 
next generation of ``too big to fail'' firms. While experts 
disagree on whether increased reliance upon CCPs amplifies 
rather than mitigates systemic risk, there is broad agreement 
that designating these organizations as ``systemically 
important'' and granting them immediate access to the Fed 
discount window increases financial instability by creating the 
perception that they are ``too big to fail.'' As New York Times 
columnist Gretchen Morgenson put it, ``these large and 
systemically important financial utilities that together trade 
and clear trillions of dollars in transactions appear to have 
won the daily double--access to federal money, without the 
accountability.''
    The legislative history of the Dodd-Frank Act shows that at 
least some proponents of the Dodd-Frank Act recognized the 
danger of expanding the safety net to include FMUs. Even former 
Chairman Barney Frank saw the hazards of creating a new 
category of ``too big to fail'' institutions. During the 
Financial Services Committee's markup of financial reform 
legislation in 2009, Republicans offered an amendment to strike 
the FMU provision from the bill. Rather than defend the 
provision, Chairman Frank supported the Republican amendment to 
strike it, describing the attempt to expand the Fed's 
regulatory fiefdom as ``an example of overreach on the part of 
some for the Federal Reserve.'' But the FMU provision reemerged 
in the Senate's version of the financial reform bill, 
ultimately making it into the Dodd-Frank conference report that 
was signed into law.
    Title I of the Financial CHOICE Act also repeals the 
authority of the FSOC to designate non-bank financial companies 
as systemically important financial institutions or SIFIs; 
retroactively repeals its previous designations of certain non-
bank financial companies; repeals the FSOC's related authority 
to designate particular financial activities for heightened 
prudential standards or safeguards, which includes the power to 
mandate that an activity be conducted in a certain way or be 
prohibited altogether; and repeals the FSOC's authority to 
break up a large financial institution if the Federal Reserve 
finds that the firm ``poses a grave threat to the financial 
stability of the United States.'' more fundamental problem 
exists with respect to Dodd-Frank's nonbank SIFI regime. Under 
the Financial CHOICE Act, the FSOC would continue to serve as 
an inter-agency forum to:
    (1) monitor market developments;
    (2) facilitate information-sharing and regulatory 
coordination;
    (3) bring the primary federal regulators together with the 
goal of identifying and mitigating risks to financial 
stability; and
    (4) report to Congress on those risks and making policy 
recommendations to address them.
    But the FSOC would be required to operate with a higher 
degree of transparency and inclusiveness than in it has the 
past, through the following reforms:
     The FSOC would be subject to both the ``Government 
in the Sunshine Act'' and the Federal Advisory Committee Act;
     All of the members of the commissions and boards 
represented on the FSOC--such as the SEC, the Federal Reserve, 
Federal Deposit Insurance Corporation, the Commodity Futures 
Trading Commission and the National Credit Union 
Administration--would be permitted to attend and participate in 
the FSOC's meetings;
     Before the principal of a Commission or Board 
represented on the FSOC votes as an FSOC member on an issue 
before the FSOC, the Commission or Board would have to vote on 
the issue, and the principal would have to abide by the results 
of that vote at the FSOC meeting; and
     Members of certain congressional committees would 
be permitted to attend all FSOC meetings, whether or not the 
meeting is open to the public.
    This title also repeals the Office of Financial Research 
(OFR). By driving regulators towards a homogenized assessment 
of financial system threats, the OFR contributes to a ``one-
world view'' of risk that has had such disastrous consequences 
in Basel and other regulatory contexts. Eliminating the OFR 
would actually improve risk management by encouraging diverse 
perceptions of risk and risk management strategies. There are 
countless other federal agencies--most notably the Federal 
Reserve, which maintains a ``Division of Financial Stability'' 
and employs over 300 PhD economists--that perform market 
surveillance and collect and analyze data for purposes of 
identifying threats to financial stability. Eliminating the OFR 
will result in one less redundant federal bureaucracy.
    In an effort to inject badly needed accountability, 
transparency, and targeted relief into the living will and 
stress test processes, the Financial CHOICE Act makes a number 
of important reforms. For banking organizations that do not 
make a qualifying capital election under Title VI and continue 
to submit living wills, the Financial CHOICE Act:
    (1) provides that ``living wills'' can only be requested by 
a banking agency once every two years;
    (2) requires the banking agencies to provide feedback on 
``living wills'' to banking organizations within six months of 
their submission; and
    (3) requires the banking agencies to publicly disclose 
their assessment frameworks.
    In addition, the Financial CHOICE Act would overhaul the 
current regime for stress testing banks, by:
    (1) requiring the Federal Reserve to issue regulations, 
after providing for notice and comment, that provide for at 
least three different sets of conditions under which the 
evaluation required by Section 165 of the Dodd-Frank Act (or 
under the Federal Reserve's rules implementing stress testing 
requirements) will be conducted, including baseline, adverse, 
and severely adverse, and methodologies, as well as models to 
estimate losses on certain assets;
    (2) requiring the Federal Reserve to provide copies of such 
regulations to the GAO and the Panel of Economic Advisors of 
the Congressional Budget Office before publishing such 
regulation; and
    (3) requiring the Federal Reserve to publish a summary of 
all stress test results.
    Additionally, the Financial CHOICE Act will make the 
company-run stress test an annual exercise, move the Federal 
Reserve's Comprehensive Capital Analysis and Review (CCAR) to a 
biennial process, and extend the Federal Reserve's regulatory 
relief from CCAR's qualitative assessment to all banks. 
Further, the Financial CHOICE Act will provide much needed 
transparency to the Federal Reserve's stress tests consistent 
with findings in the GAO report.
    Further, Title I improves the requirements for banking 
entities to hold capital against ``operational risk.'' All 
banking organizations should adopt written policies and 
procedures to identify and manage operational risk that is 
appropriate based on their size, activities, and product 
offerings. To require banking organizations, however, to hold 
operational risk capital against former activities is an 
unnecessary restraint and the Financial CHOICE Act limits the 
imposition of operational risk capital requirements to a bank's 
current activities and businesses and permits adjustments for 
operational risk mitigants.

          TITLE II--DEMANDING ACCOUNTABILITY FROM WALL STREET

    Because both Wall Street and Washington must be held 
accountable if future financial melt-downs are to be averted, 
the Financial CHOICE Act increases penalties for violations of 
the securities laws for individuals and entities, but couples 
those increases with important reforms to the SEC's enforcement 
program designed to promote the Rule of Law and ensure due 
process. The vigorous enforcement of the federal securities 
laws is paramount and the SEC must have the tools it needs to 
deter and punish wrongdoing and, whenever possible, to make 
defrauded investors whole. Many of the civil monetary penalties 
administered by the SEC are based on a three-tiered structure, 
in which the severity of the penalty increases according to the 
gravity of the offense.
    The SEC previously expressed concern that the current 
statutory authorities limit their ability to pursue penalties 
and influence the structure of settlement agreements. To 
address these concerns, the Financial CHOICE Act significantly 
increases the SEC's civil penalty authority, as well as 
criminal sanctions under the federal securities laws, for the 
most serious offenses. It increases the first and second tier 
penalties, and nearly doubles the penalty amounts for third-
tier offenses--those involving substantial losses for the 
victim or substantial pecuniary gain for the offender--for both 
individuals and corporations. Additionally, the Financial 
CHOICE Act establishes a new fourth tier for recidivist 
offenders that allows for damages that are triple otherwise 
maximum monetary penalties. It also significantly increases the 
criminal penalties for individuals for insider trading and 
other corrupt practices. Overall, the Republican approach 
allows the SEC Enforcement Division and the Department of 
Justice to pursue the worst offenders with stronger penalty 
authority than was provided for in the Dodd-Frank Act, which 
will have a deterrent effect on corporate executives 
considering stepping over the line.

   TITLE III--DEMANDING ACCOUNTABILITY FROM FINANCIAL REGULATORS AND 
                  DEVOLVING POWER AWAY FROM WASHINGTON

    The Constitution envisioned a system of checks and balances 
whereby power would be distributed among three distinct 
branches of government. Financial regulators instead exercise 
the powers of all three branches of government, aided by Dodd-
Frank provisions that have largely immunized them from 
accountability to Congress, the President, and the courts. The 
Dodd-Frank Act erodes basic Rule of Law principles and produces 
unnecessarily costly regulations--which harm job creation and 
limit economic opportunity--by devolving enormous power to 
unaccountable and unelected agency bureaucrats. Only by 
restoring the Constitutional separation of powers and 
reclaiming its legislative authority can Congress restore 
accountability and democratic control over federal agencies and 
ensure the financial regulatory process is accountable, fair, 
and efficient. The Financial CHOICE Act aims to restore the 
checks and balances the Constitution established between the 
branches of government. In an effort to stem the considerable 
economic damage being done by Dodd-Frank--as well as restore 
the proper balance of power between the executive and 
congressional branches of government--the Financial CHOICE Act 
incorporates the provisions of the Regulations from the 
Executive in Need of Scrutiny (REINS) Act legislation 
previously passed by the House (H.R. 26). The REINS Act 
requires Congress to pass, and the President to sign, a joint 
resolution of approval for all major regulations before they 
are effective. Major regulations are those that produce $100 
million or more in impacts on the U.S. economy, spur major 
increases in costs or prices for consumers, or have certain 
other significant adverse effects on the economy. These 
provisions will provide much-needed congressional oversight of 
and accountability for the burdensome major rules that are 
weighing down our economy with billions of dollars in 
compliance costs.
    A fundamental tenet of sound regulatory practice is that 
the benefits of a proposed regulation should, as a general 
matter, outweigh the costs that such regulation imposes on 
society. Yet the federal financial regulators have historically 
conducted ineffective economic analysis of proposed rules, when 
they conduct it at all, and have refused to change course even 
after a regulation has been proven to be too costly. The 
Financial CHOICE Act will increase regulatory transparency and 
accountability in the rulemaking process by putting in place 
economic analysis requirements for all financial regulators. 
Specifically, when proposing a rule, regulators must include an 
assessment of the rule's need and conduct a rigorous economic 
analysis of its quantitative and qualitative impacts. 
Regulators must allow at least 90 days for notice and comment 
on a proposed rule and publicly release the data underlying 
their analyses. If the rule's costs are determined to outweigh 
its benefits, the regulators will be prohibited from finalizing 
the rule absent an express authorization from Congress.
    The Financial CHOICE Act also strengthens retrospective 
review requirements--another regulatory best practice. Within 
five years of a new rule's implementation, the regulator must 
also complete an analysis that examines the economic impact of 
the rule, including its direct and indirect costs. The 
Financial CHOICE Act also directs regulators to conduct 
retrospective reviews of previous rules every five years to 
modify, streamline, expand, or repeal existing regulations.
    Additionally, the legislation creates a Chief Economist 
Council comprised of the chief economists from each of the 
financial regulatory agencies, which will meet quarterly. The 
Council will be required to conduct a review and report on the 
costs and benefits of all financial regulations released in the 
previous year. It also will report on the cumulative effects of 
regulations finalized within the same timeframe.
    To return to a Constitutional structure and create agency 
accountability, Congress must reclaim its ``power of the 
purse''--one of the most potent tools the Constitution gives 
Congress for conducting oversight of federal agencies and 
implementing real reforms. This tool is needed now more than 
ever before. There can be no ``consent of the governed'' if the 
American people, through their democratically elected 
representatives, have no say in how their government spends 
their hard-earned dollars. To reassert Congress' power of the 
purse, the Financial CHOICE Act calls for all of the federal 
financial regulatory agencies--including the CFPB and the 
FSOC--to be funded through the Congressional appropriations 
process. This will allow Congress to ensure that these agencies 
use their funding effectively and transparently to fulfill 
their missions of protecting consumers and investors.
    The Financial CHOICE Act also addresses concerns with the 
so-called ``Chevron doctrine.'' In far too many instances in 
recent years, federal courts have refused to fulfill their 
Constitutional responsibility to interpret and apply the laws 
as Congress has written them, contributing to the unchecked 
expansion of federal agencies' powers. This trend began in 
earnest with the 1984 case of Chevron v. Natural Resources 
Defense Council. Under the ``Chevron doctrine'' or ``Chevron 
deference'' established in that case, if there is ambiguity in 
how to interpret a statute, courts must accept an agency's 
interpretation of a law unless it is arbitrary or manifestly 
contrary to the statute. In fact, the Supreme Court ruled in 
the 2013 case City of Arlington v. FCC that courts must even 
defer to an agency's interpretation of the laws that establish 
the agency's own jurisdiction. Because of these court rulings, 
agencies now have virtually unfettered power to expand the 
scope of their own authority by regulatory fiat. And, courts 
also defer to agency interpretations of their own rules and 
regulations. The Dodd-Frank Act went still further, instructing 
courts to grant heightened deference to the CFPB.
    This pattern of regulatory overreach is why Congress must 
eliminate the ``Chevron doctrine'' and hold the judicial branch 
to its Constitutional responsibilities. Unelected bureaucrats 
now decide what and who they can regulate, and how to regulate, 
with only the flimsiest of limitations on how far they can go 
in stretching and torturing the meaning of the laws written by 
Congress. Until both Congress and the courts uphold their end 
of the bargain to fulfill their Constitutional 
responsibilities, the administrative state will continue to 
grow in power and shrink in accountability, to the detriment of 
the American people. Therefore, the Financial CHOICE Act 
repeals the ``Chevron doctrine'' for federal financial 
regulators, after two years, requiring courts to review their 
rules de novo.
    Finally, the Financial CHOICE Act makes additional changes 
to bring greater transparency and accountability to financial 
regulatory agencies. Specifically, the bill requires that they 
provide notice and opportunity for comment on international 
standard setting negotiations and agreements, undertake greater 
analysis of their rules' impact on state and local governments 
and private entities, similar to the Unfunded Mandates Reform 
Act, requires they implement policies and procedures to 
minimize duplication of investigations and enforcement actions, 
prohibits settlement payments to non-victim third parties, and 
institutes criminal penalties for the unauthorized disclosure 
of sensitive, market-moving information and regulatory 
determinations.

 TITLE IV--UNLEASHING OPPORTUNITIES FOR SMALL BUSINESSES, INNOVATORS, 
           AND JOB CREATORS BY FACILITATING CAPITAL FORMATION

    Congress entrusted the SEC with a three-part statutory 
mission in overseeing the U.S. capital markets: to protect 
investors; maintain fair, orderly, and efficient markets; and 
facilitate capital formation. Unfortunately, the Dodd-Frank 
Act's answer to the financial crisis was to burden the SEC with 
myriad responsibilities, many of which were unrelated to its 
statutory mission. Because these extraneous responsibilities 
make it harder for the SEC to meet its statutory 
responsibilities, Congress has the responsibility to either 
amend or repeal the provisions in the Dodd-Frank Act that not 
only divert the SEC from its statutory mission but also force 
the SEC to expend valuable resources on activities that do not 
benefit capital markets or investors.
    Since 2010, the SEC has devoted thousands of man-hours and 
millions of dollars to finish rules mandated by the Dodd-Frank 
Act that neither address the causes of the financial crises nor 
advance the SEC's statutory mission. For example, rather than 
devote time and resources to rules that would protect investors 
or facilitate capital formation, the SEC has instead focused 
its efforts on rules to require public companies to make 
confusing and immaterial disclosures relating to, for example, 
conflict minerals, resource extraction, and CEO pay ratios. The 
Dodd-Frank Act has accelerated a troubling trend in which the 
securities laws have been hijacked by those more interested in 
scoring political points than enhancing capital markets or 
investor protection.
    Although small companies are at the forefront of 
technological innovation and job creation, they frequently face 
obstacles in obtaining funding in the capital markets. These 
obstacles are often attributable to the proportionately larger 
burden that securities regulations--written for large public 
companies--place on small companies when they seek to go 
public. The Jumpstart Our Business Startups Act--popularly 
known as the JOBS Act--makes it easier for smaller companies to 
access capital markets. Signed into law on April 5, 2012, the 
bipartisan JOBS Act consists of six bills that originated in 
the Financial Services Committee that help small companies 
obtain access to capital markets by lifting the burden of 
certain securities regulations. By helping small companies 
obtain funding, the JOBS Act facilitates economic growth and 
job creation. It does this by encouraging the SEC to expand its 
mission beyond its traditional approach to securities 
regulation.
    This title of the Financial CHOICE Act includes numerous 
provisions--many of them strongly bipartisan--to further 
capital formation. Specifically, the legislation will modernize 
the regulatory regime for business development companies (BDCs) 
to allow them to amplify financing for small and medium-size 
businesses at a time when these companies are struggling to 
access capital to support growth and job creation. It will 
facilitate the creation of venture exchanges to encourage 
smaller companies to access capital in the public markets, with 
the potential to create millions of jobs. It will expand 
provisions of the JOBS Act helping companies offer securities 
in a public offering. It will eliminate onerous and unnecessary 
regulatory burdens on smaller public and private companies that 
are restricting their ability to access capital to grow and 
create jobs. And it will require the SEC to consider the 
recommendations of its Forum on Small Business Capital 
Formation, and outline what, if any, action the SEC intends to 
take to implement those recommendations, thereby ensuring the 
SEC no longer neglects its statutory mission.

  TITLE V--REGULATORY RELIEF FOR MAIN STREET AND COMMUNITY FINANCIAL 
                              INSTITUTIONS

    While sold to the American public as ``Wall Street 
reform,'' the Dodd-Frank Act's most pernicious effects have 
been felt on Main Street, among community-based financial 
institutions and the customers they serve. Dodd-Frank's slew of 
new regulatory mandates disproportionately harms smaller 
institutions that lack the personnel and financial resources of 
larger firms, and ultimately results in a less competitive 
marketplace, as smaller institutions overwhelmed by the volume 
and complexity of regulations are forced to exit business lines 
or seek to merge with other institutions. The end results for 
consumers are fewer and more expensive borrowing choices and 
reduced upward mobility--particularly for those economically 
disadvantaged groups that have historically had the most 
difficulty accessing credit.
    Multiple studies and surveys have documented the 
destructive effect of excessive regulation on the ability of 
community financial institutions to meet the needs of their 
customers. For example, a February 2017 paper by researchers at 
the University of Maryland examined the effects of Dodd-Frank 
on mortgage originations. They found that while ``Dodd-Frank 
aimed at reducing mortgage fees and abuses against vulnerable 
borrowers,'' the lending regulations of Dodd-Frank actually 
``triggered a substantial redistribution of credit from the 
middle-class households to wealthy households.'' They also 
found that while ``[p]roponents of regulation aim to help 
vulnerable consumers,'' in fact the same regulators 
``underestimate the fact that lenders are private organizations 
competing in a free market, and hence they react to the 
incentives regulation creates based on their own objective 
function.'' Ultimately, ``in the case of Dodd-Frank, middle 
class households did not obtain cheaper mortgages, but were cut 
out of the mortgage market altogether.''
    Compliance with new regulations is expensive. After a 
regulation has been finalized, an institution must hire lawyers 
to review its procedures and forms to ensure that it complies 
with the regulation; coordinate its compliance activities and 
design internal audit programs; train its employees; buy 
additional information technology; design, print, and mail new 
forms and other disclosures; monitor its employees' compliance 
with new rules; and make records and employees available for 
regulatory examinations. These expenses exact a higher toll on 
smaller institutions than they do larger ones.
    The Financial CHOICE Act includes a host of reforms to 
address the plight of consumers finding it increasingly 
difficult to access affordable credit and community financial 
institutions unable to offer the products and services that 
those consumers demand. The goal is to free community financial 
institutions from unnecessarily burdensome regulations so that 
they can offer customers the personalized level of service that 
is the hallmark of the relationship-based lending model.
    Like community banks, America's credit unions did not cause 
the financial crisis, but are nonetheless caught in Dodd-
Frank's regulatory cross-hairs. They, too, receive significant 
regulatory relief under the Financial CHOICE Act. In addition 
to benefiting from many of the same reforms applicable to 
community banks (described above), credit unions will be 
afforded relief unique to their charter. Additionally, the 
Financial CHOICE Act requires the National Credit Union 
Administration (NCUA), which regulates federally insured credit 
unions, to hold annual budget hearings that are open to the 
public, and also requires the inclusion in each annual budget 
of a report detailing the NCUA's ``overhead transfer rate.''

  TITLE VI--REGULATORY RELIEF FOR STRONGLY CAPITALIZED, WELL MANAGED 
                         BANKING ORGANIZATIONS

    As the enormous costs and economic harm from the Dodd-Frank 
Act and other post-crisis regulatory initiatives have come into 
sharper relief, a consensus has begun to emerge that there has 
to be a better approach to financial regulation, one that 
prizes simplicity over needless complexity, and market 
discipline over regulatory arbitrage and central planning.
    Under the Financial CHOICE Act, banking organizations that 
maintain a leverage ratio of at least 10 percent, at the time 
of the election, may elect to be exempted from a number of 
regulatory requirements, including the Basel III capital and 
liquidity standards and the ``heightened prudential standards'' 
applicable to larger institutions under section 165 of the 
Dodd-Frank Act. The CHOICE Act thus offers financial 
institutions of all shapes and sizes a Dodd-Frank ``off-
ramp''--freedom from an overly burdensome and highly intrusive 
regulatory regime in exchange for maintaining significantly 
higher capital than is required by current law and regulation.
    The leverage ratio used to assess capital adequacy under 
the Financial CHOICE Act is more stringent than the risk-based 
capital regime traditionally favored by global banking 
regulators and embodied in the successive iterations of the 
Basel capital accord. Unlike Basel's risk-weighted capital 
requirements, a leverage ratio measures a bank's capital 
against its total assets, without incorporating subjective 
regulatory judgments about the relative riskiness of those 
assets. Apologists for the Basel status quo can be expected to 
argue that by treating all assets the same for capital 
purposes, a leverage ratio is too blunt an instrument, because 
there is no ``penalty'' for holding risky assets if those 
assets are not adjusted for relative risk. Far better, they 
say, to trust regulators to carefully calibrate the risk 
weights on specific asset classes so that banks do not gorge 
themselves on highly speculative investments in search of 
higher returns.
    By relying upon a simple leverage ratio, which measures 
shareholder equity available to absorb losses from total 
balance sheet and some off-balance sheet assets, the Financial 
CHOICE Act substitutes simplicity and market discipline for the 
complexity and unfettered regulatory discretion embodied by the 
Basel regime. FDIC Vice Chairman Hoenig, who has spent 
virtually his entire career in bank supervision, has argued 
that a leverage ratio approach will yield a more effective, 
more efficient, and more cost-effective supervisory regime than 
one in which regulators spend endless hours calibrating risk 
weights and policing banks' calculations of their risk-adjusted 
capital ratios: ``From a supervisory program perspective, 
moving away from risk-based capital measures toward an 
assessment of adequacy based on tangible equity would generate 
more reliable information from which to make supervisory 
judgments and would free up billions of dollars from 
supervision budgets currently spent waiting for, understanding, 
and implementing risk-based measures.''
    Had the leverage ratio approach proposed by the Financial 
CHOICE Act been in place prior to the financial crisis--instead 
of Basel's risk-based capital regime--much of the economic 
carnage from that crisis could have been avoided, as banks 
would have lacked incentives to herd into risky mortgage-backed 
securities and sovereign debt.
    Banks that make the capital election available under the 
Financial CHOICE Act will do so only if they believe it will 
create more value for their customers and investors. Moreover, 
electing banks will not only do better for themselves, they 
will contribute to a less fragile financial sector and more 
dynamic economy. Indeed, electing banks will reduce risks to 
taxpayers, who serve as the real lenders of last resort under 
the current system. Finally, by putting more of their own money 
to work in the real economy, and wasting less on compliance 
with regulatory diktats from Washington, electing banks will 
increase productivity in an economy that continues to suffer 
through the slowest economic recovery in the post-World War II 
era.
    A less leveraged, less highly concentrated banking sector, 
combined with a simplified regulatory scheme and a repeal of 
Dodd-Frank's taxpayer bailout mechanisms, will produce a 
financial system that is far less susceptible to destabilizing 
panics than the system we had prior to 2008. Investors and 
creditors will allocate capital and price risk based upon the 
state of a firm's balance sheet and the strength of its 
management, not their assessment of the likelihood that its 
failure will prompt government intervention to protect those 
investors and creditors. The Financial CHOICE Act's solution is 
not to expunge all risk from the financial system and turn 
banks into functional utilities. Rather, it is to confront bank 
management, shareholders, and creditors with the full 
consequences of their decisions (both good and bad), to ensure 
that the market rewards both effective risk management and 
prudent risk-taking, and to make good on Dodd-Frank's broken 
promise to taxpayers that they will never again be asked to 
pick up the tab for mistakes made on Wall Street or in 
Washington.

   TITLE VII--EMPOWERING AMERICANS TO ACHIEVE FINANCIAL INDEPENDENCE

    Title X of the Dodd-Frank Act established the Bureau of 
Consumer Financial Protection for the purpose of implementing 
and enforcing federal consumer financial law while ensuring 
that consumers have access to financial products and services, 
and warranting fair, transparent, and competitive markets for 
such services and products. Under the Dodd-Frank Act, the 
Bureau can issue rules, examine certain institutions, and 
enforce consumer protection laws and regulations. The Consumer 
Financial Protection Bureau is not accountable to Congress or 
the American people. The Bureau's policies often harm consumers 
or exceed its legal authority because the Bureau is not subject 
to checks and balances that apply to other regulatory agencies. 
The Bureau symbolizes a paternalistic approach to consumer 
protection that empowers bureaucrats while denying consumers 
access to financial products and services they want and need. 
The Financial CHOICE Act will increase accountability by 
changing the Bureau's governance and funding mechanism, and 
promote real consumer protection by putting power where it 
belongs: in the hands of consumers, not Washington bureaucrats.
    The Financial CHOICE Act remedies the defects in the 
Bureau's design in a number of ways, providing accountability 
to Congress and ensuring that the Bureau will benefit--rather 
than harm--consumers. The Act begins by renaming the Bureau to 
reflect its mission of protecting consumer opportunity: the 
Consumer Law Enforcement Agency (CLEA). The Financial CHOICE 
Act provides accountability to the Agency's Director by making 
him or her removable by the President at will, and brings the 
Agency's structure into conformity with the Constitution. The 
Act additionally subjects the agency to the congressional 
appropriations process, providing oversight and accountability.
    The Financial CHOICE Act reforms the Agency's statutory 
mandate to ensure that it takes into account, and seeks to 
promote, robust market competition, while it simultaneously 
refocuses the Bureau on its responsibility to conduct robust 
and effective civil enforcement of consumer protection 
statutes. By restructuring the Agency as a civil enforcement 
agency, the Act ensures the Agency has the same effective tools 
to enforce the consumer protection statutes as those the 
Federal Trade Commission has successfully utilized for decades.
    The Financial CHOICE Act also provides courts with enhanced 
authority to correct any erroneous interpretation made by the 
Agency of its own legal authority. It requires that the Bureau 
complete comprehensive cost-benefit analysis before adopting 
regulations, and affords Congress the opportunity to approve 
significant Agency regulations before they take effect. It 
repeals the CFPB's standard-less authority to deny consumers 
access to any financial product and service it declares 
``unfair, deceptive, or abusive.'' And, the CHOICE Act removes 
the Agency's ability to make rules that unilaterally expand its 
own authority to regulate markets Congress did not expressly 
authorize.
    Effective consumer protection requires policing markets for 
fraud and deception while promoting competition and choice 
among financial products and services, ultimately advancing the 
goal of financial inclusion. By creating checks-and-balances 
for the Agency's operations, the Financial CHOICE Act achieves 
these goals and shields consumers from further harm under Dodd-
Frank's command-and-control economy.
    The Durbin Amendment, which was inserted into the Dodd-
Frank Act without adequate congressional deliberation, is a 
price-fixing scheme that picks winners and losers in the 
marketplace. When a customer uses a credit or debit card to pay 
for goods or services at a merchant, the merchant's bank pays 
the customer's bank an ``interchange fee'' for purchases that 
use a card network such as Visa and MasterCard. These fees are 
set by the credit card networks, and are the biggest part of 
the fees that merchants pay for the privilege of accepting 
credit cards. Interchange fees have a complex pricing 
structure, and those fees are set according to the card brand, 
the type of credit or debit card, the type and size of the 
accepting merchant, and the type of transaction. Interchange 
fees are typically a flat fee plus a percentage of the total 
purchase price.
    Many large retail ``big box'' merchants can negotiate the 
fees they pay because they control large transaction volumes; 
other merchants refuse to accept credit cards to avoid paying 
the fees; still other merchants believe they cannot refuse to 
accept the major network-branded cards, because they are 
ubiquitous and preferred by their customers. Merchants have 
complained that the interchange fees they pay are set at levels 
that are far higher than the banks' costs for processing these 
transactions. Merchants claim that if fees were set at 
competitive rates, consumers would benefit from lower prices.
    The banking industry counters that consumers do not benefit 
from lower interchange fees, both because merchants do not pass 
savings on to consumers in the form of lower prices and because 
bank profits from interchange fees subsidize the costs--and 
thereby lower the prices--of other financial products and 
services that consumers rely upon. Capping interchange fees 
thus forces banks to raise prices for other goods and services 
and restrict choices for bank customers.
    Overall, the Durbin Amendment has resulted in the 
elimination of free checking accounts at banks, pushing 
vulnerable Americans out of the mainstream banking system, 
while providing no discernible benefit to retail consumers. The 
Durbin amendment has had the effect on debit card pricing that 
its proponents intended. According to the Federal Reserve, the 
average interchange fee for covered issuers per debit card 
transaction was 24 cents in the fourth quarter of 2011, 
immediately after the adoption of the restrictions, which is a 
45 percent decrease from 2009, when the average interchange fee 
was 43 cents. This amounts to a government-mandated wealth 
transfer, and the evidence strongly suggests that financial 
products and services have become less available and more 
expensive as a result.
    A January 2014 Moebs Services survey of 2,890 financial 
institutions, including large and small banks and credit 
unions, found that ``overall, about 41% of U.S. financial 
institutions aren't offering unconditional free checking 
accounts this year [2014], up eight percentage points from a 
year earlier [2013].'' A Wall Street Journal report on the 
survey noted that ``the last time free checking was harder to 
come by was in 2002,'' and ``the trend marks the steepest 
annual drop in the percentage of banks and other financial 
institutions offering free checking since 2010, and follows a 
trend of less-generous deposit accounts since the recession.'' 
The article also cited the imposition of higher minimum balance 
requirements and new account maintenance fees at several large 
U.S. banks.
    Additionally, before Dodd-Frank became law, just over 75 
percent of banks offered free checking. By 2015, just 37 
percent of banks offered free checking. Research finds that the 
Durbin Amendment has contributed to this drop, as well as a 165 
percent increase in the average minimum balance for noninterest 
checking accounts, which along with other Durbin-related fee 
increases, has driven up the number of unbanked Americans. An 
October 2014 report in The Economist cited estimates that the 
Durbin Amendment has resulted ``in the transfer of between $1 
billion and $3 billion annually from poor households to big 
retailers and their shareholders.''
    Also worth noting is an October 23, 2013, University of 
Chicago working paper entitled ``The Impact of the U.S. Debit 
Card Interchange Fee Regulation on Consumer Welfare: An Event 
Study Analysis.'' The paper questions whether consumers gained 
more from cost savings passed on by merchants, in the form of 
higher prices and better services, than they lost from cost 
increases passed on by banks, in the form of higher prices or 
less services. The authors concluded that ``consumers lost more 
on the bank side than they gained on the merchant side. Our 
estimate is that, based on the expectations of investors, the 
present discounted value of the losses for consumers as a 
result of the implementation of the Durbin Amendment is between 
$22 and $25 billion.''
    The Financial CHOICE Act would repeal the Durbin amendment, 
and thereby bring an end to a misguided government experiment 
in price-fixing that has done consumers more harm than good. It 
is time for Congress to get out of the business of rationing 
consumer access to the mainstream banking system.

                TITLE VIII--CAPITAL MARKETS IMPROVEMENTS

    Title IX of the Dodd-Frank Act is an almost perfect 
embodiment of the adage coined by former Obama chief of staff 
Rahm Emanuel in the early days of the Administration: ``Never 
let a good crisis go to waste.'' It consists of a grab bag of 
items culled from the wish list of congressional Democrats and 
their political allies that in most instances have nothing to 
do with addressing the causes of the financial crisis. The 
Dodd-Frank Act represented a missed opportunity to streamline 
and rationalize the SEC's balkanized and overly bureaucratic 
structure. The Financial CHOICE Act includes organizational 
changes and other reforms of the SEC that will make for a more 
nimble, less sclerotic agency better-suited to fulfilling its 
statutory mission.
    Driven by a belief that the financial crisis resulted from 
a lack of regulation, the drafters of the Dodd-Frank Act 
promised that by increasing government oversight and control 
over the economy to an unprecedented degree, they would head 
off future financial crises. This ``command-and-control'' 
philosophy is evidenced by numerous mandates included in Title 
IX of the Act, which empowered the SEC to promulgate an array 
of new federal regulations that had little or nothing to with 
the financial crisis. Title IX contains ten subtitles and more 
than 100 provisions on topics that range from investor 
protection, civil enforcement remedies and penalties, fiduciary 
duty, securities arbitration, the SEC's operations/structure/
funding/authority, corporate governance, whistleblowers, 
compensation practices, credit rating agencies, asset-backed 
securities and risk retention, the Sarbanes-Oxley Act and the 
PCAOB, municipal securities, municipal advisers, and the 
Municipal Securities Rulemaking Board and the powers and 
authorities of Inspectors General. The Financial CHOICE Act 
repeals the most egregious examples of government overreach in 
Title IX, modifies several other provisions, and leaves others 
intact.
    The Financial CHOICE Act also repeals the DOL's fiduciary 
rule and requires the SEC, before promulgating any such rule, 
to report to the House Committee on Financial Services and the 
Senate Committee on Banking, Housing, and Urban Affairs on 
whether (i) retail customers are being harmed because broker-
dealers are held to a different standard of conduct from that 
of investment advisers; (ii) alternative remedies will reduce 
any confusion and harm to retail investors due to the different 
standard of conduct; (iii) adoption of a uniform fiduciary 
standard would adversely impact the commissions of broker-
dealers or the availability of certain financial products and 
transactions; and (iv) the adoption of a uniform fiduciary 
standard would adversely impact retail investors' access to 
personalized and cost-effective investment advice or 
recommendations about securities. Additionally, the SEC's chief 
economist is required to support any conclusion in the report 
with economic analysis. Finally, it requires the DOL, if it 
promulgates a fiduciary rule under the Employee Retirement 
Income Security Act, to substantially conform it to the SEC's 
standards.
    Another Dodd-Frank Act provision that holds the potential 
for investor harm is Section 921, which authorized the SEC to 
prohibit or restrict the use of pre-dispute arbitration if it 
found it to be in the public interest and necessary for the 
protection of investors. While the SEC has not taken any action 
under Section 921, using this authority to eliminate 
arbitration would harm--rather than protect--investors. Such 
regulatory attempts to prohibit or restrict arbitration would 
likely leave investors worse off, while significantly 
benefitting trial lawyers who stand to gain from increased 
litigation and class action lawsuits. Therefore, the Financial 
CHOICE Act eliminates the SEC's authority to prohibit or 
restrict arbitration agreements.
    Many post mortems of the financial crisis posit that a 
perceived misalignment of incentives in the originate-to-
distribute model led to the proliferation of poorly 
underwritten mortgages, which triggered the housing market 
collapse. But the mulita-trillion dollar asset-backed 
securities (ABS) market is much broader than residential 
mortgages, covering securities backed by everything from auto 
loans, business loans, credit cards, and equipment leases to 
commercial real estate. Many of these instruments performed 
well during the crisis, while others did not. Unfortunately, 
the Dodd-Frank Act essentially treats all of these categories 
of ABS as subprime residential mortgages. By failing to 
differentiate among types of borrowers, collateral, maturities, 
and investors, Dodd-Frank's ``one size fits all'' approach 
hampers market efficiency and harms those borrowers that rely 
on the ABS market.
    Ultimately, the Dodd-Frank Act will increase costs for the 
businesses and consumers that rely on the ABS market for 
credit. For instance, a business that takes out a loan that 
becomes part of a collateralized loan obligation (CLO) will 
find it more difficult and costly to refinance or roll over 
that loan if the CLO market shrinks because the Dodd-Frank 
Act's risk retention requirements reduces market capacity. In 
fact, CLO issuance declined over 20 percent once CLOs were 
required to comply with risk retention. To avoid that result, 
the Financial CHOICE Act eliminates the risk retention 
requirements for asset-backed securities other than residential 
mortgages.
    Another Republican proposal that was ultimately 
incorporated in the Dodd-Frank Act is Section 989G, which made 
permanent the exemption for non-accelerated filers to comply 
with an outside auditor's attestation of a company's internal 
financial controls mandated by Section 404(b) of the Sarbanes-
Oxley Act. However, the arbitrary threshold of $75 million in 
market capitalization still captures thousands of small 
companies grappling with the burdensome costs of 404(b) 
compliance. A 2011 SEC study found that Section 404(b) 
compliance can cost over $1 million annually, a staggering sum 
for a start-up or other small business that has not yet begun 
generating meaningful revenues. The Financial CHOICE Act 
increases the exemption to issuers with a market capitalization 
of up to $500 million and extends the exemption to depository 
institutions with less than $1 billion in assets.
    Other provisions of Title IX of the Dodd-Frank Act 
represent a broad expansion of the federal government's reach 
into the corporate boardroom, including on corporate governance 
matters that have traditionally been the province of state law. 
Nowhere is this interventionist approach on greater display 
than in the area of executive compensation. Popular outrage 
over instances of lavish pay packages for Wall Street traders 
whose bad bets helped spark the financial crisis provided the 
impetus for broad new government mandates that may have made 
for good politics, but have resulted in highly questionable 
public policy. Two of the most misguided Dodd-Frank 
provisions--relating to incentive-based compensation and pay 
ratio disclosures--are repealed by the Financial CHOICE Act.
    The Financial CHOICE Act also will modernize, and right 
size, the federal government's role in shareholder proposals 
with an emphasis on allowing corporate boards to responsibly 
guide the companies focused on maximizing shareholder value. 
Specifically, it will remove the dollar threshold, leaving in 
place a percentage of ownership threshold and extending the 
holding period to three years. This critical modernization of 
the SEC rule will ensure that shareholders with sufficient 
``skin in the game,'' and interest in the long-term value of 
the company have access to the corporate proxy, and eliminate 
the ability for gadflies to abuse the system. Additionally, it 
will update the resubmission thresholds consistent with the 
SEC's 1997 proposal.
    Additionally, Title XV of the Dodd-Frank Act imposes a 
number of overly burdensome disclosure requirements related to 
conflict minerals, extractive industries, and mine safety that 
bare no rational relationship to the SEC's statutory mission to 
protect investors, maintain fair, orderly, and efficient 
markets, and promote capital formation. The Financial CHOICE 
Act repeals those requirements. There is overwhelming evidence 
that Dodd-Frank's conflict minerals disclosure requirement has 
done far more harm than good to its intended beneficiaries--the 
citizens of the Democratic Republic of Congo and neighboring 
Central African countries. Former SEC Chair Mary Jo White, an 
Obama appointee, has conceded the Commission is not the 
appropriate agency to carry out humanitarian policy. The 
provisions of Title XV of the Dodd-Frank Act are a prime 
example of the increasing use of the federal securities laws as 
a cudgel to force public companies to disclose extraneous 
political, social, and environmental matters in their periodic 
filings. That core mission of the SEC is to protect investors, 
maintain fair, orderly, and efficient markets, and facilitate 
capital formation. The politically motivated provisions in the 
Title XV ``Miscellaneous'' do nothing to fulfill the SEC's 
statutory mandate. The Financial CHOICE Act repeals these 
harmful and counterproductive provisions of the Dodd-Frank Act 
that are ``more directed at exerting societal pressure on 
companies to change behavior, rather than to disclose 
information that primarily informs investment decisions.'' 
Although private equity funds did not cause nor contribute to 
the financial crisis, Dodd-Frank imposes burdensome 
requirements on advisers to private equity funds, which 
unnecessarily punishes their investors and impedes job 
creation. Title IV of the Dodd-Frank Act requires the SEC to 
expend scarce resources on the protection of sophisticated 
institutional investors and wealthy individual investors that 
would be better utilized protecting the millions of retail 
investors of more modest means who have a far greater need for 
the SEC's assistance. The Financial CHOICE Act amends Title IV 
of the Dodd-Frank Act to enhance funding opportunities for 
start-up companies and other job creators, and to focus 
government resources on protecting mom-and-pop investors 
instead of the wealthiest Americans.
    Title IV of the Dodd-Frank Act also directed the SEC to 
adjust the standard for calculating the net worth of an 
accredited investor who is a natural person by excluding the 
value of the investor's primary residence from the calculation, 
and requiring the Commission to engage in a quadrennial review 
of the standard to determine whether it should be further 
adjusted. Private placement offerings are a key source of 
equity capital for many small and emerging companies that 
generate a disproportionate share of the new jobs in our 
economy. Because such offerings are generally available only to 
accredited and other sophisticated investors, it is essential 
that the SEC not overly restrict the pool of accredited 
investors.
    By expanding the definition of accredited investor to 
include sophisticated individuals who do not otherwise satisfy 
the net worth test, the Financial CHOICE Act seeks to promote 
capital formation and extend investment opportunity beyond a 
narrow class of wealthy Americans. The legislation is premised 
upon a belief that individual investors who have the risk 
appetite and ability to understand a private offering should be 
able to invest in it--the government should not limit the 
options of individual investors to only those the government 
deems worthy based on their income and net worth.
    Finally, the Financial CHOICE Act seeks to modernize 
aspects of the SEC's enforcement program to ensure that the 
Commission upholds important due process protections while 
vigorously enforcing the federal securities laws. The SEC 
possesses a wide array of enforcement tools to supplement and 
effectuate its penalty authority. However, there have been 
increasing concerns regarding the SEC's use of this authority 
in its enforcement of the federal securities laws.
    Over the past seven years, the SEC has increasingly turned 
to its own ALJs--rather than the federal courts--to adjudicate 
enforcement actions. This shift from litigation in federal 
court to administrative proceedings occurred largely as a 
result of Section 929P of the Dodd-Frank Act, which expanded 
the SEC's authority to obtain civil penalties in administrative 
proceedings against any person or entity. SEC administrative 
proceedings are quasi-judicial proceedings in which ALJs 
appointed by the SEC adjudicate enforcement actions under SEC 
rules. While the SEC has publicly supported administrative 
proceedings as a more efficient way to resolve enforcement 
matters, critics have noted that administrative proceedings 
confer several advantages on the SEC and may deprive defendants 
of their due process rights.
    The SEC's ``home court'' advantage in administrative 
proceedings has been manifest in its win-loss record compared 
to cases it brings in the federal courts. During FY 2014, the 
SEC's Enforcement Division won all six of its litigated 
administrative proceedings, compared to only 11 of its 18 cases 
brought in federal court. The Enforcement Division's broad 
prosecutorial discretion, coupled with Section 929P's enhanced 
authority to obtain penalties in administrative proceedings, 
has created a strong incentive for the SEC to bring cases in an 
administrative forum that have historically been brought in the 
federal courts instead. SEC Acting Chairman Michael Piwowar 
observed in a 2015 speech that the Enforcement Division's 
avoidance of federal court ``has the appearance of the 
Commission looking to improve its chances of success by moving 
cases to its in-house administrative system.''
    In December 2016, the U.S. Court of Appeals for the Tenth 
Circuit dealt the SEC's in-house tribunals a serious blow, 
ruling that the SEC's process for hiring ALJs violates the 
Appointments Clause of the U.S. Constitution, because the 
judges are ``inferior officers'' within the meaning of that 
clause and must therefore be appointed directly by the SEC 
Commissioners. The Tenth Circuit's opinion conflicts with an 
earlier decision by the U.S. Court of Appeals for the D.C. 
Circuit. In August 2016 the D.C. Circuit held that ALJs need 
not be appointed directly because their decisions are 
reviewable by the SEC Commissioners.
    The SEC's recent penchant for imposing civil penalties on 
corporations that violate the federal securities laws instead 
of bringing enforcement actions against individual offenders 
also has raised concerns among SEC commissioners and other 
commentators that innocent shareholders are being penalized 
while the culpable corporate officers escape liability. As a 
result of this policy, even though the SEC is collecting larger 
penalties from public companies, those penalties may not be 
having the intended effect. Corporate employees tempted to cut 
legal corners or engage in malfeasance will think twice if they 
know they are likely to pay a price for their wrongdoing. If it 
is far more likely that the costs will instead be imposed on 
the company or its shareholders, that deterrent effect is 
undermined.
    Critics also have noted that the Enforcement Division has 
broad discretion to set the amount of civil penalties and that 
there are no binding rules or guidelines requiring the SEC to 
consider the best interests of shareholders in deciding whether 
to approve a civil penalty proposed by the Division. At the 
2015 edition of the ``SEC Speaks'' conference, Commissioner 
Piwowar commented that the imposition of corporate penalties 
and the issuance of waivers ``would benefit from the consistent 
application of public stated guidelines or factors.''
    Yet there are circumstances in which civil money penalties 
against corporations are clearly warranted. For example, 
penalties against regulated entities (which submit to 
substantive and comprehensive regulation by the SEC) or 
corporations where the shareholders receive a direct benefit 
from the fraud (for example, bribery of a foreign official to 
secure lucrative business in violation of the Foreign Corrupt 
Practices Act) may deter and punish fraudulent conduct without 
further harming shareholders.
    Another concern is the SEC's system for automatic 
disqualifications, in which individuals and other entities 
found to have committed certain bad acts, or deemed to have 
done so through the operation of a legal settlement with the 
federal government, are barred from engaging in certain 
activities or from relying on exemptions that otherwise would 
be available to them. The SEC has the discretion to waive the 
disqualification based in its review of the facts and 
circumstances. While this may seem like a reasonable approach, 
it has resulted in a system that often conflates the 
disqualifications with the SEC's current remedial and punitive 
enforcement authorities, which was not Congress's original 
intent in establishing the enhanced enforcement authorities. 
These disqualifications were never meant to be enforcement 
enhancements and even SEC Chair Mary Jo White has acknowledged 
that the actions subject to automatic disqualifications ``very 
often involve a relatively limited number of a firm's employees 
or a specific business line, and [are] wholly unrelated to the 
activities that would be the subject of the disqualification.'' 
When the actions of individuals, corporations, or other 
entities warrant putting them out of business to protect 
investors, the SEC has sufficient authority to do so.
    Finally, there has been increasing concern with the SEC's 
growing practice of ``rulemaking by enforcement.'' In 
settlements, the Enforcement Division has mandated that 
settling defendants agree to ``undertakings,'' or remedial 
measures. These ``undertakings'' effectively have the force of 
new regulations because they put other market participants on 
notice that similar activities, even if not inconsistent with 
current regulations, could result in SEC enforcement actions. 
These undertakings essentially amount to new compliance 
obligations imposed on corporations and individuals outside of 
the predictable regulatory process and the mandates of the 
Administrative Procedure Act, including the right of public 
notice and comment. As a result, rulemaking by enforcement has 
the potential to create greater uncertainty for market 
participants and deprive companies and individuals of essential 
due process protections.
    These issues and others related to the SEC's sprawling 
enforcement program raise a number of important questions--not 
all of which can be resolved within the scope of the Financial 
CHOICE Act. In the past, the SEC has taken it upon itself to 
engage in a review of its policies and procedures. In 1972, 
then-SEC Chairman William Casey announced the creation of an 
advisory committee to ``review and evaluate the Commission's 
enforcement policies and practices and to make such 
recommendations as they deemed appropriate.'' While the 
official name of the committee was the ``Advisory Committee on 
Enforcement and Practices,'' but it is best known as the 
``Wells Committee,'' after its chairman, John Wells.
    It has been 45 years since the Wells Committee engaged in a 
holistic review of the SEC's enforcement program and the 
significant changes--in terms of the SEC's mission, its 
authorities, and the markets and its participants--necessitate 
another introspective to modernize the SEC's Enforcement 
program and policies. The Financial CHOICE Act will require 
that the SEC Chairman convene a new Committee, with the same 
mission as the original Wells Committee, to holistically review 
the Enforcement program to ensure it comports with both with 
the SEC's mission to protect investors, maintain fair, orderly, 
and efficient markets, and facilitate capital formation and our 
constitutional due process rights.
    Overall, Republicans support the vigorous enforcement of 
the federal securities laws and believe that the SEC must have 
the tools it needs to deter and punish wrongdoing and, whenever 
possible, to make defrauded investors whole. But the SEC must 
strike the right balance between deterring and punishing 
securities fraud and protecting shareholders ultimately 
responsible for paying large civil penalties for violations 
they did not commit and that may further harm a public company.
    To help the SEC and the Enforcement Division strike this 
balance, the Financial CHOICE Act requires the SEC to implement 
policies consistent with the principles of predictability, 
fairness, and transparency. For example, to better protect 
innocent shareholders from further monetary harm, the 
legislation requires the SEC, when issuing a civil penalty 
against an issuer, to include findings, supported by the SEC 
Chief Economist, whether the alleged violations resulted in 
direct economic benefit to the issuer and the penalties do not 
harm the issuer's shareholders.
    The Financial CHOICE Act addresses constitutional concerns 
with the SEC's enforcement program by giving respondents in SEC 
administrative proceedings the right to remove their 
enforcement action to federal court to ensure that the 
respondents' due process rights are protected. It also requires 
the SEC to allow respondents to appear before the Commission 
prior to the initiation of a formal enforcement action, and 
establishes an Enforcement Ombudsman to review complaints about 
the Enforcement program. Further, the SEC will be required to 
approve and publish an Enforcement Manual to ensure 
transparency and uniform application of its procedures. It 
comports certain private claims under the Investment Company 
Act with prior securities litigation reform efforts. Finally, 
the Financial CHOICE Act eliminates the system of automatic 
disqualifications and makes such disqualifications subject to 
the Commission's discretion, thereby ensuring that the worst 
offenders can be barred from certain business activities and, 
if necessary, the industry.
    Finally, the Financial CHOICE Act brings additionally 
accountability to the Public Company Accounting Oversight Board 
(PCAOB). ``Sunlight is said to be the best of disinfectants,'' 
wrote U.S. Supreme Court Justice Louis Brandeis in 1913. But in 
creating the PCAOB, Congress did not adhere to Justice 
Brandeis's famous axiom. The Sarbanes-Oxley Act omits Congress 
from the class of entities that can receive confidential 
information from the PCAOB, which creates statutory ambiguity 
and could allow the PCAOB to deny congressional requests for 
information. To ensure that the PCAOB follows its 
congressionally mandated mission, Congress must have full and 
complete access to PCAOB documents. The Financial CHOICE Act 
will ensure that the PCAOB cannot deny Congress access to 
information.

       TITLE IX--REPEAL OF THE VOLCKER RULE AND OTHER PROVISIONS

    Section 619 of the Dodd-Frank Act--popularly known as the 
``Volcker Rule'' after its chief proponent, former Federal 
Reserve Chairman Paul Volcker--prohibits U.S. bank holding 
companies and their affiliates from engaging in ``proprietary 
trading'' and from sponsoring hedge funds and private equity 
funds. Chairman Volcker has argued that such activities should 
not be conducted by firms that benefit from a federal safety 
net, such as deposit insurance or access to the Federal 
Reserve's discount window. From its inception, the Volcker Rule 
has been a solution in search of a problem--it seeks to address 
activities that had nothing to do with the financial crisis, 
and its practical effect has been to undermine financial 
stability rather than preserve it.
    The Volcker Rule does not address any of the problems that 
led to the financial crisis, and it has significantly harmed 
the economy and inhibited economic growth. Former Obama 
Treasury Secretary Tim Geithner put it bluntly: ``if you look 
at this crisis . . . most of the losses that were material for 
both the weak and strong institutions did not come from those 
[proprietary trading] activities. They came overwhelmingly from 
what I think you can fairly describe as classic extensions of 
credit.'' Even Paul Volcker himself has admitted that 
proprietary trading did not lead to the crisis: ``proprietary 
trading in commercial banks . . . was not central to the 
crisis.'' Not only is the Volcker Rule completely irrelevant to 
the problem of financial stability--it is also affirmatively 
harmful. It weakens banks because it deprives them of a 
profitable business line stream that helps them diversify their 
revenue streams and better manage their risks. As banking 
experts Charles Calomiris, Robert Eisenbeis and Robert Litan 
put it, ``to the extent that [proprietary] trading has been 
profitable for banks, denying them the ability to pursue it 
could detract from their safety and soundness.'' In other 
words, the Volcker Rule doesn't make the financial system safer 
or stronger--it makes it riskier and more fragile.
    The Volcker Rule also dries up much needed liquidity in the 
financial markets. As researchers at the New York Federal 
Reserve discovered, ``Our results show that bond liquidity 
deterioration around rating downgrades has worsened following 
the implementation of the Volcker Rule . . . [W]e find that the 
relative deterioration in liquidity around these stress events 
is as high during the post-Volcker period as during the 
Financial Crisis. Given how badly liquidity deteriorated during 
the financial crisis, this finding suggests that the Volcker 
Rule may have serious consequences for corporate bond market 
functioning in stress times.'' By drying up liquidity from the 
corporate bond market, the Volcker Rule has made the financial 
system more fragile. It has also made it harder for businesses 
to borrow, it has lowered investment returns for households 
saving for retirement and their children's education. And it 
has inhibited economic growth by constraining market-making 
activity.
    There is further anecdotal evidence from regulators and 
market participants about the negative impacts of the Volcker 
Rule. Federal Reserve Governor Jerome Powell bluntly assessed 
the effect of the Volcker Rule in this way: ``the Volcker Rule 
. . . [has] discouraged banks from holding and making markets 
in [corporate] debt.'' His conclusion: the Volcker Rule has 
resulted in ``tremendous expense and quite marginal benefit.'' 
He urged Congress to ``take another look'' at the Volcker Rule.
    Former Federal Reserve Governor Jeremy Stein was equally 
candid about the Volcker Rule's failure: ``There are reasons to 
be skeptical about the usefulness of the Volcker Rule. By 
discouraging ``speculation'' at broker-dealer banks, the rule 
may dissuade dealers from providing liquidity during a market 
correction. Most fundamentally, market-making and proprietary 
trading are almost impossible to distinguish in practice, 
making the rule difficult to enforce, while at the same time 
creating large compliance and supervisory costs. . . Thus, on 
balance, we believe that the Volcker Rule should be repealed.''
    In his farewell remarks, former Federal Reserve Governor 
Daniel Tarullo also found the Volcker Rule's meager benefits 
were not justified by its costs: ``the Volcker rule is too 
complicated. Achieving compliance under the current approach 
would consume too many supervisory, as well as bank, resources 
relative to the implementation and oversight of other 
prudential standards. And although the evidence is still more 
anecdotal than systematic, it may be having a deleterious 
effect on market making, particularly for some less liquid 
issues.''
    And Tobias Adrian, the former senior vice president of the 
New York Federal Reserve and now Director of the Monetary IMF's 
Monetary and Capital Markets Department offered this scathing 
assessment of the Volcker Rule: ``It is a rule that's very 
difficult to enforce, because it's very difficult to 
distinguish between what are proprietary trades and what are 
client trades. So it's not clear how effective it is. . . . 
[R]egulations [can] make the system safer. But they can also 
impact the ability of institutions to supply credit, to make 
markets, and that trade-off has to be carefully considered.''
    It is long past time for Congress to ``carefully consider'' 
the trade-off between the benefits that Volcker Rule offers and 
the costs that it imposes. The benefits are few and the costs 
are enormous. The Volcker Rule will increase borrowing costs 
for businesses, lower investment returns for households, and 
reduce economic activity overall because it constrains market-
making activity and has already reduced liquidity in key fixed-
income markets, including the corporate bond market. The 
Financial CHOICE Act's repeal of the Volcker Rule will promote 
more resilient capital markets and a more stable financial 
system.

            TITLE X--FED OVERSIGHT REFORM AND MODERNIZATION

    Dodd-Frank rewarded government bureaucrats who were 
arguably most responsible for the financial crisis--the Federal 
Reserve--with expansive new regulatory powers, lending credence 
to the adage that at least in Washington, nothing succeeds like 
failure. By amassing a $4.5 trillion balance sheet and stepping 
well outside the bound of monetary policy to engage as a fiscal 
principal in the most political of credit markets, the Fed 
erased the line between fiscal and monetary policy, and in 
doing so has undermined the important political independence of 
monetary policy.
    A transparent and reliable monetary policy strategy would 
enhance congressional oversight--and therefore public 
accountability--of the Federal Reserve, helping to demystify an 
institution that wields enormous influence over the lives of 
every American but about which most Americans know very little.
    Monetary policy works best when the Federal Reserve can 
make credible commitments to the public about its future 
course. Requiring the Federal Reserve to systematically explain 
differences between actual policy decisions and prescriptions 
from well-known benchmarks can help households and markets set 
better expectations about the future path of monetary policy, 
and thus make better economic decisions in the present. 
Accordingly, the Financial CHOICE Act seeks to improve how the 
Fed communicates monetary policy, by requiring it to choose a 
monetary policy strategy, and explain to the American people 
how its chosen course compares to a reference policy rule. 
Importantly, it is the Federal Reserve that selects the policy 
inputs that go into the formulation of its strategy, and the 
Fed retains the power to change or depart from its chosen 
strategy whenever it determines that economic circumstances 
warrant. The requirement is simply for a more clear 
communication of policy and not for any particular policy.
    By promoting a monetary policy strategy that is both more 
principled and transparent, the Financial CHOICE Act finally 
provides a framework for monetary policy to do what it can (and 
only what it can) to fundamentally support a dynamic and 
growing economy for every American--that is, reliably produce 
clear price signals so that businesses and households can make 
better economic decisions. Leading academic and Fed economists, 
including several Nobel Laureates, support this important 
reform. However, while a decade of improvisational monetary 
policies consistently failed to deliver on the Fed's own 
benchmarks, Fed Chair Yellen continues to oppose this simple 
reform.
    While it is understandable that the Federal Reserve wishes 
to avoid greater public scrutiny of its conduct of monetary 
policy--which many observers have likened to performing 
financial alchemy--that is not how open democratic societies 
operate. At a time when the American people's distrust of 
government and cynicism about our public institutions has never 
been higher, asking the Federal Reserve to be accountable for 
its actions and operate with a modicum of transparency is most 
certainly not asking too much.
    Title X also imposes new limitations on the Federal 
Reserve's emergency lending authority under Section 13(3) of 
the Federal Reserve Act. During the financial crisis, the 
Federal Reserve resorted several times to its emergency lending 
authority under Section 13(3) of the Federal Reserve Act, which 
allows it to make emergency loans to ``any individual, 
partnership, or corporation'' under ``unusual and exigent 
circumstances,'' provided the borrower ``is unable to secure 
adequate credit accommodations from other banking 
institutions.''
    The Financial CHOICE Act incorporates a number of reforms 
to 13(3) that would significantly reduce the potential use of 
Section 13(3) as a bailout tool. The legislation would allow 
the Federal Reserve to invoke its emergency lending powers only 
upon a finding that ``unusual and exigent circumstances exist 
that pose a threat to the financial stability of the United 
States.'' This amendment raises the bar from the current 
trigger, which permits the Fed to utilize 13(3) in ``unusual 
and exigent circumstances,'' defined however the Fed sees fit. 
The bill also mandates that in addition to the current 
requirement that five of seven Fed Board Governors approve of a 
13(3) facility, nine of the twelve District Fed Bank Presidents 
must also approve--increasing the confidence and competence 
with which a lack of liquidity can be distinguished from a lack 
of solvency in times of panic. It limits eligible recipients of 
13(3) assistance to financial institutions, defined as those 
entities that derive 85 percent or more of their annual gross 
revenues from activities that are ``financial in nature.'' The 
Financial CHOICE Act also restricts the use of 13(3) to those 
instances that meet the specific criteria of Bagehot's Dictum, 
named after the noted British financial journalist Walter 
Bagehot, which stipulates that a central bank should lend 
freely in a financial crisis, but only to solvent borrowers, 
against good collateral, and at penalty rates.

   TITLE XI--IMPROVING INSURANCE COORDINATION THROUGH AN INDEPENDENT 
                                ADVOCATE

    The Dodd-Frank Act made two notable changes to the role the 
federal government plays in the insurance industry. First, in 
Title V, the Dodd-Frank Act created a new Federal Insurance 
Office (FIO) within the Treasury Department to provide the 
federal government with information and expertise on insurance 
matters. Though by design FIO has no supervisory or regulatory 
authority, the Dodd-Frank Act charges the FIO with several 
mandates, including: (1) monitoring all aspects of the 
insurance industry; (2) recommending which insurance companies 
be designated for heightened prudential standards and 
supervision; (3) assisting in administering the Terrorism Risk 
Insurance Program; (4) coordinating federal involvement and 
policymaking on international insurance matters and in 
negotiations of international insurance agreements; and (5) 
consulting with state insurance regulators on matters of 
national or international importance. The Dodd-Frank Act also 
charged the FIO Director with producing several one-time and 
annual reports on matters relating to the insurance industry.
    The FIO Director is a non-voting member of the FSOC, the 
15-member inter-agency group comprising federal and state 
regulators and other financial regulatory experts that Dodd-
Frank charges with identifying risks to the financial stability 
of the United States and promoting market discipline. The Dodd-
Frank Act mandates that one of the FSOC's members--this one 
with voting powers--be an Independent Member with Insurance 
Expertise, with no other federal supervisory or regulatory 
duties. The Independent Member is the sole source of expertise 
among the FSOC's ten voting members.
    This fragmented approach--featuring one insurance 
bureaucrat who monitors the insurance industry, advises federal 
officials, and participates in international insurance 
negotiations but cannot vote on FSOC macroprudential matters, 
and another insurance bureaucrat who does vote on FSOC 
macroprudential matters but has no other substantive policy 
responsibilities--has proved unwieldy. In theory, on matters 
relating to an insurance company, other FSOC voting members 
might be expected to defer to the professional judgment of the 
FSOC's dedicated insurance expert in evaluating the potential 
systemic risk posed by an insurer. But in practice, the 
opposite has occurred. For example, when the FSOC voted in 2013 
to designate the insurance conglomerate Prudential Financial as 
``systemically important,'' the Independent Member with 
Insurance Expertise strongly dissented, but only one of the 
eight other voting members that day sided with him. This 
scenario repeated itself in the 2014 designation of MetLife, 
when the Independent Member with Insurance Expertise filed the 
lone dissent to the FSOC's determination.
    Similarly, FIO has been criticized by some for not using 
its position to champion the best interests of the U.S. 
domestic insurance industry in insurance matters and in 
negotiations of international insurance agreements. Other 
critics have lamented that FIO lacks a unified voice in 
speaking with state regulators on matters of national or 
international importance, further fragmenting our unique system 
of domestic insurance regulation.
    To address these overlapping and conflicting authorities, 
the Financial CHOICE Act consolidates the federal insurance 
bureaucracy by merging and reforming FIO and the Independent 
Member with Insurance Expertise into one unified Independent 
Insurance Advocate (IIA). Appointed by the President, subject 
to the advice and consent of the Senate, for a six-year term, 
the IIA will be housed as an independent Office of the 
Independent Insurance Advocate within the Treasury Department.
    The IIA will replace the Independent Member with Insurance 
Expertise as the voting FSOC member and will coordinate federal 
efforts on the prudential aspects of international insurance 
matters, including representing the U.S. in the International 
Association of Insurance Supervisors (IAIS) and assisting in 
the negotiations of covered agreements. Also the IIA will 
consult with state insurance regulators regarding insurance 
matters of national importance and prudential insurance matters 
of international importance and will assist Treasury in 
administering TRIA.
    To promote accountability and transparency in the new 
office, the IIA will be required to testify before Congress 
twice a year on the activities and objectives of the Office, 
any actions taken by the Office pursuant to covered agreements, 
the state of the insurance industry, and the scope of global 
insurance and reinsurance markets and the role such markets 
play in supporting insurance in the U.S.

                    TITLE XII--TECHNICAL CORRECTIONS

    Title XII makes numerous technical and grammatical changes 
to many of the titles of the Dodd-Frank Act and other statutes 
within the jurisdiction of the Committee on Financial Services.

                                Hearings

    The Committee on Financial Services held a hearing 
examining a discussion draft of H.R. 10 entitled ``A 
Legislative Proposal to Create Hope and Opportunity for 
Investors, Consumers, and Entrepreneurs'' on April 26 and April 
28, 2017. In addition to this hearing, the Committee and its 
subcommittees held a substantial number of hearings in the 
112th, 113th, 114th, and 115th Congresses that examined the 
impact and effect of the Dodd-Frank Wall Street Reform and 
Consumer Protection Act and potential legislative alternatives.

                        Committee Consideration

    The Committee on Financial Services met in open session on 
May 2, 2017, May 3, 2017, and May 4, 2017, to consider H.R. 10. 
Sundry amendments were considered and adopted as described 
below. The Committee ordered H.R. 10 to be reported favorably 
to the House as amended by a recorded vote of 34 yeas to 26 
nays (recorded vote no. FC-57), a quorum being present.

                            Committee Votes

    Clause 3(b) of rule XIII of the Rules of the House of 
Representatives requires the Committee to list the record votes 
on the motion to report legislation and amendments thereto. A 
question of consideration offered by Mr. Kildee was agreed to 
in the affirmative by a recorded vote of 29 yeas to 23 nays 
(FC-37). During consideration of the bill, Chairman Hensarling 
offered an amendment in the nature of a substitute. Amendments 
to the amendment in the nature of a substitute were disposed of 
as follows:
    Velazquez Amendment (no. 1a) was not agreed to by a 
recorded vote of 24 yeas to 32 nays (Recorded vote no. FC-38)
    Maloney Amendment (no. 1b) was not agreed to by a recorded 
vote of 24 yeas to 32 nays (Recorded vote no. FC-39)
    Scott Amendment (no. 1c) was not agreed to by a recorded 
vote of 24 yeas to 31 nays (Recorded vote no. FC-40)
    Kildee Amendment (no. 1d) was not agreed to by a recorded 
vote of 25 yeas to 32 nays (Recorded vote no. FC-41)
    Gottheimer Amendment (no. 1e) was not agreed to by a 
recorded vote of 25 yeas to 32 nays (Recorded vote no. FC-42)
    Kihuen Amendment (no. 1f) was not agreed to by a recorded 
vote of 25 yeas to 33 nays (Recorded vote no. FC-43)
    Lynch Amendment (no. 1g) was not agreed to by a recorded 
vote of 24 yeas to 34 nays (Recorded vote no. FC-44)
    Capuano Amendment (no. 1h) was not agreed to by a recorded 
vote of 26 yeas to 33 nays (Recorded vote no. FC-45)
    Perlmutter Amendment (no. 1i) was not agreed to by a 
recorded vote of 26 yeas to 32 nays (Recorded vote no. FC-46)
    Moore Amendment (no. 1j) was not agreed to by a recorded 
vote of 26 yeas to 32 nays (Recorded vote no. FC-47)
    Foster Amendment (no. 1k) was not agreed to by a recorded 
vote of 26 yeas to 33 nays (Recorded vote no. FC-48)
    Himes Amendment (no. 1l) was not agreed to by a recorded 
vote of 26 yeas to 33 nays (Recorded vote no. FC-49)
    Heck Amendment (no. 1m) was not agreed to by a recorded 
vote of 26 yeas to 33 nays (Recorded vote no. FC-50)
    Sherman Amendment (no. 1n) was not agreed to by a recorded 
vote of 26 yeas to 33 nays (Recorded vote no. FC-51)
    Meeks Amendment (no. 1o) was not agreed to by a recorded 
vote of 26 yeas to 33 nays (Recorded vote no. FC-52)
    Crist Amendment (no. 1p) was not agreed to by a recorded 
vote of 26 yeas to 33 nays (Recorded vote no. FC-53)
    Maloney Amendment (no. 1q) was not agreed to by a recorded 
vote of 26 yeas to 33 nays (Recorded vote no. FC-54)
    Maloney Amendment (no. 1r) was not agreed to by a recorded 
vote of 26 yeas to 33 nays (Recorded vote no. FC-55)
    Gottheimer Amendment (no. 1s) was not agreed to by a 
recorded vote of 26 yeas to 34 nays (Recorded vote no. FC-56).
    The amendment in the nature of a substitute was then 
adopted by voice vote. The bill as amended was ordered 
favorably reported to the House by a recorded vote of 34 yeas 
to 26 nays (Recorded vote no. FC-57), a quorum being present.


                      Committee Oversight Findings

    Pursuant to clause 3(c)(1) of rule XIII of the Rules of the 
House of Representatives, 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.

                    Performance Goals and Objectives

    Pursuant to clause 3(c)(4) of rule XIII of the Rules of the 
House of Representatives, the Committee states that H.R. 10 
will, among other things, end taxpayer-funded bailouts of too-
big-to-fail financial institutions, reduce regulatory burdens 
on community financial institutions, lower costs and increase 
financial services for consumers, encourage new entrants into 
the market for financial services, improve the conduct of 
monetary policy, promote capital formation, and reform and 
reauthorize the Securities and Exchange Commission.

   New Budget Authority, Entitlement Authority, and Tax Expenditures

    In compliance with clause 3(c)(2) of rule XIII of the Rules 
of the House of Representatives, the Committee adopts as its 
own the estimate of new budget authority, entitlement 
authority, or tax expenditures or revenues contained in the 
cost estimate prepared by the Director of the Congressional 
Budget Office pursuant to section 402 of the Congressional 
Budget Act of 1974.

                        Committee Cost Estimate

    The Committee adopts as its own the cost estimate prepared 
by the Director of the Congressional Budget Office pursuant to 
section 402 of the Congressional Budget Act of 1974.

                 Congressional Budget Office Estimates

    Pursuant to clause 3(c)(3) of rule XIII of the Rules of the 
House of Representatives, the following is the cost estimate 
provided by the Congressional Budget Office pursuant to section 
402 of the Congressional Budget Act of 1974:

                                     U.S. Congress,
                               Congressional Budget Office,
                                      Washington, DC, May 18, 2017.
Hon. Jeb Hensarling,
Chairman, Committee on Financial Services,
House of Representatives, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for H.R. 10, the Financial 
CHOICE Act of 2017.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contact is Sarah Puro, 
who can be reached at 226-2860.
            Sincerely,
                                                        Keith Hall.
    Enclosure.

H.R. 10--Financial CHOICE Act of 2017

    Summary: H.R. 10 would amend the Dodd-Frank Wall Street 
Reform and Consumer Protection Act (Dodd-Frank Act) and other 
laws governing regulation of the financial industry. The bill 
also would repeal the Federal Deposit Insurance Corporation's 
(FDIC) authority to use the Orderly Liquidation Fund (OLF) and 
would allow financial institutions, under certain 
circumstances, to be exempt from a variety of regulations. H.R. 
10 would make numerous other changes to the authorities of the 
agencies that regulate the financial industry, and it would 
change how the operations of the National Credit Union 
Administration (NCUA) and Consumer Financial Protection Bureau 
(CFPB) are funded.
    CBO estimates that enacting the legislation would reduce 
federal deficits by $24.1 billion over the 2017-2027 period. 
Direct spending would be reduced by $30.1 billion, and revenues 
would be reduced by $5.9 billion. Most of the budgetary savings 
would come from eliminating the OLF and changing how the CFPB 
is funded.
    CBO also estimates that, over the 2017-2027 period, and 
assuming appropriation of the necessary amounts, implementing 
the bill would cost $1.8 billion.
    Those estimates are subject to considerable uncertainty, in 
part because they depend on the probability in any year that a 
systemically important firm will fail. That probability is 
small under both current law and under the legislation, but it 
is hard to predict. Despite those and other uncertainties, CBO 
has endeavored to develop estimates that are in the middle of 
the distribution of possible outcomes.
    Pay-as-you-go procedures apply because enacting the 
legislation would affect direct spending and revenues.
    CBO estimates that enacting the legislation would not 
increase net direct spending or on-budget deficits by more than 
$5 billion in any of the four consecutive 10-year periods 
beginning in 2028.
    H.R. 10 contains intergovernmental and private-sector 
mandates as defined in the Unfunded Mandates Reform Act (UMRA). 
CBO estimates the aggregate costs of the mandates on public 
entities would fall well below the annual threshold established 
in UMRA for intergovernmental mandates ($78 million in 2017, 
adjusted annually for inflation). However, in aggregate, CBO 
estimates the net cost of the mandates on private entities 
would exceed the annual threshold established in UMRA for 
private-sector mandates ($156 million in 2017, adjusted 
annually for inflation) in 2018 and 2019, primarily because of 
increases in fees and assessments.
    List of Acronyms: As a reference, these acronyms are used 
throughout this cost estimate:
           Commodity Futures Trading Commission (CFTC),
           Consumer Financial Protection Bureau (CFPB),
           Consumer Law Enforcement Agency (CLEA),
           Deposit Insurance Fund (DIF),
           Federal Deposit Insurance Corporation 
        (FDIC),
           Federal Financial Institutions Examination 
        Council (FFIEC),
           Federal Housing Finance Agency (FHFA),
           Federal Open Market Committee (FOMC),
           Financial Research Fund (FRF),
           Financial Stability Oversight Council 
        (FSOC),
           Government Accountability Office (GAO),
           Globally systemic important bank (G-SIB),
           National Credit Union Administration (NCUA),
           Office of Financial Research (OFR),
           Office of the Comptroller of the Currency 
        (OCC),
           Orderly Liquidation Fund (OLF),
           Securities and Exchange Commission (SEC),
           Share Insurance Fund (SIF),
           Supplementary Leverage Ratio (SLR), and
           Unfunded Mandates Reform Act (UMRA).
    Estimated Cost to the Federal Government: The estimated 
budgetary effect of H.R. 10 is shown in the upcoming table. The 
costs of this legislation fall within budget function 370 
(commerce and housing credit).

------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                 By fiscal year, in millions of dollars--
                                        --------------------------------------------------------------------------------------------------------------------------------------------------------
                                            2017        2018        2019        2020        2021        2022        2023       2024       2025       2026       2027     2017-2022    2017-2027
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                   NET INCREASES AND DECREASES (-) IN THE DEFICIT FROM CHANGES IN DIRECT SPENDING AND REVENUES
 
Eliminating the Orderly Liquidation               0        -700      -1,200      -1,750      -2,450      -1,850     -1,450     -1,300     -1,300     -1,250     -1,250       -7,950      -14,500
 Fund..................................
Allowing Capital Election and Making              0           0          30          40          40          40         40         30         20         30         30          150          300
 Other Changes to Financial Regulations
 a.....................................
Amending Responsibilities and                     0          35          60          65          40          50         45         30         35         35         25          250          420
 Operations............................
Modifying Agency Funding...............           0        -615        -865        -880        -910        -925       -950       -980     -1,005     -1,030     -1,055       -4,195       -9,215
Transferring Responsibilities and                 0           5         -65         -55         -60         -60        -60        -70        -65        -65        -65         -235         -560
 Eliminating Agencies..................
Penalties..............................           0          40          75         -60         -75         -90        -85        -90        -90        -90        -95         -110         -560
    Total Decrease in the Deficit......           0      -1,235      -1,965      -2,640      -3,415      -2,835     -2,460     -2,380     -2,405     -2,370     -2,410      -12,090      -24,115
 
                                                                 INCREASES OR DECREASES (-) IN SPENDING SUBJECT TO APPROPRIATION
 
SEC
    Net Authorization Level............           0         179         202         225         246         265          0          0          0          0          0        1,116        1,116
    Net Estimated Outlays..............          40        -174         191         214         235         254        397          0          0          0          0          719        1,116
CLEAb Authorization Level                         0         485           0           0           0           0          0          0          0          0          0          485          485
    Estimated Outlays..................           0         315         170           0           0           0          0          0          0          0          0          485          485
CFTC
    Estimated Authorization Level......           0          14          14          14          11          11         10          9          9          9          9           64          110
    Estimated Outlays..................           0          13          14          14          11          11          9          9          9          9          9           62          107
Other
    Net Estimated Authorization Level..           0           7           7           7           7           7          7          7          7          7          7           34           69
    Net Estimated Outlays..............           0           6           7           7           7           7          7          7          7          7          7           33           68
    Total Changes......................
        Net Estimated..................
        Authorization Level............           0         685         223         246         263         283         16         16         16         16         16        1,699        1,781
        Net Estimated Outlays..........           0         159         382         234         252         272        414         16         16         16         16        1,299        1,777
Memorandum: Components of the Net
 Increase in the Deficit
                                                                                  DECREASES IN DIRECT SPENDING
 
Total Changes in Direct Spending.......
    Estimated Budget Authority.........           0      -1,670      -2,165      -2,830      -3,680      -3,210     -3,035     -3,040     -3,175     -3,350     -3,485      -13,555      -29,640
    Estimated Outlays..................           0      -1,515      -2,260      -2,885      -3,745      -3,265     -3,090     -3,105     -3,240     -3,405     -3,550      -13,670      -30,060
 
                                                                                      DECREASES IN REVENUES
 
Total Changes in Revenues..............           0        -280        -295        -245        -330        -430       -630       -725       -835     -1,035     -1,140       -1,580       -5,945
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Source: Congressional Budget Office and the staff of the Joint Committee on Taxation.
Notes: Amounts may not sum to totals because of rounding; SEC = Securities and Exchange Commission, CLEA = Consumer Law Enforcement Agency, CFTC = Commodity Futures Trading Commission.
a The capital election would permit some banks to maintain a 10 percent leverage ratio and then be subject to reduced regulatory oversight.
b Under the bill the Consumer Financial Protection Bureau would be renamed CLEA. In addition, H.R. 10 would not authorize appropriations for the agency after 2018, but CBO estimates that its
  operations would cost about $5 billion over the 2019-2027 period, assuming appropriations were provided in those years that were equal to the amount authorized for 2018, adjusted for
  anticipated inflation.

    Basis of Estimate: For this estimate, CBO assumes that H.R. 
10 will be enacted late in 2017, that the specified and 
estimated amounts will be appropriated each year, and that 
outlays will follow historical spending patterns for the 
affected agencies.
    Changes in the Deficit From Changes in Direct Spending and 
Revenues: Many of the agencies that would be affected by the 
bill have both the authority to spend funds without annual 
appropriations (known as direct spending) and the authority to 
offset such spending with collections; some of those 
collections are classified as offsetting receipts, which are 
treated as reductions in direct spending, and the remainder are 
classified as revenues. Because proposed changes to the 
operations of those agencies would affect both direct spending 
and revenues, this estimate shows the budgetary effects of most 
provisions in terms of their net effect on the deficit.

Eliminating the Orderly Liquidation Fund

    Title I would repeal the FDIC's authority to use the OLF to 
resolve large, systemically important financial firms 
(including banks and nonbank firms) that become or are in 
danger of becoming insolvent, subject to certain conditions. 
CBO estimates that ending that authority would reduce deficits 
by $14.5 billion over the 2018-2027 period. That change 
reflects estimated reductions in both direct spending and 
revenues of $18.8 billion and $4.3 billion, respectively. The 
overall reduction incorporates an estimated increase in net 
costs to the FDIC's Deposit Insurance Fund of $1 billion to 
address failures of federally insured depositary institutions 
that would result from eliminating the OLF.
    The Orderly Liquidation Fund. Current law provides the FDIC 
with the authority and funding to address the failure--or 
possible failure--of large, systemically important banks and 
other financial firms. Use of that authority is contingent on 
certain conditions being met, including a finding by the 
Secretary of the Treasury that the bankruptcy process is not 
appropriate for resolving a firm's financial difficulties and 
that the firm's failure would threaten the stability of the 
nation's financial system.
    If the necessary conditions were met, the FDIC would be 
authorized under current law to borrow funds from the Treasury 
and implement alternative legal arrangements to resolve a 
firm's financial problems. The FDIC would be required to 
collect fees from other large financial firms to offset the 
cost of any losses resulting from those activities. The net 
outlays for any financial transactions stemming from the use of 
this authority would be recorded in the budget on a cash basis, 
and any income from fees would be recorded as revenues as the 
payments were received.
    Although the probability that the FDIC would have to 
liquidate a systemically important firm in any year is small, 
the potential associated cash flows would probably be large. On 
an expected-value basis, CBO estimates that the potential use 
of OLF authorities under current law will increase the deficit 
by $15.5 billion over the 2018-2027 period, reflecting net 
direct spending of $19.8 billion (which includes recoveries 
from the sale of assets) and revenues from fees of $4.3 billion 
(net of effects on income and payroll taxes). CBO estimates 
that repealing the authorities as specified in title I would 
reduce deficits by a corresponding amount.
    CBO's baseline projections reflect the estimated 
probability of various scenarios regarding the frequency and 
magnitude of systemic problems that could trigger spending by 
the OLF. Because future economic and financial events are 
inherently unpredictable, CBO assumes (on the basis of recent 
and historical trends) there is a chance of such an event in 
each of the 10 years of the projection period. The estimated 
effects on the deficit also account for differences in the 
timing between the expected values of spending by the OLF to 
resolve insolvent firms and assessments collected by the OLF to 
recover any costs. It might take several years, for example, to 
recoup the funds spent to liquidate a complex financial 
institution. As a result, CBO expects some of the proceeds from 
asset sales or cost recovery fees related to financial problems 
emerging in any particular year would be collected beyond the 
10-year budget window. CBO estimates, however, that over time 
net revenues collected from assessments would be lower than 
projected outlays, because the assessments would reduce the 
base for income and payroll taxes.
    The Deposit Insurance Fund. Repealing the FDIC's orderly 
liquidation authority could change how large, systemically 
important firms that fail would be resolved in the future and 
who would bear the costs. Without the OLF, CBO expects that any 
future defaults of such firms would have to be addressed 
through bankruptcy courts using financial resources available 
from the private sector. After considering the possibility of 
different outcomes, as detailed below, CBO estimates that 
without the OLF, the FDIC would realize additional net costs of 
about $1 billion through the DIF over the next 10 years.
    CBO expects that if a systemically important financial firm 
failed, some federally insured depository institutions would be 
among its creditors, increasing the probability of losses to 
the DIF. CBO also expects that creditors' losses would be 
larger under a bankruptcy proceeding than they would be under a 
resolution using the OLF because the timing and mechanisms of 
the bankruptcy process would probably place additional stress 
on the firm's creditors and other financial institutions.
    The legislation's potential effects on the DIF would depend 
on many legal, financial, and economic factors that are 
uncertain and difficult to quantify. For example, the risk to 
the DIF of additional bank failures would depend on the extent 
of the exposure of insured depository institutions to higher 
costs and whether they could remain financially solvent after 
absorbing those costs. To calculate the additional costs to the 
DIF, CBO considered the estimated cash flows of the OLF and 
interrelated financial institutions (known as counterparties) 
that would accrue losses; only insured depository institutions 
that fail would be resolved by the DIF.
    In its baseline, CBO projects that, on average under 
current law, the DIF will reduce the deficit by about $6 
billion per year. That projection includes income to the fund 
from insurance premiums and recoveries totaling, on average, 
about $10 billion per year and costs to resolve failed 
institutions totaling between $2 billion and $5 billion per 
year (excluding the DIF's operating costs). Those projections 
reflect a very small chance that a large, financially complex 
institution will fail and that the DIF will resolve the insured 
deposits at that institution.
    CBO estimates that under title I, the value of assets of 
failed institutions requiring resolution by the FDIC and the 
NCUA would increase by more than 5 percent above the amounts 
included in CBO's baseline projections. (The overwhelming 
majority of that increase would be resolved by additional 
spending through the DIF, although CBO estimates that insurance 
funds administered by the NCUA would also be needed to resolve 
some institutions.) To calculate the net effect on the federal 
budget, CBO considered the FDIC's loss ratio, which is the net 
cost of resolving the failure of an institution before changes 
in insurance assessments are made. For this estimate, CBO 
calculated variations in the loss ratio from the average of 18 
percent to as high as 30 percent, because in times when the 
financial sector has been under stress, the loss ratio for the 
DIF has typically been higher than average. Although, in CBO's 
estimation, the FDIC would eventually recover the cost of any 
additional losses by raising assessments on insured depository 
institutions, such recoveries would occur over many years.

Allowing Capital Election and Making Other Changes to Financial 
        Regulations

    Title VI would permit financial institutions to opt out of 
a number of financial rules and regulations, including all of 
those related to capital and liquidity standards if they choose 
to maintain a ratio of capital to assets as defined in the 
bill--a leverage ratio--that exceeds 10 percent.\1\ Some 
institutions would have to raise more capital to meet such a 
ratio. All of the financial institutions that opted into the 
new regulatory framework under the bill, in an action CBO has 
termed capital election, would receive less oversight from 
federal regulators. Other provisions of H.R. 10 would reduce 
regulatory oversight of some financial institutions by reducing 
the frequency of stress tests and reviews of resolution plans 
(known as living wills). Also, the bill would make changes to 
the authority of regulators to oversee certain banking 
activities and would allow institutions to change their 
operations in ways that could affect the DIF's losses.
---------------------------------------------------------------------------
    \1\Under that definition of leverage ratio, a firm with a higher 
ratio has lower leverage.
---------------------------------------------------------------------------
    CBO estimates that, on balance, those changes would result 
in higher losses by the DIF. Losses by the DIF are recovered by 
increasing assessments on banking institutions, which are 
recorded as reductions in direct spending. However, not all of 
the additional costs stemming from H.R. 10 would be recovered 
over the next 10 years. Thus, CBO estimates that enacting those 
provisions would increase net direct spending by about $300 
million over the 2018-2027 period.
    CBO's estimates for H.R. 10 are based on the analysis 
underlying the projections for deposit insurance in its January 
2017 baseline. Those projections incorporate the small 
probability that there is a financial crisis in any given year 
during the projection period and the more likely scenario of an 
average number of bank and credit union failures in any given 
year. As a result, the estimated cost represents a weighted 
probability of outcomes--including some cases, for which the 
probability is very low, but the losses by the DIF are much 
larger.
    In order to estimate the effects of the title VI 
provisions, CBO first considered which financial institutions 
might choose to make the capital election and the effect of 
that choice on the DIF.\2\ Financial institutions that 
currently maintain or exceed a leverage ratio of 10 percent and 
opt into the new framework would be subject to less regulatory 
oversight. That decline in oversight would tend to increase the 
losses those institutions impose on the DIF if they fail. The 
case is not as clear-cut for financial institutions that would 
need to increase their capital to meet the 10 percent threshold 
for making the capital election because increases in capital 
would typically decrease the risk of failure.
---------------------------------------------------------------------------
    \2\The Share Insurance Fund (SIF), administered by the NCUA, would 
experience effects similar to those for the DIF, as discussed in this 
section.
---------------------------------------------------------------------------
    However, under the bill, the calculation of the leverage 
ratio would not consider the riskiness of the assets. (Under 
current regulations, financial institutions must meet both 
risk-weighted and non-risk-weighted capital ratios.) As a 
result, an institution that met the 10 percent leverage ratio 
and made the capital election would probably have a somewhat 
riskier portfolio of assets and would impose somewhat higher 
costs on the DIF, on average, than financial institutions with 
similar ratios that did not make the election.
    CBO analyzed financial institutions on the basis of the 
size of their assets and the concentration of certain types of 
assets within their balance sheet portfolios. Financial 
institutions in the United States hold a total of about $18 
trillion in assets (about $17 trillion at banks and $1 trillion 
at credit unions). Roughly 70 percent of the assets in the 
banking sector are held in banks with assets over $50 billion. 
Financial institutions would decide whether or not to make the 
capital election allowed by H.R. 10 on the basis of their 
specific financial and strategic goals. Some firms that 
currently have a leverage ratio of 10 percent could make that 
election without needing to significantly change their business 
models. Firms currently below that threshold would have to 
assess the trade-offs between the costs of raising capital and 
the benefits of less regulation.
    Choices for Financial Institutions With Assets of Less Than 
$50 Billion. CBO expects that most of the financial 
institutions that chose to maintain a leverage ratio at 10 
percent would be those with assets below $10 billion, commonly 
known as community banks. CBO estimates that more than one-half 
of banks with assets of less than $50 billion have a 10 percent 
capital ratio and that those institutions hold roughly 15 
percent of the total assets held by banks. (About two-thirds of 
credit unions holding about two-thirds of credit union assets 
also have leverage ratios of 10 percent or more). However, CBO 
does not expect that all of those institutions would make the 
capital election because they would have to maintain that ratio 
over time, as well as their return on equity. CBO assigned an 
initial probability of 50 percent that those institutions would 
choose to make the capital election. Those firms account for 
about 7 percent of all bank assets. CBO expects that both the 
number of institutions making the election and the percentage 
of total assets would grow over time.
    Choices for Financial Institutions With Assets of More Than 
$50 Billion. Under H.R. 10, most larger financial institutions 
with more diverse portfolios and trading assets would be 
subject to a different leverage ratio known as the 
supplementary leverage ratio (SLR). The bill defines the SLR to 
include derivatives and other commitments that are not 
typically included in the leverage ratio calculation. As a 
result, the banks subject to the SLR would need to raise 
significantly more capital to qualify for reduced regulation 
and would probably have to make costly changes to internal 
processes that already comply with current regulations. CBO 
anticipates that, for example, the eight large banks 
headquartered in the United States that are characterized as 
globally systemic important banks (G-SIBs) would not make the 
election because they would have to raise much more capital.\3\ 
Further, the G-SIBs would still need to comply with a variety 
of regulations because of international rules. As a result, CBO 
expects that the G-SIBs would be unlikely to choose the 
alternative regulatory regime authorized by the bill. Those 
eight banks have about half of the assets of the U.S. banking 
industry.
---------------------------------------------------------------------------
    \3\The G-SIBS are JPMorgan Chase, Citigroup, Bank of America, 
Goldman Sachs, Morgan Stanley, Bank of New York Mellon, State Street, 
and Wells Fargo.
---------------------------------------------------------------------------
    CBO estimates that fewer than 10 financial institutions in 
this cohort would meet the criteria to use the leverage ratio 
of 10 percent that would apply to smaller financial 
institutions. For those institutions that would be eligible and 
already have a 10 percent leverage ratio, CBO assigned the same 
50 percent probability discussed above. For those banks with 
less than a 10 percent ratio, CBO estimated a small probability 
that they would raise sufficient capital to reach that 
threshold. As a result, CBO estimates that roughly 2 percent of 
the assets at banks with assets over $50 billion would be at 
institutions that make the capital election.
    Estimating the Budgetary Effects of the Capital Election. 
CBO used a simulation model that draws on academic and 
financial industry research to estimate the cost of allowing 
financial institutions to make the capital election in exchange 
for regulatory relief.\4\ Using bank call reports, as well as 
historical banking and market data as a starting point, CBO 
simulated the changes that financial institutions might make to 
their assets, liabilities, and capital structure under current 
law and under the provisions of H.R. 10. Those simulations 
generated a wide range of possible future outcomes for each 
institution's leverage ratio and also projected the probability 
that institutions making the capital election would fail. On 
average, those simulations indicated that financial 
institutions would be slightly more likely to fail under the 
regulatory and capital framework proposed in H.R. 10 than would 
be expected under current law. The increase in the probability 
of failure primarily stems from the increased riskiness of the 
assets taken on by institutions that would choose to make the 
capital election. (As noted, for financial institutions that 
must increase capital to make the capital election, the 
increased capital would partially offset that increase in 
risk.)
---------------------------------------------------------------------------
    \4\Federal Reserve Board of Minneapolis, ``The Minneapolis Plan to 
End Too Big to Fail'' (January 17, 2017), https://tinyurl.com/zgmas54; 
Simon Firestone, Amy Lorenc, and Ben Ranish, An Empirical Economic 
Assessment of the Costs and Benefits of Bank Capital in the U.S., 
Finance and Economics Discussion Series Paper 2017-034 (Board of 
Governors of the Federal Reserve System, 2017), https://doi.org/
10.17016/FEDS.2017.034; Kevin Jacques and Peter Nigro, ``Risk-Based 
Capital, Portfolio Risk, and Bank Capital: A Simultaneous Equations 
Approach,'' E&PA Working Paper 94-6 (Office of the Comptroller of the 
Currency, September 1994), https://go.usa.gov/xNWYW; Fitch Ratings, 
``Leverage Ratio Hurdle Not a Cure-All for Bank Failures'' (February 
28, 2017), www.fitchratings.com/site/pr/1019822.
---------------------------------------------------------------------------
    Other Changes to Regulatory Standards. H.R. 10 would 
reduce, from annually to biennially, the frequency of the 
requirement that larger financial institutions complete stress 
tests administered by the Federal Reserve and submit to the 
FDIC plans for resolution in the event of a financial crisis. 
Because less frequent testing and reporting would allow risk to 
accumulate for a longer period without corrective measures, CBO 
estimates a very small increase in losses by the DIF, 
incorporating a probability that reflects the unlikely failure 
of a large bank or the failure of a series of large financial 
institutions. That estimate is based on information from 
national credit rating agencies and other industry experts.\5\
---------------------------------------------------------------------------
    \5\S&P Global Market Intelligence, ``What Financial Regulations May 
Be Affected by the Trump Administration, and How They Can Affect 
Ratings'' (March 20, 2017), https://tinyurl.com/k2dwxws.
---------------------------------------------------------------------------
    In addition, the bill would prohibit financial regulators 
from classifying certain commercial loans as nonperforming and 
from requiring certain banks to raise more capital to cover the 
potential losses that could stem from those loans. CBO expects 
that those prohibitions would primarily affect loans for 
commercial real estate.\6\ Some banks and credit unions with 
holdings that are primarily concentrated in the commercial real 
estate sector could experience a reduction in their capital 
reserves, which would lead to a higher probability of a failure 
and would increase the probability of additional federal 
spending to resolve the liabilities of failed institutions.
---------------------------------------------------------------------------
    \6\For more information on those provisions, contained in section 
546 of H.R. 10, see Congressional Budget Office, cost estimate for H.R. 
1941, the Financial Institutions Examination Fairness and Reform Act 
(February 11, 2016), www.cbo.gov/publication/51243.
---------------------------------------------------------------------------
    Net Budgetary Effect of Changes to Regulatory Standards and 
Oversight. CBO anticipates that failures of financial 
institutions resulting from the combination of reduced 
regulatory oversight and increased risk would increase losses 
by the DIF by about 1 percent to 2 percent and would total 
about $600 million over the 2018-2027 period.\7\ CBO expects 
that the FDIC would assess fees to recoup any additional costs 
to the DIF of resolving failed institutions in order to restore 
the fund's balance to its target level of the designated 
reserve ratio. Over the 2018-2027 period, those fees would 
total about $200 million, CBO estimates.
---------------------------------------------------------------------------
    \7\That total also includes about $20 million from the SIF.
---------------------------------------------------------------------------
    FDIC's Risk-Based Premiums. Under current law, the FDIC 
charges banks premiums based on their risk profile. Those 
premiums are recorded as offsetting receipts in the budget. 
Under H.R. 10, the FDIC would continue to assess risk-based 
premiums on all banks, CBO anticipates. By CBO's estimates, 
those premiums would slightly increase for some of the banks 
that chose to meet the 10 percent leverage ratio, and the 
additional premiums would total about $100 million over the 
next 10 years.

Changes to Financial Regulatory Agencies

    Changes in H.R. 10 to the financial regulatory agencies 
primarily consist of:
       Amending the underlying responsibilities and 
operations for the agencies,
       Modifying the way in which the agencies are 
funded, and
       Transferring responsibilities and eliminating 
agencies.

    Amending Responsibilities and Operations. Numerous 
provisions of H.R. 10 would affect the administrative costs of 
the FDIC, the Treasury Department's Office of Comptroller of 
the Currency (OCC), the NCUA, the Federal Housing Finance 
Agency (FHFA), and the Federal Reserve by changing procedures 
for rulemaking, examinations, and enforcement. CBO estimates 
that implementing those changes would increase deficits by $420 
million over the 2018-2027 period.
    Changes in Administrative Costs. Several provisions, such 
as the requirements under title III to perform additional 
analyses for proposed and final rules and the establishment of 
an Office of Independent Examination Review within the Federal 
Financial Institutions Council, would increase administrative 
costs, while other provisions could decrease costs. On the 
basis of an analysis of information from the affected agencies, 
CBO estimates that, on net, enacting those changes would 
increase the deficit by $440 million over the 2018-2027 period, 
reflecting estimated increases in direct spending of $220 
million and estimated decreases in revenues of $220 million.
    Some financial regulators (for example, the FDIC) can 
eventually recover additional costs through assessments on the 
industry, but because there is a lag between the time costs are 
incurred and when additional assessments would be imposed, not 
all additional costs would be recovered within the next 10 
years. In contrast, the Federal Reserve would be able to 
recover only a portion of its additional costs because it 
assesses fees to cover only the costs associated with its role 
as the primary regulator of systemically important financial 
institutions (certain nonbanks and large banks).
    Changes to the Federal Reserve. Title I would remove 
certain authorities the Dodd-Frank Act provided to the Federal 
Reserve that require it to supervise and regulate systemically 
important nonbank financial institutions and financial market 
utilities. Those changes would reduce operating costs of the 
Federal Reserve and raise remittances to the Treasury by $589 
million over the 2018-2027 period. However, the Federal Reserve 
also would stop collecting assessments on institutions it would 
no longer regulate, reducing revenues by $371 million over the 
2018-2027 period, net of income and payroll tax effects, CBO 
estimates. On net, those changes would increase revenues by 
$218 million over the same period.
    Title I also would require the Federal Reserve to perform 
new analysis and to undertake new regulatory actions related to 
stress tests and resolution plans, increasing costs to the 
system. Title VII would split the current Office of the 
Inspector General of the Federal Reserve and CFPB into two 
separate offices, lowering costs to the Federal Reserve. Title 
X would make a number of other changes to the operations of the 
Federal Reserve System. CBO estimates that, in total, those 
provisions would reduce revenues by $40 million over the 2018-
2027 period.
    Provisions in Title X with the most significant effects 
include:
       Employees and members of the Board of Governors 
would become subject to additional ethics standards and 
financial disclosure rules. The ethics standards would follow 
those that apply to employees of the SEC.
       The Federal Open Market Committee (FOMC) would 
be required to develop a monetary policy rule that specifies an 
interest rate target and explains how that target rate would be 
adjusted for changes in certain economic variables. The rule 
would be provided to the Government Accountability Office 
(GAO), which would assess the rule and any subsequent changes 
to the rule for compliance with the requirements of the bill.
       Other changes include requiring GAO to prepare, 
within 12 months of enactment, an audit of the Board of 
Governors of the Federal Reserve System and the Federal Reserve 
banks, including the conduct of monetary policy; restricting 
certain public communications by the FOMC; and changing the 
membership of the FOMC.
    Other Changes. CBO and the staff of the Joint Committee on 
Taxation (JCT) estimate that implementing several other 
provisions of H.R. 10 would increase deficits by $159 million 
over the 2018-2027 period, reflecting increases in direct 
spending of $8 million and decreases in revenues of $151 
million. CBO estimates that implementing those provisions also 
would cost $146 million over the 2018-2027 period, subject to 
the availability of appropriated funds. Specifically:
       Title IV would authorize the SEC to refund the 
overpayment of certain fees by lowering future collections by 
the corresponding amount. CBO estimates that implementing the 
provision would increase direct spending by $8 million over the 
2018-2027 period.
     Title IV would amend regulations such that it 
would expand allowable activities of business development 
companies. JCT estimates that in response to those changes, 
income would be shifted from C corporations to business 
development companies, reducing tax revenues by $151 million 
over the 2018-2027 period.
     Title I would authorize the appropriation of $4 
million each year for the operations of the Financial Stability 
Oversight Council (FSOC). CBO estimates that implementing the 
provision would cost $39 million over the 2018-2027 period, 
subject to the availability of appropriated funds.
     H.R. 10 would require the CFTC to perform 
additional analyses of rules and regulations. On the basis of 
an analysis of information from the agency, CBO estimates that 
implementing the provisions would cost $107 million over the 
2018-2027 period, subject to the availability of appropriated 
funds.
    Modifying Agency Funding. Under current law, spending by 
the financial regulators is often covered by fees or other 
sources of income that usually offset spending by those 
agencies. Some agencies charge fees that are subject to the 
annual appropriation process, some agencies charge fees under 
permanent authority, and the CFPB receives funds from the 
Federal Reserve.
    The bill would attempt to make the operating costs and 
collection of fees of the financial regulators subject to 
annual appropriations. However, in most cases, the changes 
specified would not become effective until 90 days after the 
enactment of an appropriation bill that provided the funding 
specified in H.R. 10. Because subsequent legislation would be 
necessary to make the changes effective, the current funding 
arrangements for the SEC, OCC, FDIC, the FHFA, and the Federal 
Reserve would not change following enactment of H.R. 10. 
Therefore, those changes in funding are not reflected in CBO's 
cost estimate for this legislation.
    In contrast, the bill would effectively make spending for 
the CFPB and the collections and spending for the NCUA's 
administrative costs subject to annual appropriation. Under 
current law those expenses are covered by permanent (mandatory) 
appropriations. Because CBO expects that the level of spending 
for the CFPB and the NCUA under H.R. 10 would be similar to the 
amount of spending for such activities under current law, the 
reductions in direct spending by the CFPB and the NCUA would 
increase the need for future appropriations for those agencies 
by a similar amount.
    CBO estimates that enacting those provisions, over the 
2018-2027 period, would reduce direct spending by $9.2 billion 
and would cost $1.6 billion, assuming appropriation of the 
necessary amounts.
    Consumer Financial Protection Board. Under current law, the 
CFPB is funded by transfers from the Federal Reserve and the 
agency's spending is recorded as direct spending. Title VII 
would amend current law to make spending for the CFPB (renamed 
the Consumer Law Enforcement Agency) subject to annual 
appropriations. The bill would authorize the appropriation of 
$485 million for fiscal year 2018, an amount equal to the 
amount transferred from the Federal Reserve to the CFPB in 
2015. CBO estimates that enacting this provision would reduce 
direct spending by $6.9 billion over the 2018-2027 period and 
cost $485 million over the 2018-2022 period, subject to 
appropriation of the authorized amounts. H.R. 10 would not 
authorize appropriations for the agency after 2018, but CBO 
estimates that its operations would cost about $5 billion over 
the 2019-2027 period, assuming appropriations were provided in 
those years that were equal to the amount authorized for 2018, 
adjusted for anticipated inflation.
    National Credit Union Administration. Under current law, 
the NCUA imposes fees on all federally chartered credit unions 
to pay for its operations. Under H.R. 10, the NCUA would 
instead impose a fee on all credit unions, including those 
chartered by states, to offset the costs of an annual 
appropriation for the agency's administrative operating costs. 
Under the bill, the total collections from credit unions would 
be higher than under current law because the bill would not 
reduce current assessments as much as current spending for 
administrative costs. By making the NCUA's administrative costs 
subject to annual appropriation, this provision would, by CBO's 
estimates, decrease the deficit by $2.3 billion over the 2018-
2027 period, reflecting decreases in direct spending of $3.4 
billion and reductions in offsetting receipts of $1.1 billion 
over the 2018-2027 period. Because the NCUA would collect fees 
to offset any spending of appropriated funds, implementing the 
provisions regarding the NCUA would have no net effect on 
spending that is subject to annual appropriations.
    Securities Exchange Commission. H.R. 10 also would change 
the level of certain fees collected by the SEC that, under 
current law, are intended to fully offset its annual 
appropriation. The bill would create a target collection amount 
for those fees that would increase annually at the rate of 
inflation to partially offset the agency's appropriation.
    H.R. 10 also would authorize the appropriation of $8.5 
billion over the 2018-2022 period for the SEC. Assuming 
appropriation of the specified amounts, CBO estimates that 
implementing this provision would cost $8.5 billion over the 
2018-2022 period. However, under the bill, the SEC would be 
authorized to collect $1.4 billion, annually adjusted for 
inflation, in fees intended to partially offset its annual 
appropriation; therefore, CBO estimates that the net effect 
would increase discretionary appropriations by $1.1 billion 
over the 2018-2022 period.
    Public Company Accounting Oversight Board. The bill would 
require the Public Company Accounting Oversight Board to 
deposit civil penalties it collects in the Treasury, rather 
than spending them. On the basis of an analysis of information 
from the board, CBO estimates that enacting the provision would 
decrease direct spending by $28 million over the 2018-2027 
period.
    Transferring Responsibilities and Eliminating Agencies. 
H.R. 10 would transfer certain responsibilities away from the 
CFPB, eliminate the Financial Research Fund (FRF), and 
eliminate the SEC's authority to spend certain collections. CBO 
estimates that enacting these provisions would reduce deficits 
by $560 million.
    Consumer Financial Protection Bureau. Under current law, 
the CFPB has the authority to supervise and examine certain 
financial institutions and nonbank companies and to require 
those entities to comply with certain consumer financial laws. 
Under H.R. 10, the agency's supervision and examination 
authority and its authority to enforce consumer financial laws 
for insured financial institutions with over $10 billion in 
total assets would be eliminated. Under the bill, some of those 
authorities would be transferred to other financial regulators. 
On the basis of an analysis of information from the affected 
agencies, CBO estimates that enacting those provisions would 
increase the deficit by $230 million over the 2018-2027 period, 
reflecting an estimated increase in direct spending of $30 
million and a decrease in revenues of $200 million over the 
2018-2027 period for the Federal Reserve, the FDIC, the OCC, 
and the NCUA to collectively hire approximately 150 additional 
staff.
    Financial Research Fund. H.R. 10 would eliminate the FRF. 
Under current law, the costs of operating the Office of 
Financial Research (OFR), the Financial Stability Oversight 
Council (FSOC), and some administrative expenses of the OLF are 
offset by fees collected from certain bank holding companies 
and nonbank financial companies. Those fees are deposited into 
the FRF. Those fees are recorded in the budget as revenues when 
they are collected and as direct spending when spent. In 2016, 
the FRF spent $99 million. On the basis of an analysis of 
information from the OFR and the FSOC, CBO estimates that 
eliminating FRF would reduce deficits by $300 million over the 
2018-2027 period, reflecting an estimated reduction in direct 
spending of $1.4 billion and an estimated loss in revenues of 
$1.1 billion, net of income and payroll tax effects. The total 
includes the costs of shutting down the OFR (for closing 
contracts, staff severance, and leave payments) and the costs 
of providing pensions and health benefits to federal retirees.
    CBO estimates that implementing this provision would 
increase costs at the Department of the Treasury by $30 million 
over the 2018-2027 period for administrative costs currently 
shared by the OFR and the department; such spending would be 
subject to the availability of appropriated funds.
    Securities and Exchange Commission. Under current law, the 
SEC may deposit a portion of the revenues it collects into a 
reserve fund and spend up to $100 million annually from that 
fund without further appropriation. Under the bill, the SEC 
Reserve Fund would be abolished, reducing direct spending by 
$490 million over the 2018-2027 period, CBO estimates.
    Penalties. Provisions in H.R. 10 would change the maximum 
penalties for certain violations of securities laws enforced by 
the SEC and change how the cases are administered. The bill 
also would change how the CFPB administers civil penalty cases 
and would eliminate the Volcker rule.\8\ CBO estimates that the 
provisions would reduce the deficit by $560 million over the 
2018-2027 period, reflecting an estimated reduction in direct 
spending of $710 million and reduction in revenues of $150 
million.
---------------------------------------------------------------------------
    \8\The Volcker rule, section 619 of the Dodd-Frank Act, restricts 
FDIC-insured institutions from engaging in certain proprietary trading 
of securities, derivatives, commodity futures, and options on those 
instruments. With certain exceptions, the rule also prohibits banks 
from owning, sponsoring, or having certain relationships with hedge 
funds and private equity funds.
---------------------------------------------------------------------------
    Changes in Penalties by the SEC. Title II would amend 
various securities and financial laws to increase the maximum 
penalty that agencies may assess for certain violations. Under 
the bill, various civil penalties authorized to be levied by 
the SEC and other federal financial regulatory agencies would 
increase. The bill also would add a new tier of penalties for 
individuals previously convicted of securities fraud.
    Title VIII would allow parties to administrative 
proceedings brought by the SEC to file to terminate them. The 
SEC would then have the option to bring civil actions in a 
federal district court against parties that terminate their 
administrative proceedings. On the basis of an analysis of 
information from the SEC regarding current civil penalty 
collections, CBO estimates that enacting the provisions would 
decrease revenues by $80 million over the 2018-2027 period. The 
change would result from increases in collections resulting 
from higher maximum penalties as well as decreases resulting 
from delays, as some collections would arise from civil rather 
than administrative proceedings.
    Changes to Penalties by the CFPB. Title VII would change 
the operation of the civil penalty fund of the CFPB. Under 
current law, the CFPB collects civil penalties that result from 
its enforcement actions and deposits them into a civil penalty 
fund. The agency is authorized to use those funds to pay 
victims of activities for which civil penalties have been 
imposed as well as for certain consumer education and financial 
literacy programs. Allocations are made to eligible victims 
from the pooled amount in the fund; classes of victims are not 
limited to receiving only the amount the civil penalty paid for 
their case.
    Under the bill, the CLEA would be required to maintain a 
separate account for each civil penalty award. The payments to 
victims would be limited to the amount of the civil penalty 
paid for that specific case. If at the end of two years, any 
amounts remained in a segregated civil penalty account, those 
amounts would be deposited into the general fund of the 
Treasury. Amounts currently in the fund would be required to be 
segregated into discrete accounts by civil penalty action and 
be subject to the same requirements as any new civil penalty 
awards. Using information from the CFPB about the amounts 
currently in the fund, CBO estimates that enacting the 
provisions would decrease direct spending by $710 million over 
the 2018-2027 period.
    Volcker Rule. By eliminating the Volcker rule and the 
corresponding penalties for noncompliance, H.R. 10 would reduce 
revenues by an estimated $70 million over the 2018-2027 period.
    Pay-As-You-Go considerations: The Statutory Pay-As-You-Go 
Act of 2010 establishes budget-reporting and enforcement 
procedures for legislation affecting direct spending or 
revenues. The net changes in outlays and revenues that are 
subject to those pay-as-you-go procedures are shown in the 
following table.

                              CBO's ESTIMATE OF PAY-AS-YOU-GO EFFECTS FOR H.R. 10, AS ORDERED REPORTED BY THE HOUSE COMMITTEE ON FINANCIAL SERVICES ON MAY 4, 2017
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                               By fiscal year, in millions of dollars--
                                     -----------------------------------------------------------------------------------------------------------------------------------------------------------
                                         2017        2018        2019        2020        2021        2022        2023        2024        2025        2026        2027      2017-2022   2017-2027
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                   NET DECREASE IN THE DEFICIT
 
Statutory Pay-As-You-Go Impact......           0      -1,235      -1,965      -2,640      -3,415      -2,835      -2,460      -2,380      -2,405      -2,370      -2,410     -12,090     -24,115
Memorandum:
    Changes in Outlays..............           0      -1,515      -2,260      -2,885      -3,745      -3,265      -3,090      -3,105      -3,240      -3,405      -3,550     -13,670     -30,060
    Changes in Revenues.............           0        -280        -295        -245        -330        -430        -630        -725        -835      -1,035      -1,140      -1,580      -5,945
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

    Increase in long-term direct spending and deficits: CBO 
estimates that enacting the legislation would not increase net 
direct spending or on-budget deficits by more than $5 billion 
in any of the four consecutive 10-year periods beginning in 
2028.
    Intergovernmental and private-sector impact: The bill 
contains a number of mandates, some that fall on entities in 
both the public and private sectors, and others that fall on 
one sector or the other. In the aggregate, CBO estimates, the 
costs of mandates on public entities would fall below the 
annual threshold established in UMRA for intergovernmental 
mandates ($78 million in 2017, adjusted annually for 
inflation). However, CBO estimates that the net costs of 
mandates on private-sector entities would exceed the annual 
threshold for private-sector mandates ($156 million in 2017, 
adjusted annually for inflation) in at least two of the first 
five years the mandates were in effect, primarily because of 
new and increased fees and assessments.

Mandates That Apply to Both Public and Private Entities

    The bill would eliminate a right of action that allows 
public and private investors to pursue damage claims against 
broker-dealers who issue research reports on exchange-traded 
funds. Under current law, the SEC's rules generally prohibit an 
issuer from offering securities for sale without filing a 
registration statement with the agency. Section 421 of title IV 
of H.R. 10 would establish a safe harbor allowing broker-
dealers to issue research reports about certain investment 
funds without such reports being considered an offering for 
sale of shares of those funds. In so doing, it would protect 
broker-dealers from being sued on the basis that such a report 
constituted an offering for sale. By providing the safe harbor 
and eliminating the existing right of action, the bill would 
impose a mandate on public and private entities that might 
otherwise have a cause of action. The cost of the mandate would 
be the forgone value of the awards and settlements in such 
cases. To date, CBO has found no cases successfully 
establishing liability for information contained in or missing 
from such research reports and expects few, if any, in the 
future.

Mandates That Apply to State Governments Only

    The bill would impose mandates on states by preempting 
their laws in a number of areas. Preemptions of state law are 
mandates as defined in UMRA because they limit the authority of 
states to apply their own laws and regulations. However, CBO 
estimates that none of the preemptions in the bill would impose 
on states duties resulting in additional spending or a loss of 
revenues.
    Various provisions of titles IV, V, and XI of the bill 
would preempt state laws, as follows:
     Section 461 would exempt some security offerings 
from state registration and regulation. Issuers would be exempt 
from registering such a security if each purchaser had a 
preexisting relationship with the officer of the issuer, the 
offering had 35 or fewer purchasers, and the aggregate amount 
of securities sold by the issuer did not exceed $500,000 in a 
12-month period.
     Section 478 would exempt some security offerings 
from state registration, documentation, and other requirements. 
Issuers would be exempt from such state regulations if security 
offerings were small transactions.
     Sections 491 through 493 would exempt from state 
laws that provide a lower level of liability protection than 
the bill does those financial institutions and their employees 
who have received training on the financial exploitation of 
senior citizens when those employees file a report to a 
government authority about the potential exploitation of a 
senior citizen.
     Section 496 would exempt issuers of securities 
from registering a security with a state if the security was 
listed on a national exchange approved by the SEC.
     Section 556 would grant a temporary license to 
some loan originators who became employed by a state-licensed 
mortgage company in one state, enabling them to issue loans in 
other states.
     Section 581 would preempt state usury laws 
regulating the validity of loans that are sold, assigned, or 
transferred to a third party. Such loans would retain their 
maximum rate of interest as set by the loan's originator 
regardless of whether the loan was sold, assigned, or 
transferred to a third party located in a different state.
     Section 1101 would allow the independent insurance 
advocate (a role created by the bill) to preempt state 
insurance measures that are inconsistent with bilateral or 
multilateral insurance measures between the United States and a 
foreign government.

Mandates That Apply to Private Entities Only

    H.R. 10 would impose private-sector mandates on individuals 
and businesses in the financial services industry. The bill 
would affect certain fees and assessments on financial 
institutions, limit certain contractual rights, eliminate 
existing rights of action, require additional registration and 
reporting for proxy advisers, and apply standards for 
processing funds in two American territories. Although the 
incremental changes required to comply with some of the 
mandates would be small relative to existing practices, CBO 
estimates that the net increase in fees and assessments would 
exceed $200 million in the first two years the mandates were in 
effect.
    Increased Fees and Assessments. CBO expects some of the 
financial regulatory agencies to increase fees and assessments 
to offset the costs related to implementing the bill. For 
example, under the bill, the NCUA would assess fees on both 
federal and state-chartered credit unions insured by the Share 
Insurance Fund to offset costs associated with changing the 
agency's funding structure. CBO estimates that the incremental 
cost of the new fees would total about $200 million annually. 
Further, the bill's repeal of the Orderly Liquidation Fund 
might cause the FDIC to increase assessments on insured 
deposits to offset the cost of higher losses in the Deposit 
Insurance Fund. In each case, those higher fees would increase 
the cost of an existing mandate on institutions responsible for 
paying those assessments. At the same time, the elimination of 
the OLF would result in savings for some large financial 
institutions in the unlikely event of the failure of a 
systemically important financial institution, as the bill would 
eliminate assessments associated with the fund. Those savings 
are not estimated to begin until 2020. There is virtually no 
overlap between the institutions that would be subject to 
increased credit union and DIF assessments under the bill and 
those that would realize savings resulting from the elimination 
of the OLF. In the aggregate, CBO estimates, incremental costs 
associated with the changes in fees and assessments across the 
financial industry would total more than $210 million in 2018 
and 2019 and would fall in subsequent years, netting to a 
savings after five years.
    Temporary Limit on Contractual Rights. The bill would 
establish a new bankruptcy process for certain financial 
institutions with assets of more than $50 billion. The bill 
would impose a mandate by establishing a temporary stay on 
actions to terminate or modify certain nonfinancial contracts, 
such as derivatives contracts, for 48 hours after a bankruptcy 
petition was filed under the bankruptcy process established in 
the bill. The temporary stay would limit the contractual rights 
that entities have under current law. Limiting the ability of 
those entities to take actions such as collecting collateral or 
accelerating debt during that two-day period could cause them 
to incur losses. The cost of the mandate would total any losses 
the parties sustained as a result of the stay. Because of 
uncertainty about both the number and size of contracts that 
would be affected and the amount of losses that would occur as 
a result of this provision, CBO cannot estimate the cost of the 
mandate. However, on the basis of historical data, the 
likelihood that a large financial institution would fail in any 
one year is very low, and many experts believe that a stay in 
such circumstances would probably occur over a single weekend, 
potentially minimizing losses.
    Other Mandates on Private Entities. The bill would impose 
other private-sector mandates with small costs in a number of 
areas.
    Safe Harbor for Portfolio Lending. Section 516 would 
eliminate an existing right of action against lenders that hold 
mortgages on their balance sheets. Under current law, lenders 
that meet the standards for qualified mortgages are granted 
legal protection from civil actions based on a claim that they 
failed to comply with ability-to-repay requirements. By 
broadening the definition of qualified mortgages to include 
mortgages that lenders hold on their balance sheets, the bill 
would limit borrowers' right to file claims against them.
    Safe Harbor for Reporting Exploitation of a Senior Citizen. 
Section 491 would eliminate the right of plaintiffs to file a 
civil action against financial institutions and their employees 
who have received training on the financial exploitation of 
senior citizens when those employees file a report to a 
government authority about the potential exploitation of a 
senior citizen.
    Requirements on Proxy Advisory Firms. Section 482 would 
impose a mandate on proxy advisory firms (which can provide 
voting recommendations to investment advisers who have the 
authority to proxy vote for their clients) by requiring them to 
register with the SEC and subjecting them to new personnel and 
reporting requirements.
    Extended Application of the Expedited Funds Availability 
Act. Section 521 would require accounts at and checks drawn on 
commercial banks in American Samoa and the Northern Mariana 
Islands to meet standards required under the Expedited Funds 
Availability Act. The standards would require those banks to 
process such accounts and checks sooner than is their current 
business practice.
    Uncertainty: These estimates are subject to considerable 
uncertainty. For example, they depend in part on the 
probability of failure of a systemically important firm in any 
year. Although that probability is small both under current law 
and under the legislation, it is hard to predict. In addition, 
budgetary effects depend in part on how financial institutions 
would respond to changes in regulation. Projecting such 
responses is particularly difficult given that some proposed 
changes have little historical precedent. Although those and 
other aspects of the estimate are uncertain, CBO and JCT have 
endeavored to develop estimates that fall in the middle of the 
distribution of possible outcomes.
    Previous CBO estimates: On February 24, 2017, CBO 
transmitted a cost estimate for H.R. 732, the Stop Settlement 
Slush Funds Act of 2017, as ordered reported by the House 
Committee on the Judiciary on February 7, 2017. Provisions in 
H.R. 10 are similar to H.R. 732, and CBO's estimate of their 
budgetary effects is the same.
    On March 22, 2017, CBO transmitted a cost estimate for H.R. 
1219, the Supporting America's Innovators Act of 2017, as 
ordered reported by the House Committee on Financial Services 
on March 9, 2017. Provisions in H.R. 10 are similar to H.R. 
1219, and CBO's estimate of their budgetary effects is the 
same.
    On March 22, 2017, CBO transmitted a cost estimate for H.R. 
1312, the Small Business Capital Formation Enhancement Act, as 
ordered reported by the House Committee on Financial Services 
on March 9, 2017. Provisions in H.R. 10 are similar to H.R. 
1312, and CBO's estimate of their budgetary effects is the 
same.
    On March 23, 2017, CBO transmitted a cost estimate for H.R. 
1343, the Encouraging Employee Ownership Act of 2017, as 
ordered reported by the House Committee on Financial Services 
on March 9, 2017. Provisions in H.R. 10 are similar to H.R. 
1343, and CBO's estimate of their budgetary effects is the 
same.
    On March 30, 2017, CBO transmitted a cost estimate for H.R. 
910, the Fair Access to Investment Research Act of 2017, as 
ordered reported by the House Committee on Financial Services 
on March 9, 2017. Provisions in H.R. 10 are similar to H.R. 
910, and CBO's estimate of their budgetary effects is the same.
    On March 30, 2017, CBO transmitted a cost estimate for H.R. 
1667, the Financial Institution Bankruptcy Act of 2017, as 
ordered reported by the House Committee on the Judiciary on 
March 29, 2017. Provisions in H.R. 10 are similar to those in 
H.R. 1667, and CBO's estimate of their budgetary effects is the 
same.
    On April 4, 2017, CBO transmitted a cost estimate for H.R. 
1257, the Securities and Exchange Commission Overpayment Credit 
Act, as ordered reported by the House Committee on Financial 
Services on March 9, 2017. H.R. 10 would require the SEC to 
refund any overpayment of certain fees national securities 
exchanges pay. CBO's estimate of spending for the refund of 
overpayments is higher under H.R. 10 than under H.R. 1257 
because H.R. 10 would apply to fees and assessments paid over a 
longer period of time.
    Estimate prepared by: Federal Costs: Kathleen Gramp, Sarah 
Puro, Stephen Rabent, Jason Levine, and Jacob Fabian; Federal 
Revenues: Nathaniel Frentz and the staff of the Joint Committee 
on Taxation; Impact on State, Local, and Tribal Governments: 
Rachel Austin; Impact on the Private Sector: Logan Smith.
    Estimate approved by: Kim P. Cawley, Unit Chief for the 
Natural and Physical Resources Cost Estimates Unit; H. Samuel 
Papenfuss, Deputy Assistant Director for Budget Analysis; 
Theresa Gullo, Assistant Director for Budget Analysis.

                       Federal Mandates Statement

    The Committee adopts as its own the estimate of Federal 
mandates prepared by the Director of the Congressional Budget 
Office pursuant to section 423 of the Unfunded Mandates reform 
Act.

                      Advisory Committee Statement

    One advisory committee within the meaning of section 5(b) 
of the Federal Advisory Committee Act was created within this 
legislation. Pursuant to the Act, the Committee determines that 
the functions of the proposed advisory committee are not 
presently being performed by an agency or existing advisory 
committee. The Committee further determines that such functions 
cannot be performed by enlarging the mandate of an existing 
advisory committee. The advisory committee created by this 
legislation is as follows:
    Sec. 820--Advisory Committee on Commission's Enforcement 
Policies and Procedures.

                  Applicability to Legislative Branch

    The Committee finds that the legislation does not relate to 
the terms and conditions of employment or access to public 
services or accommodations within the meaning of the section 
102(b)(3) of the Congressional Accountability Act.

                         Earmark Identification

    H.R. 10 does not contain any congressional earmarks, 
limited tax benefits, or limited tariff benefits as defined in 
clause 9 of rule XXI.

                    Duplication of Federal Programs

    Pursuant to section 3(c)(5) of rule XIII, the Committee 
states that no provision of H.R. 10 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 Rulemakings

    Pursuant to section 3(i) of H. Res. 5, 115th Cong. (2017), 
the Committee states that H.R. 10 contains the following 
directed rulemakings:

         TITLE I--ENDING ``TOO BIG TO FAIL'' AND BANK BAILOUTS

    Section 111 directs the Federal Reserve to issue final 
rules implementing Section 165 of the Dodd-Frank Act as amended 
by the Financial CHOICE Act.
    Section 151 directs the Federal Reserve to issue 
regulations providing for three different sets of conditions 
under which the Federal Reserve will conduct stress tests 
required under subsection 165(i)(1) of the Financial Stability 
Act.

 TITLE IV--UNLEASHING OPPORTUNITIES FOR SMALL BUSINESSES, INNOVATORS, 
           AND JOB CREATORS BY FACILITATING CAPITAL FORMATION

    Section 406 directs the Securities and Exchange Commission 
(SEC) to revise 17 CFR 230.701(e) to raise the threshold for 
disclosures relating to compensatory benefit plans from $5 
million to $20 million.
    Section 411 directs the SEC to revise 17 CFR 229, 230, 232, 
239, 240 and 249 to exempt emerging growth companies and other 
smaller companies form the SEC's XBRL requirements.
    Section 421 directs the SEC to revise 17 CFR 230.139 to 
expand the safe harbor for investment research.
    Section 426 directs the SEC to revise Form S-3 to expand 
the class of registrants eligible to use Form S-3.
    Section 438 directs the SEC to revise 17 CFR 230, 240 and 
243, which set forth the rules relating to business development 
companies so that these companies can use the securities 
offering and proxy rules available to other issuers; and 
directs the SEC to revise Form N-2.
    Section 446 directs the SEC to revise 17 CFR 230 to clarify 
circumstances in which the prohibitions against general 
solicitation and general advertising do not apply. Section 466 
directs the SEC to revise 17 CFR 501 and Form D filing 
requirements for private placements.
    Section 476 directs the SEC to issue or revise to implement 
Section 476's amendments to Section 4A of the Securities Act of 
1933 regarding crowdfunding; section 476 also directs the SEC 
to establish by rule or regulation disqualification provisions 
for issuers and intermediaries.
    Section 482 directs the SEC to require by rule or 
regulation application registrations for proxy advisory firms. 
Section 482 also directs the SEC to issue rules regarding 
conflicts of interest at proxy advisory firms; unfair or 
coercive acts or practices by proxy advisory firms; and the 
filing of financial statements by proxy advisory firms. Section 
482 also directs the SEC to issue new provisions required by 
Section 482 or otherwise necessary to carry out Section 482.

  TITLE V--REGULATORY RELIEF FOR MAIN STREET AND COMMUNITY FINANCIAL 
                              INSTITUTIONS

    Section 526 directs the Federal Reserve to revise 12 CFR 
225 appendix C to raise the consolidated asset threshold for it 
Small Bank Holding Company Policy Statement on Assessment of 
Financial and Managerial Factors from $1 billion to $10 
billion.
    Section 531 directs the Consumer Law Enforcement Agency to 
issue regulations exempting small servicers from Section 6 of 
the Real Estate Settlement Procedures Act or to issue 
regulations adjust Section 6 for small servicers.
    Section 546 directs federal financial institutions 
regulatory agencies to revise regulations adopted in the seven-
year period before the Financial CHOICE Act was introduced in 
the House of Representatives as required by the Financial 
CHOICE Act. Section 551 directs the Office of the Comptroller 
of the Currency to issue rules to implement the Financial 
CHOICE Act's amendment of the Home Owner's Loan Act regarding 
covered savings associations. Section 566 directs the federal 
banking agencies to issue regulations allowing for a reduced 
reporting requirement for covered depository institutions.

   TITLE VII--EMPOWERING AMERICANS TO ACHIEVE FINANCIAL INDEPENDENCE

    Section 737 directs federal banking regulators to prescribe 
regulations to prevent unfair or deceptive acts or practices by 
depository institutions. Section 737 also directs the federal 
banking regulators to promulgate regulations substantially 
similar to those prescribed by the Federal Trade Commission 
under Section 18(a)(1)(B) of the Federal Trade Commission 
whenever the Federal Trade Commission does so.

                TITLE VIII--CAPITAL MARKETS IMPROVEMENTS

    Section 844 directs the SEC to revise 17 CFR section 
240.14a to revise the resubmission thresholds and the holding 
requirements for shareholder proposals.
    Section 848 directs the SEC issue rules to streamline the 
application process for exemptions from the Investment Company 
Act of 1940.
    Section 858 directs the SEC to issue rules to require 
investment advisers to maintain records and provide annual 
reports to the SEC.
    Section 871 directs the SEC and the Commodity Futures 
Trading Commission to jointly issue rules to resolve 
inconsistencies in their rules, orders, and interpretative 
guidance relating to the regulation of over-the-counter swaps 
markets.

            TITLE X--FED OVERSIGHT REFORM AND MODERNIZATION

    Section 1001 directs the Federal Open Market Committee to 
submit a Directive Policy Rule to the House Financial Services 
and Senate Banking Committees and the Government Accountability 
Office.
    Section 1008 directs the Federal Reserve to issue a rule 
establishing a method for determining the sufficiency of 
collateral for securing an extension of credit under the 
Federal Reserve's authority under section 13(3) of the Federal 
Reserve Act, acceptable classes of collateral, the amount of 
any discount on collateral, and a method for obtaining 
independent appraisals of such collateral. Section 1008 also 
directs the Federal Reserve to issue a rule establishing a 
minimum interest rate for extensions of credit under the 
Federal Reserve's 13(3) lending authority.

             Section-by-Section Analysis of the Legislation

    Section 1. Short title; Table of contents.

         TITLE I--ENDING ``TOO BIG TO FAIL'' AND BANK BAILOUTS

        Subtitle A--Repeal of the Orderly Liquidation Authority

    Section 111. Repeal of the orderly liquidation authority.--
Repeals Title II of the Dodd-Frank Act, which allows the 
Federal Deposit Insurance Corporation (FDIC) to bail out the 
creditors and counterparties of a failing non-bank financial 
institution. Removes the FDIC from the process of evaluating 
``living wills.''

              Subtitle B--Financial Institution Bankruptcy

    Section 121. General provisions relating to covered 
financial corporations.--Defines the term ``covered financial 
corporation'' and provides that title 11 of the United States 
Code applies to ``covered financial corporations.''
    Section 122. Liquidation, reorganization, or 
recapitalization of a covered financial corporation.--Adds a 
new subchapter V to Chapter 11 of title 11 of the United States 
Code that sets forth the procedures for liquidating, 
reorganizing, or recapitalizing ``covered financial 
corporations'' under title 11 of the United States Code.
    Section 123. Amendments to title 28, United States Code.--
Provides for the appointment and assignment of bankruptcy 
judges to hear cases brought under subchapter V.

                Subtitle C--Ending Government Guarantees

    Section 131. Repeal of obligation guarantee program.--
Repeals sections 1104, 1105, and 1106 of the Dodd-Frank Act, 
which allow the FDIC to guarantee the obligations of insured 
depository institutions.
    Section 132. Repeal of systemic risk determination in 
resolutions.--Repeals the ``systemic risk exception'' to the 
FDIC's obligation to use the deposit insurance fund to resolve 
failing banks using the least costly method.
    Section 133. Restrictions on use of the Exchange 
Stabilization Fund.--Prohibits the use of the Exchange 
Stabilization to establish guaranty programs for financial 
institutions.

     Subtitle D--Eliminating Financial Market Utility Designations

    Section 141. Repeal of title VIII.--Repeals Title VIII of 
the Dodd-Frank Act, which grants the Financial Stability 
Oversight Council (FSOC) the authority to designate ``financial 
market utilities'' as systemically important and authorizes the 
Federal Reserve to provide financial support to these 
designated ``financial market utilities.''

       Subtitle E--Reform of the Financial Stability Act of 2010

    Section 151. Repeal and modification of provisions of the 
Financial Stability Act of 2010.--
    Changes the FSOC's authority, structure, and procedures:
     Repeals the FSOC's authority to designate non-bank 
financial institutions as systemically important.
     Repeals the FSOC's authority to order a bank 
holding company or a non-bank financial institution to sell or 
transfer assets upon the recommendation of the Federal Reserve.
     Provides that the commission members of multi-
member regulatory agencies (in addition to the agency heads) 
are members of the FSOC, and sets forth procedures for voting 
on matters before the FSOC.
     Authorizes FSOC members to designate agency staff 
to attend FSOC meetings. Allows members of the House Financial 
Services Committee and the Senate Banking Committee to attend 
FSOC meetings.
     Makes the FSOC's funding subject to Congressional 
appropriations.
     Makes FSOC's open meetings subject to the Sunshine 
Act.
     Grants chairmen of the House Financial Services 
Committee and Senate Banking Committee the authority to request 
confidential congressional briefings.
    Changes the Federal Reserve's authority to supervise bank 
holding companies and non-bank financial institutions:
     Abolishes the Federal Reserve's authority to 
supervise and set regulations for non-bank financial 
institutions.
     Repeals the Federal Reserve's authority to 
continue supervising entities that cease to be bank holding 
companies.
     Exempts ``qualifying banking organizations'' as 
defined in Section 605 from the Federal Reserve's authority to 
set more stringent prudential standards for bank holding 
companies.
     Changes the procedure for the submission and 
review of the so-called ``living wills'':
            Requires bank holding companies subject to the 
        ``living wills'' requirement to submit them once every 
        two years to the Federal Reserve.
            Requires the Federal Reserve to review and provide 
        feedback within six months of receiving a ``living 
        will.''
            Requires the Federal Reserve to disclose the 
        framework used to assess the adequacy of ``living 
        wills,'' and provide a notice-and-comment period before 
        finalizing the assessment framework.
     Improves the stress testing process for bank 
holding companies:
            Requiring bank holding companies subject to the 
        Federal Reserve's more stringent standards having 
        assets less than $10 billion to conduct company-run 
        stress tests once a year rather than semiannually.
            Requires the Federal Reserve to issue regulations 
        subject to notice-and-comment for conducting stress 
        tests that set forth economic conditions and 
        methodologies, and to assess the effect of the Federal 
        Reserve's stress-testing models and methodologies on 
        financial stability, credit availability, model risks, 
        and investment cycles.
            Requires the Federal Reserve to issue regulations 
        subject to notice-and-comment for its Comprehensive 
        Capital Analysis and Review (CCAR) program, provides 
        that the Federal Reserve may not subject a bank holding 
        company to its CCAR program more than once every two 
        years, prohibits the Federal Reserve from objecting to 
        a bank holding company's capital plan based on 
        qualitative deficiencies, directs the Federal Reserve 
        to establish procedures for responding to inquiries 
        from bank holding companies subject to the CCAR 
        program.
    Office of Financial Research
       Abolishes the Office of Financial Research.
    Section 152. Operational risk capital requirements for 
banking organizations.--Requires federal banking regulators to 
set operational risk capital requirements based on the risks 
posed by an organization's current activities, using forward-
looking assessments and permitting adjustments for risk 
mitigants.

          TITLE II--DEMANDING ACCOUNTABILITY FROM WALL STREET

                Subtitle A--SEC Penalties Modernization

    Section 211. Enhancement of civil penalties for securities 
laws violations.--Increases the civil money penalties that may 
be sought in administrative and civil actions brought under the 
Securities Act of 1933, the Securities Exchange Act of 1934, 
the Investment Company Act of 1940, the Investment Advisers Act 
of 1940; adds a new category of monetary penalties in 
administrative and civil actions brought under the federal 
securities laws for recidivists; provides that for violations 
of injunctions and orders issued under the federal securities 
laws, each day of failure to comply is a separate offense.
    Section 212. Updated civil money penalties of Public 
Company Accounting Oversight Board.--Increases civil money 
penalties that the PCAOB may impose in actions brought under 
the Sarbanes-Oxley Act.
    Section 213. Updated civil money penalty for controlling 
persons in connection with insider trading.--Increases the 
civil money penalties that the SEC may seek against controlling 
persons in insider trading cases brought under Section 
21A(a)(3) of the Securities Exchange Act of 1934.
    Section 214. Update of certain other penalties.--Increases 
the civil money penalties that the SEC may seek under Section 
32 of the Securities Exchange Act of 1934.
    Section 215. Monetary sanctions to be used for the relief 
of victims.--Provides that monetary sanctions collected by the 
SEC for a violation of the securities laws shall be added to 
funds established for the benefit of the victims of the 
violation.
    Section 216. GAO report on use of civil money penalty 
authority by Commission.--Directs the GAO to report on the 
SEC's use of its authority to impose civil money penalties.

               Subtitle B--FIRREA Penalties Modernization

    Section 221. Increase of civil and criminal penalties 
originally established in the Financial Institutions Reform, 
Recovery, and Enforcement Act of 1989.--Increases civil and 
criminal penalties established in FIRREA.

   TITLE III--DEMANDING ACCOUNTABILITY FROM FINANCIAL REGULATORS AND 
                  DEVOLVING POWER AWAY FROM WASHINGTON

                   Subtitle A--Cost-Benefit Analyses

    Section 311. Definitions.--Defines terms used in Subtitle 
A.
    Section 312. Required regulatory analysis.--Directs federal 
financial regulatory agencies to include in proposed 
rulemakings regulatory analyses that identify the need for 
regulation and the regulatory objective (including an 
identification of the market or regulatory failure that makes 
regulation necessary); identify alternatives to the proposed 
regulation and explain why private market or non-federal 
authorities cannot address the problem; assess the costs, 
benefits, and consequences of the proposed regulation; and 
describe the data relied upon in analyzing the proposed 
regulation. Prohibits federal financial regulatory agencies 
from issuing a notice of final rulemaking if costs are greater 
than benefits without a joint resolution from Congress 
directing the agency to issue a notice of final rulemaking.
    Section 313. Rule of construction.--Provides that the 
collection of information in connection with the regulatory 
analysis mandated under Section 312 is not a ``collection of 
information'' under the Paperwork Reduction Act if the federal 
financial regulatory agency has issued an advance notice of 
proposed rulemaking and has informed the person from whom 
information is sought that the provision of information is 
voluntary.
    Section 314. Public availability of data and regulatory 
analysis.--Directs federal financial regulatory agencies to 
disclose on their websites sufficient information about 
regulatory analyses conducted as part of their rulemakings so 
that the agencies' results can be reproduced.
    Section 315. Five-year regulatory impact analysis.--Directs 
the chief economists at federal financial regulatory agencies 
to report on the economic impact of regulations that the 
agencies have issued within five years of the final rulemaking.
    Section 316. Retrospective review of existing rules.--
Directs the federal financial regulatory agencies to adopt a 
plan for modifying, streamlining, expanding, or repealing 
existing regulations to make the agencies' regulatory programs 
more effective or less burdensome.
    Section 317. Judicial review.--Grants individuals the right 
to bring actions in the D.C. Circuit Court seeking review of an 
agency's compliance with Section 312.
    Section 318. Chief Economists Council.--Establishes a 
council consisting of the chief economists of the federal 
financial regulatory agencies and directs it to report each 
year on the benefits and costs of regulations that the agencies 
have adopted in the prior year; the regulatory actions planned 
by the agencies in the coming year; the cumulative effect of 
existing agency regulations on economic activity; the training 
and qualifications of the persons who conducted regulatory 
analyses at the agencies during the prior year and the 
sufficiency of resources for conducting these analyses; and 
recommendations for legislative or regulatory action to improve 
financial regulation.
    Section 319. Conforming amendments.--Amends the Commodity 
Exchange Act to conform with the requirements of this subtitle.
    Section 320. Other regulatory entities.--Directs the SEC to 
submit a plan for subjecting the PCAOB, the Municipal 
Securities Rulemaking Board, and registered national securities 
associations to the requirements of this subtitle.
    Section 321. Avoidance of duplicative or unnecessary 
analyses.--Provides that regulatory analyses required by this 
subtitle may be performed in conjunction with analyses required 
by any other provision of law if the analysis satisfies the 
requirements of this subtitle.

Subtitle B--Congressional Review of Federal Financial Agency Rulemaking

    Section 331. Congressional review.--Requires federal 
financial agencies to report on proposed rules to Congress and 
the GAO before the rules take effect; requires that Congress 
approve rules having an annual effect on the economy of $100 
million or more through a joint resolution of approval before 
such rules can take effect; provides that Congress may pass a 
joint resolution of disapproval to prevent non-major rules from 
taking effect.
    Section 332. Congressional approval procedure for major 
rules.--Sets forth the procedures for Congress to approve rules 
having an annual effect on the economy of $100 million or more 
through a joint resolution of approval.
    Section 333. Congressional disapproval procedure for non-
major rules.--Sets forth the procedure for Congress to 
disapprove non-major rules.
    Section 334. Definitions.--Defines terms used in Subtitle 
B.
    Section 335. Judicial review.--Provides that 
determinations, findings, actions, or omissions under Subtitle 
B are not subject to judicial review.
    Section 336. Effective date of certain rules.--Provides 
that rules relating to hunting, fishing, or camping and non-
major rules for which notice and public comment are 
impracticable are effective on the date determined by the 
federal financial agency.
    Section 337. Budgetary effects of rules subject to section 
332 of the Financial CHOICE Act of 2017.--Amends the Balanced 
Budget and Emergency Deficit Control Act of 1985 to conform 
with the Financial Choice Act.

             Subtitle C--Judicial Review of Agency Actions

    Section 341. Scope of judicial review of agency actions.--
Directs court reviewing the actions of federal financial 
agencies to use a de novo standard of review when deciding all 
questions of law relating to an agency action, including the 
interpretation of constitutional and statutory provisions and 
the rules promulgated by an agency.

             Subtitle D--Leadership of Financial Regulators

    Section 351. Federal Deposit Insurance Corporation.--
Provides that the FDIC's board of directors is to consist of 5 
members appointed by the President with the advice and consent 
of the Senate, one of whom must have state bank supervisory 
experience.
    Section 352. Federal Housing Finance Agency.--Provides that 
the President may remove the director of the Federal Housing 
Finance Agency (FHFA) before the end of the director's 
appointed term with or without cause.

         Subtitle E--Congressional Oversight of Appropriations

    Section 361. Bringing the Federal Deposit Insurance 
Corporation into the regular appropriations process.--Makes the 
FDIC's funding subject to Congressional appropriations.
    Section 362. Bringing the Federal Housing Finance Agency 
into the regular appropriations process.--Makes the FHFA's 
funding subject to Congressional appropriations.
    Section 363. Bringing the National Credit Union 
Administration into the regular appropriations process.--Makes 
the NCUA's funding subject to Congressional appropriations.
    Section 364. Bringing the Office of the Comptroller of the 
Currency into the regular appropriations process.--Makes the 
Officer of the Comptroller of the Currency's (OCC) funding 
subject to Congressional appropriations.
    Section 365. Bringing the non-monetary policy related 
functions of the Board of Governors of the Federal Reserve 
System into the regular appropriations process.--Makes the 
Federal Reserve's funding for its non-monetary policy functions 
subject to Congressional appropriations.

                  Subtitle F--International Processes

    Section 371. Requirements for international processes.--
Requires the federal financial regulatory agencies and the 
Treasury Department to notify Congress and the public before 
participating in international standard-setting processes, 
publicly report on international standard-setting processes in 
which they have participated, and notify the House Financial 
Services and Senate Banking Committees of agreements that may 
result from international processes and consult with these 
Committees on these agreements and their economic effects.

                  Subtitle G--Unfunded Mandates Reform

    Section 381. Definitions.--Defines terms used in Subtitle 
G.
    Section 382. Statements to accompany significant regulatory 
actions.--Directs federal financial regulatory agencies to 
issue statements setting forth estimates for the compliance 
costs of federal mandates on particular regions of the nation, 
states, tribal and local governments, particular communities 
before promulgating notices of proposed rulemaking or final 
rules.
    Section 383. Small government agency plan.--Directs federal 
financial regulatory agencies to develop plans for providing 
small governments with notice of proposed rulemakings that 
affect small governments and the opportunity to provide input 
on such proposed rulemakings.
    Section 384. State, local, and tribal government and 
private sector input.--Directs federal financial regulatory 
agencies to develop processes for state, local, and tribal 
governments to provide input and consult with these agencies on 
proposed rulemakings that affect state, local, and tribal 
governments.
    Section 385. Least burdensome option or explanation 
required.--Requires federal financial regulatory agencies to 
identify regulatory alternatives and select the least costly 
alternative for rules that impose federal mandates on state, 
local, and tribal governments or the private sector.
    Section 386. Assistance to the Office of Information and 
Regulatory Affairs.--Directs the Office of Information and 
Regulatory Affairs (OIRA) to collect the statements required 
under this Subtitle and forward them to the Congressional 
Budget Office.
    Section 387. Office of Information and Regulatory Affairs 
responsibilities.--Directs OIRA to oversee the statements 
issued by federal financial regulatory agencies under this 
Subtitle to ensure that these statements comply with the 
Subtitle's requirements.
    Section 388. Judicial review.--Provides that agency 
compliance with the requirements of this Subtitle is subject to 
limited judicial review.

                  Subtitle H--Enforcement Coordination

    Section 391. Policies to minimize duplication of 
enforcement efforts.--Directs federal financial regulatory 
agencies to implement policies that minimize duplication of 
enforcement actions.

           Subtitle I--Penalties for Unauthorized Disclosures

    Section 392. Criminal penalty for unauthorized 
disclosures.--Imposes criminal penalties on the employees of 
federal financial regulatory authorities for the unauthorized 
disclosure of information in ``living wills'' or stress tests.

                Subtitle J--Stop Settlement Slush Funds

    Section 393. Limitation on donations made pursuant to 
settlement agreements to which certain departments or agencies 
are a party.--Prohibits federal financial regulatory 
authorities from using settlement proceeds to make payments to 
persons who were not directly harmed by the wrongdoing that led 
to the settlement.

 TITLE IV--UNLEASHING OPPORTUNITIES FOR SMALL BUSINESSES, INNOVATORS, 
           AND JOB CREATORS BY FACILITATING CAPITAL FORMATION

Subtitle A--Small Business Mergers, Acquisitions, Sales, and Brokerage 
                             Simplification

    Section 401. Registration exemption for merger and 
acquisition brokers.--Exempts merger-and-acquisition brokers 
from the registration requirements of the Securities Exchange 
Act of 1934.
    Section 402. Effective date.--Provides that Subtitle A will 
become effective 90 days after the enactment of the Financial 
CHOICE Act of 2017.

               Subtitle B--Encouraging Employee Ownership

    Section 406. Increased threshold for disclosures relating 
to compensatory benefit plans.--Directs the SEC to increase the 
threshold exemption from the registration requirements of the 
Securities Act of 1933 for certain securities offered as part 
of compensatory benefit plans from $5 million to $20 million.

          Subtitle C--Small Company Disclosure Simplification

    Section 411. Exemption from XBRL requirements for emerging 
growth companies and other smaller companies.--Exempts Emerging 
Growth Companies and other smaller companies from the SEC's 
eXtensible Business Reporting Language (XBRL) requirements for 
filing financial statements with the SEC.
    Section 412. Analysis by the SEC.--Directs the SEC to study 
the costs and benefits to smaller companies of using XBRL to 
file financial statements with the SEC.
    Section 413. Report to Congress.--Directs the SEC to report 
to the House Financial Services and Senate Banking Committees 
on its progress in implementing XBRL reporting and the use of 
XBRL data by the SEC and investors.
    Section 414. Definitions.--Defines terms used in Subtitle 
C.

   Subtitle D--Securities and Exchange Commission Overpayment Credit

    Section 416. Refunding or crediting overpayment of section 
31 fees.--Directs the SEC to credit overpayments made by 
national securities exchanges and associations against future 
fees and assessments.

             Subtitle E--Fair Access to Investment Research

    Section 421. Safe harbor for investment fund research.--
Directs the SEC to issue regulations providing that a covered 
investment fund research report is not an offer under the 
Securities Act of 1933.

               Subtitle F--Accelerating Access to Capital

    Section 426. Expanded eligibility for use of Form S-3.--
Directs the SEC to revise Form S-3 to expand the eligibility of 
smaller companies that may use Form S-3 for offerings.

                  Subtitle G--Enhancing the RAISE Act

    Section 431. Certain accredited investor transactions.--
Amends the Securities Act of 1933 to clarify that the resale of 
certain restricted securities to accredited investors are 
exempt from prohibitions against interstate solicitation.

             Subtitle H--Small Business Credit Availability

    Section 436. Business development company ownership of 
securities of investment advisers and certain financial 
companies.--Amends the Investment Company Act of 1940 to allow 
business development companies to own shares in registered 
investment advisers, up to 50 percent of their total assets. 
This section shall not be construed to allow a business 
development company to own shares of such companies in a 
percentage greater than 50 percent of their total assets.
    Section 437. Expanding access to capital for business 
development companies.--Amends the asset coverage requirements 
in the Investment Company Act of 1940 for business development 
companies.
    Section 438. Parity for business development companies 
regarding offering and proxy rules.--Directs the SEC to revise 
its rules to allow business development companies file 
offerings and proxy statements under rules available to other 
issuers.

                    Subtitle I--Fostering Innovation

    Section 441. Temporary exemption for low-revenue issuers.--
Grants certain low-revenue issuers a temporary exemption from 
Section 404(b) of the Sarbanes-Oxley Act.

        Subtitle J--Small Business Capital Formation Enhancement

    Section 446. Annual review of government-business forum on 
capital formation.--Directs the SEC to report on the findings 
and recommendations of the government-business forum on capital 
formation and the SEC's actions on these findings and 
recommendations.

              Subtitle K--Helping Angels Lead Our Startups

    Section 451. Definition of angel investor group.--Defines 
the term ``angel investor group.''
    Section 452. Clarification of general solicitation.--
Directs the SEC to revise its rules to clarify that the 
prohibition against general solicitation does not apply to 
certain presentations or communications made at events 
sponsored by institutions of higher education; nonprofit 
organizations; angel investor groups; venture forums, venture 
capital associations, or trade associations; or other groups 
determined by the SEC.

                     Subtitle L--Main Street Growth

    Section 456. Venture exchanges.--Amends the Securities 
Exchange Act of 1934 to allow a national securities exchange to 
register as a venture exchange and exempts venture exchanges 
from certain national security exchange regulations; amends the 
Securities Exchange Act of 1933 to provide that ``venture 
securities'' are exempt from state regulation of securities 
offerings.

                 Subtitle M--Micro Offering Safe Harbor

    Section 461. Exemptions for micro-offerings.--Amends the 
Securities Act of 1933 to provide that certain micro-offerings 
are exempt from prohibitions against interstate solicitation; 
amends the Securities Exchange Act of 1933 to provide that 
micro-offerings are exempt from state regulation of securities 
offerings.

               Subtitle N--Private Placement Improvement

    Section 466. Revisions to SEC Regulation D.--Directs the 
SEC to revise Regulation D to streamline and improve its filing 
requirements and procedures for issuers offering securities 
under Regulation D.

              Subtitle O--Supporting America's Innovators

    Section 471. Investor limitation for qualifying venture 
capital funds.--Amends the Investment Company Act of 1940 to 
exempt qualifying venture capital funds from Investment 
Company's Act definition of ``investment company.''

                      Subtitle P--Fix Crowdfunding

    Section 476. Crowdfunding exemption.--Amends the Securities 
Exchange Act of 1933 to exempt from the Act's registration 
requirements securities offerings involving certain small 
transactions.
    Section 477. Exclusion of crowdfunding investors from 
shareholder cap.--Amends the Securities Exchange Act of 1934 to 
provide that securities purchased under Section 476 are not 
``held of record'' under the Securities Exchange Act of 1934.
    Section 478. Preemption of State law.--Clarifies that the 
Subtitle P pre-empts only state registration, documentation and 
offering requirements for securities offered under Section 476, 
and that Subtitle P does not affect the states' enforcement 
authorities.
    Section 479. Treatment of funding portals.--Excludes 
funding portals from the definition of ``financial 
institution'' required to submit records and report on monetary 
instruments transactions.

        Subtitle Q--Corporate Governance Reform and Transparency

    Section 481. Definitions.--Defines terms used in Subtitle 
Q.
    Section 482. Registration of proxy advisory firms.--
Requires proxy advisory firms to register with the SEC and sets 
forth the procedure for registration.
    Section 483. Commission annual report.--Directs the SEC to 
report annually on proxy advisory firms.

                        Subtitle R--Senior Safe

    Section 491. Immunity.--Grants immunity from suit to 
certain individuals and financial institutions for disclosing 
the possible exploitation of a senior citizen to a financial 
regulatory agency.
    Section 492. Training required.--Provides that financial 
institutions may train certain employees on identifying and 
reporting the possible exploitation of senior citizens.
    Section 493. Relationship to State law.--Provides that 
Subtitle R does not pre-empt state law, except to the extent 
that it provides greater protection against liability to 
certain individuals and financial institutions for disclosing 
the possible exploitation of a senior citizen to a financial 
regulatory agency.

       Subtitle S--National Securities Exchange Regulatory Parity

    Section 496. Application of exemption.--Amends the 
Securities Act of 1933 to strike references to specific 
exchanges in defining ``covered securities'' exempt from 
regulation of securities offerings.

           Subtitle T--Private Company Flexibility and Growth

    Section 497. Shareholder threshold for registration.--
Amends the Securities Exchange Act of 1934 to raise the 
registration threshold for assets and shareholders.

        Subtitle U--Small Company Capital Formation Enhancements

    Section 498. JOBS Act-related exemption.--Amends the 
Securities Act of 1933 to raise the amount of securities that 
may be offered and sold within a 12-month period under the 
exemption for additional issues authorized by the JOBS Act.

                Subtitle V--Encouraging Public Offerings

    Section 499. Expanding testing the waters and confidential 
submissions.--Amends the Securities Act of 1933 to allow 
issuers to submit draft registration statements to the SEC for 
confidential, nonpublic review before an initial public 
offering.

  TITLE V--REGULATORY RELIEF FOR MAIN STREET AND COMMUNITY FINANCIAL 
                              INSTITUTIONS

         Subtitle A--Preserving Access to Manufactured Housing

    Section 501. Mortgage originator definition.--Amends the 
definition of ``mortgage originator'' in the Truth in Lending 
Act to specify that, subject to certain exceptions, a retailer 
of manufactured housing or its employee is not a ``mortgage 
originator.''
    Section 502. High-Cost mortgage definition.--Amends the 
definition of ``High-Cost Mortgage'' in the Truth in Lending 
Act to provide that a credit transaction secured by a 
consumer's dwelling is a ``high-cost mortgage'' if the dwelling 
is personal property, the annual percentage rate exceeds the 
average prime offer rate by more than 10 percentage points, and 
the transaction is for less than $75,000.

                      Subtitle B--Mortgage Choice

    Section 506. Definition of points and fees.--Amends the 
definition of ``points and fees'' in the Truth in Lending Act 
to exclude fees paid for affiliated business arrangements.

         Subtitle C--Financial Institution Customer Protection

    Section 511. Requirements for deposit account termination 
requests and orders.--Requires federal banking regulators to 
have a material reason not based solely on reputation risk for 
requesting or ordering a depository institution to terminate a 
customer's account.
    Section 512. Amendments to the Financial Institutions 
Reform, Recovery, and Enforcement Act of 1989.--Amends FIRREA 
to provide that FIRREA's civil penalties provisions apply to 
violations by a depository institution against an unaffiliated 
third person; requires the Attorney General for investigations 
of possible violations of FIRREA to request a court order to 
summon witnesses or compel the production of documents, or to 
personally or through delegation to at least a Deputy Attorney 
General, issue a subpoena to summon witnesses or compel the 
production of documents.

           Subtitle D--Portfolio Lending and Mortgage Access

    Section 516. Safe harbor for certain loans held on 
portfolio.--Amends the Truth in Lending Act to provide a safe 
harbor against litigation for depository institutions and 
mortgage originators for residential mortgage loans held on the 
creditor's balance sheet since the origination of the loan if 
the loan fails to comply with TILA's ability-to-repay 
requirements.

    Subtitle E--Application of the Expedited Funds Availability Act

    Section 521. Application of the Expedited Funds 
Availability Act.--Amends the Expedited Funds Availability Act 
to clarify that the time periods under the Act apply to 
institutions located in American Samoa and the Northern Marian 
Islands.

        Subtitle F--Small Bank Holding Company Policy Statement

    Section 526. Changes required to small bank holding company 
policy statement on assessment of financial and managerial 
factors.--Directs the Federal Reserve to raise the threshold 
for its Small Bank Holding Company Policy Statement from $1 
million to $5 million.

           Subtitle G--Community Institution Mortgage Relief

    Section 531. Community financial institution mortgage 
relief.--Amends the Truth in Lending Act to exempt smaller 
creditors from TILA's escrow requirements.

   Subtitle H--Financial Institutions Examination Fairness and Reform

    Section 536. Timeliness of examination reports.--Amends the 
Federal Financial Institutions Examination Council Act of 1978 
to require federal financial regulatory agencies to provide 
examined institutions with a final examination report within 60 
days of an examination's exit interview; sets examination 
standards for agencies; creates an Office of Independent 
Examination Review to investigate complaints about 
examinations; grants financial institutions the right to seek 
review of supervisory determinations.

  Subtitle I--National Credit Union Administration Budget Transparency

    Section 541. Budget transparency for the NCUA.--Amends the 
Federal Credit Union Act to require the National Credit Union 
Administration (NCUA) to annually hold public hearings on its 
budget.

   Subtitle J--Taking Account of Institutions with Low Operation Risk

    Section 546. Regulations appropriate to business models.--
Directs federal financial regulatory agencies tailor regulatory 
actions to an institution's risk profile and business model.

      Subtitle K--Federal Savings Association Charter Flexibility

    Section 551. Option for Federal savings associations to 
operate as a covered savings association.--Amends the Home 
Owners' Loan Act to allow certain federal savings associations 
to operate with the same rights and privileges as a national 
bank supervised by the OCC.

                Subtitle L--SAFE Transitional Licensing

    Section 556. Eliminating barriers to jobs for loan 
originators.--Amends the S.A.F.E. Mortgage Licensing Act of 
2008 to temporarily allow loan originators to continue to act 
as loan originators if they move from a depository institution 
to a non-depository institution or if they move from one state 
to another while their applications to be state-licensed loan 
originators are pending.

                       Subtitle M--Right to Lend

    Section 561. Small business loan data collection 
requirement.--Repeals Sections 704B of the Equal Credit 
Opportunity Act, which requires financial institutions to 
collect information from small businesses regarding their 
ownership.

              Subtitle N--Community Bank Reporting Relief

    Section 566. Short-form call report.--Amends the Federal 
Deposit Insurance Act to direct federal banking regulators to 
issue regulations that would allow well-capitalized depository 
institutions to file short-from call reports in the first and 
third quarters of each year.

          Subtitle O--Homeowner Information Privacy Protection

    Section 571. Study regarding privacy of information 
collected under the Home Mortgage Disclosure Act of 1975.--
Directs the Government Accountability Office (GAO) to study and 
report on whether the collection of data mandated by the Home 
Mortgage Disclosure Act puts mortgage borrowers at risk of 
identity theft or of losing sensitive personal financial 
information.

            Subtitle P--Home Mortgage Disclosure Adjustment

    Section 576. Depository institutions subject to maintenance 
of records and disclosure requirements.--Amends the Home 
Mortgage Disclosure Act of 1975 to exempt from the Act's 
reporting and recordkeeping requirements those depository 
institutions that originate fewer than 100 closed-end mortgage 
loans and fewer than 200 open-end mortgage loans over two 
years.

           Subtitle Q--Protecting Consumers Access to Credit

    Section 581. Rate of interest after transfer of loan.--
Amends various federal statutes to provide that a loan that is 
valid as to its maximum rate of interest when made remains 
valid if the loan is sold, assigned, or otherwise transferred 
to a third party.

                 Subtitle R--NCUA Overhead Transparency

    Section 586. Fund transparency.--Amends the Federal Credit 
Union Act to require the NCUA to report annually on how it 
allocates expenses between its prudential and insurance-related 
activities, whether these expenses are paid from operating fees 
assessed by the NCUA or from the NCUA Share Insurance Fund, and 
the NCUA's rationale for using amounts in the Share Insurance 
Fund in its annual budget.

             Subtitle S--Housing Opportunities Made Easier

    Section 591. Clarification of donated services to non-
profits.--Amends the Truth in Lending Act to state that if a 
fee appraiser voluntarily donates appraisal services to an 
organization described in section 170(c)(2) of the Internal 
Revenue Code of 1986, such voluntary donation shall be deemed 
customary and reasonable.

  TITLE VI--REGULATORY RELIEF FOR STRONGLY CAPITALIZED, WELL MANAGED 
                         BANKING ORGANIZATIONS

    Section 601. Capital election.--Provides that a banking 
organization may elect to be treated as a ``qualifying banking 
organization'' if it maintains an average leverage ratio of at 
least 10 percent; sets the process for banking organizations to 
make such an election; sets forth consequences of failure to 
maintain minimum average leverage ratio.
    Section 602. Regulatory relief.--Exempts qualifying banking 
organizations from federal laws and regulations that set 
capital and liquidity requirements and federal laws and 
regulations that permit federal banking agencies to object to 
capital distributions; prohibits federal banking agencies from 
considering a qualifying banking organization's effect on 
systemic risk or financial stability.
    Section 603. Contingent capital study.--Directs the Federal 
Reserve, the FDIC, and the OCC to study requiring banking 
organizations to issue contingent capital with a market-based 
conversion trigger and to report their findings to Congress.
    Section 604. Study on altering the current prompt 
corrective action rules.--Directs the OCC to study the 
feasibility of replacing the current prompt corrective action 
rules and Basel capital ratios with a nonperforming asset 
coverage ratio and to report its findings to Congress.
    Section 605. Definitions.--Defines terms used in Title VI.

   TITLE VII--EMPOWERING AMERICANS TO ACHIEVE FINANCIAL INDEPENDENCE

       Subtitle A--Separation of Powers and Liberty Enhancements

    Section 711. Consumer Law Enforcement Agency.--Renames the 
``Bureau of Consumer Financial Protection'' as the ``Consumer 
Law Enforcement Agency''; makes conforming amendments to 
various federal statutes to reflect the new name; provides that 
the Deputy Director of the Consumer Law Enforcement Agency is 
to be appointed by the president; and strikes paragraph (3) of 
subsection 1101(c), which provided that the Director could only 
be removed by the president for cause.
    Section 712. Authority of the Office of Information and 
Regulatory Affairs.--Provides that OIRA has the same duties and 
authorities regarding the Consumer Law Enforcement Agency as it 
does for any other non-independent regulatory agency.
    Section 713. Bringing the Agency into the regular 
appropriations process.--Makes the Consumer Law Enforcement 
Agency subject to Congressional appropriations.
    Section 714. Consumer Law Enforcement Agency Inspector 
General Reform.--Provides for the appointment of an independent 
Inspector General for the Consumer Law Enforcement Agency and 
requires the Inspector General to testify at semi-annual 
hearings before the House Financial Services and Senate Banking 
Committees.
    Section 715. Private parties authorized to compel the 
Agency to seek sanctions by filing civil actions; Adjudications 
deemed actions.--Authorizes private parties that are parties to 
administrative proceedings brought by the Consumer Law 
Enforcement Agency to compel the Agency to terminate the 
administrative proceeding; authorizes the Agency to bring a 
civil action seeking the same remedy if the Agency is required 
to terminate an administrative proceeding.
    Section 716. Civil investigative demands to be appealed to 
courts.--Authorizes the recipients of a civil investigate 
demand issued by the Consumer Law Enforcement Agency to seek an 
order from a federal district court modifying or setting aside 
the demand.
    Section 717. Agency dual mandate and economic analysis.--
Amends the Consumer Financial Protection Act to provide that 
the purpose of the Consumer Law Enforcement Agency also 
includes strengthening consumer participation in financial 
markets, increasing competition, and enhancing consumer choice; 
establishes an Office of Economic Analysis within the Agency 
and directs it to review and assess regulations and 
administrative enforcement and civil actions.
    Section 718. No deference to Agency interpretation.--Amends 
the Consumer Financial Protection Act to repeal the Act's 
provision requiring courts to defer to the determinations of 
the Consumer Law Enforcement Agency regarding the meaning of 
federal consumer financial law.

                Subtitle B--Administrative Enhancements

    Section 721. Advisory opinions.--Directs the Consumer Law 
Enforcement Agency to establish a procedure for responding to 
requests for advisory opinions regarding whether specific 
conduct conforms with federal consumer financial law.
    Section 722. Reform of Consumer Financial Civil Penalty 
Fund.--Directs the Consumer Law Enforcement Agency to establish 
segregated accounts for each civil penalty collected by the 
Agency, to use those accounts to compensate victims of the 
violation for which the penalty was collected, and to credit as 
general revenue to the Treasury any amounts remaining in the 
segregated account after two years.
    Section 723. Agency pay fairness.--Puts employees of the 
Consumer Law Enforcement Agency on the General Schedule pay 
scale for federal employees.
    Section 724. Elimination of market monitoring functions.--
Repeals the Consumer Law Enforcement Agency's responsibility 
for monitoring markets for consumer financial products and 
services.
    Section 725. Reforms to mandatory functional units.--
Provides that the Consumer Law Enforcement Agency may--but is 
not required to--establish certain offices within the Agency. 
Prohibits publication of information gathered for the consumer 
complaint database, while retaining the requirement the 
database be shared with other federal and state agencies.
    Section 726. Repeal of mandatory advisory board.--Abolishes 
the mandatory Consumer Advisory Board. Does not limit the 
Director's discretion to establish advisory boards pursuant to 
the Federal Advisory Committee Act.
    Section 727. Elimination of supervision authority.--
Abolishes the Consumer Law Enforcement Agency's authority to 
supervise and examine financial institutions.
    Section 728. Transfer of old OTS building from OCC to 
GSA.--Directs the OCC to transfer administrative jurisdiction 
over the former OTS headquarters at 1700 G Street, NW to the 
GSA.
    Section 729. Limitation on Agency authority.--Provides that 
Consumer Law Enforcement Agency may not exercise any 
rulemaking, enforcement, or other authority relating to 
employee benefit compensation plans or persons regulated by the 
SEC or the Commodity Futures Trading Commission (CFTC).

                    Subtitle C--Policy Enhancements

    Section 731. Consumer right to financial privacy.--Requires 
the Consumer Law Enforcement Agency to obtain a consumer's 
consent before collecting a consumer's nonpublic personal 
information.
    Section 732. Repeal of Council authority to set aside 
Agency rules and requirement of safety and soundness 
considerations when issuing rules.--Repeals the FSOC's 
authority to set aside for safety and soundness reasons rules 
promulgated by the Consumer Law Enforcement Agency.
    Section 733. Removal of authority to regulate small-dollar 
credit.--Prohibits the Consumer Law Enforcement Agency from 
exercising rulemaking or enforcement authority over small-
dollar loans.
    Section 734. Reforming indirect auto financing guidance.--
Nullifies the March 2013 Auto Lending Guidance issued by the 
Consumer Financial Protection Bureau and sets forth procedural 
requirements that the Consumer Law Enforcement Agency must 
follow in issuing guidance relating to indirect auto financing.
    Section 735. Prohibition of Government price controls for 
payment card transactions.--Repeals the Federal Reserve's 
authority to issue regulations setting interchange transaction 
fees and network fees.
    Section 736. Removal of Agency UDAAP authority.--Repeals 
the Consumer Law Enforcement Agency's rulemaking and 
enforcement authority over unfair, deceptive, or abusive acts 
and practices.
    Section 737. Preservation of UDAP authority for Federal 
banking regulators.--Directs federal banking regulators to 
promulgate regulations to prevent unfair or deceptive acts or 
practices and to enforce those regulations.
    Section 738. Repeal of authority to restrict arbitration.--
Repeals the Consumer Law Enforcement Agency's authority to 
restrict agreements requiring pre-dispute arbitration in 
connection with the offering or providing of consumer financial 
products or services.

                TITLE VIII--CAPITAL MARKETS IMPROVEMENTS

       Subtitle A--SEC Reform, Restructuring, and Accountability

    Section 801. Authorization of appropriations.--Authorizes 
appropriations for the Securities and Exchange Commission (SEC) 
for fiscal years 2017 through 2022.
    Section 802. Report on unobligated appropriations.--Directs 
the SEC to report to the House Financial Services and Senate 
Banking Committees on unobligated funds appropriated to the 
SEC.
    Section 803. SEC Reserve Fund abolished.--Abolishes the 
SEC's Reserve Fund.
    Section 804. Fees to offset appropriations.--Directs the 
SEC to collect fees and assessments to offset Congressional 
appropriations; provides that fees collected in excess of 
amounts appropriated by Congress shall be credited as general 
revenue to the Treasury.
    Section 805. Commission relocation funding prohibition.--
This section is intended to prohibit the SEC from obligating 
any funds to construct a new, government owned headquarters 
facility. This section only prohibits the obligation of funds 
for the purposes of federal construction and shall not be 
construed as prohibiting the obligation of funds associated 
with a replacement lease, including the construction of tenant 
improvements or security improvements, for a leased SEC 
headquarters facility.
    Section 806. Implementation of recommendations.--Directs 
the SEC finish implementing the recommendations contained in 
the independent consultant's report issued on March 10, 2011.
    Section 807. Office of Credit Ratings to report to the 
Division of Trading and Markets.--Restructures the SEC's Office 
of Credit Ratings to place it within the SEC's Division of 
Trading and Markets.
    Section 808. Office of Municipal Securities to report to 
the Division of Trading and Markets.--Restructures the SEC's 
Office of Municipal Securities to place it within the SEC's 
Division of Trading and Markets.
    Section 809. Independence of Commission Ombudsman.--
Provides that the Ombudsman will be appointed by the SEC's 
Commissioners and reports to the Commission.
    Section 810. Investor Advisory Committee improvements.--
Requires the SEC's Investor Advisory Committee to consult with 
the SEC's Small Business Capital Formation Advisory Committee 
in submitting findings and recommendations to the SEC; requires 
the Investor Advisory Committee to include as a non-voting 
member a member of the Small Business Capital Formation 
Advisory Committee; sets term lengths for members of the 
Investor Advisory Committee.
    Section 811. Duties of Investor Advocate.--Prohibits the 
Investor Advocate from taking a position on pending legislation 
other than legislative changes proposed by the Investor 
Advocate relating to retail investors; requires the Investor 
Advocate to consult with the Advocate for Small Business 
Capital formation in proposing recommendations relating to 
retail investors; and directs the Investor Advocate to advice 
the Advocate for Small Business Capital Formation on issues 
related to small business investors.
    Section 812. Elimination of exemption of Small Business 
Capital Formation Advisory Committee from Federal Advisory 
Committee Act.--Repeals the Small Business Capital Formation 
Advisory Committee's exemption from the Federal Advisory 
Committee Act.
    Section 813. Internal risk controls.--Directs the SEC and 
registered national security associations, in consultation with 
the SEC's chief economist, to develop internal risk controls to 
safeguard market data; requires the operator of the 
Consolidated Audit Trail, in consultation with the SEC's chief 
economist, to develop internal risk controls to safeguard 
market data before the SEC approves a national market system 
plan governing the implementation of the Consolidated Audit 
Trail.
    Section 814. Applicability of notice and comment 
requirements of the Administrative Procedure Act to guidance 
voted on by the Commission.--Subjects SEC statements and 
guidance that implement, interpret, or prescribe law or policy 
to the notice-and-comment requirements of the Administrative 
Procedure Act.
    Section 815. Limitation on pilot programs.--Provides that 
pilot programs established by self-regulatory organizations 
expire five years after they are approved by the SEC, unless 
the SEC issues a rule to permanently continue the pilot program 
or approves the program on a permanent basis.
    Section 816. Procedure for obtaining certain intellectual 
property.--Requires the SEC to obtain a subpoena in order to 
compel the production of source code.
    Section 817. Process for closing investigations.--Directs 
the SEC to establish procedures for closing investigations in a 
timely manner.
    Section 818. Enforcement Ombudsman.--Directs the SEC to 
appoint an Enforcement Ombudsman who reports to the SEC and 
acts as a liaison between the SEC and any person who is the 
subject of an SEC investigation or an administrative or 
judicial action brought by the SEC.
    Section 819. Adequate notice.--Provides that no person can 
be subject to an SEC enforcement action if that person did not 
have adequate notice of the law, rule, or regulation on which 
the action is based; provides that publication of an SEC 
statement or guidance constitutes adequate notice.
    Section 820. Advisory committee on Commission's enforcement 
policies and practices.--Directs the SEC Chair to establish an 
advisory committee to analyze and make recommendations 
regarding the SEC's enforcement policies and practices.
    Section 821. Process to permit recipient of Wells 
notification to appear before Commission staff in-person.--
Directs the SEC to establish a process in which the recipient 
of a Wells notice can make a presentation to SEC staff 
regarding the staff's preliminary recommendation that the SEC 
bring an enforcement action against the recipient of the 
notice.
    Section 822. Publication of enforcement manual.--Directs 
the SEC to publish a manual setting forth the policies and 
procedures the SEC follows in enforcing the securities laws; 
directs the SEC to publish annually an enforcement plan and 
report that sets forth the SEC's enforcement priorities and 
reports on the SEC's enforcement and examination activities for 
the previous year.
    Section 823. Private parties authorized to compel the 
Securities and Exchange Commission to seek sanctions by filing 
civil actions.--Authorizes defendants in administrative 
proceedings brought by the SEC to require the SEC to terminate 
the administrative proceeding; authorizes the SEC to bring a 
civil action seeking the same remedy that it sought in the 
terminated administrative proceeding.
    Section 824. Certain findings required to approve civil 
money penalties against issuers.--Requires the SEC, when 
imposing civil money penalties against issuers, to determine 
whether the violation resulted in direct economic benefit to 
the issuer and whether the penalty will harm the issuer's 
shareholders; requires that such a finding be supported by an 
analysis by the division of Economic and Risk Analysis and be 
certified by the Chief Economist.
    Section 825. Repeal of authority of the Commission to 
prohibit persons from serving as officers or directors.--
Repeals the SEC's authority to prohibit certain persons from 
serving as officers and directors through administrative 
proceedings.
    Section 826. Subpoena duration and renewal.--Prohibits the 
SEC from issuing omnibus orders of investigation of indefinite 
duration; requires SEC action to renew such an order.
    Section 827. Elimination of automatic disqualifications.--
Provides that entities and individuals may not be automatically 
disqualified from using exemptions or registration provisions 
as a result of having been the subject of an order, judgment, 
or decree arising from a governmental action.
    Section 828. Denial of award to culpable whistleblowers.--
Prohibits the SEC from awarding compensation to whistleblowers 
who are complicit in the wrongdoing for which they provided 
information.
    Section 829. Confidentiality of records obtained from 
foreign securities and law enforcement authorities.--Provides 
that the SEC cannot be compelled to produce records obtained 
from foreign securities regulators or foreign law enforcement 
authorities.
    Section 830. Clarification of authority to impose sanctions 
on persons associated with a broker or dealer.--Clarifies that 
the SEC may impose sanctions on persons associated with a 
broker or dealer.
    Section 831. Complaint and burden of proof requirements for 
certain actions for breach of fiduciary duty.--Provides that in 
derivative actions brought under the Investment Company Act 
alleging a breach of fiduciary duty, the plaintiff must state 
with particularity all the facts establishing a breach of 
fiduciary duty, and that the plaintiff must prove the breach of 
fiduciary duty by clear and convincing evidence.
    Section 832. Congressional access to information held by 
the Public Company Accounting Oversight Board.--Directs the 
PCAOB to make information the PCAOB received in connection with 
an inspection or an investigation available to the House 
Financial Services and Senate Banking Committees.
    Section 833. Abolishing Investor Advisory Group.--Directs 
the PCAOB to abolish the Investor Advisory Group.
    Section 834. Repeal of requirement for Public Company 
Accounting Oversight Board to use certain funds for merit 
scholarship program.--Repeals the requirement that the PCAOB 
fund a merit scholarship program and instead remit the funds to 
the Treasury.
    Section 835. Reallocation of fines for violations of rules 
of municipal securities rulemaking board.--Provides that fines 
collected for MSRB rule violations be credited as general 
revenue to the Treasury.

 Subtitle B--Eliminating Excessive Government Intrusion in the Capital 
                                Markets

    Section 841. Repeal of Department of Labor fiduciary rule 
and requirements prior to rulemaking relating to standards of 
conduct for brokers and dealers.--Repeals the Department of 
Labor's final rule titled ``Definition of the Term `Fiduciary'; 
Conflict of Interest Rule--Retirement Investment Advice''; 
provides that the Department of Labor may not issue a rule 
defining a ``fiduciary'' until 60 days after the SEC issues a 
rule relating to standards of conduct for brokers and dealers; 
provides that if the Department of Labor issues a rule defining 
a ``fiduciary,'' that the Department of Labor's rule must 
prescribe a definition substantially similar to the SEC's and 
that the Department of Labor's rule must impose substantially 
identical standards of care as the SEC has imposed on brokers, 
dealers, and investment advisers; directs the SEC to report to 
the House Financial Services and Senate Banking Committees on 
the costs and benefits of proposed rules relating to standards 
of conduct for brokers and dealers before promulgating such a 
rule.
    Section 842. Exemption from risk retention requirements for 
nonresidential mortgage.--Exempts asset-backed securities made 
up of non-residential mortgages from the Dodd-Frank Act's risk-
retention requirements.
    Section 843. Frequency of shareholder approval of executive 
compensation.--Provides that shareholders be given the 
opportunity to approve executive compensation in those years in 
which the executive compensation of an issuer has materially 
changed from the previous year.
    Section 844. Shareholder Proposals.--Directs the SEC to 
adjust the resubmission thresholds for shareholder proposals; 
directs the SEC to revise the holding requirements for a 
shareholder to submit a proposal by eliminating the option to 
satisfy the holding requirement by holding a certain dollar 
amount and by requiring a shareholder to hold 1 percent of the 
issuer's voting securities, and adjusting the holding period to 
3 years; prohibits an issuer from including shareholder 
proposals by proxies in the issuer's proxy materials.
    Section 845. Prohibition on requiring a single ballot.--
Prohibits the SEC from requiring proxy solicitations to use a 
single ballot for director elections.
    Section 846. Requirement for municipal advisor for issuers 
of municipal securities.--Provides that an issuer of municipal 
securities is not required to retain a municipal advisor before 
issuing securities.
    Section 847. Small issuer exemption from internal control 
evaluation.--Exempts issuers with market capitalizations of 
less than $500 million and depository institutions with assets 
of less than $1 billion from having to comply with internal 
control evaluation requirement of the Sarbanes-Oxley Act.
    Section 848. Streamlining of applications for an exemption 
from the Investment Company Act of 1940.--Sets forth the 
application process for the SEC to grant exemptions from the 
requirements of the Investment Company Act under the SEC's 
general exemptive authority.
    Section 849. Restriction on recovery of erroneously awarded 
compensation.--Provides that the SEC's rules requiring issuers 
to develop policies providing for the recovery of erroneously 
awarded compensation to an executive officer under an 
accounting restatement apply only when the officer had control 
or authority over the financial reporting that resulted in the 
accounting restatement.
    Section 850. Exemptive authority for certain provisions 
relating to registration of nationally recognized statistical 
rating organizations.--Grants the SEC the authority to exempt a 
person from provisions relating to the registration of NRSROs 
if the SEC finds that registration creates a barrier to entry, 
impedes competition, or that such an exemption is in the public 
interest.
    Section 851. Risk-based examinations of Nationally 
Recognized Statistical Rating Organizations.--Directs the SEC 
to conduct risk-based examinations of NRSROs.
    Section 852. Transparency of credit rating methodologies.--
Prohibits the SEC from requiring NRSROs to include in their 
disclosures of rating methodologies references to statutory or 
regulatory requirements; prohibits the SEC from mandating the 
specific format of an NRSRO's disclosure of its rating 
methodology.
    Section 853. Repeal of certain attestation requirements 
relating to credit ratings.--Repeals the requirement that the 
chief executive officer of an NRSRO attest to its internal 
controls over processes for determining credit ratings; repeals 
the requirement that an NRSRO include in its disclosures an 
attestation that the rating was not influenced by business 
activities, that the rating was based solely on the merits of 
the instruments being rated, and that the rating was an 
independent evaluation of the risks and merits of the 
instrument.
    Section 854. Look-back review by NRSRO.--Amends the look-
back requirement for NRSROs to apply only to the lead 
underwriter in reviewing whether conflicts of interests between 
employees of the NRSRO and employees of the person subject to 
the rating or an employee of an issuer, underwriter, or sponsor 
of a security subject to the rating influenced the rating.
    Section 855. Approval of credit rating procedures and 
methodologies.--Provides that an NRSRO's Chief Credit Officer 
may approve an NRSRO's procedures and methodologies.
    Section 856. Exception for providing certain material 
information relating to a credit rating.--Provides that a 
person who markets or sells an NRSRO's products and services 
may provide information to a person who determines or monitors 
a credit rating or who develops and approves methodologies for 
determining a rating as long as the information provided is not 
intended to influence the determination of a credit rating or 
the methodologies used to determine credit ratings.
    Section 857. Repeals.--Repeals certain provisions of title 
IX of the Dodd-Frank Act. In particular:
     In Subtitle A (Increasing Investor Protection), 
repeals the section granting the SEC the authority to engage in 
investor testing; repeals the sections mandating studies on 
investment adviser examinations, financial literacy among 
investors, mutual fund advertising, conflicts of interest, 
access to information on investment advisers and broker-
dealers, and on financial planners and the use of financial 
designations.
     In Subtitle B (Increasing Regulatory Enforcement 
and Remedies), repeals the section granting the SEC the 
authority to restrict mandatory pre-dispute arbitration; 
providing for equal treatment of self-regulatory organization 
rules; providing for short sale reforms; and the section 
mandating studies on extraterritorial private rights of action 
and securities litigation.
     In Subtitle C (Improvements to the Regulation of 
Credit Rating Agencies), repeals the sections on Congress's 
findings on credit ratings and NRSROs, the pleading 
requirements for state of mind in private actions against 
NRSROs, timing of regulations, the elimination of the exemption 
of NRSROs from the fair disclosure rule, and repeals the 
sections mandating studies on credit rating agency 
independence, alternative business models, and the creation of 
an independent professional analyst organization; repeals the 
section mandating a study and rulemaking on assigned credit 
ratings; repeals the section rescinding the exemption from 
expert liability afforded to credit rating agencies under SEC 
Rule 436(g); repeals the section setting forth the sense of 
Congress regarding the SEC's rulemaking authority over NRSROs.
     In Subtitle D (Improvements to the Asset-Backed 
Securitization Process), repeals the section mandating a study 
on the macroeconomic effects of risk retention requirements.
     In Subtitle E (Accountability and Executive 
Compensation), repeals the subsection requiring issuers to 
disclose the ratio of the median annual compensation of all 
employees and the compensation of the chief executive officer; 
repeals the sections mandating disclosure by issuers regarding 
employee and director hedging, enhanced disclosure by financial 
institutions of compensation arrangements for executives, and 
prohibiting certain compensation arrangements.
     In Subtitle F (Improvements to the Management of 
the Securities and Exchange Commission), repeals the sections 
mandating studies on the oversight of national securities 
associations and former SEC employees subsequently employed by 
financial institutions regulated by the SEC; repeals the 
section directing the SEC's Division of Trading and Markets and 
its Division of Investment Management to maintain a staff of 
compliance examiners.
     In Subtitle G (Strengthening Corporate 
Governance), repeals sections permitting the SEC to issue rules 
regarding proxy access and directing the SEC to issue rules 
requiring issuers to explain their chairman and chief executive 
officer structures.
     In Subtitle H (Municipal Securities), repeals 
sections mandating studies of increased disclosure to investors 
in municipal securities and on municipal securities markets; 
repeals the section permitting the SEC to require national 
securities associations to fund the Governmental Accounting 
Standards Board.
     In Subtitle I (Public Company Accounting Oversight 
Board, Portfolio Margining, and Other Matters), repealing 
sections directing the SEC to issue regulations regarding the 
disclosure of securities lending; creating a program for making 
grants to states for the purpose of investigating and 
prosecuting persons selling financial products to senior 
citizens who are not specifically credentialed as having 
special training in advising senior citizens; and directing 
federal financial regulatory agencies to address deficiencies 
identified by their respective inspector general. Also repeals 
sections mandating studies on proprietary trading, person-to-
person lending, the exemption for small issuers from Section 
404(b) of the Sarbanes-Oxley Act, and the subsection mandating 
a study on compliance burdens from Section 404(b) of the 
Sarbanes-Oxley Act on companies with a market capitalization 
between $75 million and $250 million.
    Section 858. Exemption of and reporting by private equity 
fund advisers.--Exempts the advisers to private equity funds 
from the registration and reporting requirements of the 
Investment Advisers Act of 1940.
    Section 859. Records and reports of private funds.--Removes 
references to the Financial Stability Oversight Council and 
systemic risk from the statutory rationale for requiring 
registered investment advisers to maintain and produce records 
and reports.
    Section 860. Definition of accredited investor.--Amends the 
definition of ``accredited investor'' to include natural 
persons whose individual or joint net worth with a spouse 
exceeds $1 million; a natural person having an individual 
income greater than $200,000 or joint income with a spouse 
greater than $300,000 in the two years prior; a natural person 
licensed as a broker or investment adviser; and any natural 
person the SEC determines has the education or job experience 
to qualify as having professional knowledge related to 
investment.
    Section 861. Repeal of certain provisions requiring a study 
and report to Congress.--Repeals certain provisions of title IX 
of the Dodd-Frank Act. In particular, repeals sections 
mandating a study on custody rule costs, a study on the 
criteria for determining ``accredited investors,'' a study on 
the feasibility of a self-regulatory organization to oversee 
private funds, and a study on short selling.
    Section 862. Repeal.--Repeals certain provisions of title 
XV of the Dodd-Frank Act. In particular, repeals sections 
directing the SEC to promulgate regulations regarding the 
following: disclosures relating to conflict minerals 
originating in the Democratic Republic of the Congo; 
disclosures regarding coal or other mine safety; disclosures of 
payments to foreign governments by resource extraction issuers. 
Also repeals sections mandating studies on the effectiveness of 
inspectors general and on core deposits and brokered deposits.

             Subtitle C--Harmonization of Derivatives Rules

    Section 871. Commissions review and harmonization of rules 
relating to the regulation of over-the-counter swaps markets.--
Directs the SEC and CFTC to review rules, orders, and guidance 
issued pursuant to Title VII of the Dodd-Frank Act and to 
resolve inconsistencies.
    Section 872. Treatment of transactions between 
affiliates.--Exempts swap transactions between affiliated 
entities from the swaps rules issued by the SEC and the CFTC.

       TITLE IX--REPEAL OF THE VOLCKER RULE AND OTHER PROVISIONS

    Section 901. Repeals.--Repeals certain provisions of title 
VI of the Dodd-Frank Act, including Section 619, also known as 
the Volcker Rule. In particular, repeals sections imposing a 
moratorium on the provision of deposit insurance by the FDIC to 
industrial banks, credit card banks, and trust banks owned or 
controlled by a commercial firm; granting the Federal Reserve 
supervisory authority over securities holding companies; 
prohibiting banking entities from engaging in proprietary 
trading or maintaining certain relationships with hedge funds 
and private equity funds; and prohibiting underwriters, 
placement agents, initial purchasers and sponsors of an asset-
backed security engaging in transactions that give rise to a 
conflict of interest with an investor in the security for a 
one-year period. Also repeals the section mandating a study on 
bank investment activities.

            TITLE X--FED OVERSIGHT REFORM AND MODERNIZATION

    Section 1001. Requirements for policy rules of the Federal 
Open Market Committee.--Requires the Federal Reserve to adopt a 
``directive policy rule'' for open market operations; directs 
the GAO to monitor the Federal Reserve's compliance with the 
directive policy rule that the Federal Reserve has adopted and 
report instances of non-compliance to the House Financial 
Services and Senate Banking Committees; authorizes the chairs 
of the House Financial Services and Senate Banking Committees 
to request the Federal Reserve Chair to testify on the Federal 
Reserve's failure to comply with its directive policy rule.
    Section 1002. Federal Open Market Committee blackout 
period.--Defines the term ``blackout period''; specifies the 
public communications that may be made by members of the 
Federal Open Market Committee during the blackout period; 
exempts the Federal Reserve Chair from the blackout period.
    Section 1003. Public transcripts of FOMC meetings.--
Requires the Federal Open Market Committee to record its 
meetings and make full transcripts of its meetings available to 
the public.
    Section 1004. Membership of Federal Open Market 
Committee.--Changes the composition of the Federal Open Market 
Committee by adding a sixth representative from the regional 
Federal Reserve Banks to the Committee; changes the rotation of 
membership on the Federal Open Market Committee among the 
representatives of the regional Federal Reserve Banks so that 
representatives from the Federal Reserve Banks of Boston, 
Philadelphia, Richmond, Chicago, Minneapolis, and Dallas serve 
in odd-numbered calendar years, and representatives from the 
Federal Reserve Banks of New York, Cleveland, Atlanta, St. 
Louis, Kansas City, and San Francisco serve in even-numbered 
calendar years.
    Section 1005. Frequency of testimony of the Chairman of the 
Board of Governors of the Federal Reserve System to Congress.--
Requires the Federal Reserve Chair to testify quarterly before 
the House Financial Services and Senate Banking Committees on 
the conduct of monetary policy and economic developments and 
future prospects for the economy.
    Section 1006. Vice Chairman for Supervision report 
requirement.--Requires the Federal Reserve Vice Chair for 
Supervision to report in the Vice Chair's written testimony on 
the status of pending and anticipated rulemakings by the 
Federal Reserve; provides that the Federal Reserve Vice Chair 
or the Federal Reserve Chair shall testify if the position of 
Vice Chair for Supervision is vacant.
    Section 1007. Salaries, financial disclosures, and office 
staff of the Board of Governors of the Federal Reserve 
System.--Subjects members and employees of the Federal Reserve 
to the same prohibitions and restrictions on financial 
interests, transactions, and outside employment that employees 
of the SEC are subject to; requires members and employees of 
the Federal Reserve to disclose all brokerage accounts and 
authorize the sending of duplicate account statements to the 
Federal Reserve; requires the Federal Reserve to publicly 
disclose the names, salaries, and required financial 
disclosures of Federal Reserve members, officers, and employees 
whose annual salary exceeds the annual rate of pay for GS-15 on 
the General Schedule; and permits each member of the Federal 
Reserve Board to employ at least 2 individuals as office staff.
    Section 1008. Amendments to powers of the Board of 
Governors of the Federal Reserve System.--Amends section 13(3) 
of the Federal Reserve Act to provide that the Federal Reserve 
may exercise its emergency lending authority only if the 
``unusual and exigent circumstances'' identified as the basis 
for the exercise of such authority also ``pose a threat to the 
financial stability of the United States''; to require the 
affirmative vote of at least nine presidents of the regional 
Federal Reserve Banks in addition to the affirmative vote of 
five members of the Federal Reserve Board to exercise the 
emergency lending authority. Directs the Federal Reserve to 
issue rules regarding the sufficiency and acceptability of, 
discounts on, and methods for appraising collateral required to 
secure loans made under the Federal Reserve's emergency lending 
authority. Provides federal banking regulators must certify 
that an institution is solvent before it is eligible to borrow 
under the Federal Reserve's emergency lending authority. 
Directs the Federal Reserve to issue rules regarding minimum 
interest rates to be charged for loans made under its emergency 
lending authority, and defines the minimum interest rate.
    Section 1009. Interest rates on balances maintained at a 
Federal Reserve bank by depository institutions established by 
Federal Open Market Committee.--Provides that the Federal Open 
Market Committee establishes the rate of earnings paid on 
balances maintained at Federal Reserve Banks by depository 
institutions.
    Section 1010. Audit reform and transparency for the Board 
of Governors of the Federal Reserve System.--Directs the GAO to 
annually audit the Federal Reserve Board and Federal Reserve 
Banks and report to Congress on the results of its audit.
    Section 1011. Establishment of a Centennial Monetary 
Commission.--Establishes a Centennial Monetary Commission to 
examine the effect of monetary policy since the creation of the 
Federal Reserve on the U.S. economy and to evaluate the 
effectiveness of the regimes under which the Federal Reserve 
has conducted monetary policy in achieving the maximum 
sustainable level of output and price stability.

   TITLE XI--IMPROVING INSURANCE COORDINATION THROUGH AN INDEPENDENT 
                                ADVOCATE

    Section 1101. Repeal of the Federal Insurance Office; 
Creation of the Office of the Independent Insurance Advocate.--
Abolishes the Federal Insurance Office and establishes the 
Office of the Independent Insurance Advocate to act as an 
independent advocate on behalf of U.S. policyholders on 
prudential aspects of insurance matters; grants the Office of 
the Independent Insurance Advocate the authority to coordinate 
federal efforts on prudential aspects of international 
insurance matters, consult with states regarding insurance 
matters of national importance, to assist the Treasury 
Secretary in administering the Terrorism Reinsurance Program, 
and to observe all aspects of the insurance industry and 
identify issues that could contribute to systemic crises in the 
insurance industry or the U.S. financial system; provides that 
the Independent Insurance Advocate is a voting member of the 
FSOC.
    Section 1102. Treatment of covered agreements.--Requires 
the Treasury Secretary and the U.S. Trade Representative to 
publish in the Federal Register and make available for public 
comment the proposed text of a bilateral or multilateral 
agreement regarding prudential measures relating to insurance 
or reinsurance before the agreement can become effective.

                    TITLE XII--TECHNICAL CORRECTIONS

    Section 1201. Table of contents; Definitional 
corrections.--Makes technical corrections to the Table of 
Contents and Section 2 of the Dodd-Frank Act.
    Section 1202. Antitrust savings clause corrections.--Makes 
technical corrections to Section 6 of the Dodd-Frank Act.
    Section 1203. Title I corrections.--Makes technical 
corrections to Title I of the Dodd-Frank Act.
    Section 1204. Title III corrections.--Makes technical 
corrections to Title III of the Dodd-Frank Act.
    Section 1205. Title IV correction. Makes technical 
corrections to Title IV of the Dodd-Frank Act.
    Section 1206. Title VI corrections.--Makes technical 
corrections to Title VI of the Dodd-Frank Act.
    Section 1207. Title VII corrections.--Makes technical 
corrections to Title VII of the Dodd-Frank Act.
    Section 1208. Title IX corrections. Makes technical 
corrections to Title IX of the Dodd-Frank Act.
    Section 1209. Title X corrections. Makes technical 
corrections to Title X of the Dodd-Frank Act.
    Section 1210. Title XII correction. Makes technical 
corrections to Title XII of the Dodd-Frank Act.
    Section 1211. Title XIV correction.--Makes technical 
corrections to Title XIV of the Dodd-Frank Act.
    Section 1212. Technical corrections to other statutes.--
Makes technical corrections to various federal statutes.

          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 (existing law 
proposed to be omitted is enclosed in black brackets, new 
matter is printed in italics, and existing law in which no 
change is proposed is shown in roman):

       DODD-FRANK WALL STREET REFORM AND CONSUMER PROTECTION ACT


SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

  (a) Short Title.--This Act may be cited as the ``Dodd-Frank 
Wall Street Reform and Consumer Protection Act''.
  (b) Table of Contents.--The table of contents for this Act is 
as follows:

Sec. 1. Short title; table of contents.
     * * * * * * *

                      TITLE I--FINANCIAL STABILITY

     * * * * * * *

            Subtitle A--Financial Stability Oversight Council

     * * * * * * *
[Sec. 113. Authority to require supervision and regulation of certain 
          nonbank financial companies.
[Sec. 114. Registration of nonbank financial companies supervised by the 
          Board of Governors.
[Sec. 115. Enhanced supervision and prudential standards for nonbank 
          financial companies supervised by the Board of Governors and 
          certain bank holding companies.
[Sec. 116. Reports.
[Sec. 117. Treatment of certain companies that cease to be bank holding 
          companies.]
     * * * * * * *
[Sec. 119. Resolution of supervisory jurisdictional disputes among 
          member agencies.
[Sec. 120. Additional standards applicable to activities or practices 
          for financial stability purposes.
[Sec. 121. Mitigation of risks to financial stability.]
     * * * * * * *

                [Subtitle B--Office of Financial Research

[Sec. 151. Definitions.
[Sec. 152. Office of Financial Research established.
[Sec. 153. Purpose and duties of the Office.
[Sec. 154. Organizational structure; responsibilities of primary 
          programmatic units.
[Sec. 155. Funding.
[Sec. 156. Transition oversight. ]

Subtitle C--Additional Board of Governors Authority for Certain Nonbank 
             Financial Companies and Bank Holding Companies

[Sec. 161. Reports by and examinations of nonbank financial companies by 
          the Board of Governors.
[Sec. 162. Enforcement.]
     * * * * * * *
[Sec. 164. Prohibition against management interlocks between certain 
          financial companies.]
     * * * * * * *
[Sec. 166. Early remediation requirements.
[Sec. 167. Affiliations.
[Sec. 168. Regulations.]
     * * * * * * *
[Sec. 170. Safe harbor.]
     * * * * * * *
[Sec. 172. Examination and enforcement actions for insurance and orderly 
          liquidation purposes.]
     * * * * * * *
[Sec. 174. Studies and reports on holding company capital requirements.
[Sec. 175. International policy coordination.]
     * * * * * * *

                [TITLE II--ORDERLY LIQUIDATION AUTHORITY

[Sec. 201. Definitions.
[Sec. 202. Judicial review.
[Sec. 203. Systemic risk determination.
[Sec. 204. Orderly liquidation of covered financial companies.
[Sec. 205. Orderly liquidation of covered brokers and dealers.
[Sec. 206. Mandatory terms and conditions for all orderly liquidation 
          actions.
[Sec. 207. Directors not liable for acquiescing in appointment of 
          receiver.
[Sec. 208. Dismissal and exclusion of other actions.
[Sec. 209. Rulemaking; non-conflicting law.
[Sec. 210. Powers and duties of the Corporation.
[Sec. 211. Miscellaneous provisions.
[Sec. 212. Prohibition of circumvention and prevention of conflicts of 
          interest.
[Sec. 213. Ban on certain activities by senior executives and directors.
[Sec. 214. Prohibition on taxpayer funding.
[Sec. 215. Study on secured creditor haircuts.
[Sec. 216. Study on bankruptcy process for financial and nonbank 
          financial institutions
[Sec. 217. Study on international coordination relating to bankruptcy 
          process for nonbank financial institutions]
     * * * * * * *

       TITLE IV--REGULATION OF ADVISERS TO HEDGE FUNDS AND OTHERS

     * * * * * * *
[Sec. 407. Exemption of venture capital fund advisers.
[Sec. 408. Exemption of and record keeping by private equity fund 
          advisers.
[Sec. 409. Family offices.
[Sec. 410. State and Federal responsibilities; asset threshold for 
          Federal registration of investment advisers.
[Sec. 411. Custody of client assets.
[Sec. 412. Adjusting the accredited investor standard.
[Sec. 413. GAO study and report on accredited investors.
[Sec. 414. GAO study on self-regulatory organization for private funds.
[Sec. 415. Commission study and report on short selling.
[Sec. 416. Transition period.
[Sec. 417. Commission study and report on short selling.]
Sec. 407. Exemption of and reporting by venture capital fund advisers.
Sec. 408. Exemption of and reporting by certain private fund advisers.
Sec. 409. Family offices.
Sec. 410. State and Federal responsibilities; asset threshold for 
          Federal registration of investment advisers.
Sec. 411. Custody of client assets.
Sec. 414. Rule of construction relating to the Commodity Exchange Act.
Sec. 418. Qualified client standard.
Sec. 419. Transition period.
     * * * * * * *

  TITLE VI--IMPROVEMENTS TO REGULATION OF BANK AND SAVINGS ASSOCIATION 
              HOLDING COMPANIES AND DEPOSITORY INSTITUTIONS

     * * * * * * *
[Sec. 603. Moratorium and study on treatment of credit card banks, 
          industrial loan companies, and certain other companies under 
          the Bank Holding Company Act of 1956.]
     * * * * * * *
[Sec. 618. Securities holding companies.
[Sec. 619. Prohibitions on proprietary trading and certain relationships 
          with hedge funds and private equity funds.
[Sec. 620. Study of bank investment activities.
[Sec. 621. Conflicts of interest.]
     * * * * * * *

       [TITLE VIII--PAYMENT, CLEARING, AND SETTLEMENT SUPERVISION

[Sec. 801. Short title.
[Sec. 802. Findings and purposes.
[Sec. 803. Definitions.
[Sec. 804. Designation of systemic importance.
[Sec. 805. Standards for systemically important financial market 
          utilities and payment, clearing, or settlement activities.
[Sec. 806. Operations of designated financial market utilities.
[Sec. 807. Examination of and enforcement actions against designated 
          financial market utilities.
[Sec. 808. Examination of and enforcement actions against financial 
          institutions subject to standards for designated activities.
[Sec. 809. Requests for information, reports, or records.
[Sec. 810. Rulemaking.
[Sec. 811. Other authority.
[Sec. 812. Consultation.
[Sec. 813. Common framework for designated clearing entity risk 
          management.
[Sec. 814. Effective date.]

  TITLE IX--INVESTOR PROTECTIONS AND IMPROVEMENTS TO THE REGULATION OF 
                               SECURITIES

     * * * * * * *

               Subtitle A--Increasing Investor Protection

     * * * * * * *
[Sec. 912. Clarification of authority of the Commission to engage in 
          investor testing.]
     * * * * * * *
[Sec. 914. Study on enhancing investment adviser examinations.]
     * * * * * * *
[Sec. 917. Study regarding financial literacy among investors.
[Sec. 918. Study regarding mutual fund advertising.]
     * * * * * * *
[Sec. 919A. Study on conflicts of interest.
[Sec. 919B. Study on improved investor access to information on 
          investment advisers and broker-dealers.
[Sec. 919C. Study on financial planners and the use of financial 
          designations.]
     * * * * * * *

       Subtitle B--Increasing Regulatory Enforcement and Remedies

[Sec. 921. Authority to restrict mandatory pre-dispute arbitration.]
     * * * * * * *
[Sec. 929T. Equal treatment of self-regulatory organization rules.]
     * * * * * * *
[Sec. 929X. Short sale reforms.
[Sec. 929Y. Study on extraterritorial private rights of action.
[Sec. 929Z. GAO study on securities litigation.]

  Subtitle C--Improvements to the Regulation of Credit Rating Agencies

[Sec. 931. Findings. ]
     * * * * * * *
[Sec. 933. State of mind in private actions.]
     * * * * * * *
[Sec. 937. Timing of regulations.]
     * * * * * * *
[Sec. 939B. Elimination of exemption from fair disclosure rule.
[Sec. 939C. Securities and Exchange Commission study on strengthening 
          credit rating agency independence.
[Sec. 939D. Government Accountability Office study on alternative 
          business models.
[Sec. 939E. Government Accountability Office study on the creation of an 
          independent professional analyst organization.
[Sec. 939F. Study and rulemaking on assigned credit ratings.
[Sec. 939G. Effect of Rule 436(g).
[Sec. 939H. Sense of Congress.]

   Subtitle D--Improvements to the Asset-Backed Securitization Process

     * * * * * * *
[Sec. 946. Study on the macroeconomic effects of risk retention 
          requirements.]

          Subtitle E--Accountability and Executive Compensation

     * * * * * * *
[Sec. 955. Disclosure regarding employee and director hedging.
[Sec. 956. Enhanced compensation structure reporting.]
     * * * * * * *

    Subtitle F--Improvements to the Management of the Securities and 
                           Exchange Commission

     * * * * * * *
[Sec. 964. Report on oversight of national securities associations.
[Sec. 965. Compliance examiners.]
     * * * * * * *
[Sec. 968. Study on SEC revolving door.]

             Subtitle G--Strengthening Corporate Governance

[Sec. 971. Proxy access.
[Sec. 972. Disclosures regarding chairman and CEO structures.]

                    Subtitle H--Municipal Securities

     * * * * * * *
[Sec. 976. Government Accountability Office study of increased 
          disclosure to investors.
[Sec. 977. Government Accountability Office study on the municipal 
          securities markets.
[Sec. 978. Funding for Governmental Accounting Standards Board.]
     * * * * * * *

    Subtitle I--Public Company Accounting Oversight Board, Portfolio 
                      Margining, and Other Matters

     * * * * * * *
[Sec. 984. Loan or borrowing of securities.]
     * * * * * * *
[Sec. 989. Government Accountability Office study on proprietary 
          trading.
[Sec. 989A. Senior investor protections.]
     * * * * * * *
[Sec. 989F. GAO study of person to person lending.]
     * * * * * * *
[Sec. 989I. GAO study regarding exemption for smaller issuers.]
     * * * * * * *

            TITLE X--BUREAU OF CONSUMER FINANCIAL PROTECTION

     * * * * * * *

   Subtitle A--[Bureau of Consumer Financial Protection]Consumer Law 
                           Enforcement Agency

Sec. 1011. Establishment of the [Bureau of Consumer Financial 
          Protection]Consumer Law Enforcement Agency.
     * * * * * * *
[Sec. 1014. Consumer Advisory Board.]
     * * * * * * *

            Subtitle B--General Powers of the [Bureau]Agency

     * * * * * * *
[Sec. 1023. Review of Bureau regulations.]
Sec. 1024. [Supervision of]Authority with respect to certain 
          nondepository covered persons.
[Sec. 1025. Supervision of very large banks, savings associations, and 
          credit unions.]
     * * * * * * *
Sec. 1027. Limitations on authorities of the [Bureau]Agency; 
          preservation of authorities.
[Sec. 1028. Authority to restrict mandatory pre-dispute arbitration.]
     * * * * * * *

             Subtitle C--Specific [Bureau]Agency Authorities

[Sec. 1031. Prohibiting unfair, deceptive, or abusive acts or 
          practices.]
     * * * * * * *

                     Subtitle E--Enforcement Powers

     * * * * * * *
Sec. 1059. Consideration of cost-benefit analysis related to 
          administrative enforcement and civil actions.
     * * * * * * *

                   Subtitle G--Regulatory Improvements

     * * * * * * *
[Sec. 1075. Reasonable fees and rules for payment card transactions.]
     * * * * * * *

               TITLE XI--FEDERAL RESERVE SYSTEM PROVISIONS

     * * * * * * *
[Sec. 1104. Liquidity event determination.
[Sec. 1105. Emergency financial stabilization.
[Sec. 1106. Additional related amendments.]
     * * * * * * *

                   TITLE XV--MISCELLANEOUS PROVISIONS

     * * * * * * *
[Sec. 1502. Conflict minerals.
[Sec. 1503. Reporting requirements regarding coal or other mine safety.
[Sec. 1504. Disclosure of payments by resource extraction issuers.
[Sec. 1505. Study by the Comptroller General.
[Sec. 1506. Study on core deposits and brokered deposits.]

SEC. 2. DEFINITIONS.

  As used in this Act, the following definitions shall apply, 
except as the context otherwise requires or as otherwise 
specifically provided in this Act:
          (1) Affiliate.--The term ``affiliate'' has the same 
        meaning as in [section 3] section 3(w) of the Federal 
        Deposit Insurance Act [(12 U.S.C. 1813)] (12 U.S.C. 
        1813(w)).
          (2) Appropriate federal banking agency.--On and after 
        the transfer date, the term ``appropriate Federal 
        banking agency'' has the same meaning as in section 
        3(q) of the Federal Deposit Insurance Act (12 U.S.C. 
        1813(q)), as amended by title III.
          (3) Board of governors.--The term ``Board of 
        Governors'' means the Board of Governors of the Federal 
        Reserve System.
          [(4) Bureau.--The term ``Bureau'' means the Bureau of 
        Consumer Financial Protection established under title 
        X.]
          (4) Agency.--The term ``Agency'' means the Consumer 
        Law Enforcement Agency established under title X.
          (5) Commission.--The term ``Commission'' means the 
        Securities and Exchange Commission, except in the 
        context of the Commodity Futures Trading Commission.
          (6) Commodity futures terms.--The terms ``futures 
        commission merchant'', ``swap'', ``swap dealer'', 
        ``swap execution facility'', ``derivatives clearing 
        organization'', ``board of trade'', ``commodity trading 
        advisor'', ``commodity pool'', and ``commodity pool 
        operator'' have the same meanings as given the terms in 
        section 1a of the Commodity Exchange Act (7 U.S.C. [1 
        et seq.] 1a).
          (7) Corporation.--The term ``Corporation'' means the 
        Federal Deposit Insurance Corporation.
          (8) Council.--The term ``Council'' means the 
        Financial Stability Oversight Council established under 
        title I.
          (9) Credit union.--The term ``credit union'' means a 
        Federal credit union, State credit union, or State-
        chartered credit union, as those terms are defined in 
        section 101 of the Federal Credit Union Act (12 U.S.C. 
        1752).
          (10) Federal banking agency.--The term--
                  (A) ``Federal banking agency'' means, 
                individually, the Board of Governors, the 
                Office of the Comptroller of the Currency, and 
                the Corporation; and
                  (B) ``Federal banking agencies'' means all of 
                the agencies referred to in subparagraph (A), 
                collectively.
          (11) Functionally regulated subsidiary.--The term 
        ``functionally regulated subsidiary'' has the same 
        meaning as in section 5(c)(5) of the Bank Holding 
        Company Act of 1956 (12 U.S.C. 1844(c)(5)).
          (12) Primary financial regulatory agency.--The term 
        ``primary financial regulatory agency'' means--
                  (A) the appropriate Federal banking agency, 
                with respect to institutions described in 
                section 3(q) of the Federal Deposit Insurance 
                Act, except to the extent that an institution 
                is or the activities of an institution are 
                otherwise described in subparagraph (B), (C), 
                (D), or (E);
                  (B) the Securities and Exchange Commission, 
                with respect to--
                          (i) any broker or dealer that is 
                        registered with the Commission under 
                        the Securities Exchange Act of 1934, 
                        with respect to the activities of the 
                        broker or dealer that require the 
                        broker or dealer to be registered under 
                        that Act;
                          (ii) any investment company that is 
                        registered with the Commission under 
                        the Investment Company Act of 1940, 
                        with respect to the activities of the 
                        investment company that require the 
                        investment company to be registered 
                        under that Act;
                          (iii) any investment adviser that is 
                        registered with the Commission under 
                        the Investment Advisers Act of 1940, 
                        with respect to the investment advisory 
                        activities of such company and 
                        activities that are incidental to such 
                        advisory activities;
                          (iv) any clearing agency registered 
                        with the Commission under the 
                        Securities Exchange Act of 1934, with 
                        respect to the activities of the 
                        clearing agency that require the agency 
                        to be registered under such Act;
                          (v) any nationally recognized 
                        statistical rating organization 
                        registered with the Commission under 
                        the Securities Exchange Act of 1934;
                          (vi) any transfer agent registered 
                        with the Commission under the 
                        Securities Exchange Act of 1934;
                          (vii) any exchange registered as a 
                        national securities exchange with the 
                        Commission under the Securities 
                        Exchange Act of 1934;
                          (viii) any national securities 
                        association registered with the 
                        Commission under the Securities 
                        Exchange Act of 1934;
                          (ix) any securities information 
                        processor registered with the 
                        Commission under the Securities 
                        Exchange Act of 1934;
                          (x) the Municipal Securities 
                        Rulemaking Board established under the 
                        Securities Exchange Act of 1934;
                          (xi) the Public Company Accounting 
                        Oversight Board established under the 
                        Sarbanes-Oxley Act of 2002 (15 U.S.C. 
                        7211 et seq.);
                          (xii) the Securities Investor 
                        Protection Corporation established 
                        under the Securities Investor 
                        Protection Act of 1970 (15 U.S.C. 78aaa 
                        et seq.); and
                          (xiii) any security-based swap 
                        execution facility, security-based swap 
                        data repository, security-based swap 
                        dealer or major security-based swap 
                        participant registered with the 
                        Commission under the Securities 
                        Exchange Act of 1934, with respect to 
                        the security-based swap activities of 
                        the person that require such person to 
                        be registered under such Act;
                  (C) the Commodity Futures Trading Commission, 
                with respect to--
                          (i) any futures commission merchant 
                        registered with the Commodity Futures 
                        Trading Commission under the Commodity 
                        Exchange Act (7 U.S.C. 1 et seq.), with 
                        respect to the activities of the 
                        futures commission merchant that 
                        require the futures commission merchant 
                        to be registered under that Act;
                          (ii) any commodity pool operator 
                        registered with the Commodity Futures 
                        Trading Commission under the Commodity 
                        Exchange Act (7 U.S.C. 1 et seq.), with 
                        respect to the activities of the 
                        commodity pool operator that require 
                        the commodity pool operator to be 
                        registered under that Act, or a 
                        commodity pool, as defined in that Act;
                          (iii) any commodity trading advisor 
                        or introducing broker registered with 
                        the Commodity Futures Trading 
                        Commission under the Commodity Exchange 
                        Act (7 U.S.C. 1 et seq.), with respect 
                        to the activities of the commodity 
                        trading advisor or introducing broker 
                        that require the commodity trading 
                        adviser or introducing broker to be 
                        registered under that Act;
                          (iv) any derivatives clearing 
                        organization registered with the 
                        Commodity Futures Trading Commission 
                        under the Commodity Exchange Act (7 
                        U.S.C. 1 et seq.), with respect to the 
                        activities of the derivatives clearing 
                        organization that require the 
                        derivatives clearing organization to be 
                        registered under that Act;
                          (v) any board of trade designated as 
                        a contract market by the Commodity 
                        Futures Trading Commission under the 
                        Commodity Exchange Act (7 U.S.C. 1 et 
                        seq.);
                          (vi) any futures association 
                        registered with the Commodity Futures 
                        Trading Commission under the Commodity 
                        Exchange Act (7 U.S.C. 1 et seq.);
                          (vii) any retail foreign exchange 
                        dealer registered with the Commodity 
                        Futures Trading Commission under the 
                        Commodity Exchange Act (7 U.S.C. 1 et 
                        seq.), with respect to the activities 
                        of the retail foreign exchange dealer 
                        that require the retail foreign 
                        exchange dealer to be registered under 
                        that Act;
                          (viii) any swap execution facility, 
                        swap data repository, swap dealer, or 
                        major swap participant registered with 
                        the Commodity Futures Trading 
                        Commission under the Commodity Exchange 
                        Act (7 U.S.C. 1 et seq.) with respect 
                        to the swap activities of the person 
                        that require such person to be 
                        registered under that Act; and
                          (ix) any registered entity under the 
                        Commodity Exchange Act (7 U.S.C. 1 et 
                        seq.), with respect to the activities 
                        of the registered entity that require 
                        the registered entity to be registered 
                        under that Act;
                  (D) the State insurance authority of the 
                State in which an insurance company is 
                domiciled, with respect to the insurance 
                activities and activities that are incidental 
                to such insurance activities of an insurance 
                company that is subject to supervision by the 
                State insurance authority under State insurance 
                law; and
                  (E) the Federal Housing Finance Agency, with 
                respect to Federal Home Loan Banks or the 
                Federal Home Loan Bank System, and with respect 
                to the Federal National Mortgage Association or 
                the Federal Home Loan Mortgage Corporation.
          (13) Prudential standards.--The term ``prudential 
        standards'' means enhanced supervision and regulatory 
        standards developed by the Board of Governors under 
        section 165.
          (14) Secretary.--The term ``Secretary'' means the 
        Secretary of the Treasury.
          (15) Securities terms.--The--
                  (A) terms ``broker'', ``dealer'', ``issuer'', 
                ``nationally recognized statistical rating 
                organization'', ``security'', and ``securities 
                laws'' have the same meanings as in section 3 
                of the Securities Exchange Act of 1934 (15 
                U.S.C. 78c);
                  (B) term ``investment adviser'' has the same 
                meaning as in section 202 of the Investment 
                Advisers Act of 1940 (15 U.S.C. 80b-2); and
                  (C) term ``investment company'' has the same 
                meaning as in section 3 of the Investment 
                Company Act of 1940 (15 U.S.C. 80a-3).
          (16) State.--The term ``State'' means any State, 
        commonwealth, territory, or possession of the United 
        States, the District of Columbia, the Commonwealth of 
        Puerto Rico, the Commonwealth of the Northern Mariana 
        Islands, American Samoa, Guam, or the United States 
        Virgin Islands.
          (17) Transfer date.--The term ``transfer date'' means 
        the date established under section 311.
          (18) Other incorporated definitions.--
                  (A) Federal deposit insurance act.--The terms 
                ``bank'', [``bank holding company'',] 
                ``control'', ``deposit'', ``depository 
                institution'', ``Federal depository 
                institution'', ``Federal savings association'', 
                ``foreign bank'', ``includes'', ``including'', 
                ``insured branch'', ``insured depository 
                institution'', ``national member bank'', 
                ``national nonmember bank'', ``savings 
                association'', ``State bank'', ``State 
                depository institution'', ``State member 
                bank'', ``State nonmember bank'', ``State 
                savings association'', and ``subsidiary'' have 
                the same meanings as in section 3 of the 
                Federal Deposit Insurance Act (12 U.S.C. 1813).
                  (B) Holding companies.--The term--
                          (i) ``bank holding company'' has the 
                        same meaning as in section 2 of the 
                        Bank Holding Company Act of 1956 (12 
                        U.S.C. 1841);
                          (ii) ``financial holding company'' 
                        has the same meaning as in section 2(p) 
                        of the Bank Holding Company Act of 1956 
                        (12 U.S.C. 1841(p)); and
                          (iii) ``savings and loan holding 
                        company'' has the same meaning as in 
                        section 10 of the Home Owners' Loan Act 
                        (12 U.S.C. 1467a(a)).

           *       *       *       *       *       *       *


SEC. 6. ANTITRUST SAVINGS CLAUSE.

  Nothing in this Act, or any amendment made by this Act, shall 
be construed to modify, impair, or supersede the operation of 
any of the antitrust laws, unless otherwise specified. For 
purposes of this section, the term ``antitrust laws'' has the 
same meaning as in subsection (a) of the first section of the 
Clayton Act (15 U.S.C. 12(a)), except that such term includes 
section 5 of the Federal Trade Commission [Act, to] Act (15 
U.S.C. 45) to the extent that such section 5 applies to unfair 
methods of competition.

                      TITLE I--FINANCIAL STABILITY

SEC. 101. SHORT TITLE.

  This title may be cited as the ``Financial Stability Act of 
2010''.

SEC. 102. DEFINITIONS.

  (a) In General.--For purposes of this title, unless the 
context otherwise requires, the following definitions shall 
apply:
          (1) Bank holding company.--The term ``bank holding 
        company'' has the same meaning as in section 2 of the 
        Bank Holding Company Act of 1956 (12 U.S.C. 1841). A 
        foreign bank or company that is treated as a bank 
        holding company for purposes of the Bank Holding 
        Company Act of 1956, pursuant to section 8(a) of the 
        International Banking Act of 1978 (12 U.S.C. 3106(a)), 
        shall be treated as a bank holding company for purposes 
        of this title.
          (2) Chairperson.--The term ``Chairperson'' means the 
        Chairperson of the Council.
          (3) Member agency.--The term ``member agency'' means 
        an agency represented by a voting member of the 
        Council.
          (4) Nonbank financial company definitions.--
                  (A) Foreign nonbank financial company.--The 
                term ``foreign nonbank financial company'' 
                means a company (other than a company that is, 
                or is treated in the United States as, a bank 
                holding company) that is--
                          (i) incorporated or organized in a 
                        country other than the United States; 
                        and
                          (ii) predominantly engaged in, 
                        including through a branch in the 
                        United States, financial activities, as 
                        defined in paragraph (6).
                  (B) U.S. nonbank financial company.--The term 
                ``U.S. nonbank financial company'' means a 
                company (other than a bank holding company, a 
                Farm Credit System institution chartered and 
                subject to the provisions of the Farm Credit 
                Act of 1971 (12 U.S.C. 2001 et seq.), or a 
                national securities exchange (or parent 
                thereof), clearing agency (or parent thereof, 
                unless the parent is a bank holding company), 
                security-based swap execution facility, or 
                security-based swap data repository registered 
                with the Commission, or a board of trade 
                designated as a contract market (or parent 
                thereof), or a derivatives clearing 
                organization (or parent thereof, unless the 
                parent is a bank holding company), swap 
                execution facility or a swap data repository 
                registered with the Commodity Futures Trading 
                Commission), that is--
                          (i) incorporated or organized under 
                        the laws of the United States or any 
                        State; and
                          (ii) predominantly engaged in 
                        financial activities, as defined in 
                        paragraph (6).
                  (C) Nonbank financial company.--The term 
                ``nonbank financial company'' means a U.S. 
                nonbank financial company and a foreign nonbank 
                financial company.
                  (D) Nonbank financial company supervised by 
                the board of governors.--The term ``nonbank 
                financial company supervised by the Board of 
                Governors'' means a nonbank financial company 
                that the Council has determined under section 
                113 shall be supervised by the Board of 
                Governors.
          [(5) Office of financial research.--The term ``Office 
        of Financial Research'' means the office established 
        under section 152.]
          (6) Predominantly engaged.--A company is 
        ``predominantly engaged in financial activities'' if--
                  (A) the annual gross revenues derived by the 
                company and all of its subsidiaries from 
                activities that are financial in nature (as 
                defined in section 4(k) of the Bank Holding 
                Company Act of 1956 (12 U.S.C. 1843(k))) and, 
                if applicable, from the ownership or control of 
                one or more insured depository institutions, 
                represents 85 percent or more of the 
                consolidated annual gross revenues of the 
                company; or
                  (B) the consolidated assets of the company 
                and all of its subsidiaries related to 
                activities that are financial in nature (as 
                defined in section 4(k) of the Bank Holding 
                Company Act of 1956 (12 U.S.C. 1843(k))) and, 
                if applicable, related to the ownership or 
                control of one or more insured depository 
                institutions, represents 85 percent or more of 
                the consolidated assets of the company.
          (7) Significant institutions.--The terms 
        ``significant nonbank financial company'' and 
        ``significant bank holding company'' have the meanings 
        given those terms by rule of the Board of Governors, 
        but in no instance shall the term ``significant nonbank 
        financial company'' include those entities that are 
        excluded under paragraph (4)(B).
  (b) Definitional Criteria.--The Board of Governors shall 
establish, by regulation, the requirements for determining if a 
company is predominantly engaged in financial activities, as 
defined in subsection (a)(6).
  (c) Foreign Nonbank Financial Companies.--For purposes of the 
application of subtitles A and C (other than section 113(b)) 
with respect to a foreign nonbank financial company, references 
in this title to ``company'' or ``subsidiary'' include only the 
United States activities and subsidiaries of such foreign 
company, except as otherwise provided.

           Subtitle A--Financial Stability Oversight Council

SEC. 111. FINANCIAL STABILITY OVERSIGHT COUNCIL ESTABLISHED.

  (a) Establishment.--Effective on the date of enactment of 
this Act, there is established the Financial Stability 
Oversight Council.
  (b) Membership.--The Council shall consist of the following 
members:
          (1) Voting members.--The voting members, [who shall 
        each] who shall, except as provided below, each have 1 
        vote on the Council shall be--
                  (A) the Secretary of the Treasury, who shall 
                serve as Chairperson of the Council;
                  [(B) the Chairman of the Board of Governors;
                  [(C) the Comptroller of the Currency;
                  [(D) the Director of the Bureau;
                  [(E) the Chairman of the Commission;
                  [(F) the Chairperson of the Corporation;
                  [(G) the Chairperson of the Commodity Futures 
                Trading Commission;
                  [(H) the Director of the Federal Housing 
                Finance Agency;
                  [(I) the Chairman of the National Credit 
                Union Administration Board; and
                  [(J) an independent member appointed by the 
                President, by and with the advice and consent 
                of the Senate, having insurance expertise.]
                  (B) each member of the Board of Governors, 
                who shall collectively have 1 vote on the 
                Council;
                  (C) the Comptroller of the Currency;
                  (D) the Director of the Consumer Law 
                Enforcement Agency;
                  (E) each member of the Commission, who shall 
                collectively have 1 vote on the Council;
                  (F) each member of the Corporation, who shall 
                collectively have 1 vote on the Council;
                  (G) each member of the Commodity Futures 
                Trading Commission, who shall collectively have 
                1 vote on the Council;
                  (H) the Director of the Federal Housing 
                Finance Agency;
                  (I) each member of the National Credit Union 
                Administration Board, who shall collectively 
                have 1 vote on the Council; and
                  (J) the Independent Insurance Advocate.
          (2) Nonvoting members.--The nonvoting members, who 
        shall serve in an advisory capacity as a nonvoting 
        member of the Council, shall be--
                  [(A) the Director of the Office of Financial 
                Research;
                  [(B) the Director of the Federal Insurance 
                Office;]
                  [(C)] (A) a State insurance commissioner, to 
                be designated by a selection process determined 
                by the State insurance commissioners;
                  [(D)] (B) a State banking supervisor, to be 
                designated by a selection process determined by 
                the State banking supervisors; and
                  [(E)] (C) a State securities commissioner (or 
                an officer performing like functions), to be 
                designated by a selection process determined by 
                such State securities commissioners.
          (3) Acting officials may serve.--In the event of a 
        vacancy in the office of the head of a member agency or 
        department, and pending the appointment of a successor, 
        or during the absence or disability of the head of a 
        member agency or department, the acting head of the 
        member agency or department shall serve as a member of 
        the Council in the place of that agency or department 
        head.
          (4) Voting by multi-person entity.--
                  (A) Voting within the entity.--An entity 
                described under subparagraph (B), (E), (F), 
                (G), or (I) of paragraph (1) shall determine 
                the entity's Council vote by using the voting 
                process normally applicable to votes by the 
                entity's members.
                  (B) Casting of entity vote.--The 1 collective 
                Council vote of an entity described under 
                subparagraph (A) shall be cast by the head of 
                such agency or, in the event such head is 
                unable to cast such vote, the next most senior 
                member of the entity available.
  (c) Terms; Vacancy.--
          (1) Terms.--The independent member of the Council 
        shall serve for a term of 6 years, and each nonvoting 
        member described in [subparagraphs (C), (D), and (E)] 
        subparagraphs (B), (C), and (D) of subsection (b)(2) 
        shall serve for a term of 2 years.
          (2) Vacancy.--Any vacancy on the Council shall be 
        filled in the manner in which the original appointment 
        was made.
          (3) Acting officials may serve.--In the event of a 
        vacancy in the office of the head of a member agency or 
        department, and pending the appointment of a successor, 
        or during the absence or disability of the head of a 
        member agency or department, the acting head of the 
        member agency or department shall serve as a member of 
        the Council in the place of [that agency or department 
        head] the head of that member agency or department.
  (d) Technical and Professional Advisory Committees.--The 
Council may appoint such special advisory, technical, or 
professional committees as may be useful in carrying out the 
functions of the Council, including an advisory committee 
consisting of State regulators, and the members of such 
committees may be members of the Council, or other persons, or 
both.
  (e) Meetings.--
          (1) Timing.--The Council shall meet at the call of 
        the Chairperson or a majority of the members then 
        serving, but not less frequently than quarterly.
          (2) Rules for conducting business.--The Council shall 
        adopt such rules as may be necessary for the conduct of 
        the business of the Council. Such rules shall be rules 
        of agency organization, procedure, or practice for 
        purposes of section 553 of title 5, United States Code.
          (3) Staff access.--Any member of the Council may 
        select to have one or more individuals on the member's 
        staff attend a meeting of the Council, including any 
        meeting of representatives of the member agencies other 
        than the members themselves.
          (4) Congressional oversight.--All meetings of the 
        Council, whether or not open to the public, shall be 
        open to the attendance by members of the Committee on 
        Financial Services of the House of Representatives and 
        the Committee on Banking, Housing, and Urban Affairs of 
        the Senate.
          (5) Member agency meetings.--Any meeting of 
        representatives of the member agencies other than the 
        members themselves shall be open to attendance by staff 
        of the Committee on Financial Services of the House of 
        Representatives and the Committee on Banking, Housing, 
        and Urban Affairs of the Senate.
  (f) Voting.--Unless otherwise specified, the Council shall 
make all decisions that it is authorized or required to make by 
a majority vote of the voting members then serving.
  [(g) Nonapplicability of FACA.--The Federal Advisory 
Committee Act (5 U.S.C. App.) shall not apply to the Council, 
or to any special advisory, technical, or professional 
committee appointed by the Council, except that, if an 
advisory, technical, or professional committee has one or more 
members who are not employees of or affiliated with the United 
States Government, the Council shall publish a list of the 
names of the members of such committee.]
  (g) Open Meeting Requirement.--The Council shall be an agency 
for purposes of section 552b of title 5, United States Code 
(commonly referred to as the ``Government in the Sunshine 
Act'').
  (h) Confidential Congressional Briefings.--At the request of 
the Chairman of the Committee on Financial Services of the 
House of Representatives or the Chairman of the Committee on 
Banking, Housing, and Urban Affairs of the Senate, the 
Chairperson shall appear before Congress to provide a 
confidential briefing.
  [(h)] (i) Assistance From Federal Agencies.--Any department 
or agency of the United States may provide to the Council and 
any special advisory, technical, or professional committee 
appointed by the Council, such services, funds, facilities, 
staff, and other support services as the Council may determine 
advisable.
  [(i)] (j) Compensation of Members.--
          (1) Federal employee members.--All members of the 
        Council who are officers or employees of the United 
        States shall serve without compensation in addition to 
        that received for their services as officers or 
        employees of the United States.
          (2) Compensation for non-federal member.--Section 
        5314 of title 5, United States Code, is amended by 
        adding at the end the following:``Independent Member of 
        the Financial Stability Oversight Council (1).''.
  [(j)] (k) Detail of Government Employees.--Any employee of 
the Federal Government may be detailed to the Council without 
reimbursement, and such detail shall be without interruption or 
loss of civil service status or privilege. An employee of the 
Federal Government detailed to the Council shall report to and 
be subject to oversight by the Council during the assignment to 
the Council, and shall be compensated by the department or 
agency from which the employee was detailed.

SEC. 112. COUNCIL AUTHORITY.

  (a) Purposes and Duties of the Council.--
          (1) In general.--The purposes of the Council are--
                  (A) to identify risks to the financial 
                stability of the United States that could arise 
                from the material financial distress or 
                failure, or ongoing activities, of large, 
                interconnected bank holding companies or 
                nonbank financial companies, or that could 
                arise outside the financial services 
                marketplace;
                  (B) to promote market discipline, by 
                eliminating expectations on the part of 
                shareholders, creditors, and counterparties of 
                such companies that the Government will shield 
                them from losses in the event of failure; and
                  (C) to respond to emerging threats to the 
                stability of the United States financial 
                system.
          (2) Duties.--The Council shall, in accordance with 
        this title--
                  (A) collect information from member agencies, 
                other Federal and State financial regulatory 
                agencies, [the Federal Insurance Office and, if 
                necessary to assess risks to the United States 
                financial system, direct the Office of 
                Financial Research to] and, if necessary to 
                assess risks to the United States financial 
                system, collect information from bank holding 
                companies and nonbank financial companies;
                  [(B) provide direction to, and request data 
                and analyses from, the Office of Financial 
                Research to support the work of the Council;]
                  [(C)] (B) monitor the financial services 
                marketplace in order to identify potential 
                threats to the financial stability of the 
                United States;
                  [(D) to] (C) monitor domestic and 
                international financial regulatory proposals 
                and developments, including insurance and 
                accounting issues, and advise Congress and make 
                recommendations in such areas that will enhance 
                the integrity, efficiency, competitiveness, and 
                stability of the U.S. financial markets;
                  [(E)] (D) facilitate information sharing and 
                coordination among the member agencies and 
                other Federal and State agencies regarding 
                domestic financial services policy development, 
                rulemaking, examinations, reporting 
                requirements, and enforcement actions;
                  [(F)] (E) recommend to the member agencies 
                general supervisory priorities and principles 
                reflecting the outcome of discussions among the 
                member agencies;
                  [(G)] (F) identify gaps in regulation that 
                could pose risks to the financial stability of 
                the United States;
                  [(H) require supervision by the Board of 
                Governors for nonbank financial companies that 
                may pose risks to the financial stability of 
                the United States in the event of their 
                material financial distress or failure, or 
                because of their activities pursuant to section 
                113;
                  [(I) make recommendations to the Board of 
                Governors concerning the establishment of 
                heightened prudential standards for risk-based 
                capital, leverage, liquidity, contingent 
                capital, resolution plans and credit exposure 
                reports, concentration limits, enhanced public 
                disclosures, and overall risk management for 
                nonbank financial companies and large, 
                interconnected bank holding companies 
                supervised by the Board of Governors;
                  [(J) identify systemically important 
                financial market utilities and payment, 
                clearing, and settlement activities (as that 
                term is defined in title VIII);]
                  [(K)] (G) make recommendations to primary 
                financial regulatory agencies to apply new or 
                heightened standards and safeguards for 
                financial activities or practices that could 
                create or increase risks of significant 
                liquidity, credit, or other problems spreading 
                among bank holding companies, nonbank financial 
                companies, and United States financial markets;
                  [(L)] (H) review and, as appropriate, [may] 
                submit comments to the Commission and any 
                standard-setting body with respect to an 
                existing or proposed accounting principle, 
                standard, or procedure;
                  [(M)] (I) provide a forum for--
                          (i) discussion and analysis of 
                        emerging market developments and 
                        financial regulatory issues; and
                          (ii) resolution of jurisdictional 
                        disputes among the members of the 
                        Council; and
                  [(N)] (J) annually report to and testify 
                before Congress on--
                          (i) the activities of the Council;
                          (ii) significant financial market and 
                        regulatory developments, including 
                        insurance and accounting regulations 
                        and standards, along with an assessment 
                        of those developments on the stability 
                        of the financial system;
                          (iii) potential emerging threats to 
                        the financial stability of the United 
                        States; and
                          [(iv) all determinations made under 
                        section 113 or title VIII, and the 
                        basis for such determinations;
                          [(v) all recommendations made under 
                        section 119 and the result of such 
                        recommendations; and]
                          [(vi)] (iv) recommendations--
                                  (I) to enhance the integrity, 
                                efficiency, competitiveness, 
                                and stability of United States 
                                financial markets;
                                  (II) to promote market 
                                discipline; and
                                  (III) to maintain investor 
                                confidence.
  (b) Statements by Voting Members of the Council.--At the time 
at which each report is submitted under subsection (a), each 
voting member of the Council shall--
          (1) if such member believes that the Council, the 
        Government, and the private sector are taking all 
        reasonable steps to ensure financial stability and to 
        mitigate systemic risk that would negatively affect the 
        economy, submit a signed statement to Congress stating 
        such belief; or
          (2) if such member does not believe that all 
        reasonable steps described under paragraph (1) are 
        being taken, submit a signed statement to Congress 
        stating what actions such member believes need to be 
        taken in order to ensure that all reasonable steps 
        described under paragraph (1) are taken.
  (c) Testimony by the Chairperson.--The Chairperson shall 
appear before the Committee on Financial Services of the House 
of Representatives and the Committee on Banking, Housing, and 
Urban Affairs of the Senate at an annual hearing, after the 
report is submitted under subsection (a)--
          (1) to discuss the efforts, activities, objectives, 
        and plans of the Council; and
          (2) to discuss and answer questions concerning such 
        report.
  (d) Authority To Obtain Information.--
          (1) In general.--The Council may receive, and may 
        request the submission of, any data or information from 
        [the Office of Financial Research, member agencies, and 
        the Federal Insurance Office] member agencies, as 
        necessary--
                  (A) to monitor the financial services 
                marketplace to identify potential risks to the 
                financial stability of the United States; or
                  (B) to otherwise carry out any of the 
                provisions of this title.
          (2) Submissions by the office and member agencies.--
        Notwithstanding any other provision of law, [the Office 
        of Financial Research, any member agency, and the 
        Federal Insurance Office,] member agencies are 
        authorized to submit information to the Council.
          (3) Financial data collection.--
                  (A) In general.--The Council[, acting through 
                the Office of Financial Research,] may require 
                the submission of periodic and other reports 
                from any nonbank financial company or bank 
                holding company for the purpose of assessing 
                the extent to which a financial activity or 
                financial market in which the nonbank financial 
                company or bank holding company participates, 
                or the nonbank financial company or bank 
                holding company itself, poses a threat to the 
                financial stability of the United States.
                  (B) Mitigation of report burden.--Before 
                requiring the submission of reports from any 
                nonbank financial company or bank holding 
                company that is regulated by a member agency or 
                any primary financial regulatory agency, the 
                Council[, acting through the Office of 
                Financial Research,] shall coordinate with such 
                agencies and shall, whenever possible, rely on 
                information available from [the Office of 
                Financial Research or] such agencies.
                  (C) Mitigation in case of foreign financial 
                companies.--Before requiring the submission of 
                reports from a company that is a foreign 
                nonbank financial company or foreign-based bank 
                holding company, the Council shall[, acting 
                through the Office of Financial Research,] to 
                the extent appropriate, consult with the 
                appropriate foreign regulator of such company 
                and, whenever possible, rely on information 
                already being collected by such foreign 
                regulator, with English translation.
          (4) Back-up examination by the board of governors.--
        If the Council is unable to determine whether the 
        financial activities of a U.S. nonbank financial 
        company pose a threat to the financial stability of the 
        United States, based on information or reports obtained 
        under paragraphs (1) and (3), discussions with 
        management, and publicly available information, the 
        Council may request the Board of Governors, and the 
        Board of Governors is authorized, to conduct an 
        examination of the U.S. nonbank financial company for 
        the sole purpose of determining whether the nonbank 
        financial company should be supervised by the Board of 
        Governors for purposes of this title.
          (5) Confidentiality.--
                  (A) In general.--The Council[, the Office of 
                Financial Research,] and the other member 
                agencies shall maintain the confidentiality of 
                any data, information, and reports submitted 
                under this title.
                  (B) Retention of privilege.--The submission 
                of any nonpublicly available data or 
                information under this [subsection and subtitle 
                B] subtitle shall not constitute a waiver of, 
                or otherwise affect, any privilege arising 
                under Federal or State law (including the rules 
                of any Federal or State court) to which the 
                data or information is otherwise subject.
                  (C) Freedom of information act.--Section 552 
                of title 5, United States Code, including the 
                exceptions thereunder, shall apply to any data 
                or information submitted under this [subsection 
                and subtitle B] subtitle.

[SEC. 113. AUTHORITY TO REQUIRE SUPERVISION AND REGULATION OF CERTAIN 
                    NONBANK FINANCIAL COMPANIES.

  [(a) U.S. Nonbank Financial Companies Supervised by the Board 
of Governors.--
          [(1) Determination.--The Council, on a nondelegable 
        basis and by a vote of not fewer than \2/3\ of the 
        voting members then serving, including an affirmative 
        vote by the Chairperson, may determine that a U.S. 
        nonbank financial company shall be supervised by the 
        Board of Governors and shall be subject to prudential 
        standards, in accordance with this title, if the 
        Council determines that material financial distress at 
        the U.S. nonbank financial company, or the nature, 
        scope, size, scale, concentration, interconnectedness, 
        or mix of the activities of the U.S. nonbank financial 
        company, could pose a threat to the financial stability 
        of the United States.
          [(2) Considerations.--In making a determination under 
        paragraph (1), the Council shall consider--
                  [(A) the extent of the leverage of the 
                company;
                  [(B) the extent and nature of the off-
                balance-sheet exposures of the company;
                  [(C) the extent and nature of the 
                transactions and relationships of the company 
                with other significant nonbank financial 
                companies and significant bank holding 
                companies;
                  [(D) the importance of the company as a 
                source of credit for households, businesses, 
                and State and local governments and as a source 
                of liquidity for the United States financial 
                system;
                  [(E) the importance of the company as a 
                source of credit for low-income, minority, or 
                underserved communities, and the impact that 
                the failure of such company would have on the 
                availability of credit in such communities;
                  [(F) the extent to which assets are managed 
                rather than owned by the company, and the 
                extent to which ownership of assets under 
                management is diffuse;
                  [(G) the nature, scope, size, scale, 
                concentration, interconnectedness, and mix of 
                the activities of the company;
                  [(H) the degree to which the company is 
                already regulated by 1 or more primary 
                financial regulatory agencies;
                  [(I) the amount and nature of the financial 
                assets of the company;
                  [(J) the amount and types of the liabilities 
                of the company, including the degree of 
                reliance on short-term funding; and
                  [(K) any other risk-related factors that the 
                Council deems appropriate.
  [(b) Foreign Nonbank Financial Companies Supervised by the 
Board of Governors.--
          [(1) Determination.--The Council, on a nondelegable 
        basis and by a vote of not fewer than \2/3\ of the 
        voting members then serving, including an affirmative 
        vote by the Chairperson, may determine that a foreign 
        nonbank financial company shall be supervised by the 
        Board of Governors and shall be subject to prudential 
        standards, in accordance with this title, if the 
        Council determines that material financial distress at 
        the foreign nonbank financial company, or the nature, 
        scope, size, scale, concentration, interconnectedness, 
        or mix of the activities of the foreign nonbank 
        financial company, could pose a threat to the financial 
        stability of the United States.
          [(2) Considerations.--In making a determination under 
        paragraph (1), the Council shall consider--
                  [(A) the extent of the leverage of the 
                company;
                  [(B) the extent and nature of the United 
                States related off-balance-sheet exposures of 
                the company;
                  [(C) the extent and nature of the 
                transactions and relationships of the company 
                with other significant nonbank financial 
                companies and significant bank holding 
                companies;
                  [(D) the importance of the company as a 
                source of credit for United States households, 
                businesses, and State and local governments and 
                as a source of liquidity for the United States 
                financial system;
                  [(E) the importance of the company as a 
                source of credit for low-income, minority, or 
                underserved communities in the United States, 
                and the impact that the failure of such company 
                would have on the availability of credit in 
                such communities;
                  [(F) the extent to which assets are managed 
                rather than owned by the company and the extent 
                to which ownership of assets under management 
                is diffuse;
                  [(G) the nature, scope, size, scale, 
                concentration, interconnectedness, and mix of 
                the activities of the company;
                  [(H) the extent to which the company is 
                subject to prudential standards on a 
                consolidated basis in its home country that are 
                administered and enforced by a comparable 
                foreign supervisory authority;
                  [(I) the amount and nature of the United 
                States financial assets of the company;
                  [(J) the amount and nature of the liabilities 
                of the company used to fund activities and 
                operations in the United States, including the 
                degree of reliance on short-term funding; and
                  [(K) any other risk-related factors that the 
                Council deems appropriate.
  [(c) Antievasion.--
          [(1) Determinations.--In order to avoid evasion of 
        this title, the Council, on its own initiative or at 
        the request of the Board of Governors, may determine, 
        on a nondelegable basis and by a vote of not fewer than 
        \2/3\ of the voting members then serving, including an 
        affirmative vote by the Chairperson, that--
                  [(A) material financial distress related to, 
                or the nature, scope, size, scale, 
                concentration, interconnectedness, or mix of, 
                the financial activities conducted directly or 
                indirectly by a company incorporated or 
                organized under the laws of the United States 
                or any State or the financial activities in the 
                United States of a company incorporated or 
                organized in a country other than the United 
                States would pose a threat to the financial 
                stability of the United States, based on 
                consideration of the factors in subsection 
                (a)(2) or (b)(2), as applicable;
                  [(B) the company is organized or operates in 
                such a manner as to evade the application of 
                this title; and
                  [(C) such financial activities of the company 
                shall be supervised by the Board of Governors 
                and subject to prudential standards in 
                accordance with this title, consistent with 
                paragraph (3).
          [(2) Report.--Upon making a determination under 
        paragraph (1), the Council shall submit a report to the 
        appropriate committees of Congress detailing the 
        reasons for making such determination.
          [(3) Consolidated supervision of only financial 
        activities; establishment of an intermediate holding 
        company.--
                  [(A) Establishment of an intermediate holding 
                company.--Upon a determination under paragraph 
                (1), the company that is the subject of the 
                determination may establish an intermediate 
                holding company in which the financial 
                activities of such company and its subsidiaries 
                shall be conducted (other than the activities 
                described in section 167(b)(2)) in compliance 
                with any regulations or guidance provided by 
                the Board of Governors. Such intermediate 
                holding company shall be subject to the 
                supervision of the Board of Governors and to 
                prudential standards under this title as if the 
                intermediate holding company were a nonbank 
                financial company supervised by the Board of 
                Governors.
                  [(B) Action of the board of governors.--To 
                facilitate the supervision of the financial 
                activities subject to the determination in 
                paragraph (1), the Board of Governors may 
                require a company to establish an intermediate 
                holding company, as provided for in section 
                167, which would be subject to the supervision 
                of the Board of Governors and to prudential 
                standards under this title, as if the 
                intermediate holding company were a nonbank 
                financial company supervised by the Board of 
                Governors.
          [(4) Notice and opportunity for hearing and final 
        determination; judicial review.--Subsections (d) 
        through (h) shall apply to determinations made by the 
        Council pursuant to paragraph (1) in the same manner as 
        such subsections apply to nonbank financial companies.
          [(5) Covered financial activities.--For purposes of 
        this subsection, the term ``financial activities''--
                  [(A) means activities that are financial in 
                nature (as defined in section 4(k) of the Bank 
                Holding Company Act of 1956);
                  [(B) includes the ownership or control of one 
                or more insured depository institutions; and
                  [(C) does not include internal financial 
                activities conducted for the company or any 
                affiliate thereof, including internal treasury, 
                investment, and employee benefit functions.
          [(6) Only financial activities subject to prudential 
        supervision.--Nonfinancial activities of the company 
        shall not be subject to supervision by the Board of 
        Governors and prudential standards of the Board. For 
        purposes of this Act, the financial activities that are 
        the subject of the determination in paragraph (1) shall 
        be subject to the same requirements as a nonbank 
        financial company supervised by the Board of Governors. 
        Nothing in this paragraph shall prohibit or limit the 
        authority of the Board of Governors to apply prudential 
        standards under this title to the financial activities 
        that are subject to the determination in paragraph (1).
  [(d) Reevaluation and Rescission.--The Council shall--
          [(1) not less frequently than annually, reevaluate 
        each determination made under subsections (a) and (b) 
        with respect to such nonbank financial company 
        supervised by the Board of Governors; and
          [(2) rescind any such determination, if the Council, 
        by a vote of not fewer than \2/3\ of the voting members 
        then serving, including an affirmative vote by the 
        Chairperson, determines that the nonbank financial 
        company no longer meets the standards under subsection 
        (a) or (b), as applicable.
  [(e) Notice and Opportunity for Hearing and Final 
Determination.--
          [(1) In general.--The Council shall provide to a 
        nonbank financial company written notice of a proposed 
        determination of the Council, including an explanation 
        of the basis of the proposed determination of the 
        Council, that a nonbank financial company shall be 
        supervised by the Board of Governors and shall be 
        subject to prudential standards in accordance with this 
        title.
          [(2) Hearing.--Not later than 30 days after the date 
        of receipt of any notice of a proposed determination 
        under paragraph (1), the nonbank financial company may 
        request, in writing, an opportunity for a written or 
        oral hearing before the Council to contest the proposed 
        determination. Upon receipt of a timely request, the 
        Council shall fix a time (not later than 30 days after 
        the date of receipt of the request) and place at which 
        such company may appear, personally or through counsel, 
        to submit written materials (or, at the sole discretion 
        of the Council, oral testimony and oral argument).
          [(3) Final determination.--Not later than 60 days 
        after the date of a hearing under paragraph (2), the 
        Council shall notify the nonbank financial company of 
        the final determination of the Council, which shall 
        contain a statement of the basis for the decision of 
        the Council.
          [(4) No hearing requested.--If a nonbank financial 
        company does not make a timely request for a hearing, 
        the Council shall notify the nonbank financial company, 
        in writing, of the final determination of the Council 
        under subsection (a) or (b), as applicable, not later 
        than 10 days after the date by which the company may 
        request a hearing under paragraph (2).
  [(f) Emergency Exception.--
          [(1) In general.--The Council may waive or modify the 
        requirements of subsection (e) with respect to a 
        nonbank financial company, if the Council determines, 
        by a vote of not fewer than \2/3\ of the voting members 
        then serving, including an affirmative vote by the 
        Chairperson, that such waiver or modification is 
        necessary or appropriate to prevent or mitigate threats 
        posed by the nonbank financial company to the financial 
        stability of the United States.
          [(2) Notice.--The Council shall provide notice of a 
        waiver or modification under this subsection to the 
        nonbank financial company concerned as soon as 
        practicable, but not later than 24 hours after the 
        waiver or modification is granted.
          [(3) International coordination.--In making a 
        determination under paragraph (1), the Council shall 
        consult with the appropriate home country supervisor, 
        if any, of the foreign nonbank financial company that 
        is being considered for such a determination.
          [(4) Opportunity for hearing.--The Council shall 
        allow a nonbank financial company to request, in 
        writing, an opportunity for a written or oral hearing 
        before the Council to contest a waiver or modification 
        under this subsection, not later than 10 days after the 
        date of receipt of notice of the waiver or modification 
        by the company. Upon receipt of a timely request, the 
        Council shall fix a time (not later than 15 days after 
        the date of receipt of the request) and place at which 
        the nonbank financial company may appear, personally or 
        through counsel, to submit written materials (or, at 
        the sole discretion of the Council, oral testimony and 
        oral argument).
          [(5) Notice of final determination.--Not later than 
        30 days after the date of any hearing under paragraph 
        (4), the Council shall notify the subject nonbank 
        financial company of the final determination of the 
        Council under this subsection, which shall contain a 
        statement of the basis for the decision of the Council.
  [(g) Consultation.--The Council shall consult with the 
primary financial regulatory agency, if any, for each nonbank 
financial company or subsidiary of a nonbank financial company 
that is being considered for supervision by the Board of 
Governors under this section before the Council makes any final 
determination with respect to such nonbank financial company 
under subsection (a), (b), or (c).
  [(h) Judicial Review.--If the Council makes a final 
determination under this section with respect to a nonbank 
financial company, such nonbank financial company may, not 
later than 30 days after the date of receipt of the notice of 
final determination under subsection (d)(2), (e)(3), or (f)(5), 
bring an action in the United States district court for the 
judicial district in which the home office of such nonbank 
financial company is located, or in the United States District 
Court for the District of Columbia, for an order requiring that 
the final determination be rescinded, and the court shall, upon 
review, dismiss such action or direct the final determination 
to be rescinded. Review of such an action shall be limited to 
whether the final determination made under this section was 
arbitrary and capricious.
  [(i) International Coordination.--In exercising its duties 
under this title with respect to foreign nonbank financial 
companies, foreign-based bank holding companies, and cross-
border activities and markets, the Council shall consult with 
appropriate foreign regulatory authorities, to the extent 
appropriate.

[SEC. 114. REGISTRATION OF NONBANK FINANCIAL COMPANIES SUPERVISED BY 
                    THE BOARD OF GOVERNORS.

  [Not later than 180 days after the date of a final Council 
determination under section 113 that a nonbank financial 
company is to be supervised by the Board of Governors, such 
company shall register with the Board of Governors, on forms 
prescribed by the Board of Governors, which shall include such 
information as the Board of Governors, in consultation with the 
Council, may deem necessary or appropriate to carry out this 
title.

[SEC. 115. ENHANCED SUPERVISION AND PRUDENTIAL STANDARDS FOR NONBANK 
                    FINANCIAL COMPANIES SUPERVISED BY THE BOARD OF 
                    GOVERNORS AND CERTAIN BANK HOLDING COMPANIES.

  [(a) In General.--
          [(1) Purpose.--In order to prevent or mitigate risks 
        to the financial stability of the United States that 
        could arise from the material financial distress, 
        failure, or ongoing activities of large, interconnected 
        financial institutions, the Council may make 
        recommendations to the Board of Governors concerning 
        the establishment and refinement of prudential 
        standards and reporting and disclosure requirements 
        applicable to nonbank financial companies supervised by 
        the Board of Governors and large, interconnected bank 
        holding companies, that--
                  [(A) are more stringent than those applicable 
                to other nonbank financial companies and bank 
                holding companies that do not present similar 
                risks to the financial stability of the United 
                States; and
                  [(B) increase in stringency, based on the 
                considerations identified in subsection (b)(3).
          [(2) Recommended application of required standards.--
        In making recommendations under this section, the 
        Council may--
                  [(A) differentiate among companies that are 
                subject to heightened standards on an 
                individual basis or by category, taking into 
                consideration their capital structure, 
                riskiness, complexity, financial activities 
                (including the financial activities of their 
                subsidiaries), size, and any other risk-related 
                factors that the Council deems appropriate; or
                  [(B) recommend an asset threshold that is 
                higher than $50,000,000,000 for the application 
                of any standard described in subsections (c) 
                through (g).
  [(b) Development of Prudential Standards.--
          [(1) In general.--The recommendations of the Council 
        under subsection (a) may include--
                  [(A) risk-based capital requirements;
                  [(B) leverage limits;
                  [(C) liquidity requirements;
                  [(D) resolution plan and credit exposure 
                report requirements;
                  [(E) concentration limits;
                  [(F) a contingent capital requirement;
                  [(G) enhanced public disclosures;
                  [(H) short-term debt limits; and
                  [(I) overall risk management requirements.
          [(2) Prudential standards for foreign financial 
        companies.--In making recommendations concerning the 
        standards set forth in paragraph (1) that would apply 
        to foreign nonbank financial companies supervised by 
        the Board of Governors or foreign-based bank holding 
        companies, the Council shall--
                  [(A) give due regard to the principle of 
                national treatment and equality of competitive 
                opportunity; and
                  [(B) take into account the extent to which 
                the foreign nonbank financial company or 
                foreign-based bank holding company is subject 
                on a consolidated basis to home country 
                standards that are comparable to those applied 
                to financial companies in the United States.
          [(3) Considerations.--In making recommendations 
        concerning prudential standards under paragraph (1), 
        the Council shall--
                  [(A) take into account differences among 
                nonbank financial companies supervised by the 
                Board of Governors and bank holding companies 
                described in subsection (a), based on--
                          [(i) the factors described in 
                        subsections (a) and (b) of section 113;
                          [(ii) whether the company owns an 
                        insured depository institution;
                          [(iii) nonfinancial activities and 
                        affiliations of the company; and
                          [(iv) any other factors that the 
                        Council determines appropriate;
                  [(B) to the extent possible, ensure that 
                small changes in the factors listed in 
                subsections (a) and (b) of section 113 would 
                not result in sharp, discontinuous changes in 
                the prudential standards established under 
                section 165; and
                  [(C) adapt its recommendations as appropriate 
                in light of any predominant line of business of 
                such company, including assets under management 
                or other activities for which particular 
                standards may not be appropriate.
  [(c) Contingent Capital.--
          [(1) Study required.--The Council shall conduct a 
        study of the feasibility, benefits, costs, and 
        structure of a contingent capital requirement for 
        nonbank financial companies supervised by the Board of 
        Governors and bank holding companies described in 
        subsection (a), which study shall include--
                  [(A) an evaluation of the degree to which 
                such requirement would enhance the safety and 
                soundness of companies subject to the 
                requirement, promote the financial stability of 
                the United States, and reduce risks to United 
                States taxpayers;
                  [(B) an evaluation of the characteristics and 
                amounts of contingent capital that should be 
                required;
                  [(C) an analysis of potential prudential 
                standards that should be used to determine 
                whether the contingent capital of a company 
                would be converted to equity in times of 
                financial stress;
                  [(D) an evaluation of the costs to companies, 
                the effects on the structure and operation of 
                credit and other financial markets, and other 
                economic effects of requiring contingent 
                capital;
                  [(E) an evaluation of the effects of such 
                requirement on the international 
                competitiveness of companies subject to the 
                requirement and the prospects for international 
                coordination in establishing such requirement; 
                and
                  [(F) recommendations for implementing 
                regulations.
          [(2) Report.--The Council shall submit a report to 
        Congress regarding the study required by paragraph (1) 
        not later than 2 years after the date of enactment of 
        this Act.
          [(3) Recommendations.--
                  [(A) In general.--Subsequent to submitting a 
                report to Congress under paragraph (2), the 
                Council may make recommendations to the Board 
                of Governors to require any nonbank financial 
                company supervised by the Board of Governors 
                and any bank holding company described in 
                subsection (a) to maintain a minimum amount of 
                contingent capital that is convertible to 
                equity in times of financial stress.
                  [(B) Factors to consider.--In making 
                recommendations under this subsection, the 
                Council shall consider--
                          [(i) an appropriate transition period 
                        for implementation of a conversion 
                        under this subsection;
                          [(ii) the factors described in 
                        subsection (b)(3);
                          [(iii) capital requirements 
                        applicable to a nonbank financial 
                        company supervised by the Board of 
                        Governors or a bank holding company 
                        described in subsection (a), and 
                        subsidiaries thereof;
                          [(iv) results of the study required 
                        by paragraph (1); and
                          [(v) any other factor that the 
                        Council deems appropriate.
  [(d) Resolution Plan and Credit Exposure Reports.--
          [(1) Resolution plan.--The Council may make 
        recommendations to the Board of Governors concerning 
        the requirement that each nonbank financial company 
        supervised by the Board of Governors and each bank 
        holding company described in subsection (a) report 
        periodically to the Council, the Board of Governors, 
        and the Corporation, the plan of such company for rapid 
        and orderly resolution in the event of material 
        financial distress or failure.
          [(2) Credit exposure report.--The Council may make 
        recommendations to the Board of Governors concerning 
        the advisability of requiring each nonbank financial 
        company supervised by the Board of Governors and bank 
        holding company described in subsection (a) to report 
        periodically to the Council, the Board of Governors, 
        and the Corporation on--
                  [(A) the nature and extent to which the 
                company has credit exposure to other 
                significant nonbank financial companies and 
                significant bank holding companies; and
                  [(B) the nature and extent to which other 
                such significant nonbank financial companies 
                and significant bank holding companies have 
                credit exposure to that company.
  [(e) Concentration Limits.--In order to limit the risks that 
the failure of any individual company could pose to nonbank 
financial companies supervised by the Board of Governors or 
bank holding companies described in subsection (a), the Council 
may make recommendations to the Board of Governors to prescribe 
standards to limit such risks, as set forth in section 165.
  [(f) Enhanced Public Disclosures.--The Council may make 
recommendations to the Board of Governors to require periodic 
public disclosures by bank holding companies described in 
subsection (a) and by nonbank financial companies supervised by 
the Board of Governors, in order to support market evaluation 
of the risk profile, capital adequacy, and risk management 
capabilities thereof.
  [(g) Short-term Debt Limits.--The Council may make 
recommendations to the Board of Governors to require short-term 
debt limits to mitigate the risks that an over-accumulation of 
such debt could pose to bank holding companies described in 
subsection (a), nonbank financial companies supervised by the 
Board of Governors, or the financial system.

[SEC. 116. REPORTS.

  [(a) In General.--Subject to subsection (b), the Council, 
acting through the Office of Financial Research, may require a 
bank holding company with total consolidated assets of 
$50,000,000,000 or greater or a nonbank financial company 
supervised by the Board of Governors, and any subsidiary 
thereof, to submit certified reports to keep the Council 
informed as to--
          [(1) the financial condition of the company;
          [(2) systems for monitoring and controlling 
        financial, operating, and other risks;
          [(3) transactions with any subsidiary that is a 
        depository institution; and
          [(4) the extent to which the activities and 
        operations of the company and any subsidiary thereof, 
        could, under adverse circumstances, have the potential 
        to disrupt financial markets or affect the overall 
        financial stability of the United States.
  [(b) Use of Existing Reports.--
          [(1) In general.--For purposes of compliance with 
        subsection (a), the Council, acting through the Office 
        of Financial Research, shall, to the fullest extent 
        possible, use--
                  [(A) reports that a bank holding company, 
                nonbank financial company supervised by the 
                Board of Governors, or any functionally 
                regulated subsidiary of such company has been 
                required to provide to other Federal or State 
                regulatory agencies or to a relevant foreign 
                supervisory authority;
                  [(B) information that is otherwise required 
                to be reported publicly; and
                  [(C) externally audited financial statements.
          [(2) Availability.--Each bank holding company 
        described in subsection (a) and nonbank financial 
        company supervised by the Board of Governors, and any 
        subsidiary thereof, shall provide to the Council, at 
        the request of the Council, copies of all reports 
        referred to in paragraph (1).
          [(3) Confidentiality.--The Council shall maintain the 
        confidentiality of the reports obtained under 
        subsection (a) and paragraph (1)(A) of this subsection.

[SEC. 117. TREATMENT OF CERTAIN COMPANIES THAT CEASE TO BE BANK HOLDING 
                    COMPANIES.

  [(a) Applicability.--This section shall apply to--
          [(1) any entity that--
                  [(A) was a bank holding company having total 
                consolidated assets equal to or greater than 
                $50,000,000,000 as of January 1, 2010; and
                  [(B) received financial assistance under or 
                participated in the Capital Purchase Program 
                established under the Troubled Asset Relief 
                Program authorized by the Emergency Economic 
                Stabilization Act of 2008; and
          [(2) any successor entity (as defined by the Board of 
        Governors, in consultation with the Council) to an 
        entity described in paragraph (1).
  [(b) Treatment.--If an entity described in subsection (a) 
ceases to be a bank holding company at any time after January 
1, 2010, then such entity shall be treated as a nonbank 
financial company supervised by the Board of Governors, as if 
the Council had made a determination under section 113 with 
respect to that entity.
  [(c) Appeal.--
          [(1) Request for hearing.--An entity may request, in 
        writing, an opportunity for a written or oral hearing 
        before the Council to appeal its treatment as a nonbank 
        financial company supervised by the Board of Governors 
        in accordance with this section. Upon receipt of the 
        request, the Council shall fix a time (not later than 
        30 days after the date of receipt of the request) and 
        place at which such entity may appear, personally or 
        through counsel, to submit written materials (or, at 
        the sole discretion of the Council, oral testimony and 
        oral argument).
          [(2) Decision.--
                  [(A) Proposed decision.--A Council decision 
                to grant an appeal under this subsection shall 
                be made by a vote of not fewer than \2/3\ of 
                the voting members then serving, including an 
                affirmative vote by the Chairperson. Not later 
                than 60 days after the date of a hearing under 
                paragraph (1), the Council shall submit a 
                report to, and may testify before, the 
                Committee on Banking, Housing, and Urban 
                Affairs of the Senate and the Committee on 
                Financial Services of the House of 
                Representatives on the proposed decision of the 
                Council regarding an appeal under paragraph 
                (1), which report shall include a statement of 
                the basis for the proposed decision of the 
                Council.
                  [(B) Notice of final decision.--The Council 
                shall notify the subject entity of the final 
                decision of the Council regarding an appeal 
                under paragraph (1), which notice shall contain 
                a statement of the basis for the final decision 
                of the Council, not later than 60 days after 
                the later of--
                          [(i) the date of the submission of 
                        the report under subparagraph (A); or
                          [(ii) if, not later than 1 year after 
                        the date of submission of the report 
                        under subparagraph (A), the Committee 
                        on Banking, Housing, and Urban Affairs 
                        of the Senate or the Committee on 
                        Financial Services of the House of 
                        Representatives holds one or more 
                        hearings regarding such report, the 
                        date of the last such hearing.
                  [(C) Considerations.--In making a decision 
                regarding an appeal under paragraph (1), the 
                Council shall consider whether the company 
                meets the standards under section 113(a) or 
                113(b), as applicable, and the definition of 
                the term ``nonbank financial company'' under 
                section 102. The decision of the Council shall 
                be final, subject to the review under paragraph 
                (3).
          [(3) Review.--If the Council denies an appeal under 
        this subsection, the Council shall, not less frequently 
        than annually, review and reevaluate the decision.

[SEC. 118. COUNCIL FUNDING.

  [Any expenses of the Council shall be treated as expenses of, 
and paid by, the Office of Financial Research.

[SEC. 119. RESOLUTION OF SUPERVISORY JURISDICTIONAL DISPUTES AMONG 
                    MEMBER AGENCIES.

  [(a) Request for Council Recommendation.--The Council shall 
seek to resolve a dispute among 2 or more member agencies, if--
          [(1) a member agency has a dispute with another 
        member agency about the respective jurisdiction over a 
        particular bank holding company, nonbank financial 
        company, or financial activity or product (excluding 
        matters for which another dispute mechanism 
        specifically has been provided under title X);
          [(2) the Council determines that the disputing 
        agencies cannot, after a demonstrated good faith 
        effort, resolve the dispute without the intervention of 
        the Council; and
          [(3) any of the member agencies involved in the 
        dispute--
                  [(A) provides all other disputants prior 
                notice of the intent to request dispute 
                resolution by the Council; and
                  [(B) requests in writing, not earlier than 14 
                days after providing the notice described in 
                subparagraph (A), that the Council seek to 
                resolve the dispute.
  [(b) Council Recommendation.--The Council shall seek to 
resolve each dispute described in subsection (a)--
          [(1) within a reasonable time after receiving the 
        dispute resolution request;
          [(2) after consideration of relevant information 
        provided by each agency party to the dispute; and
          [(3) by agreeing with 1 of the disputants regarding 
        the entirety of the matter, or by determining a 
        compromise position.
  [(c) Form of Recommendation.--Any Council recommendation 
under this section shall--
          [(1) be in writing;
          [(2) include an explanation of the reasons therefor; 
        and
          [(3) be approved by the affirmative vote of \2/3\ of 
        the voting members of the Council then serving.
  [(d) Nonbinding Effect.--Any recommendation made by the 
Council under subsection (c) shall not be binding on the 
Federal agencies that are parties to the dispute.

[SEC. 120. ADDITIONAL STANDARDS APPLICABLE TO ACTIVITIES OR PRACTICES 
                    FOR FINANCIAL STABILITY PURPOSES.

  [(a) In General.--The Council may provide for more stringent 
regulation of a financial activity by issuing recommendations 
to the primary financial regulatory agencies to apply new or 
heightened standards and safeguards, including standards 
enumerated in section 115, for a financial activity or practice 
conducted by bank holding companies or nonbank financial 
companies under their respective jurisdictions, if the Council 
determines that the conduct, scope, nature, size, scale, 
concentration, or interconnectedness of such activity or 
practice could create or increase the risk of significant 
liquidity, credit, or other problems spreading among bank 
holding companies and nonbank financial companies, financial 
markets of the United States, or low-income, minority, or 
underserved communities.
  [(b) Procedure for Recommendations to Regulators.--
          [(1) Notice and opportunity for comment.--The Council 
        shall consult with the primary financial regulatory 
        agencies and provide notice to the public and 
        opportunity for comment for any proposed recommendation 
        that the primary financial regulatory agencies apply 
        new or heightened standards and safeguards for a 
        financial activity or practice.
          [(2) Criteria.--The new or heightened standards and 
        safeguards for a financial activity or practice 
        recommended under paragraph (1)--
                  [(A) shall take costs to long-term economic 
                growth into account; and
                  [(B) may include prescribing the conduct of 
                the activity or practice in specific ways (such 
                as by limiting its scope, or applying 
                particular capital or risk management 
                requirements to the conduct of the activity) or 
                prohibiting the activity or practice.
  [(c) Implementation of Recommended Standards.--
          [(1) Role of primary financial regulatory agency.--
                  [(A) In general.--Each primary financial 
                regulatory agency may impose, require reports 
                regarding, examine for compliance with, and 
                enforce standards in accordance with this 
                section with respect to those entities for 
                which it is the primary financial regulatory 
                agency.
                  [(B) Rule of construction.--The authority 
                under this paragraph is in addition to, and 
                does not limit, any other authority of a 
                primary financial regulatory agency. Compliance 
                by an entity with actions taken by a primary 
                financial regulatory agency under this section 
                shall be enforceable in accordance with the 
                statutes governing the respective jurisdiction 
                of the primary financial regulatory agency over 
                the entity, as if the agency action were taken 
                under those statutes.
          [(2) Imposition of standards.--The primary financial 
        regulatory agency shall impose the standards 
        recommended by the Council in accordance with 
        subsection (a), or similar standards that the Council 
        deems acceptable, or shall explain in writing to the 
        Council, not later than 90 days after the date on which 
        the Council issues the recommendation, why the agency 
        has determined not to follow the recommendation of the 
        Council.
  [(d) Report to Congress.--The Council shall report to 
Congress on--
          [(1) any recommendations issued by the Council under 
        this section;
          [(2) the implementation of, or failure to implement, 
        such recommendation on the part of a primary financial 
        regulatory agency; and
          [(3) in any case in which no primary financial 
        regulatory agency exists for the nonbank financial 
        company conducting financial activities or practices 
        referred to in subsection (a), recommendations for 
        legislation that would prevent such activities or 
        practices from threatening the stability of the 
        financial system of the United States.
  [(e) Effect of Rescission of Identification.--
          [(1) Notice.--The Council may recommend to the 
        relevant primary financial regulatory agency that a 
        financial activity or practice no longer requires any 
        standards or safeguards implemented under this section.
          [(2) Determination of primary financial regulatory 
        agency to continue.--
                  [(A) In general.--Upon receipt of a 
                recommendation under paragraph (1), a primary 
                financial regulatory agency that has imposed 
                standards under this section shall determine 
                whether such standards should remain in effect.
                  [(B) Appeal process.--Each primary financial 
                regulatory agency that has imposed standards 
                under this section shall promulgate regulations 
                to establish a procedure under which entities 
                under its jurisdiction may appeal a 
                determination by such agency under this 
                paragraph that standards imposed under this 
                section should remain in effect.

[SEC. 121. MITIGATION OF RISKS TO FINANCIAL STABILITY.

  [(a) Mitigatory Actions.--If the Board of Governors 
determines that a bank holding company with total consolidated 
assets of $50,000,000,000 or more, or a nonbank financial 
company supervised by the Board of Governors, poses a grave 
threat to the financial stability of the United States, the 
Board of Governors, upon an affirmative vote of not fewer than 
\2/3\ of the voting members of the Council then serving, 
shall--
          [(1) limit the ability of the company to merge with, 
        acquire, consolidate with, or otherwise become 
        affiliated with another company;
          [(2) restrict the ability of the company to offer a 
        financial product or products;
          [(3) require the company to terminate one or more 
        activities;
          [(4) impose conditions on the manner in which the 
        company conducts 1 or more activities; or
          [(5) if the Board of Governors determines that the 
        actions described in paragraphs (1) through (4) are 
        inadequate to mitigate a threat to the financial 
        stability of the United States in its recommendation, 
        require the company to sell or otherwise transfer 
        assets or off-balance-sheet items to unaffiliated 
        entities.
  [(b) Notice and Hearing.--
          [(1) In general.--The Board of Governors, in 
        consultation with the Council, shall provide to a 
        company described in subsection (a) written notice that 
        such company is being considered for mitigatory action 
        pursuant to this section, including an explanation of 
        the basis for, and description of, the proposed 
        mitigatory action.
          [(2) Hearing.--Not later than 30 days after the date 
        of receipt of notice under paragraph (1), the company 
        may request, in writing, an opportunity for a written 
        or oral hearing before the Board of Governors to 
        contest the proposed mitigatory action. Upon receipt of 
        a timely request, the Board of Governors shall fix a 
        time (not later than 30 days after the date of receipt 
        of the request) and place at which such company may 
        appear, personally or through counsel, to submit 
        written materials (or, at the discretion of the Board 
        of Governors, in consultation with the Council, oral 
        testimony and oral argument).
          [(3) Decision.--Not later than 60 days after the date 
        of a hearing under paragraph (2), or not later than 60 
        days after the provision of a notice under paragraph 
        (1) if no hearing was held, the Board of Governors 
        shall notify the company of the final decision of the 
        Board of Governors, including the results of the vote 
        of the Council, as described in subsection (a).
  [(c) Factors for Consideration.--The Board of Governors and 
the Council shall take into consideration the factors set forth 
in subsection (a) or (b) of section 113, as applicable, in 
making any determination under subsection (a).
  [(d) Application to Foreign Financial Companies.--The Board 
of Governors may prescribe regulations regarding the 
application of this section to foreign nonbank financial 
companies supervised by the Board of Governors and foreign-
based bank holding companies--
          [(1) giving due regard to the principle of national 
        treatment and equality of competitive opportunity; and
          [(2) taking into account the extent to which the 
        foreign nonbank financial company or foreign-based bank 
        holding company is subject on a consolidated basis to 
        home country standards that are comparable to those 
        applied to financial companies in the United States.]

SEC. 118. COUNCIL FUNDING.

  There is authorized to be appropriated to the Council 
$4,000,000 for fiscal year 2017 and each fiscal year thereafter 
to carry out the duties of the Council.

           *       *       *       *       *       *       *


               [Subtitle B--Office of Financial Research

[SEC. 151. DEFINITIONS.

  [For purposes of this subtitle--
          [(1) the terms ``Office'' and ``Director'' mean the 
        Office of Financial Research established under this 
        subtitle and the Director thereof, respectively;
          [(2) the term ``financial company'' has the same 
        meaning as in title II, and includes an insured 
        depository institution and an insurance company;
          [(3) the term ``Data Center'' means the data center 
        established under section 154;
          [(4) the term ``Research and Analysis Center'' means 
        the research and analysis center established under 
        section 154;
          [(5) the term ``financial transaction data'' means 
        the structure and legal description of a financial 
        contract, with sufficient detail to describe the rights 
        and obligations between counterparties and make 
        possible an independent valuation;
          [(6) the term ``position data''--
                  [(A) means data on financial assets or 
                liabilities held on the balance sheet of a 
                financial company, where positions are created 
                or changed by the execution of a financial 
                transaction; and
                  [(B) includes information that identifies 
                counterparties, the valuation by the financial 
                company of the position, and information that 
                makes possible an independent valuation of the 
                position;
          [(7) the term ``financial contract'' means a legally 
        binding agreement between 2 or more counterparties, 
        describing rights and obligations relating to the 
        future delivery of items of intrinsic or extrinsic 
        value among the counterparties; and
          [(8) the term ``financial instrument'' means a 
        financial contract in which the terms and conditions 
        are publicly available, and the roles of one or more of 
        the counterparties are assignable without the consent 
        of any of the other counterparties (including common 
        stock of a publicly traded company, government bonds, 
        or exchange traded futures and options contracts).

[SEC. 152. OFFICE OF FINANCIAL RESEARCH ESTABLISHED.

  [(a) Establishment.--There is established within the 
Department of the Treasury the Office of Financial Research.
  [(b) Director.--
          [(1) In general.--The Office shall be headed by a 
        Director, who shall be appointed by the President, by 
        and with the advice and consent of the Senate.
          [(2) Term of service.--The Director shall serve for a 
        term of 6 years, except that, in the event that a 
        successor is not nominated and confirmed by the end of 
        the term of service of a Director, the Director may 
        continue to serve until such time as the next Director 
        is appointed and confirmed.
          [(3) Executive level.--The Director shall be 
        compensated at Level III of the Executive Schedule.
          [(4) Prohibition on dual service.--The individual 
        serving in the position of Director may not, during 
        such service, also serve as the head of any financial 
        regulatory agency.
          [(5) Responsibilities, duties, and authority.--The 
        Director shall have sole discretion in the manner in 
        which the Director fulfills the responsibilities and 
        duties and exercises the authorities described in this 
        subtitle.
  [(c) Budget.--The Director, in consultation with the 
Chairperson, shall establish the annual budget of the Office.
  [(d) Office Personnel.--
          [(1) In general.--The Director, in consultation with 
        the Chairperson, may fix the number of, and appoint and 
        direct, all employees of the Office.
          [(2) Compensation.--The Director, in consultation 
        with the Chairperson, shall fix, adjust, and administer 
        the pay for all employees of the Office, without regard 
        to chapter 51 or subchapter III of chapter 53 of title 
        5, United States Code, relating to classification of 
        positions and General Schedule pay rates.
          [(3) Comparability.--Section 1206(a) of the Financial 
        Institutions Reform, Recovery, and Enforcement Act of 
        1989 (12 U.S.C. 1833b(a)) is amended--
                  [(A) by striking ``Finance Board,'' and 
                inserting ``Finance Board, the Office of 
                Financial Research, and the Bureau of Consumer 
                Financial Protection''; and
                  [(B) by striking ``and the Office of Thrift 
                Supervision,''.
          [(4) Senior executives.--Section 3132(a)(1)(D) of 
        title 5, United States Code, is amended by striking 
        ``and the National Credit Union Administration;'' and 
        inserting ``the National Credit Union Administration, 
        the Bureau of Consumer Financial Protection, and the 
        Office of Financial Research;''.
  [(e) Assistance From Federal Agencies.--Any department or 
agency of the United States may provide to the Office and any 
special advisory, technical, or professional committees 
appointed by the Office, such services, funds, facilities, 
staff, and other support services as the Office may determine 
advisable. Any Federal Government employee may be detailed to 
the Office without reimbursement, and such detail shall be 
without interruption or loss of civil service status or 
privilege.
  [(f) Procurement of Temporary and Intermittent Services.--The 
Director may procure temporary and intermittent services under 
section 3109(b) of title 5, United States Code, at rates for 
individuals which do not exceed the daily equivalent of the 
annual rate of basic pay prescribed for Level V of the 
Executive Schedule under section 5316 of such title.
  [(g) Post-employment Prohibitions.--The Secretary, with the 
concurrence of the Director of the Office of Government Ethics, 
shall issue regulations prohibiting the Director and any 
employee of the Office who has had access to the transaction or 
position data maintained by the Data Center or other business 
confidential information about financial entities required to 
report to the Office from being employed by or providing advice 
or consulting services to a financial company, for a period of 
1 year after last having had access in the course of official 
duties to such transaction or position data or business 
confidential information, regardless of whether that entity is 
required to report to the Office. For employees whose access to 
business confidential information was limited, the regulations 
may provide, on a case-by-case basis, for a shorter period of 
post-employment prohibition, provided that the shorter period 
does not compromise business confidential information.
  [(h) Technical and Professional Advisory Committees.--The 
Office, in consultation with the Chairperson, may appoint such 
special advisory, technical, or professional committees as may 
be useful in carrying out the functions of the Office, and the 
members of such committees may be staff of the Office, or other 
persons, or both.
  [(i) Fellowship Program.--The Office, in consultation with 
the Chairperson, may establish and maintain an academic and 
professional fellowship program, under which qualified 
academics and professionals shall be invited to spend not 
longer than 2 years at the Office, to perform research and to 
provide advanced training for Office personnel.
  [(j) Executive Schedule Compensation.--Section 5314 of title 
5, United States Code, is amended by adding at the end the 
following new item:Director of the Office of Financial 
Research.''.

[SEC. 153. PURPOSE AND DUTIES OF THE OFFICE.

  [(a) Purpose and Duties.--The purpose of the Office is to 
support the Council in fulfilling the purposes and duties of 
the Council, as set forth in subtitle A, and to support member 
agencies, by--
          [(1) collecting data on behalf of the Council, and 
        providing such data to the Council and member agencies;
          [(2) standardizing the types and formats of data 
        reported and collected;
          [(3) performing applied research and essential long-
        term research;
          [(4) developing tools for risk measurement and 
        monitoring;
          [(5) performing other related services;
          [(6) making the results of the activities of the 
        Office available to financial regulatory agencies; and
          [(7) assisting such member agencies in determining 
        the types and formats of data authorized by this Act to 
        be collected by such member agencies.
  [(b) Administrative Authority.--The Office may--
          [(1) share data and information, including software 
        developed by the Office, with the Council, member 
        agencies, and the Bureau of Economic Analysis, which 
        shared data, information, and software--
                  [(A) shall be maintained with at least the 
                same level of security as is used by the 
                Office; and
                  [(B) may not be shared with any individual or 
                entity without the permission of the Council;
          [(2) sponsor and conduct research projects; and
          [(3) assist, on a reimbursable basis, with financial 
        analyses undertaken at the request of other Federal 
        agencies that are not member agencies.
  [(c) Rulemaking Authority.--
          [(1) Scope.--The Office, in consultation with the 
        Chairperson, shall issue rules, regulations, and orders 
        only to the extent necessary to carry out the purposes 
        and duties described in paragraphs (1), (2), and (7) of 
        subsection (a).
          [(2) Standardization.--Member agencies, in 
        consultation with the Office, shall implement 
        regulations promulgated by the Office under paragraph 
        (1) to standardize the types and formats of data 
        reported and collected on behalf of the Council, as 
        described in subsection (a)(2). If a member agency 
        fails to implement such regulations prior to the 
        expiration of the 3-year period following the date of 
        publication of final regulations, the Office, in 
        consultation with the Chairperson, may implement such 
        regulations with respect to the financial entities 
        under the jurisdiction of the member agency. This 
        paragraph shall not supersede or interfere with the 
        independent authority of a member agency under other 
        law to collect data, in such format and manner as the 
        member agency requires.
  [(d) Testimony.--
          [(1) In general.--The Director of the Office shall 
        report to and testify before the Committee on Banking, 
        Housing, and Urban Affairs of the Senate and the 
        Committee on Financial Services of the House of 
        Representatives annually on the activities of the 
        Office, including the work of the Data Center and the 
        Research and Analysis Center, and the assessment of the 
        Office of significant financial market developments and 
        potential emerging threats to the financial stability 
        of the United States.
          [(2) No prior review.--No officer or agency of the 
        United States shall have any authority to require the 
        Director to submit the testimony required under 
        paragraph (1) or other congressional testimony to any 
        officer or agency of the United States for approval, 
        comment, or review prior to the submission of such 
        testimony. Any such testimony to Congress shall include 
        a statement that the views expressed therein are those 
        of the Director and do not necessarily represent the 
        views of the President.
  [(e) Additional Reports.--The Director may provide additional 
reports to Congress concerning the financial stability of the 
United States. The Director shall notify the Council of any 
such additional reports provided to Congress.
  [(f) Subpoena.--
          [(1) In general.--The Director may require from a 
        financial company, by subpoena, the production of the 
        data requested under subsection (a)(1) and section 
        154(b)(1), but only upon a written finding by the 
        Director that--
                  [(A) such data is required to carry out the 
                functions described under this subtitle; and
                  [(B) the Office has coordinated with the 
                relevant primary financial regulatory agency, 
                as required under section 154(b)(1)(B)(ii).
          [(2) Format.--Subpoenas under paragraph (1) shall 
        bear the signature of the Director, and shall be served 
        by any person or class of persons designated by the 
        Director for that purpose.
          [(3) Enforcement.--In the case of contumacy or 
        failure to obey a subpoena, the subpoena shall be 
        enforceable by order of any appropriate district court 
        of the United States. Any failure to obey the order of 
        the court may be punished by the court as a contempt of 
        court.

[SEC. 154. ORGANIZATIONAL STRUCTURE; RESPONSIBILITIES OF PRIMARY 
                    PROGRAMMATIC UNITS.

  [(a) In General.--There are established within the Office, to 
carry out the programmatic responsibilities of the Office--
          [(1) the Data Center; and
          [(2) the Research and Analysis Center.
  [(b) Data Center.--
          [(1) General duties.--
                  [(A) Data collection.--The Data Center, on 
                behalf of the Council, shall collect, validate, 
                and maintain all data necessary to carry out 
                the duties of the Data Center, as described in 
                this subtitle. The data assembled shall be 
                obtained from member agencies, commercial data 
                providers, publicly available data sources, and 
                financial entities under subparagraph (B).
                  [(B) Authority.--
                          [(i) In general.--The Office may, as 
                        determined by the Council or by the 
                        Director in consultation with the 
                        Council, require the submission of 
                        periodic and other reports from any 
                        financial company for the purpose of 
                        assessing the extent to which a 
                        financial activity or financial market 
                        in which the financial company 
                        participates, or the financial company 
                        itself, poses a threat to the financial 
                        stability of the United States.
                          [(ii) Mitigation of report burden.--
                        Before requiring the submission of a 
                        report from any financial company that 
                        is regulated by a member agency, any 
                        primary financial regulatory agency, a 
                        foreign supervisory authority, or the 
                        Office shall coordinate with such 
                        agencies or authority, and shall, 
                        whenever possible, rely on information 
                        available from such agencies or 
                        authority.
                          [(iii) Collection of financial 
                        transaction and position data.--The 
                        Office shall collect, on a schedule 
                        determined by the Director, in 
                        consultation with the Council, 
                        financial transaction data and position 
                        data from financial companies.
                  [(C) Rulemaking.--The Office shall promulgate 
                regulations pursuant to subsections (a)(1), 
                (a)(2), (a)(7), and (c)(1) of section 153 
                regarding the type and scope of the data to be 
                collected by the Data Center under this 
                paragraph.
          [(2) Responsibilities.--
                  [(A) Publication.--The Data Center shall 
                prepare and publish, in a manner that is easily 
                accessible to the public--
                          [(i) a financial company reference 
                        database;
                          [(ii) a financial instrument 
                        reference database; and
                          [(iii) formats and standards for 
                        Office data, including standards for 
                        reporting financial transaction and 
                        position data to the Office.
                  [(B) Confidentiality.--The Data Center shall 
                not publish any confidential data under 
                subparagraph (A).
          [(3) Information security.--The Director shall ensure 
        that data collected and maintained by the Data Center 
        are kept secure and protected against unauthorized 
        disclosure.
          [(4) Catalog of financial entities and instruments.--
        The Data Center shall maintain a catalog of the 
        financial entities and instruments reported to the 
        Office.
          [(5) Availability to the council and member 
        agencies.--The Data Center shall make data collected 
        and maintained by the Data Center available to the 
        Council and member agencies, as necessary to support 
        their regulatory responsibilities.
          [(6) Other authority.--The Office shall, after 
        consultation with the member agencies, provide certain 
        data to financial industry participants and to the 
        general public to increase market transparency and 
        facilitate research on the financial system, to the 
        extent that intellectual property rights are not 
        violated, business confidential information is properly 
        protected, and the sharing of such information poses no 
        significant threats to the financial system of the 
        United States.
  [(c) Research and Analysis Center.--
          [(1) General duties.--The Research and Analysis 
        Center, on behalf of the Council, shall develop and 
        maintain independent analytical capabilities and 
        computing resources--
                  [(A) to develop and maintain metrics and 
                reporting systems for risks to the financial 
                stability of the United States;
                  [(B) to monitor, investigate, and report on 
                changes in systemwide risk levels and patterns 
                to the Council and Congress;
                  [(C) to conduct, coordinate, and sponsor 
                research to support and improve regulation of 
                financial entities and markets;
                  [(D) to evaluate and report on stress tests 
                or other stability-related evaluations of 
                financial entities overseen by the member 
                agencies;
                  [(E) to maintain expertise in such areas as 
                may be necessary to support specific requests 
                for advice and assistance from financial 
                regulators;
                  [(F) to investigate disruptions and failures 
                in the financial markets, report findings, and 
                make recommendations to the Council based on 
                those findings;
                  [(G) to conduct studies and provide advice on 
                the impact of policies related to systemic 
                risk; and
                  [(H) to promote best practices for financial 
                risk management.
  [(d) Reporting Responsibilities.--
          [(1) Required reports.--Not later than 2 years after 
        the date of enactment of this Act, and not later than 
        120 days after the end of each fiscal year thereafter, 
        the Office shall prepare and submit a report to 
        Congress.
          [(2) Content.--Each report required by this 
        subsection shall assess the state of the United States 
        financial system, including--
                  [(A) an analysis of any threats to the 
                financial stability of the United States;
                  [(B) the status of the efforts of the Office 
                in meeting the mission of the Office; and
                  [(C) key findings from the research and 
                analysis of the financial system by the Office.

[SEC. 155. FUNDING.

  [(a) Financial Research Fund.--
          [(1) Fund established.--There is established in the 
        Treasury of the United States a separate fund to be 
        known as the ``Financial Research Fund''.
          [(2) Fund receipts.--All amounts provided to the 
        Office under subsection (c), and all assessments that 
        the Office receives under subsection (d) shall be 
        deposited into the Financial Research Fund.
          [(3) Investments authorized.--
                  [(A) Amounts in fund may be invested.--The 
                Director may request the Secretary to invest 
                the portion of the Financial Research Fund that 
                is not, in the judgment of the Director, 
                required to meet the needs of the Office.
                  [(B) Eligible investments.--Investments shall 
                be made by the Secretary in obligations of the 
                United States or obligations that are 
                guaranteed as to principal and interest by the 
                United States, with maturities suitable to the 
                needs of the Financial Research Fund, as 
                determined by the Director.
          [(4) Interest and proceeds credited.--The interest 
        on, and the proceeds from the sale or redemption of, 
        any obligations held in the Financial Research Fund 
        shall be credited to and form a part of the Financial 
        Research Fund.
  [(b) Use of Funds.--
          [(1) In general.--Funds obtained by, transferred to, 
        or credited to the Financial Research Fund shall be 
        immediately available to the Office, and shall remain 
        available until expended, to pay the expenses of the 
        Office in carrying out the duties and responsibilities 
        of the Office.
          [(2) Fees, assessments, and other funds not 
        government funds.--Funds obtained by, transferred to, 
        or credited to the Financial Research Fund shall not be 
        construed to be Government funds or appropriated 
        moneys.
          [(3) Amounts not subject to apportionment.--
        Notwithstanding any other provision of law, amounts in 
        the Financial Research Fund shall not be subject to 
        apportionment for purposes of chapter 15 of title 31, 
        United States Code, or under any other authority, or 
        for any other purpose.
  [(c) Interim Funding.--During the 2-year period following the 
date of enactment of this Act, the Board of Governors shall 
provide to the Office an amount sufficient to cover the 
expenses of the Office.
  [(d) Permanent Self-funding.--Beginning 2 years after the 
date of enactment of this Act, the Secretary shall establish, 
by regulation, and with the approval of the Council, an 
assessment schedule, including the assessment base and rates, 
applicable to bank holding companies with total consolidated 
assets of 50,000,000,000 or greater and nonbank financial 
companies supervised by the Board of Governors, that takes into 
account differences among such companies, based on the 
considerations for establishing the prudential standards under 
section 115, to collect assessments equal to the total expenses 
of the Office.

[SEC. 156. TRANSITION OVERSIGHT.

  [(a) Purpose.--The purpose of this section is to ensure that 
the Office--
          [(1) has an orderly and organized startup;
          [(2) attracts and retains a qualified workforce; and
          [(3) establishes comprehensive employee training and 
        benefits programs.
  [(b) Reporting Requirement.--
          [(1) In general.--The Office shall submit an annual 
        report to the Committee on Banking, Housing, and Urban 
        Affairs of the Senate and the Committee on Financial 
        Services of the House of Representatives that includes 
        the plans described in paragraph (2).
          [(2) Plans.--The plans described in this paragraph 
        are as follows:
                  [(A) Training and workforce development 
                plan.--The Office shall submit a training and 
                workforce development plan that includes, to 
                the extent practicable--
                          [(i) identification of skill and 
                        technical expertise needs and actions 
                        taken to meet those requirements;
                          [(ii) steps taken to foster 
                        innovation and creativity;
                          [(iii) leadership development and 
                        succession planning; and
                          [(iv) effective use of technology by 
                        employees.
                  [(B) Workplace flexibility plan.--The Office 
                shall submit a workforce flexibility plan that 
                includes, to the extent practicable--
                          [(i) telework;
                          [(ii) flexible work schedules;
                          [(iii) phased retirement;
                          [(iv) reemployed annuitants;
                          [(v) part-time work;
                          [(vi) job sharing;
                          [(vii) parental leave benefits and 
                        childcare assistance;
                          [(viii) domestic partner benefits;
                          [(ix) other workplace flexibilities; 
                        or
                          [(x) any combination of the items 
                        described in clauses (i) through (ix).
                  [(C) Recruitment and retention plan.--The 
                Office shall submit a recruitment and retention 
                plan that includes, to the extent practicable, 
                provisions relating to--
                          [(i) the steps necessary to target 
                        highly qualified applicant pools with 
                        diverse backgrounds;
                          [(ii) streamlined employment 
                        application processes;
                          [(iii) the provision of timely 
                        notification of the status of 
                        employment applications to applicants; 
                        and
                          [(iv) the collection of information 
                        to measure indicators of hiring 
                        effectiveness.
  [(c) Expiration.--The reporting requirement under subsection 
(b) shall terminate 5 years after the date of enactment of this 
Act.
  [(d) Rule of Construction.--Nothing in this section may be 
construed to affect--
          [(1) a collective bargaining agreement, as that term 
        is defined in section 7103(a)(8) of title 5, United 
        States Code, that is in effect on the date of enactment 
        of this Act; or
          [(2) the rights of employees under chapter 71 of 
        title 5, United States Code.]

Subtitle C--Additional Board of Governors Authority for Certain Nonbank 
             Financial Companies and Bank Holding Companies

[SEC. 161. REPORTS BY AND EXAMINATIONS OF NONBANK FINANCIAL COMPANIES 
                    BY THE BOARD OF GOVERNORS.

  [(a) Reports.--
          [(1) In general.--The Board of Governors may require 
        each nonbank financial company supervised by the Board 
        of Governors, and any subsidiary thereof, to submit 
        reports under oath, to keep the Board of Governors 
        informed as to--
                  [(A) the financial condition of the company 
                or subsidiary, systems of the company or 
                subsidiary for monitoring and controlling 
                financial, operating, and other risks, and the 
                extent to which the activities and operations 
                of the company or subsidiary pose a threat to 
                the financial stability of the United States; 
                and
                  [(B) compliance by the company or subsidiary 
                with the requirements of this title.
          [(2) Use of existing reports and information.--In 
        carrying out subsection (a), the Board of Governors 
        shall, to the fullest extent possible, use--
                  [(A) reports and supervisory information that 
                a nonbank financial company or subsidiary 
                thereof has been required to provide to other 
                Federal or State regulatory agencies;
                  [(B) information otherwise obtainable from 
                Federal or State regulatory agencies;
                  [(C) information that is otherwise required 
                to be reported publicly; and
                  [(D) externally audited financial statements 
                of such company or subsidiary.
          [(3) Availability.--Upon the request of the Board of 
        Governors, a nonbank financial company supervised by 
        the Board of Governors, or a subsidiary thereof, shall 
        promptly provide to the Board of Governors any 
        information described in paragraph (2).
  [(b) Examinations.--
          [(1) In general.--Subject to paragraph (2), the Board 
        of Governors may examine any nonbank financial company 
        supervised by the Board of Governors and any subsidiary 
        of such company, to inform the Board of Governors of--
                  [(A) the nature of the operations and 
                financial condition of the company and such 
                subsidiary;
                  [(B) the financial, operational, and other 
                risks of the company or such subsidiary that 
                may pose a threat to the safety and soundness 
                of such company or subsidiary or to the 
                financial stability of the United States;
                  [(C) the systems for monitoring and 
                controlling such risks; and
                  [(D) compliance by the company or such 
                subsidiary with the requirements of this title.
          [(2) Use of examination reports and information.--For 
        purposes of this subsection, the Board of Governors 
        shall, to the fullest extent possible, rely on reports 
        of examination of any subsidiary depository institution 
        or functionally regulated subsidiary made by the 
        primary financial regulatory agency for that 
        subsidiary, and on information described in subsection 
        (a)(2).
  [(c) Coordination With Primary Financial Regulatory Agency.--
The Board of Governors shall--
          [(1) provide reasonable notice to, and consult with, 
        the primary financial regulatory agency for any 
        subsidiary before requiring a report or commencing an 
        examination of such subsidiary under this section; and
          [(2) avoid duplication of examination activities, 
        reporting requirements, and requests for information, 
        to the fullest extent possible.

[SEC. 162. ENFORCEMENT.

  [(a) In General.--Except as provided in subsection (b), a 
nonbank financial company supervised by the Board of Governors 
and any subsidiaries of such company (other than any depository 
institution subsidiary) shall be subject to the provisions of 
subsections (b) through (n) of section 8 of the Federal Deposit 
Insurance Act (12 U.S.C. 1818), in the same manner and to the 
same extent as if the company were a bank holding company, as 
provided in section 8(b)(3) of the Federal Deposit Insurance 
Act (12 U.S.C. 1818(b)(3)).
  [(b) Enforcement Authority for Functionally Regulated 
Subsidiaries.--
          [(1) Referral.--If the Board of Governors determines 
        that a condition, practice, or activity of a depository 
        institution subsidiary or functionally regulated 
        subsidiary of a nonbank financial company supervised by 
        the Board of Governors does not comply with the 
        regulations or orders prescribed by the Board of 
        Governors under this Act, or otherwise poses a threat 
        to the financial stability of the United States, the 
        Board of Governors may recommend, in writing, to the 
        primary financial regulatory agency for the subsidiary 
        that such agency initiate a supervisory action or 
        enforcement proceeding. The recommendation shall be 
        accompanied by a written explanation of the concerns 
        giving rise to the recommendation.
          [(2) Back-up authority of the board of governors.--
        If, during the 60-day period beginning on the date on 
        which the primary financial regulatory agency receives 
        a recommendation under paragraph (1), the primary 
        financial regulatory agency does not take supervisory 
        or enforcement action against a subsidiary that is 
        acceptable to the Board of Governors, the Board of 
        Governors (upon a vote of its members) may take the 
        recommended supervisory or enforcement action, as if 
        the subsidiary were a bank holding company subject to 
        supervision by the Board of Governors.]

SEC. 163. ACQUISITIONS.

  [(a) Acquisitions of Banks; Treatment as a Bank Holding 
Company.--For purposes of section 3 of the Bank Holding Company 
Act of 1956 (12 U.S.C. 1842), a nonbank financial company 
supervised by the Board of Governors shall be deemed to be, and 
shall be treated as, a bank holding company.]
  [(b)] (a) Acquisition of Nonbank Companies.--
          (1) Prior notice for large acquisitions.--
        Notwithstanding section 4(k)(6)(B) of the Bank Holding 
        Company Act of 1956 (12 U.S.C. 1843(k)(6)(B)), a bank 
        holding company with total consolidated assets equal to 
        or greater than $50,000,000,000 [or a nonbank financial 
        company supervised by the Board of Governors] shall not 
        acquire direct or indirect ownership or control of any 
        voting shares of any company (other than an insured 
        depository institution) that is engaged in activities 
        described in section 4(k) of the Bank Holding Company 
        Act of 1956 having total consolidated assets of 
        $10,000,000,000 or more, without providing written 
        notice to the Board of Governors in advance of the 
        transaction.
          (2) Exemptions.--The prior notice requirement in 
        paragraph (1) shall not apply with regard to the 
        acquisition of shares that would qualify for the 
        exemptions in section 4(c) or section 4(k)(4)(E) of the 
        Bank Holding Company Act of 1956 (12 U.S.C. 1843(c) and 
        (k)(4)(E)).
          (3) Notice procedures.--The notice procedures set 
        forth in section 4(j)(1) of the Bank Holding Company 
        Act of 1956 (12 U.S.C. 1843(j)(1)), without regard to 
        section 4(j)(3) of that Act, shall apply to an 
        acquisition of any company (other than an insured 
        depository institution) by a bank holding company with 
        total consolidated assets equal to or greater than 
        $50,000,000,000 [or a nonbank financial company 
        supervised by the Board of Governors], as described in 
        paragraph (1), including any such company engaged in 
        activities described in section 4(k) of that Act.
          (4) Standards for review.--[In addition]
                  (A) In general._In addition to the standards 
                provided in section 4(j)(2) of the Bank Holding 
                Company Act of 1956 (12 U.S.C. 1843(j)(2)), the 
                Board of Governors shall consider the extent to 
                which the proposed acquisition would result in 
                greater or more concentrated risks to global or 
                United States financial stability or the United 
                States economy.
                  (B) Exception for qualifying banking 
                organization.--Subparagraph (A) shall not apply 
                to a proposed acquisition by a qualifying 
                banking organization, as defined under section 
                605 of the Financial CHOICE Act of 2017.
          (5) Hart-Scott-Rodino filing requirement.--Solely for 
        purposes of section 7A(c)(8) of the Clayton Act (15 
        U.S.C. 18a(c)(8)), the transactions subject to the 
        requirements of paragraph (1) shall be treated as if 
        Board of Governors approval is not required.

[SEC. 164. PROHIBITION AGAINST MANAGEMENT INTERLOCKS BETWEEN CERTAIN 
                    FINANCIAL COMPANIES.

  [A nonbank financial company supervised by the Board of 
Governors shall be treated as a bank holding company for 
purposes of the Depository Institutions Management Interlocks 
Act (12 U.S.C. 3201 et seq.), except that the Board of 
Governors shall not exercise the authority provided in section 
7 of that Act (12 U.S.C. 3207) to permit service by a 
management official of a nonbank financial company supervised 
by the Board of Governors as a management official of any bank 
holding company with total consolidated assets equal to or 
greater than $50,000,000,000, or other nonaffiliated nonbank 
financial company supervised by the Board of Governors (other 
than to provide a temporary exemption for interlocks resulting 
from a merger, acquisition, or consolidation).]

SEC. 165. ENHANCED SUPERVISION AND PRUDENTIAL STANDARDS FOR NONBANK 
                    FINANCIAL COMPANIES SUPERVISED BY THE BOARD OF 
                    GOVERNORS AND CERTAIN BANK HOLDING COMPANIES.

  (a) In General.--
          (1) Purpose.--In order to prevent or mitigate risks 
        to the financial stability of the United States that 
        could arise from the material financial distress or 
        failure, or ongoing activities, of large, 
        interconnected financial institutions, the Board of 
        Governors shall, on its own or pursuant to 
        recommendations by the Council under section 115, 
        establish prudential standards for [nonbank financial 
        companies supervised by the Board of Governors and] 
        bank holding companies with total consolidated assets 
        equal to or greater than $50,000,000,000 that--
                  (A) are more stringent than the standards and 
                requirements applicable to nonbank financial 
                companies and bank holding companies that do 
                not present similar risks to the financial 
                stability of the United States; and
                  (B) increase in stringency, based on the 
                considerations identified in subsection (b)(3).
          [(2) Tailored application.--
                  [(A) In general.--In prescribing more 
                stringent prudential standards under this 
                section, the Board of Governors may, on its own 
                or pursuant to a recommendation by the Council 
                in accordance with section 115, differentiate 
                among companies on an individual basis or by 
                category, taking into consideration their 
                capital structure, riskiness, complexity, 
                financial activities (including the financial 
                activities of their subsidiaries), size, and 
                any other risk-related factors that the Board 
                of Governors deems appropriate.
                  [(B) Adjustment of threshold for application 
                of certain standards.--The Board of Governors 
                may, pursuant to a recommendation by the 
                Council in accordance with section 115, 
                establish an asset threshold above 
                $50,000,000,000 for the application of any 
                standard established under subsections (c) 
                through (g).]
          (2) Tailored application.--In prescribing more 
        stringent prudential standards under this section, the 
        Board of Governors may differentiate among companies on 
        an individual basis or by category, taking into 
        consideration their capital structure, riskiness, 
        complexity, financial activities (including the 
        financial activities of their subsidiaries), size, and 
        any other risk-related factors that the Board of 
        Governors deems appropriate.
  (b) Development of Prudential Standards.--
          (1) In general.--
                  (A) Required standards.--The Board of 
                Governors shall establish prudential standards 
                for [nonbank financial companies supervised by 
                the Board of Governors and] bank holding 
                companies described in subsection (a), that 
                shall include--
                          (i) risk-based capital requirements 
                        and leverage limits, unless the Board 
                        of Governors, in consultation with the 
                        Council, determines that such 
                        requirements are not appropriate for a 
                        company subject to more stringent 
                        prudential standards because of the 
                        activities of such company (such as 
                        investment company activities or assets 
                        under management) or structure, in 
                        which case, the Board of Governors 
                        shall apply other standards that result 
                        in similarly stringent risk controls;
                          (ii) liquidity requirements;
                          (iii) overall risk management 
                        requirements;
                          (iv) resolution plan and credit 
                        exposure report requirements; and
                          (v) concentration limits.
                  (B) Additional standards authorized.--The 
                Board of Governors may establish additional 
                prudential standards for [nonbank financial 
                companies supervised by the Board of Governors 
                and] bank holding companies described in 
                subsection (a), that include--
                          (i) a contingent capital requirement;
                          (ii) enhanced public disclosures;
                          (iii) short-term debt limits; and
                          (iv) such other prudential standards 
                        as the Board or Governors[, on its own 
                        or pursuant to a recommendation made by 
                        the Council in accordance with section 
                        115,] determines are appropriate.
          (2) Standards for foreign financial companies.--In 
        applying the standards set forth in paragraph (1) to 
        any [foreign nonbank financial company supervised by 
        the Board of Governors or] foreign-based bank holding 
        company, the Board of Governors [shall--]
                  [(A)] [give due] shall give due regard to the 
                principle of national treatment and equality of 
                competitive opportunity[; and].
                  [(B) take into account the extent to which 
                the foreign financial company is subject on a 
                consolidated basis to home country standards 
                that are comparable to those applied to 
                financial companies in the United States.]
          (3) Considerations.--In prescribing prudential 
        standards under paragraph (1), the Board of Governors 
        shall--
                  (A) take into account differences among 
                [nonbank financial companies supervised by the 
                Board of Governors and] bank holding companies 
                described in subsection (a), based on--
                          [(i) the factors described in 
                        subsections (a) and (b) of section 
                        113;]
                          [(ii)] (i) whether the company owns 
                        an insured depository institution;
                          [(iii)] (ii) nonfinancial activities 
                        and affiliations of the company; and
                          [(iv)] (iii) any other risk-related 
                        factors that the Board of Governors 
                        determines appropriate; and
                  [(B) to the extent possible, ensure that 
                small changes in the factors listed in 
                subsections (a) and (b) of section 113 would 
                not result in sharp, discontinuous changes in 
                the prudential standards established under 
                paragraph (1) of this subsection;
                  [(C) take into account any recommendations of 
                the Council under section 115; and]
                  [(D)] (B) adapt the required standards as 
                appropriate in light of any predominant line of 
                business of such company, including assets 
                under management or other activities for which 
                particular standards may not be appropriate.
          (4) Consultation.--Before imposing prudential 
        standards or any other requirements pursuant to this 
        section, including notices of deficiencies in 
        resolution plans and more stringent requirements or 
        divestiture orders resulting from such notices, that 
        are likely to have a significant impact on a 
        functionally regulated subsidiary or depository 
        institution subsidiary of [a nonbank financial company 
        supervised by the Board of Governors or] a bank holding 
        company described in subsection (a), the Board of 
        Governors shall consult with each Council member that 
        primarily supervises any such subsidiary with respect 
        to any such standard or requirement.
          (5) Report.--The Board of Governors shall submit an 
        annual report to Congress regarding the implementation 
        of the prudential standards required pursuant to 
        paragraph (1), including the use of such standards to 
        mitigate risks to the financial stability of the United 
        States.
  (c) Contingent Capital.--
          (1) In general.--Subsequent to submission by the 
        Council of a report to Congress [under section 115(c)], 
        the Board of Governors may issue regulations that 
        require each [nonbank financial company supervised by 
        the Board of Governors and] bank holding companies 
        described in subsection (a) to maintain a minimum 
        amount of contingent capital that is convertible to 
        equity in times of financial stress.
          (2) Factors to consider.--In issuing regulations 
        under this subsection, the Board of Governors shall 
        consider--
                  [(A) the results of the study undertaken by 
                the Council, and any recommendations of the 
                Council, under section 115(c);]
                  (A) any recommendations of the Council;
                  (B) an appropriate transition period for 
                implementation of contingent capital under this 
                subsection;
                  (C) the factors described in subsection 
                (b)(3)(A);
                  (D) capital requirements applicable to the 
                [nonbank financial company supervised by the 
                Board of Governors or] a bank holding company 
                described in subsection (a), and subsidiaries 
                thereof; and
                  (E) any other factor that the Board of 
                Governors deems appropriate.
  (d) Resolution Plan and Credit Exposure Reports.--
          (1) Resolution plan.--The Board of Governors shall 
        require each [nonbank financial company supervised by 
        the Board of Governors and] bank holding companies 
        described in subsection (a) to report [periodically] 
        not more often than every 2 years to the Board of 
        Governors[, the Council, and the Corporation] and the 
        Council the plan of such company for rapid and orderly 
        resolution in the event of material financial distress 
        or failure, which shall include--
                  (A) information regarding the manner and 
                extent to which any insured depository 
                institution affiliated with the company is 
                adequately protected from risks arising from 
                the activities of any nonbank subsidiaries of 
                the company;
                  (B) full descriptions of the ownership 
                structure, assets, liabilities, and contractual 
                obligations of the company;
                  (C) identification of the cross-guarantees 
                tied to different securities, identification of 
                major counterparties, and a process for 
                determining to whom the collateral of the 
                company is pledged; and
                  (D) any other information that the Board of 
                Governors and the Corporation jointly require 
                by rule or order.
          (2) Credit exposure report.--The Board of Governors 
        shall require each [nonbank financial company 
        supervised by the Board of Governors and] bank holding 
        companies described in subsection (a) to report 
        periodically to the Board of Governors[, the Council, 
        and the Corporation] and the Council on--
                  (A) the nature and extent to which the 
                company has credit exposure to other 
                significant nonbank financial companies and 
                significant bank holding companies; and
                  (B) the nature and extent to which other 
                significant nonbank financial companies and 
                significant bank holding companies have credit 
                exposure to that company.
          (3) Review.--[The Board]
                  (A) In general._The Board of Governors [and 
                the Corporation shall review] shall--
                          (i) review the information provided 
                        in accordance with this subsection by 
                        each [nonbank financial company 
                        supervised by the Board of Governors 
                        and] bank holding company described in 
                        subsection (a)[.]; and
                          (ii) not later than the end of the 6-
                        month period beginning on the date the 
                        bank holding company submits the 
                        resolution plan, provide feedback to 
                        the bank holding company on such plan.
                  (B) Disclosure of assessment framework.--The 
                Board of Governors shall publicly disclose the 
                assessment framework that is used to review 
                information under this paragraph and shall 
                provide the public with a notice and comment 
                period before finalizing such assessment 
                framework.
          (4) Notice of deficiencies.--If the Board of 
        Governors [and the Corporation jointly determine] 
        determines, based on [their] its review under paragraph 
        (3), that the resolution plan of [a nonbank financial 
        company supervised by the Board of Governors or] a bank 
        holding company described in subsection (a) is not 
        credible or would not facilitate an orderly resolution 
        of the company under title 11, United States Code--
                  (A) the Board of Governors [and the 
                Corporation] shall notify the company of the 
                deficiencies in the resolution plan; and
                  (B) the company shall resubmit the resolution 
                plan within a timeframe determined by the Board 
                of Governors [and the Corporation], with 
                revisions demonstrating that the plan is 
                credible and would result in an orderly 
                resolution under title 11, United States Code, 
                including any proposed changes in business 
                operations and corporate structure to 
                facilitate implementation of the plan.
          (5) Failure to resubmit credible plan.--
                  (A) In general.--If [a nonbank financial 
                company supervised by the Board of Governors 
                or] a bank holding company described in 
                subsection (a) fails to timely resubmit the 
                resolution plan as required under paragraph 
                (4), with such revisions as are required under 
                subparagraph (B), the Board of Governors [and 
                the Corporation may jointly] may impose more 
                stringent capital, leverage, or liquidity 
                requirements, or restrictions on the growth, 
                activities, or operations of the company, or 
                any subsidiary thereof, until such time as the 
                company resubmits a plan that remedies the 
                deficiencies.
                  (B) Divestiture.--The Board of Governors [and 
                the Corporation], in consultation with the 
                Council, [may jointly] may direct [a nonbank 
                financial company supervised by the Board of 
                Governors or] a bank holding company described 
                in subsection (a), by order, to divest certain 
                assets or operations identified by the Board of 
                Governors [and the Corporation], to facilitate 
                an orderly resolution of such company under 
                title 11, United States Code, in the event of 
                the failure of such company, in any case in 
                which--
                          (i) the Board of Governors [and the 
                        Corporation] [have jointly] has imposed 
                        more stringent requirements on the 
                        company pursuant to subparagraph (A); 
                        and
                          (ii) the company has failed, within 
                        the 2-year period beginning on the date 
                        of the imposition of such requirements 
                        under subparagraph (A), to resubmit the 
                        resolution plan with such revisions as 
                        were required under paragraph (4)(B).
          (6) No limiting effect.--A resolution plan submitted 
        in accordance with this subsection shall not be binding 
        on a bankruptcy court[, a receiver appointed under 
        title II,] or any other authority that is authorized or 
        required to resolve the [nonbank financial company 
        supervised by the Board, any bank holding company,] 
        bank holding company or any subsidiary or affiliate of 
        the foregoing.
          (7) No private right of action.--No private right of 
        action may be based on any resolution plan submitted in 
        accordance with this subsection.
          [(8) Rules.--Not later than 18 months after the date 
        of enactment of this Act, the Board of Governors and 
        the Corporation shall jointly issue final rules 
        implementing this subsection.]
          (8) Rules.--Not later than 12 months after enactment 
        of this paragraph, the Board of Governors shall issue 
        final rules implementing this section.
  (e) Concentration Limits.--
          (1) Standards.--In order to limit the risks that the 
        failure of any individual company could pose to [a 
        nonbank financial company supervised by the Board of 
        Governors or] a bank holding company described in 
        subsection (a), the Board of Governors, by regulation, 
        shall prescribe standards that limit such risks.
          (2) Limitation on credit exposure.--The regulations 
        prescribed by the Board of Governors under paragraph 
        (1) shall prohibit each [nonbank financial company 
        supervised by the Board of Governors and] bank holding 
        company described in subsection (a) from having credit 
        exposure to any unaffiliated company that exceeds 25 
        percent of the capital stock and surplus (or such lower 
        amount as the Board of Governors may determine by 
        regulation to be necessary to mitigate risks to the 
        financial stability of the United States) of the 
        company.
          (3) Credit exposure.--For purposes of paragraph (2), 
        ``credit exposure'' to a company means--
                  (A) all extensions of credit to the company, 
                including loans, deposits, and lines of credit;
                  (B) all repurchase agreements and reverse 
                repurchase agreements with the company, and all 
                securities borrowing and lending transactions 
                with the company, to the extent that such 
                transactions create credit exposure for [the 
                nonbank financial company supervised by the 
                Board of Governors or] a bank holding company 
                described in subsection (a);
                  (C) all guarantees, acceptances, or letters 
                of credit (including endorsement or standby 
                letters of credit) issued on behalf of the 
                company;
                  (D) all purchases of or investment in 
                securities issued by the company;
                  (E) counterparty credit exposure to the 
                company in connection with a derivative 
                transaction between [the nonbank financial 
                company supervised by the Board of Governors 
                or] a bank holding company described in 
                subsection (a) and the company; and
                  (F) any other similar transactions that the 
                Board of Governors, by regulation, determines 
                to be a credit exposure for purposes of this 
                section.
          (4) Attribution rule.--For purposes of this 
        subsection, any transaction by [a nonbank financial 
        company supervised by the Board of Governors or] a bank 
        holding company described in subsection (a) with any 
        person is a transaction with a company, to the extent 
        that the proceeds of the transaction are used for the 
        benefit of, or transferred to, that company.
          (5) Rulemaking.--The Board of Governors may issue 
        such regulations and orders, including definitions 
        consistent with this section, as may be necessary to 
        administer and carry out this subsection.
          (6) Exemptions.--This subsection shall not apply to 
        any Federal home loan bank. The Board of Governors may, 
        by regulation or order, exempt transactions, in whole 
        or in part, from the definition of the term ``credit 
        exposure'' for purposes of this subsection, if the 
        Board of Governors finds that the exemption is in the 
        public interest and is consistent with the purpose of 
        this subsection.
          (7) Transition period.--
                  (A) In general.--This subsection and any 
                regulations and orders of the Board of 
                Governors under this subsection shall not be 
                effective until 3 years after the date of 
                enactment of this Act.
                  (B) Extension authorized.--The Board of 
                Governors may extend the period specified in 
                subparagraph (A) for not longer than an 
                additional 2 years.
  (f) Enhanced Public Disclosures.--The Board of Governors may 
prescribe, by regulation, periodic public disclosures by 
[nonbank financial companies supervised by the Board of 
Governors and] bank holding companies described in subsection 
(a) in order to support market evaluation of the risk profile, 
capital adequacy, and risk management capabilities thereof.
  (g) Short-term Debt Limits.--
          (1) In general.--In order to mitigate the risks that 
        an over-accumulation of short-term debt could pose to 
        financial companies and to the stability of the United 
        States financial system, the Board of Governors may, by 
        regulation, prescribe a limit on the amount of short-
        term debt, including off-balance sheet exposures, that 
        may be accumulated by any bank holding company 
        described in subsection (a) [and any nonbank financial 
        company supervised by the Board of Governors].
          (2) Basis of limit.--Any limit prescribed under 
        paragraph (1) shall be based on the short-term debt of 
        the company described in paragraph (1) as a percentage 
        of capital stock and surplus of the company or on such 
        other measure as the Board of Governors considers 
        appropriate.
          (3) Short-term debt defined.--For purposes of this 
        subsection, the term ``short-term debt'' means such 
        liabilities with short-dated maturity that the Board of 
        Governors identifies, by regulation, except that such 
        term does not include insured deposits.
          (4) Rulemaking authority.--In addition to prescribing 
        regulations under paragraphs (1) and (3), the Board of 
        Governors may prescribe such regulations, including 
        definitions consistent with this subsection, and issue 
        such orders, as may be necessary to carry out this 
        subsection.
          (5) Authority to issue exemptions and adjustments.--
        Notwithstanding the Bank Holding Company Act of 1956 
        (12 U.S.C. 1841 et seq.), the Board of Governors may, 
        if it determines such action is necessary to ensure 
        appropriate heightened prudential supervision, with 
        respect to a company described in paragraph (1) that 
        does not control an insured depository institution, 
        issue to such company an exemption from or adjustment 
        to the limit prescribed under paragraph (1).
  (h) Risk Committee.--
          [(1) Nonbank financial companies supervised by the 
        board of governors.--The Board of Governors shall 
        require each nonbank financial company supervised by 
        the Board of Governors that is a publicly traded 
        company to establish a risk committee, as set forth in 
        paragraph (3), not later than 1 year after the date of 
        receipt of a notice of final determination under 
        section 113(e)(3) with respect to such nonbank 
        financial company supervised by the Board of 
        Governors.]
          [(2)] (1) Certain bank holding companies.--
                  (A) Mandatory regulations.--The Board of 
                Governors shall issue regulations requiring 
                each bank holding company that is a publicly 
                traded company and that has total consolidated 
                assets of not less than $10,000,000,000 to 
                establish a risk committee, as set forth in 
                [paragraph (3)] paragraph (2).
                  (B) Permissive regulations.--The Board of 
                Governors may require each bank holding company 
                that is a publicly traded company and that has 
                total consolidated assets of less than 
                $10,000,000,000 to establish a risk committee, 
                as set forth in [paragraph (3)] paragraph (2), 
                as determined necessary or appropriate by the 
                Board of Governors to promote sound risk 
                management practices.
          [(3)] (2) Risk committee.--A risk committee required 
        by this subsection shall--
                  (A) be responsible for the oversight of the 
                enterprise-wide risk management practices of 
                [the nonbank financial company supervised by 
                the Board of Governors or bank holding company 
                described in subsection (a), as applicable] a 
                bank holding company described in subsection 
                (a);
                  (B) include such number of independent 
                directors as the Board of Governors may 
                determine appropriate, based on the nature of 
                operations, size of assets, and other 
                appropriate criteria related to [the nonbank 
                financial company supervised by the Board of 
                Governors or a bank holding company described 
                in subsection (a), as applicable] a bank 
                holding company described in subsection (a); 
                and
                  (C) include at least 1 risk management expert 
                having experience in identifying, assessing, 
                and managing risk exposures of large, complex 
                firms.
          [(4)] (3) Rulemaking.--The Board of Governors shall 
        issue final rules to carry out this subsection, not 
        later than 1 year after the transfer date, to take 
        effect not later than 15 months after the transfer 
        date.
  (i) Stress Tests.--
          (1) By the board of governors.--
                  (A) Annual tests required.--The Board of 
                Governors[, in coordination with the 
                appropriate primary financial regulatory 
                agencies and the Federal Insurance Office,] 
                shall conduct annual analyses in which [nonbank 
                financial companies supervised by the Board of 
                Governors and] bank holding companies described 
                in subsection (a) are subject to evaluation of 
                whether such companies have the capital, on a 
                total consolidated basis, necessary to absorb 
                losses as a result of adverse economic 
                conditions.
                  (B) Test parameters and consequences.--The 
                Board of Governors--
                          [(i) shall provide for at least 3 
                        different sets of conditions under 
                        which the evaluation required by this 
                        subsection shall be conducted, 
                        including baseline, adverse, and 
                        severely adverse;]
                          (i) shall--
                                  (I) issue regulations, after 
                                providing for public notice and 
                                comment, that provide for at 
                                least 3 different sets of 
                                conditions under which the 
                                evaluation required by this 
                                subsection shall be conducted, 
                                including baseline, adverse, 
                                and severely adverse, and 
                                methodologies, including models 
                                used to estimate losses on 
                                certain assets, and the Board 
                                of Governors shall not carry 
                                out any such evaluation until 
                                60 days after such regulations 
                                are issued; and
                                  (II) provide copies of such 
                                regulations to the Comptroller 
                                General of the United States 
                                and the Panel of Economic 
                                Advisors of the Congressional 
                                Budget Office before publishing 
                                such regulations;
                          (ii) may require the tests described 
                        in subparagraph (A) at bank holding 
                        companies [and nonbank financial 
                        companies], in addition to those for 
                        which annual tests are required under 
                        subparagraph (A);
                          (iii) may develop and apply such 
                        other analytic techniques as are 
                        necessary to identify, measure, and 
                        monitor risks to the financial 
                        stability of the United States;
                          (iv) shall require the companies 
                        described in subparagraph (A) to update 
                        their resolution plans required under 
                        subsection (d)(1), as the Board of 
                        Governors determines appropriate, based 
                        on the results of the analyses; [and]
                          (v) shall publish a summary of the 
                        results of the tests required under 
                        subparagraph (A) or clause (ii) of this 
                        subparagraph[.], including any results 
                        of a resubmitted test;
                          (vi) shall, in establishing the 
                        severely adverse condition under clause 
                        (i), provide detailed consideration of 
                        the model's effects on financial 
                        stability and the cost and availability 
                        of credit;
                          (vii) shall, in developing the models 
                        and methodologies and providing them 
                        for notice and comment under this 
                        subparagraph, publish a process to test 
                        the models and methodologies for their 
                        potential to magnify systemic and 
                        institutional risks instead of 
                        facilitating increased resiliency;
                          (viii) shall design and publish a 
                        process to test and document the 
                        sensitivity and uncertainty associated 
                        with the model system's data quality, 
                        specifications, and assumptions; and
                          (ix) shall communicate the range and 
                        sources of uncertainty surrounding the 
                        models and methodologies.
                  (C) CCAR requirements.--
                          (i) Parameters and consequences 
                        applicable to ccar.--The requirements 
                        of subparagraph (B) shall apply to 
                        CCAR.
                          (ii) Two-year limitation.--The Board 
                        of Governors may not subject a company 
                        to CCAR more than once every two years.
                          (iii) Mid-cycle resubmission.--If a 
                        company receives a quantitative 
                        objection to, or otherwise desires to 
                        amend the company's capital plan, the 
                        company may file a new streamlined plan 
                        at any time after a capital planning 
                        exercise has been completed and before 
                        a subsequent capital planning exercise.
                          (iv) Limitation on qualitative 
                        capital planning objections.--In 
                        carrying out CCAR, the Board of 
                        Governors may not object to a company's 
                        capital plan on the basis of 
                        qualitative deficiencies in the 
                        company's capital planning process.
                          (v) Company inquiries.--The Board of 
                        Governors shall establish and publish 
                        procedures for responding to inquiries 
                        from companies subject to CCAR, 
                        including establishing the time frame 
                        in which such responses will be made, 
                        and make such procedures publicly 
                        available.
                          (vi) CCAR defined.--For purposes of 
                        this subparagraph and subparagraph (E), 
                        the term ``CCAR'' means the 
                        Comprehensive Capital Analysis and 
                        Review established by the Board of 
                        Governors.
          (2) By the company.--
                  (A) Requirement.--A [nonbank financial 
                company supervised by the Board of Governors 
                and] [a bank holding company] bank holding 
                company described in subsection (a) shall 
                conduct [semiannual] annual stress tests. [All 
                other financial companies] All other bank 
                holding companies that have total consolidated 
                assets of more than $10,000,000,000 [and are 
                regulated by a primary Federal financial 
                regulatory agency] shall conduct annual stress 
                tests. The tests required under this 
                subparagraph shall be conducted in accordance 
                with the regulations prescribed under 
                subparagraph (C).
                  (B) Report.--A company required to conduct 
                stress tests under subparagraph (A) shall 
                submit a report to the Board of Governors [and 
                to its primary financial regulatory agency] at 
                such time, in such form, and containing such 
                information as the [primary financial 
                regulatory agency] Board of Governors shall 
                require.
                  (C) Regulations.--[Each Federal primary 
                financial regulatory agency, in coordination 
                with the Board of Governors and the Federal 
                Insurance Office,] The Board of Governors shall 
                issue [consistent and comparable] regulations 
                to implement this paragraph that shall--
                          (i) define the term ``stress test'' 
                        for purposes of this paragraph;
                          (ii) establish methodologies for the 
                        conduct of stress tests required by 
                        this paragraph that shall provide for 
                        at least 3 different sets of 
                        conditions, including baseline, 
                        adverse, and severely adverse;
                          (iii) establish the form and content 
                        of the report required by subparagraph 
                        (B); and
                          (iv) require companies subject to 
                        this paragraph to publish a summary of 
                        the results of the required stress 
                        tests.
  (j) Leverage Limitation.--
          (1) Requirement.--The Board of Governors shall 
        require a bank holding company with total consolidated 
        assets equal to or greater than $50,000,000,000 [or a 
        nonbank financial company supervised by the Board of 
        Governors] to maintain a debt to equity ratio of no 
        more than 15 to 1, upon a determination by the Council 
        that such company poses a grave threat to the financial 
        stability of the United States and that the imposition 
        of such requirement is necessary to mitigate the risk 
        that such company poses to the financial stability of 
        the United States. Nothing in this paragraph shall 
        apply to a Federal home loan bank.
          (2) Considerations.--In making a determination under 
        this subsection, the Council shall consider [the 
        factors described in subsections (a) and (b) of section 
        113 and any other] any risk-related factors that the 
        Council deems appropriate.
          (3) Regulations.--The Board of Governors shall 
        promulgate regulations to establish procedures and 
        timelines for complying with the requirements of this 
        subsection.
  (k) Inclusion of Off-balance-sheet Activities in Computing 
Capital Requirements.--
          (1) In general.--In the case of any bank holding 
        company described in subsection (a) [or nonbank 
        financial company supervised by the Board of 
        Governors], the computation of capital for purposes of 
        meeting capital requirements shall take into account 
        any off-balance-sheet activities of the company.
          (2) Exemptions.--If the Board of Governors determines 
        that an exemption from the requirement under paragraph 
        (1) is appropriate, the Board of Governors may exempt a 
        company, or any transaction or transactions engaged in 
        by such company, from the requirements of paragraph 
        (1).
          (3) Off-balance-sheet activities defined.--For 
        purposes of this subsection, the term ``off-balance-
        sheet activities'' means an existing liability of a 
        company that is not currently a balance sheet 
        liability, but may become one upon the happening of 
        some future event, including the following 
        transactions, to the extent that they may create a 
        liability:
                  (A) Direct credit substitutes in which a bank 
                substitutes its own credit for a third party, 
                including standby letters of credit.
                  (B) Irrevocable letters of credit that 
                guarantee repayment of commercial paper or tax-
                exempt securities.
                  (C) Risk participations in bankers' 
                acceptances.
                  (D) Sale and repurchase agreements.
                  (E) Asset sales with recourse against the 
                seller.
                  (F) Interest rate swaps.
                  (G) Credit swaps.
                  (H) Commodities contracts.
                  (I) Forward contracts.
                  (J) Securities contracts.
                  (K) Such other activities or transactions as 
                the Board of Governors may, by rule, define.
  (l) Exemption for Qualifying Banking Organizations.--This 
section shall not apply to a proposed acquisition by a 
qualifying banking organization, as defined under section 605 
of the Financial CHOICE Act of 2017.
  (m) Criminal Penalty for Unauthorized Disclosures.--
          (1) In general.--Any officer or employee of a Federal 
        department or agency, who by virtue of such officer or 
        employee's employment or official position, has 
        possession of, or access to, agency records which 
        contain individually identifiable information submitted 
        pursuant to the requirements of this section, the 
        disclosure of which is prohibited by Federal statute, 
        rule, or regulation, and who knowing that disclosure of 
        the specific material is so prohibited, willfully 
        discloses the material in any manner to any person or 
        agency not entitled to receive it, shall be guilty of a 
        misdemeanor and fined not more than $5,000.
          (2) Obtaining records under false pretenses.--Any 
        person who knowingly and willfully requests or obtains 
        information described under paragraph (1) from a 
        Federal department or agency under false pretenses 
        shall be guilty of a misdemeanor and fined not more 
        than $5,000.
          (3) Treatment of determinations.--For purposes of 
        this subsection, a determination made under subsection 
        (d) or (i) based on individually identifiable 
        information submitted pursuant to the requirements of 
        this section shall be deemed individually identifiable 
        information, the disclosure of which is prohibited by 
        Federal statute.

[SEC. 166. EARLY REMEDIATION REQUIREMENTS.

  [(a) In General.--The Board of Governors, in consultation 
with the Council and the Corporation, shall prescribe 
regulations establishing requirements to provide for the early 
remediation of financial distress of a nonbank financial 
company supervised by the Board of Governors or a bank holding 
company described in section 165(a), except that nothing in 
this subsection authorizes the provision of financial 
assistance from the Federal Government.
  [(b) Purpose of the Early Remediation Requirements.--The 
purpose of the early remediation requirements under subsection 
(a) shall be to establish a series of specific remedial actions 
to be taken by a nonbank financial company supervised by the 
Board of Governors or a bank holding company described in 
section 165(a) that is experiencing increasing financial 
distress, in order to minimize the probability that the company 
will become insolvent and the potential harm of such insolvency 
to the financial stability of the United States.
  [(c) Remediation Requirements.--The regulations prescribed by 
the Board of Governors under subsection (a) shall--
          [(1) define measures of the financial condition of 
        the company, including regulatory capital, liquidity 
        measures, and other forward-looking indicators; and
          [(2) establish requirements that increase in 
        stringency as the financial condition of the company 
        declines, including--
                  [(A) requirements in the initial stages of 
                financial decline, including limits on capital 
                distributions, acquisitions, and asset growth; 
                and
                  [(B) requirements at later stages of 
                financial decline, including a capital 
                restoration plan and capital-raising 
                requirements, limits on transactions with 
                affiliates, management changes, and asset 
                sales.

[SEC. 167. AFFILIATIONS.

  [(a) Affiliations.--Nothing in this subtitle shall be 
construed to require a nonbank financial company supervised by 
the Board of Governors, or a company that controls a nonbank 
financial company supervised by the Board of Governors, to 
conform the activities thereof to the requirements of section 4 
of the Bank Holding Company Act of 1956 (12 U.S.C. 1843).
  [(b) Requirement.--
          [(1) In general.--
                  [(A) Board authority.--If a nonbank financial 
                company supervised by the Board of Governors 
                conducts activities other than those that are 
                determined to be financial in nature or 
                incidental thereto under section 4(k) of the 
                Bank Holding Company Act of 1956, the Board of 
                Governors may require such company to establish 
                and conduct all or a portion of such activities 
                that are determined to be financial in nature 
                or incidental thereto in or through an 
                intermediate holding company established 
                pursuant to regulation of the Board of 
                Governors, not later than 90 days (or such 
                longer period as the Board of Governors may 
                deem appropriate) after the date on which the 
                nonbank financial company supervised by the 
                Board of Governors is notified of the 
                determination of the Board of Governors under 
                this section.
                  [(B) Necessary actions.--Notwithstanding 
                subparagraph (A), the Board of Governors shall 
                require a nonbank financial company supervised 
                by the Board of Governors to establish an 
                intermediate holding company if the Board of 
                Governors makes a determination that the 
                establishment of such intermediate holding 
                company is necessary to--
                          [(i) appropriately supervise 
                        activities that are determined to be 
                        financial in nature or incidental 
                        thereto; or
                          [(ii) to ensure that supervision by 
                        the Board of Governors does not extend 
                        to the commercial activities of such 
                        nonbank financial company.
          [(2) Internal financial activities.--For purposes of 
        this subsection, activities that are determined to be 
        financial in nature or incidental thereto under section 
        4(k) of the Bank Holding Company Act of 1956, as 
        described in paragraph (1), shall not include internal 
        financial activities, including internal treasury, 
        investment, and employee benefit functions. With 
        respect to any internal financial activity engaged in 
        for the company or an affiliate and a non-affiliate of 
        such company during the year prior to the date of 
        enactment of this Act, such company (or an affiliate 
        that is not an intermediate holding company or 
        subsidiary of an intermediate holding company) may 
        continue to engage in such activity, as long as not 
        less than 2/3 of the assets or 2/3 of the revenues 
        generated from the activity are from or attributable to 
        such company or an affiliate, subject to review by the 
        Board of Governors, to determine whether engaging in 
        such activity presents undue risk to such company or to 
        the financial stability of the United States.
          [(3) Source of strength.--A company that directly or 
        indirectly controls an intermediate holding company 
        established under this section shall serve as a source 
        of strength to its subsidiary intermediate holding 
        company.
          [(4) Parent company reports.--The Board of Governors 
        may, from time to time, require reports under oath from 
        a company that controls an intermediate holding 
        company, and from the appropriate officers or directors 
        of such company, solely for purposes of ensuring 
        compliance with the provisions of this section, 
        including assessing the ability of the company to serve 
        as a source of strength to its subsidiary intermediate 
        holding company pursuant to paragraph (3) and enforcing 
        such compliance.
          [(5) Limited parent company enforcement.--
                  [(A) In general.--In addition to any other 
                authority of the Board of Governors, the Board 
                of Governors may enforce compliance with the 
                provisions of this subsection that are 
                applicable to any company described in 
                paragraph (1) that controls an intermediate 
                holding company under section 8 of the Federal 
                Deposit Insurance Act, and such company shall 
                be subject to such section (solely for such 
                purposes) in the same manner and to the same 
                extent as if such company were a bank holding 
                company.
                  [(B) Application of other act.--Any violation 
                of this subsection by any company that controls 
                an intermediate holding company may also be 
                treated as a violation of the Federal Deposit 
                Insurance Act for purposes of subparagraph (A).
                  [(C) No effect on other authority.--No 
                provision of this paragraph shall be construed 
                as limiting any authority of the Board of 
                Governors or any other Federal agency under any 
                other provision of law.
  [(c) Regulations.--The Board of Governors--
          [(1) shall promulgate regulations to establish the 
        criteria for determining whether to require a nonbank 
        financial company supervised by the Board of Governors 
        to establish an intermediate holding company under 
        subsection (b); and
          [(2) may promulgate regulations to establish any 
        restrictions or limitations on transactions between an 
        intermediate holding company or a nonbank financial 
        company supervised by the Board of Governors and its 
        affiliates, as necessary to prevent unsafe and unsound 
        practices in connection with transactions between such 
        company, or any subsidiary thereof, and its parent 
        company or affiliates that are not subsidiaries of such 
        company, except that such regulations shall not 
        restrict or limit any transaction in connection with 
        the bona fide acquisition or lease by an unaffiliated 
        person of assets, goods, or services.

[SEC. 168. REGULATIONS.

  [The Board of Governors shall have authority to issue 
regulations to implement subtitles A and C and the amendments 
made thereunder. Except as otherwise specified in subtitle A or 
C, not later than 18 months after the effective date of this 
Act, the Board of Governors shall issue final regulations to 
implement subtitles A and C, and the amendments made 
thereunder.]

           *       *       *       *       *       *       *


[SEC. 170. SAFE HARBOR.

  [(a) Regulations.--The Board of Governors shall promulgate 
regulations on behalf of, and in consultation with, the Council 
setting forth the criteria for exempting certain types or 
classes of U.S. nonbank financial companies or foreign nonbank 
financial companies from supervision by the Board of Governors.
  [(b) Considerations.--In developing the criteria under 
subsection (a), the Board of Governors shall take into account 
the factors for consideration described in subsections (a) and 
(b) of section 113 in determining whether a U.S. nonbank 
financial company or foreign nonbank financial company shall be 
supervised by the Board of Governors.
  [(c) Rule of Construction.--Nothing in this section shall be 
construed to require supervision by the Board of Governors of a 
U.S. nonbank financial company or foreign nonbank financial 
company, if such company does not meet the criteria for 
exemption established under subsection (a).
  [(d) Revisions.--
          [(1) In general.--The Board of Governors shall, in 
        consultation with the Council, review the regulations 
        promulgated under subsection (a), not less frequently 
        than every 5 years, and based upon the review, the 
        Board of Governors may revise such regulations on 
        behalf of, and in consultation with, the Council to 
        update as necessary the criteria set forth in such 
        regulations.
          [(2) Transition period.--No revisions under paragraph 
        (1) shall take effect before the end of the 2-year 
        period after the date of publication of such revisions 
        in final form.
  [(e) Report.--The Chairman of the Board of Governors and the 
Chairperson of the Council shall submit a joint report to the 
Committee on Banking, Housing, and Urban Affairs of the Senate 
and the Committee on Financial Services of the House of 
Representatives not later than 30 days after the date of the 
issuance in final form of regulations under subsection (a), or 
any subsequent revision to such regulations under subsection 
(d), as applicable. Such report shall include, at a minimum, 
the rationale for exemption and empirical evidence to support 
the criteria for exemption.]

SEC. 171. LEVERAGE AND RISK-BASED CAPITAL REQUIREMENTS.

  (a) Definitions.--For purposes of this section, the following 
definitions shall apply:
          (1) Generally applicable leverage capital 
        requirements.--The term ``generally applicable leverage 
        capital requirements'' means--
                  (A) the minimum ratios of tier 1 capital to 
                average total assets, as established by the 
                appropriate Federal banking agencies to apply 
                to insured depository institutions under the 
                prompt corrective action regulations 
                implementing section 38 of the Federal Deposit 
                Insurance Act, regardless of total consolidated 
                asset size or foreign financial exposure; and
                  (B) includes the regulatory capital 
                components in the numerator of that capital 
                requirement, average total assets in the 
                denominator of that capital requirement, and 
                the required ratio of the numerator to the 
                denominator.
          (2) Generally applicable risk-based capital 
        requirements.--The term ``generally applicable risk-
        based capital requirements'' means--
                  (A) the risk-based capital requirements, as 
                established by the appropriate Federal banking 
                agencies to apply to insured depository 
                institutions under the prompt corrective action 
                regulations implementing section 38 of the 
                Federal Deposit Insurance Act, regardless of 
                total consolidated asset size or foreign 
                financial exposure; and
                  (B) includes the regulatory capital 
                components in the numerator of those capital 
                requirements, the risk-weighted assets in the 
                denominator of those capital requirements, and 
                the required ratio of the numerator to the 
                denominator.
          (3) Definition of depository institution holding 
        company.--The term ``depository institution holding 
        company'' means a bank holding company or a savings and 
        loan holding company (as those terms are defined in 
        section 3 of the Federal Deposit Insurance Act) that is 
        organized in the United States, including any bank or 
        savings and loan holding company that is owned or 
        controlled by a foreign organization, but does not 
        include the foreign organization.
          (4) Business of insurance.--The term ``business of 
        insurance'' has the same meaning as in section 1002(3).
          (5) Person regulated by a state insurance 
        regulator.--The term ``person regulated by a State 
        insurance regulator'' has the same meaning as in 
        section 1002(22).
          (6) Regulated foreign subsidiary and regulated 
        foreign affiliate.--The terms ``regulated foreign 
        subsidiary'' and ``regulated foreign affiliate'' mean a 
        person engaged in the business of insurance in a 
        foreign country that is regulated by a foreign 
        insurance regulatory authority that is a member of the 
        International Association of Insurance Supervisors or 
        other comparable foreign insurance regulatory authority 
        as determined by the Board of Governors following 
        consultation with the State insurance regulators, 
        including the lead State insurance commissioner (or 
        similar State official) of the insurance holding 
        company system as determined by the procedures within 
        the Financial Analysis Handbook adopted by the National 
        Association of Insurance Commissioners, where the 
        person, or its principal United States insurance 
        affiliate, has its principal place of business or is 
        domiciled, but only to the extent that--
                  (A) such person acts in its capacity as a 
                regulated insurance entity; and
                  (B) the Board of Governors does not determine 
                that the capital requirements in a specific 
                foreign jurisdiction are inadequate.
          (7) Capacity as a regulated insurance entity.--The 
        term ``capacity as a regulated insurance entity''--
                  (A) includes any action or activity 
                undertaken by a person regulated by a State 
                insurance regulator or a regulated foreign 
                subsidiary or regulated foreign affiliate of 
                such person, as those actions relate to the 
                provision of insurance, or other activities 
                necessary to engage in the business of 
                insurance; and
                  (B) does not include any action or activity, 
                including any financial activity, that is not 
                regulated by a State insurance regulator or a 
                foreign agency or authority and subject to 
                State insurance capital requirements or, in the 
                case of a regulated foreign subsidiary or 
                regulated foreign affiliate, capital 
                requirements imposed by a foreign insurance 
                regulatory authority.
  (b) Minimum Capital Requirements.--
          (1) Minimum leverage capital requirements.--The 
        appropriate Federal banking agencies shall establish 
        minimum leverage capital requirements on a consolidated 
        basis for insured depository institutions, depository 
        institution holding companies, and nonbank financial 
        companies supervised by the Board of Governors. The 
        minimum leverage capital requirements established under 
        this paragraph shall not be less than the generally 
        applicable leverage capital requirements, which shall 
        serve as a floor for any capital requirements that the 
        agency may require, nor quantitatively lower than the 
        generally applicable leverage capital requirements that 
        were in effect for insured depository institutions as 
        of the date of enactment of this Act.
          (2) Minimum risk-based capital requirements.--The 
        appropriate Federal banking agencies shall establish 
        minimum risk-based capital requirements on a 
        consolidated basis for insured depository institutions, 
        depository institution holding companies, and nonbank 
        financial companies supervised by the Board of 
        Governors. The minimum risk-based capital requirements 
        established under this paragraph shall not be less than 
        the generally applicable risk-based capital 
        requirements, which shall serve as a floor for any 
        capital requirements that the agency may require, nor 
        quantitatively lower than the generally applicable 
        risk-based capital requirements that were in effect for 
        insured depository institutions as of the date of 
        enactment of this Act.
          (3) Investments in financial subsidiaries.--For 
        purposes of this section, investments in financial 
        subsidiaries that insured depository institutions are 
        required to deduct from regulatory capital under 
        section 5136A of the Revised Statutes of the United 
        States or section 46(a)(2) of the Federal Deposit 
        Insurance Act need not be deducted from regulatory 
        capital by depository institution holding companies or 
        nonbank financial companies supervised by the Board of 
        Governors, unless such capital deduction is required by 
        the Board of Governors or the primary financial 
        regulatory agency in the case of nonbank financial 
        companies supervised by the Board of Governors.
          (4) Effective dates and phase-in periods.--
                  (A) Debt or equity instruments on or after 
                may 19, 2010.--For debt or equity instruments 
                issued on or after May 19, 2010, by depository 
                institution holding companies or by nonbank 
                financial companies supervised by the Board of 
                Governors, this section shall be deemed to have 
                become effective as of May 19, 2010.
                  (B) Debt or equity instruments issued before 
                may 19, 2010.--For debt or equity instruments 
                issued before May 19, 2010, by depository 
                institution holding companies or by nonbank 
                financial companies supervised by the Board of 
                Governors, any regulatory capital deductions 
                required under this section shall be phased in 
                incrementally over a period of 3 years, with 
                the phase-in period to begin on January 1, 
                2013, except as set forth in subparagraph (C).
                  (C) Debt or equity instruments of smaller 
                institutions.--For debt or equity instruments 
                issued before May 19, 2010, by depository 
                institution holding companies with total 
                consolidated assets of less than 
                $15,000,000,000 as of December 31, 2009, or 
                March 31, 2010, and by organizations that were 
                mutual holding companies on May 19, 2010, the 
                capital deductions that would be required for 
                other institutions under this section are not 
                required as a result of this section.
                  (D) Depository institution holding companies 
                not previously supervised by the board of 
                governors.--For any depository institution 
                holding company that was not supervised by the 
                Board of Governors as of May 19, 2010, the 
                requirements of this section, except as set 
                forth in subparagraphs (A) and (B), shall be 
                effective 5 years after the date of enactment 
                of this Act.
                  (E) Certain bank holding company subsidiaries 
                of foreign banking organizations.--For bank 
                holding company subsidiaries of foreign banking 
                organizations that have relied on Supervision 
                and Regulation Letter SR-01-1 issued by the 
                Board of Governors (as in effect on May 19, 
                2010), the requirements of this section, except 
                as set forth in subparagraph (A), shall be 
                effective 5 years after the date of enactment 
                of this Act.
          (5) Exceptions.--This section shall not apply to--
                  (A) debt or equity instruments issued to the 
                United States or any agency or instrumentality 
                thereof pursuant to the Emergency Economic 
                Stabilization Act of 2008, and prior to October 
                4, 2010;
                  (B) any Federal home loan bank; or
                  [(C) any bank holding company or savings and 
                loan holding company having less than 
                $1,000,000,000 in total consolidated assets 
                that complies with the requirements of the 
                Small Bank Holding Company Policy Statement on 
                Assessment of Financial and Managerial Factors 
                of the Board of Governors (12 CFR part 225 
                appendix C), as the requirements of such Policy 
                Statement are amended pursuant to section 1 of 
                an Act entitled ``To enhance the ability of 
                community financial institutions to foster 
                economic growth and serve their communities, 
                boost small businesses, increase individual 
                savings, and for other purposes''.]
                  (C) any bank holding company or savings and 
                loan holding company that is subject to the 
                application of the Small Bank Holding Company 
                Policy Statement on Assessment of Financial and 
                Managerial Factors of the Board of Governors 
                (12 C.F.R. part 225--appendix C).
          (6) Study and report on small institution access to 
        capital.--
                  (A) Study required.--The Comptroller General 
                of the United States, after consultation with 
                the Federal banking agencies, shall conduct a 
                study of access to capital by smaller insured 
                depository institutions.
                  (B) Scope.--For purposes of this study 
                required by subparagraph (A), the term 
                ``smaller insured depository institution'' 
                means an insured depository institution with 
                total consolidated assets of $5,000,000,000 or 
                less.
                  (C) Report to congress.--Not later than 18 
                months after the date of enactment of this Act, 
                the Comptroller General of the United States 
                shall submit to the Committee on Banking, 
                Housing, and Urban Affairs of the Senate and 
                the Committee on Financial Services of the 
                House of Representatives a report summarizing 
                the results of the study conducted under 
                subparagraph (A), together with any 
                recommendations for legislative or regulatory 
                action that would enhance the access to capital 
                of smaller insured depository institutions, in 
                a manner that is consistent with safe and sound 
                banking operations.
          (7) Capital requirements to address activities that 
        pose risks to the financial system.--
                  (A) In general.--Subject to the 
                recommendations of the Council, in accordance 
                with section 120, the Federal banking agencies 
                shall develop capital requirements applicable 
                to insured depository institutions, depository 
                institution holding companies, and nonbank 
                financial companies supervised by the Board of 
                Governors that address the risks that the 
                activities of such institutions pose, not only 
                to the institution engaging in the activity, 
                but to other public and private stakeholders in 
                the event of adverse performance, disruption, 
                or failure of the institution or the activity.
                  (B) Content.--Such rules shall address, at a 
                minimum, the risks arising from--
                          (i) significant volumes of activity 
                        in derivatives, securitized products 
                        purchased and sold, financial 
                        guarantees purchased and sold, 
                        securities borrowing and lending, and 
                        repurchase agreements and reverse 
                        repurchase agreements;
                          (ii) concentrations in assets for 
                        which the values presented in financial 
                        reports are based on models rather than 
                        historical cost or prices deriving from 
                        deep and liquid 2-way markets; and
                          (iii) concentrations in market share 
                        for any activity that would 
                        substantially disrupt financial markets 
                        if the institution is forced to 
                        unexpectedly cease the activity.
  (c) Clarification.--
          (1) In general.--In establishing the minimum leverage 
        capital requirements and minimum risk-based capital 
        requirements on a consolidated basis for a depository 
        institution holding company or a nonbank financial 
        company supervised by the Board of Governors as 
        required under paragraphs (1) and (2) of subsection 
        (b), the appropriate Federal banking agencies shall not 
        be required to include, for any purpose of this section 
        (including in any determination of consolidation), a 
        person regulated by a State insurance regulator or a 
        regulated foreign subsidiary or a regulated foreign 
        affiliate of such person engaged in the business of 
        insurance, to the extent that such person acts in its 
        capacity as a regulated insurance entity.
          (2) Rule of construction on board's authority.--This 
        subsection shall not be construed to prohibit, modify, 
        limit, or otherwise supersede any other provision of 
        Federal law that provides the Board of Governors 
        authority to issue regulations and orders relating to 
        capital requirements for depository institution holding 
        companies or nonbank financial companies supervised by 
        the Board of Governors.
          (3) Rule of construction on accounting principles.--
                  (A) In general.--A depository institution 
                holding company or nonbank financial company 
                supervised by the Board of Governors of the 
                Federal Reserve that is also a person regulated 
                by a State insurance regulator that is engaged 
                in the business of insurance that files 
                financial statements with a State insurance 
                regulator or the National Association of 
                Insurance Commissioners utilizing only 
                Statutory Accounting Principles in accordance 
                with State law, shall not be required by the 
                Board under the authority of this section or 
                the authority of the Home Owners' Loan Act to 
                prepare such financial statements in accordance 
                with Generally Accepted Accounting Principles.
                  (B) Preservation of authority.--Nothing in 
                subparagraph (A) shall limit the authority of 
                the Board under any other applicable provision 
                of law to conduct any regulatory or supervisory 
                activity of a depository institution holding 
                company or non-bank financial company 
                supervised by the Board of Governors, including 
                the collection or reporting of any information 
                on an entity or group-wide basis. Nothing in 
                this paragraph shall excuse the Board from its 
                obligations to comply with section 161(a) of 
                the Dodd-Frank Wall Street Reform and Consumer 
                Protection Act (12 U.S.C. 5361(a)) and section 
                10(b)(2) of the Home Owners' Loan Act (12 
                U.S.C. 1467a(b)(2)), as appropriate.

[SEC. 172. EXAMINATION AND ENFORCEMENT ACTIONS FOR INSURANCE AND 
                    ORDERLY LIQUIDATION PURPOSES.

  [(a) Examinations for Insurance and Resolution Purposes.--
Section 10(b)(3) of the Federal Deposit Insurance Act (12 
U.S.C. 1820(b)(3)) is amended--
          [(1) by striking ``In addition'' and inserting the 
        following:
                  [``(A) In general.--In addition''; and
          [(2) by striking ``whenever the board of directors 
        determines'' and all that follows through the period 
        and inserting the following:or nonbank financial 
        company supervised by the Board of Governors or a bank 
        holding company described in section 165(a) of the 
        Financial Stability Act of 2010, whenever the Board of 
        Directors determines that a special examination of any 
        such depository institution is necessary to determine 
        the condition of such depository institution for 
        insurance purposes, or of such nonbank financial 
        company supervised by the Board of Governors or bank 
        holding company described in section 165(a) of the 
        Financial Stability Act of 2010, for the purpose of 
        implementing its authority to provide for orderly 
        liquidation of any such company under title II of that 
        Act, provided that such authority may not be used with 
        respect to any such company that is in a generally 
        sound condition.
                  [``(B) Limitation.--Before conducting a 
                special examination of a nonbank financial 
                company supervised by the Board of Governors or 
                a bank holding company described in section 
                165(a) of the Financial Stability Act of 2010, 
                the Corporation shall review any available and 
                acceptable resolution plan that the company has 
                submitted in accordance with section 165(d) of 
                that Act, consistent with the nonbinding effect 
                of such plan, and available reports of 
                examination, and shall coordinate to the 
                maximum extent practicable with the Board of 
                Governors, in order to minimize duplicative or 
                conflicting examinations.''.
  [(b) Enforcement Authority.--Section 8(t) of the Federal 
Deposit Insurance Act (12 U.S.C. 1818(t)) is amended--
          [(1) in paragraph (1), by inserting ``, any 
        depository institution holding company,'' before ``or 
        any institution-affiliated party'';
          [(2) in paragraph (2)--
                  [(A) by striking ``or'' at the end of 
                subparagraph (B);
                  [(B) at the end of subparagraph (C), by 
                striking the period and inserting ``or''; and
                  [(C) by inserting at the end the following 
                new subparagraph:
                  [``(D) the conduct or threatened conduct 
                (including any acts or omissions) of the 
                depository institution holding company poses a 
                risk to the Deposit Insurance Fund, provided 
                that such authority may not be used with 
                respect to a depository institution holding 
                company that is in generally sound condition 
                and whose conduct does not pose a foreseeable 
                and material risk of loss to the Deposit 
                Insurance Fund;''; and
          [(3) by adding at the end the following:
          [``(6) Powers and duties with respect to depository 
        institution holding companies.--For purposes of 
        exercising the backup authority provided in this 
        subsection--
                  [``(A) the Corporation shall have the same 
                powers with respect to a depository institution 
                holding company and its affiliates as the 
                appropriate Federal banking agency has with 
                respect to the holding company and its 
                affiliates; and
                  [``(B) the holding company and its affiliates 
                shall have the same duties and obligations with 
                respect to the Corporation as the holding 
                company and its affiliates have with respect to 
                the appropriate Federal banking agency.''.
  [(c) Rule of Construction.--Nothing in this Act shall be 
construed to limit or curtail the Corporation's current 
authority to examine or bring enforcement actions with respect 
to any insured depository institution or institution-affiliated 
party.]

           *       *       *       *       *       *       *


[SEC. 174. STUDIES AND REPORTS ON HOLDING COMPANY CAPITAL REQUIREMENTS.

  [(a) Study of Hybrid Capital Instruments.--The Comptroller 
General of the United States, in consultation with the Board of 
Governors, the Comptroller of the Currency, and the 
Corporation, shall conduct a study of the use of hybrid capital 
instruments as a component of Tier 1 capital for banking 
institutions and bank holding companies. The study shall 
consider--
          [(1) the current use of hybrid capital instruments, 
        such as trust preferred shares, as a component of Tier 
        1 capital;
          [(2) the differences between the components of 
        capital permitted for insured depository institutions 
        and those permitted for companies that control insured 
        depository institutions;
          [(3) the benefits and risks of allowing such 
        instruments to be used to comply with Tier 1 capital 
        requirements;
          [(4) the economic impact of prohibiting the use of 
        such capital instruments for Tier 1;
          [(5) a review of the consequences of disqualifying 
        trust preferred instruments, and whether it could lead 
        to the failure or undercapitalization of existing 
        banking organizations;
          [(6) the international competitive implications 
        prohibiting hybrid capital instruments for Tier 1;
          [(7) the impact on the cost and availability of 
        credit in the United States from such a prohibition;
          [(8) the availability of capital for financial 
        institutions with less than $10,000,000,000 in total 
        assets; and
          [(9) any other relevant factors relating to the 
        safety and soundness of our financial system and 
        potential economic impact of such a prohibition.
  [(b) Study of Foreign Bank Intermediate Holding Company 
Capital Requirements.--The Comptroller General of the United 
States, in consultation with the Secretary, the Board of 
Governors, the Comptroller of the Currency, and the 
Corporation, shall conduct a study of capital requirements 
applicable to United States intermediate holding companies of 
foreign banks that are bank holding companies or savings and 
loan holding companies. The study shall consider--
          [(1) current Board of Governors policy regarding the 
        treatment of intermediate holding companies;
          [(2) the principle of national treatment and equality 
        of competitive opportunity for foreign banks operating 
        in the United States;
          [(3) the extent to which foreign banks are subject on 
        a consolidated basis to home country capital standards 
        comparable to United States capital standards;
          [(4) potential effects on United States banking 
        organizations operating abroad of changes to United 
        States policy regarding intermediate holding companies;
          [(5) the impact on the cost and availability of 
        credit in the United States from a change in United 
        States policy regarding intermediate holding companies; 
        and
          [(6) any other relevant factors relating to the 
        safety and soundness of our financial system and 
        potential economic impact of such a prohibition.
  [(c) Report.--Not later than 18 months after the date of 
enactment of this Act, the Comptroller General of the United 
States shall submit reports to the Committee on Banking, 
Housing, and Urban Affairs of the Senate and the Committee on 
Financial Services of the House of Representatives summarizing 
the results of the studies required under subsection (a). The 
reports shall include specific recommendations for legislative 
or regulatory action regarding the treatment of hybrid capital 
instruments, including trust preferred shares, and shall 
explain the basis for such recommendations.

[SEC. 175. INTERNATIONAL POLICY COORDINATION.

  [(a) By the President.--The President, or a designee of the 
President, may coordinate through all available international 
policy channels, similar policies as those found in United 
States law relating to limiting the scope, nature, size, scale, 
concentration, and interconnectedness of financial companies, 
in order to protect financial stability and the global economy.
  [(b) By the Council.--The Chairperson of the Council, in 
consultation with the other members of the Council, shall 
regularly consult with the financial regulatory entities and 
other appropriate organizations of foreign governments or 
international organizations on matters relating to systemic 
risk to the international financial system.
  [(c) By the Board of Governors and the Secretary.--The Board 
of Governors and the Secretary shall consult with their foreign 
counterparts and through appropriate multilateral organizations 
to encourage comprehensive and robust prudential supervision 
and regulation for all highly leveraged and interconnected 
financial companies.]

                [TITLE II--ORDERLY LIQUIDATION AUTHORITY

[SEC. 201. DEFINITIONS.

  [(a) In General.--In this title, the following definitions 
shall apply:
          [(1) Administrative expenses of the receiver.--The 
        term ``administrative expenses of the receiver'' 
        includes--
                  [(A) the actual, necessary costs and expenses 
                incurred by the Corporation as receiver for a 
                covered financial company in liquidating a 
                covered financial company; and
                  [(B) any obligations that the Corporation as 
                receiver for a covered financial company 
                determines are necessary and appropriate to 
                facilitate the smooth and orderly liquidation 
                of the covered financial company.
          [(2) Bankruptcy code.--The term ``Bankruptcy Code'' 
        means title 11, United States Code.
          [(3) Bridge financial company.--The term ``bridge 
        financial company'' means a new financial company 
        organized by the Corporation in accordance with section 
        210(h) for the purpose of resolving a covered financial 
        company.
          [(4) Claim.--The term ``claim'' means any right to 
        payment, whether or not such right is reduced to 
        judgment, liquidated, unliquidated, fixed, contingent, 
        matured, unmatured, disputed, undisputed, legal, 
        equitable, secured, or unsecured.
          [(5) Company.--The term ``company'' has the same 
        meaning as in section 2(b) of the Bank Holding Company 
        Act of 1956 (12 U.S.C. 1841(b)), except that such term 
        includes any company described in paragraph (11), the 
        majority of the securities of which are owned by the 
        United States or any State.
          [(6) Court.--The term ``Court'' means the United 
        States District Court for the District of Columbia, 
        unless the context otherwise requires.
          [(7) Covered broker or dealer.--The term ``covered 
        broker or dealer'' means a covered financial company 
        that is a broker or dealer that--
                  [(A) is registered with the Commission under 
                section 15(b) of the Securities Exchange Act of 
                1934 (15 U.S.C. 78o(b)); and
                  [(B) is a member of SIPC.
          [(8) Covered financial company.--The term ``covered 
        financial company''--
                  [(A) means a financial company for which a 
                determination has been made under section 
                203(b); and
                  [(B) does not include an insured depository 
                institution.
          [(9) Covered subsidiary.--The term ``covered 
        subsidiary'' means a subsidiary of a covered financial 
        company, other than--
                  [(A) an insured depository institution;
                  [(B) an insurance company; or
                  [(C) a covered broker or dealer.
          [(10) Definitions relating to covered brokers and 
        dealers.--The terms ``customer'', ``customer name 
        securities'', ``customer property'', and ``net equity'' 
        in the context of a covered broker or dealer, have the 
        same meanings as in section 16 of the Securities 
        Investor Protection Act of 1970 (15 U.S.C. 78lll).
          [(11) Financial company.--The term ``financial 
        company'' means any company that--
                  [(A) is incorporated or organized under any 
                provision of Federal law or the laws of any 
                State;
                  [(B) is--
                          [(i) a bank holding company, as 
                        defined in section 2(a) of the Bank 
                        Holding Company Act of 1956 (12 U.S.C. 
                        1841(a));
                          [(ii) a nonbank financial company 
                        supervised by the Board of Governors;
                          [(iii) any company that is 
                        predominantly engaged in activities 
                        that the Board of Governors has 
                        determined are financial in nature or 
                        incidental thereto for purposes of 
                        section 4(k) of the Bank Holding 
                        Company Act of 1956 (12 U.S.C. 1843(k)) 
                        other than a company described in 
                        clause (i) or (ii); or
                          [(iv) any subsidiary of any company 
                        described in any of clauses (i) through 
                        (iii) that is predominantly engaged in 
                        activities that the Board of Governors 
                        has determined are financial in nature 
                        or incidental thereto for purposes of 
                        section 4(k) of the Bank Holding 
                        Company Act of 1956 (12 U.S.C. 1843(k)) 
                        (other than a subsidiary that is an 
                        insured depository institution or an 
                        insurance company); and
                  [(C) is not a Farm Credit System institution 
                chartered under and subject to the provisions 
                of the Farm Credit Act of 1971, as amended (12 
                U.S.C. 2001 et seq.), a governmental entity, or 
                a regulated entity, as defined under section 
                1303(20) of the Federal Housing Enterprises 
                Financial Safety and Soundness Act of 1992 (12 
                U.S.C. 4502(20)).
          [(12) Fund.--The term ``Fund'' means the Orderly 
        Liquidation Fund established under section 210(n).
          [(13) Insurance company.--The term ``insurance 
        company'' means any entity that is--
                  [(A) engaged in the business of insurance;
                  [(B) subject to regulation by a State 
                insurance regulator; and
                  [(C) covered by a State law that is designed 
                to specifically deal with the rehabilitation, 
                liquidation, or insolvency of an insurance 
                company.
          [(14) Nonbank financial company.--The term ``nonbank 
        financial company'' has the same meaning as in section 
        102(a)(4)(C).
          [(15) Nonbank financial company supervised by the 
        board of governors.--The term ``nonbank financial 
        company supervised by the Board of Governors'' has the 
        same meaning as in section 102(a)(4)(D).
          [(16) SIPC.--The term ``SIPC'' means the Securities 
        Investor Protection Corporation.
  [(b) Definitional Criteria.--For purpose of the definition of 
the term ``financial company'' under subsection (a)(11), no 
company shall be deemed to be predominantly engaged in 
activities that the Board of Governors has determined are 
financial in nature or incidental thereto for purposes of 
section 4(k) of the Bank Holding Company Act of 1956 (12 U.S.C. 
1843(k)), if the consolidated revenues of such company from 
such activities constitute less than 85 percent of the total 
consolidated revenues of such company, as the Corporation, in 
consultation with the Secretary, shall establish by regulation. 
In determining whether a company is a financial company under 
this title, the consolidated revenues derived from the 
ownership or control of a depository institution shall be 
included.

[SEC. 202. JUDICIAL REVIEW.

  [(a) Commencement of Orderly Liquidation.--
          [(1) Petition to district court.--
                  [(A) District court review.--
                          [(i) Petition to district court.--
                        Subsequent to a determination by the 
                        Secretary under section 203 that a 
                        financial company satisfies the 
                        criteria in section 203(b), the 
                        Secretary shall notify the Corporation 
                        and the covered financial company. If 
                        the board of directors (or body 
                        performing similar functions) of the 
                        covered financial company acquiesces or 
                        consents to the appointment of the 
                        Corporation as receiver, the Secretary 
                        shall appoint the Corporation as 
                        receiver. If the board of directors (or 
                        body performing similar functions) of 
                        the covered financial company does not 
                        acquiesce or consent to the appointment 
                        of the Corporation as receiver, the 
                        Secretary shall petition the United 
                        States District Court for the District 
                        of Columbia for an order authorizing 
                        the Secretary to appoint the 
                        Corporation as receiver.
                          [(ii) Form and content of order.--The 
                        Secretary shall present all relevant 
                        findings and the recommendation made 
                        pursuant to section 203(a) to the 
                        Court. The petition shall be filed 
                        under seal.
                          [(iii) Determination.--On a strictly 
                        confidential basis, and without any 
                        prior public disclosure, the Court, 
                        after notice to the covered financial 
                        company and a hearing in which the 
                        covered financial company may oppose 
                        the petition, shall determine whether 
                        the determination of the Secretary that 
                        the covered financial company is in 
                        default or in danger of default and 
                        satisfies the definition of a financial 
                        company under section 201(a)(11) is 
                        arbitrary and capricious.
                          [(iv) Issuance of order.--If the 
                        Court determines that the determination 
                        of the Secretary that the covered 
                        financial company is in default or in 
                        danger of default and satisfies the 
                        definition of a financial company under 
                        section 201(a)(11)--
                                  [(I) is not arbitrary and 
                                capricious, the Court shall 
                                issue an order immediately 
                                authorizing the Secretary to 
                                appoint the Corporation as 
                                receiver of the covered 
                                financial company; or
                                  [(II) is arbitrary and 
                                capricious, the Court shall 
                                immediately provide to the 
                                Secretary a written statement 
                                of each reason supporting its 
                                determination, and afford the 
                                Secretary an immediate 
                                opportunity to amend and refile 
                                the petition under clause (i).
                          [(v) Petition granted by operation of 
                        law.--If the Court does not make a 
                        determination within 24 hours of 
                        receipt of the petition--
                                  [(I) the petition shall be 
                                granted by operation of law;
                                  [(II) the Secretary shall 
                                appoint the Corporation as 
                                receiver; and
                                  [(III) liquidation under this 
                                title shall automatically and 
                                without further notice or 
                                action be commenced and the 
                                Corporation may immediately 
                                take all actions authorized 
                                under this title.
                  [(B) Effect of determination.--The 
                determination of the Court under subparagraph 
                (A) shall be final, and shall be subject to 
                appeal only in accordance with paragraph (2). 
                The decision shall not be subject to any stay 
                or injunction pending appeal. Upon conclusion 
                of its proceedings under subparagraph (A), the 
                Court shall provide immediately for the record 
                a written statement of each reason supporting 
                the decision of the Court, and shall provide 
                copies thereof to the Secretary and the covered 
                financial company.
                  [(C) Criminal penalties.--A person who 
                recklessly discloses a determination of the 
                Secretary under section 203(b) or a petition of 
                the Secretary under subparagraph (A), or the 
                pendency of court proceedings as provided for 
                under subparagraph (A), shall be fined not more 
                than 250,000, or imprisoned for not more than 5 
                years, or both.
          [(2) Appeal of decisions of the district court.--
                  [(A) Appeal to court of appeals.--
                          [(i) In general.--Subject to clause 
                        (ii), the United States Court of 
                        Appeals for the District of Columbia 
                        Circuit shall have jurisdiction of an 
                        appeal of a final decision of the Court 
                        filed by the Secretary or a covered 
                        financial company, through its board of 
                        directors, notwithstanding section 
                        210(a)(1)(A)(i), not later than 30 days 
                        after the date on which the decision of 
                        the Court is rendered or deemed 
                        rendered under this subsection.
                          [(ii) Condition of jurisdiction.--The 
                        Court of Appeals shall have 
                        jurisdiction of an appeal by a covered 
                        financial company only if the covered 
                        financial company did not acquiesce or 
                        consent to the appointment of a 
                        receiver by the Secretary under 
                        paragraph (1)(A).
                          [(iii) Expedition.--The Court of 
                        Appeals shall consider any appeal under 
                        this subparagraph on an expedited 
                        basis.
                          [(iv) Scope of review.--For an appeal 
                        taken under this subparagraph, review 
                        shall be limited to whether the 
                        determination of the Secretary that a 
                        covered financial company is in default 
                        or in danger of default and satisfies 
                        the definition of a financial company 
                        under section 201(a)(11) is arbitrary 
                        and capricious.
                  [(B) Appeal to the supreme court.--
                          [(i) In general.--A petition for a 
                        writ of certiorari to review a decision 
                        of the Court of Appeals under 
                        subparagraph (A) may be filed by the 
                        Secretary or the covered financial 
                        company, through its board of 
                        directors, notwithstanding section 
                        210(a)(1)(A)(i), with the Supreme Court 
                        of the United States, not later than 30 
                        days after the date of the final 
                        decision of the Court of Appeals, and 
                        the Supreme Court shall have 
                        discretionary jurisdiction to review 
                        such decision.
                          [(ii) Written statement.--In the 
                        event of a petition under clause (i), 
                        the Court of Appeals shall immediately 
                        provide for the record a written 
                        statement of each reason for its 
                        decision.
                          [(iii) Expedition.--The Supreme Court 
                        shall consider any petition under this 
                        subparagraph on an expedited basis.
                          [(iv) Scope of review.--Review by the 
                        Supreme Court under this subparagraph 
                        shall be limited to whether the 
                        determination of the Secretary that the 
                        covered financial company is in default 
                        or in danger of default and satisfies 
                        the definition of a financial company 
                        under section 201(a)(11) is arbitrary 
                        and capricious.
  [(b) Establishment and Transmittal of Rules and Procedures.--
          [(1) In general.--Not later than 6 months after the 
        date of enactment of this Act, the Court shall 
        establish such rules and procedures as may be necessary 
        to ensure the orderly conduct of proceedings, including 
        rules and procedures to ensure that the 24-hour 
        deadline is met and that the Secretary shall have an 
        ongoing opportunity to amend and refile petitions under 
        subsection (a)(1).
          [(2) Publication of rules.--The rules and procedures 
        established under paragraph (1), and any modifications 
        of such rules and procedures, shall be recorded and 
        shall be transmitted to--
                  [(A) the Committee on the Judiciary of the 
                Senate;
                  [(B) the Committee on Banking, Housing, and 
                Urban Affairs of the Senate;
                  [(C) the Committee on the Judiciary of the 
                House of Representatives; and
                  [(D) the Committee on Financial Services of 
                the House of Representatives.
  [(c) Provisions Applicable to Financial Companies.--
          [(1) Bankruptcy code.--Except as provided in this 
        subsection, the provisions of the Bankruptcy Code and 
        rules issued thereunder or otherwise applicable 
        insolvency law, and not the provisions of this title, 
        shall apply to financial companies that are not covered 
        financial companies for which the Corporation has been 
        appointed as receiver.
          [(2) This title.--The provisions of this title shall 
        exclusively apply to and govern all matters relating to 
        covered financial companies for which the Corporation 
        is appointed as receiver, and no provisions of the 
        Bankruptcy Code or the rules issued thereunder shall 
        apply in such cases, except as expressly provided in 
        this title.
  [(d) Time Limit on Receivership Authority.--
          [(1) Baseline period.--Any appointment of the 
        Corporation as receiver under this section shall 
        terminate at the end of the 3-year period beginning on 
        the date on which such appointment is made.
          [(2) Extension of time limit.--The time limit 
        established in paragraph (1) may be extended by the 
        Corporation for up to 1 additional year, if the 
        Chairperson of the Corporation determines and certifies 
        in writing to the Committee on Banking, Housing, and 
        Urban Affairs of the Senate and the Committee on 
        Financial Services of the House of Representatives that 
        continuation of the receivership is necessary--
                  [(A) to--
                          [(i) maximize the net present value 
                        return from the sale or other 
                        disposition of the assets of the 
                        covered financial company; or
                          [(ii) minimize the amount of loss 
                        realized upon the sale or other 
                        disposition of the assets of the 
                        covered financial company; and
                  [(B) to protect the stability of the 
                financial system of the United States.
          [(3) Second extension of time limit.--
                  [(A) In general.--The time limit under this 
                subsection, as extended under paragraph (2), 
                may be extended for up to 1 additional year, if 
                the Chairperson of the Corporation, with the 
                concurrence of the Secretary, submits the 
                certifications described in paragraph (2).
                  [(B) Additional report required.--Not later 
                than 30 days after the date of commencement of 
                the extension under subparagraph (A), the 
                Corporation shall submit a report to the 
                Committee on Banking, Housing, and Urban 
                Affairs of the Senate and the Committee on 
                Financial Services of the House of 
                Representatives describing the need for the 
                extension and the specific plan of the 
                Corporation to conclude the receivership before 
                the end of the second extension.
          [(4) Ongoing litigation.--The time limit under this 
        subsection, as extended under paragraph (3), may be 
        further extended solely for the purpose of completing 
        ongoing litigation in which the Corporation as receiver 
        is a party, provided that the appointment of the 
        Corporation as receiver shall terminate not later than 
        90 days after the date of completion of such 
        litigation, if--
                  [(A) the Council determines that the 
                Corporation used its best efforts to conclude 
                the receivership in accordance with its plan 
                before the end of the time limit described in 
                paragraph (3);
                  [(B) the Council determines that the 
                completion of longer-term responsibilities in 
                the form of ongoing litigation justifies the 
                need for an extension; and
                  [(C) the Corporation submits a report 
                approved by the Council not later than 30 days 
                after the date of the determinations by the 
                Council under subparagraphs (A) and (B) to the 
                Committee on Banking, Housing, and Urban 
                Affairs of the Senate and the Committee on 
                Financial Services of the House of 
                Representatives, describing--
                          [(i) the ongoing litigation 
                        justifying the need for an extension; 
                        and
                          [(ii) the specific plan of the 
                        Corporation to complete the litigation 
                        and conclude the receivership.
          [(5) Regulations.--The Corporation may issue 
        regulations governing the termination of receiverships 
        under this title.
          [(6) No liability.--The Corporation and the Deposit 
        Insurance Fund shall not be liable for unresolved 
        claims arising from the receivership after the 
        termination of the receivership.
  [(e) Study of Bankruptcy and Orderly Liquidation Process for 
Financial Companies.--
          [(1) Study.--
                  [(A) In general.--The Administrative Office 
                of the United States Courts and the Comptroller 
                General of the United States shall each monitor 
                the activities of the Court, and each such 
                Office shall conduct separate studies regarding 
                the bankruptcy and orderly liquidation process 
                for financial companies under the Bankruptcy 
                Code.
                  [(B) Issues to be studied.--In conducting the 
                study under subparagraph (A), the 
                Administrative Office of the United States 
                Courts and the Comptroller General of the 
                United States each shall evaluate--
                          [(i) the effectiveness of chapter 7 
                        or chapter 11 of the Bankruptcy Code in 
                        facilitating the orderly liquidation or 
                        reorganization of financial companies;
                          [(ii) ways to maximize the efficiency 
                        and effectiveness of the Court; and
                          [(iii) ways to make the orderly 
                        liquidation process under the 
                        Bankruptcy Code for financial companies 
                        more effective.
          [(2) Reports.--Not later than 1 year after the date 
        of enactment of this Act, in each successive year until 
        the third year, and every fifth year after that date of 
        enactment, the Administrative Office of the United 
        States Courts and the Comptroller General of the United 
        States shall submit to the Committee on Banking, 
        Housing, and Urban Affairs and the Committee on the 
        Judiciary of the Senate and the Committee on Financial 
        Services and the Committee on the Judiciary of the 
        House of Representatives separate reports summarizing 
        the results of the studies conducted under paragraph 
        (1).
  [(f) Study of International Coordination Relating to 
Bankruptcy Process for Financial Companies.--
          [(1) Study.--
                  [(A) In general.--The Comptroller General of 
                the United States shall conduct a study 
                regarding international coordination relating 
                to the orderly liquidation of financial 
                companies under the Bankruptcy Code.
                  [(B) Issues to be studied.--In conducting the 
                study under subparagraph (A), the Comptroller 
                General of the United States shall evaluate, 
                with respect to the bankruptcy process for 
                financial companies--
                          [(i) the extent to which 
                        international coordination currently 
                        exists;
                          [(ii) current mechanisms and 
                        structures for facilitating 
                        international cooperation;
                          [(iii) barriers to effective 
                        international coordination; and
                          [(iv) ways to increase and make more 
                        effective international coordination.
          [(2) Report.--Not later than 1 year after the date of 
        enactment of this Act, the Comptroller General of the 
        United States shall submit to the Committee on Banking, 
        Housing, and Urban Affairs and the Committee on the 
        Judiciary of the Senate and the Committee on Financial 
        Services and the Committee on the Judiciary of the 
        House of Representatives and the Secretary a report 
        summarizing the results of the study conducted under 
        paragraph (1).
  [(g) Study of Prompt Corrective Action Implementation by the 
Appropriate Federal Agencies.--
          [(1) Study.--The Comptroller General of the United 
        States shall conduct a study regarding the 
        implementation of prompt corrective action by the 
        appropriate Federal banking agencies.
          [(2) Issues to be studied.--In conducting the study 
        under paragraph (1), the Comptroller General shall 
        evaluate--
                  [(A) the effectiveness of implementation of 
                prompt corrective action by the appropriate 
                Federal banking agencies and the resolution of 
                insured depository institutions by the 
                Corporation; and
                  [(B) ways to make prompt corrective action a 
                more effective tool to resolve the insured 
                depository institutions at the least possible 
                long-term cost to the Deposit Insurance Fund.
          [(3) Report to council.--Not later than 1 year after 
        the date of enactment of this Act, the Comptroller 
        General shall submit a report to the Council on the 
        results of the study conducted under this subsection.
          [(4) Council report of action.--Not later than 6 
        months after the date of receipt of the report from the 
        Comptroller General under paragraph (3), the Council 
        shall submit a report to the Committee on Banking, 
        Housing, and Urban Affairs of the Senate and the 
        Committee on Financial Services of the House of 
        Representatives on actions taken in response to the 
        report, including any recommendations made to the 
        Federal primary financial regulatory agencies under 
        section 120.

[SEC. 203. SYSTEMIC RISK DETERMINATION.

  [(a) Written Recommendation and Determination.--
          [(1) Vote required.--
                  [(A) In general.--On their own initiative, or 
                at the request of the Secretary, the 
                Corporation and the Board of Governors shall 
                consider whether to make a written 
                recommendation described in paragraph (2) with 
                respect to whether the Secretary should appoint 
                the Corporation as receiver for a financial 
                company. Such recommendation shall be made upon 
                a vote of not fewer than \2/3\ of the members 
                of the Board of Governors then serving and \2/
                3\ of the members of the board of directors of 
                the Corporation then serving.
                  [(B) Cases involving brokers or dealers.--In 
                the case of a broker or dealer, or in which the 
                largest United States subsidiary (as measured 
                by total assets as of the end of the previous 
                calendar quarter) of a financial company is a 
                broker or dealer, the Commission and the Board 
                of Governors, at the request of the Secretary, 
                or on their own initiative, shall consider 
                whether to make the written recommendation 
                described in paragraph (2) with respect to the 
                financial company. Subject to the requirements 
                in paragraph (2), such recommendation shall be 
                made upon a vote of not fewer than \2/3\ of the 
                members of the Board of Governors then serving 
                and \2/3\ of the members of the Commission then 
                serving, and in consultation with the 
                Corporation.
                  [(C) Cases involving insurance companies.--In 
                the case of an insurance company, or in which 
                the largest United States subsidiary (as 
                measured by total assets as of the end of the 
                previous calendar quarter) of a financial 
                company is an insurance company, the Director 
                of the Federal Insurance Office and the Board 
                of Governors, at the request of the Secretary 
                or on their own initiative, shall consider 
                whether to make the written recommendation 
                described in paragraph (2) with respect to the 
                financial company. Subject to the requirements 
                in paragraph (2), such recommendation shall be 
                made upon a vote of not fewer than \2/3\ of the 
                Board of Governors then serving and the 
                affirmative approval of the Director of the 
                Federal Insurance Office, and in consultation 
                with the Corporation.
          [(2) Recommendation required.--Any written 
        recommendation pursuant to paragraph (1) shall 
        contain--
                  [(A) an evaluation of whether the financial 
                company is in default or in danger of default;
                  [(B) a description of the effect that the 
                default of the financial company would have on 
                financial stability in the United States;
                  [(C) a description of the effect that the 
                default of the financial company would have on 
                economic conditions or financial stability for 
                low income, minority, or underserved 
                communities;
                  [(D) a recommendation regarding the nature 
                and the extent of actions to be taken under 
                this title regarding the financial company;
                  [(E) an evaluation of the likelihood of a 
                private sector alternative to prevent the 
                default of the financial company;
                  [(F) an evaluation of why a case under the 
                Bankruptcy Code is not appropriate for the 
                financial company;
                  [(G) an evaluation of the effects on 
                creditors, counterparties, and shareholders of 
                the financial company and other market 
                participants; and
                  [(H) an evaluation of whether the company 
                satisfies the definition of a financial company 
                under section 201.
  [(b) Determination by the Secretary.--Notwithstanding any 
other provision of Federal or State law, the Secretary shall 
take action in accordance with section 202(a)(1)(A), if, upon 
the written recommendation under subsection (a), the Secretary 
(in consultation with the President) determines that--
          [(1) the financial company is in default or in danger 
        of default;
          [(2) the failure of the financial company and its 
        resolution under otherwise applicable Federal or State 
        law would have serious adverse effects on financial 
        stability in the United States;
          [(3) no viable private sector alternative is 
        available to prevent the default of the financial 
        company;
          [(4) any effect on the claims or interests of 
        creditors, counterparties, and shareholders of the 
        financial company and other market participants as a 
        result of actions to be taken under this title is 
        appropriate, given the impact that any action taken 
        under this title would have on financial stability in 
        the United States;
          [(5) any action under section 204 would avoid or 
        mitigate such adverse effects, taking into 
        consideration the effectiveness of the action in 
        mitigating potential adverse effects on the financial 
        system, the cost to the general fund of the Treasury, 
        and the potential to increase excessive risk taking on 
        the part of creditors, counterparties, and shareholders 
        in the financial company;
          [(6) a Federal regulatory agency has ordered the 
        financial company to convert all of its convertible 
        debt instruments that are subject to the regulatory 
        order; and
          [(7) the company satisfies the definition of a 
        financial company under section 201.
  [(c) Documentation and Review.--
          [(1) In general.--The Secretary shall--
                  [(A) document any determination under 
                subsection (b);
                  [(B) retain the documentation for review 
                under paragraph (2); and
                  [(C) notify the covered financial company and 
                the Corporation of such determination.
          [(2) Report to congress.--Not later than 24 hours 
        after the date of appointment of the Corporation as 
        receiver for a covered financial company, the Secretary 
        shall provide written notice of the recommendations and 
        determinations reached in accordance with subsections 
        (a) and (b) to the Majority Leader and the Minority 
        Leader of the Senate and the Speaker and the Minority 
        Leader of the House of Representatives, the Committee 
        on Banking, Housing, and Urban Affairs of the Senate, 
        and the Committee on Financial Services of the House of 
        Representatives, which shall consist of a summary of 
        the basis for the determination, including, to the 
        extent available at the time of the determination--
                  [(A) the size and financial condition of the 
                covered financial company;
                  [(B) the sources of capital and credit 
                support that were available to the covered 
                financial company;
                  [(C) the operations of the covered financial 
                company that could have had a significant 
                impact on financial stability, markets, or 
                both;
                  [(D) identification of the banks and 
                financial companies which may be able to 
                provide the services offered by the covered 
                financial company;
                  [(E) any potential international 
                ramifications of resolution of the covered 
                financial company under other applicable 
                insolvency law;
                  [(F) an estimate of the potential effect of 
                the resolution of the covered financial company 
                under other applicable insolvency law on the 
                financial stability of the United States;
                  [(G) the potential effect of the appointment 
                of a receiver by the Secretary on consumers;
                  [(H) the potential effect of the appointment 
                of a receiver by the Secretary on the financial 
                system, financial markets, and banks and other 
                financial companies; and
                  [(I) whether resolution of the covered 
                financial company under other applicable 
                insolvency law would cause banks or other 
                financial companies to experience severe 
                liquidity distress.
          [(3) Reports to congress and the public.--
                  [(A) In general.--Not later than 60 days 
                after the date of appointment of the 
                Corporation as receiver for a covered financial 
                company, the Corporation shall file a report 
                with the Committee on Banking, Housing, and 
                Urban Affairs of the Senate and the Committee 
                on Financial Services of the House of 
                Representatives--
                          [(i) setting forth information on the 
                        financial condition of the covered 
                        financial company as of the date of the 
                        appointment, including a description of 
                        its assets and liabilities;
                          [(ii) describing the plan of, and 
                        actions taken by, the Corporation to 
                        wind down the covered financial 
                        company;
                          [(iii) explaining each instance in 
                        which the Corporation waived any 
                        applicable requirements of part 366 of 
                        title 12, Code of Federal Regulations 
                        (or any successor thereto) with respect 
                        to conflicts of interest by any person 
                        in the private sector who was retained 
                        to provide services to the Corporation 
                        in connection with such receivership;
                          [(iv) describing the reasons for the 
                        provision of any funding to the 
                        receivership out of the Fund;
                          [(v) setting forth the expected costs 
                        of the orderly liquidation of the 
                        covered financial company;
                          [(vi) setting forth the identity of 
                        any claimant that is treated in a 
                        manner different from other similarly 
                        situated claimants under subsection 
                        (b)(4), (d)(4), or (h)(5)(E), the 
                        amount of any additional payment to 
                        such claimant under subsection (d)(4), 
                        and the reason for any such action; and
                          [(vii) which report the Corporation 
                        shall publish on an online website 
                        maintained by the Corporation, subject 
                        to maintaining appropriate 
                        confidentiality.
                  [(B) Amendments.--The Corporation shall, on a 
                timely basis, not less frequently than 
                quarterly, amend or revise and resubmit the 
                reports prepared under this paragraph, as 
                necessary.
                  [(C) Congressional testimony.--The 
                Corporation and the primary financial 
                regulatory agency, if any, of the financial 
                company for which the Corporation was appointed 
                receiver under this title shall appear before 
                Congress, if requested, not later than 30 days 
                after the date on which the Corporation first 
                files the reports required under subparagraph 
                (A).
          [(4) Default or in danger of default.--For purposes 
        of this title, a financial company shall be considered 
        to be in default or in danger of default if, as 
        determined in accordance with subsection (b)--
                  [(A) a case has been, or likely will promptly 
                be, commenced with respect to the financial 
                company under the Bankruptcy Code;
                  [(B) the financial company has incurred, or 
                is likely to incur, losses that will deplete 
                all or substantially all of its capital, and 
                there is no reasonable prospect for the company 
                to avoid such depletion;
                  [(C) the assets of the financial company are, 
                or are likely to be, less than its obligations 
                to creditors and others; or
                  [(D) the financial company is, or is likely 
                to be, unable to pay its obligations (other 
                than those subject to a bona fide dispute) in 
                the normal course of business.
          [(5) GAO review.--The Comptroller General of the 
        United States shall review and report to Congress on 
        any determination under subsection (b), that results in 
        the appointment of the Corporation as receiver, 
        including--
                  [(A) the basis for the determination;
                  [(B) the purpose for which any action was 
                taken pursuant thereto;
                  [(C) the likely effect of the determination 
                and such action on the incentives and conduct 
                of financial companies and their creditors, 
                counterparties, and shareholders; and
                  [(D) the likely disruptive effect of the 
                determination and such action on the reasonable 
                expectations of creditors, counterparties, and 
                shareholders, taking into account the impact 
                any action under this title would have on 
                financial stability in the United States, 
                including whether the rights of such parties 
                will be disrupted.
  [(d) Corporation Policies and Procedures.--As soon as is 
practicable after the date of enactment of this Act, the 
Corporation shall establish policies and procedures that are 
acceptable to the Secretary governing the use of funds 
available to the Corporation to carry out this title, including 
the terms and conditions for the provision and use of funds 
under sections 204(d), 210(h)(2)(G)(iv), and 210(h)(9).
  [(e) Treatment of Insurance Companies and Insurance Company 
Subsidiaries.--
          [(1) In general.--Notwithstanding subsection (b), if 
        an insurance company is a covered financial company or 
        a subsidiary or affiliate of a covered financial 
        company, the liquidation or rehabilitation of such 
        insurance company, and any subsidiary or affiliate of 
        such company that is not excepted under paragraph (2), 
        shall be conducted as provided under applicable State 
        law.
          [(2) Exception for subsidiaries and affiliates.--The 
        requirement of paragraph (1) shall not apply with 
        respect to any subsidiary or affiliate of an insurance 
        company that is not itself an insurance company.
          [(3) Backup authority.--Notwithstanding paragraph 
        (1), with respect to a covered financial company 
        described in paragraph (1), if, after the end of the 
        60-day period beginning on the date on which a 
        determination is made under section 202(a) with respect 
        to such company, the appropriate regulatory agency has 
        not filed the appropriate judicial action in the 
        appropriate State court to place such company into 
        orderly liquidation or rehabilitation under the laws 
        and requirements of the State, the Corporation shall 
        have the authority to stand in the place of the 
        appropriate regulatory agency and file the appropriate 
        judicial action in the appropriate State court to place 
        such company into orderly liquidation or rehabilitation 
        under the laws and requirements of the State.

[SEC. 204. ORDERLY LIQUIDATION OF COVERED FINANCIAL COMPANIES.

  [(a) Purpose of Orderly Liquidation Authority.--It is the 
purpose of this title to provide the necessary authority to 
liquidate failing financial companies that pose a significant 
risk to the financial stability of the United States in a 
manner that mitigates such risk and minimizes moral hazard. The 
authority provided in this title shall be exercised in the 
manner that best fulfills such purpose, so that--
          [(1) creditors and shareholders will bear the losses 
        of the financial company;
          [(2) management responsible for the condition of the 
        financial company will not be retained; and
          [(3) the Corporation and other appropriate agencies 
        will take all steps necessary and appropriate to assure 
        that all parties, including management, directors, and 
        third parties, having responsibility for the condition 
        of the financial company bear losses consistent with 
        their responsibility, including actions for damages, 
        restitution, and recoupment of compensation and other 
        gains not compatible with such responsibility.
  [(b) Corporation as Receiver.--Upon the appointment of the 
Corporation under section 202, the Corporation shall act as the 
receiver for the covered financial company, with all of the 
rights and obligations set forth in this title.
  [(c) Consultation.--The Corporation, as receiver--
          [(1) shall consult with the primary financial 
        regulatory agency or agencies of the covered financial 
        company and its covered subsidiaries for purposes of 
        ensuring an orderly liquidation of the covered 
        financial company;
          [(2) may consult with, or under subsection 
        (a)(1)(B)(v) or (a)(1)(L) of section 210, acquire the 
        services of, any outside experts, as appropriate to 
        inform and aid the Corporation in the orderly 
        liquidation process;
          [(3) shall consult with the primary financial 
        regulatory agency or agencies of any subsidiaries of 
        the covered financial company that are not covered 
        subsidiaries, and coordinate with such regulators 
        regarding the treatment of such solvent subsidiaries 
        and the separate resolution of any such insolvent 
        subsidiaries under other governmental authority, as 
        appropriate; and
          [(4) shall consult with the Commission and the 
        Securities Investor Protection Corporation in the case 
        of any covered financial company for which the 
        Corporation has been appointed as receiver that is a 
        broker or dealer registered with the Commission under 
        section 15(b) of the Securities Exchange Act of 1934 
        (15 U.S.C. 78o(b)) and is a member of the Securities 
        Investor Protection Corporation, for the purpose of 
        determining whether to transfer to a bridge financial 
        company organized by the Corporation as receiver, 
        without consent of any customer, customer accounts of 
        the covered financial company.
  [(d) Funding for Orderly Liquidation.--Upon its appointment 
as receiver for a covered financial company, and thereafter as 
the Corporation may, in its discretion, determine to be 
necessary or appropriate, the Corporation may make available to 
the receivership, subject to the conditions set forth in 
section 206 and subject to the plan described in section 
210(n)(9), funds for the orderly liquidation of the covered 
financial company. All funds provided by the Corporation under 
this subsection shall have a priority of claims under 
subparagraph (A) or (B) of section 210(b)(1), as applicable, 
including funds used for--
          [(1) making loans to, or purchasing any debt 
        obligation of, the covered financial company or any 
        covered subsidiary;
          [(2) purchasing or guaranteeing against loss the 
        assets of the covered financial company or any covered 
        subsidiary, directly or through an entity established 
        by the Corporation for such purpose;
          [(3) assuming or guaranteeing the obligations of the 
        covered financial company or any covered subsidiary to 
        1 or more third parties;
          [(4) taking a lien on any or all assets of the 
        covered financial company or any covered subsidiary, 
        including a first priority lien on all unencumbered 
        assets of the covered financial company or any covered 
        subsidiary to secure repayment of any transactions 
        conducted under this subsection, except that, if the 
        covered financial company or covered subsidiary is an 
        insurance company or a subsidiary of an insurance 
        company, the Corporation--
                  [(A) shall promptly notify the State 
                insurance authority for the insurance company 
                of the intention to take such lien; and
                  [(B) may only take such lien--
                          [(i) to secure repayment of funds 
                        made available to such covered 
                        financial company or covered 
                        subsidiary; and
                          [(ii) if the Corporation determines, 
                        after consultation with the State 
                        insurance authority, that such lien 
                        will not unduly impede or delay the 
                        liquidation or rehabilitation of the 
                        insurance company, or the recovery by 
                        its policyholders;
          [(5) selling or transferring all, or any part, of 
        such acquired assets, liabilities, or obligations of 
        the covered financial company or any covered 
        subsidiary; and
          [(6) making payments pursuant to subsections (b)(4), 
        (d)(4), and (h)(5)(E) of section 210.

[SEC. 205. ORDERLY LIQUIDATION OF COVERED BROKERS AND DEALERS.

  [(a) Appointment of SIPC as Trustee.--
          [(1) Appointment.--Upon the appointment of the 
        Corporation as receiver for any covered broker or 
        dealer, the Corporation shall appoint, without any need 
        for court approval, the Securities Investor Protection 
        Corporation to act as trustee for the liquidation under 
        the Securities Investor Protection Act of 1970 (15 
        U.S.C. 78aaa et seq.) of the covered broker or dealer.
          [(2) Actions by sipc.--
                  [(A) Filing.--Upon appointment of SIPC under 
                paragraph (1), SIPC shall promptly file with 
                any Federal district court of competent 
                jurisdiction specified in section 21 or 27 of 
                the Securities Exchange Act of 1934 (15 U.S.C. 
                78u, 78aa), an application for a protective 
                decree under the Securities Investor Protection 
                Act of 1970 (15 U.S.C. 78aaa et seq.) as to the 
                covered broker or dealer. The Federal district 
                court shall accept and approve the filing, 
                including outside of normal business hours, and 
                shall immediately issue the protective decree 
                as to the covered broker or dealer.
                  [(B) Administration by sipc.--Following entry 
                of the protective decree, and except as 
                otherwise provided in this section, the 
                determination of claims and the liquidation of 
                assets retained in the receivership of the 
                covered broker or dealer and not transferred to 
                the bridge financial company shall be 
                administered under the Securities Investor 
                Protection Act of 1970 (15 U.S.C. 78aaa et 
                seq.) by SIPC, as trustee for the covered 
                broker or dealer.
                  [(C) Definition of filing date.--For purposes 
                of the liquidation proceeding, the term 
                ``filing date'' means the date on which the 
                Corporation is appointed as receiver of the 
                covered broker or dealer.
                  [(D) Determination of claims.--As trustee for 
                the covered broker or dealer, SIPC shall 
                determine and satisfy, consistent with this 
                title and with the Securities Investor 
                Protection Act of 1970 (15 U.S.C. 78aaa et 
                seq.), all claims against the covered broker or 
                dealer arising on or before the filing date.
  [(b) Powers and Duties of SIPC.--
          [(1) In general.--Except as provided in this section, 
        upon its appointment as trustee for the liquidation of 
        a covered broker or dealer, SIPC shall have all of the 
        powers and duties provided by the Securities Investor 
        Protection Act of 1970 (15 U.S.C. 78aaa et seq.), 
        including, without limitation, all rights of action 
        against third parties, and shall conduct such 
        liquidation in accordance with the terms of the 
        Securities Investor Protection Act of 1970 (15 U.S.C. 
        78aaa et seq.), except that SIPC shall have no powers 
        or duties with respect to assets and liabilities 
        transferred by the Corporation from the covered broker 
        or dealer to any bridge financial company established 
        in accordance with this title.
          [(2) Limitation of powers.--The exercise by SIPC of 
        powers and functions as trustee under subsection (a) 
        shall not impair or impede the exercise of the powers 
        and duties of the Corporation with regard to--
                  [(A) any action, except as otherwise provided 
                in this title--
                          [(i) to make funds available under 
                        section 204(d);
                          [(ii) to organize, establish, 
                        operate, or terminate any bridge 
                        financial company;
                          [(iii) to transfer assets and 
                        liabilities;
                          [(iv) to enforce or repudiate 
                        contracts; or
                          [(v) to take any other action 
                        relating to such bridge financial 
                        company under section 210; or
                  [(B) determining claims under subsection (e).
          [(3) Protective decree.--SIPC and the Corporation, in 
        consultation with the Commission, shall jointly 
        determine the terms of the protective decree to be 
        filed by SIPC with any court of competent jurisdiction 
        under section 21 or 27 of the Securities Exchange Act 
        of 1934 (15 U.S.C. 78u, 78aa), as required by 
        subsection (a).
          [(4) Qualified financial contracts.--Notwithstanding 
        any provision of the Securities Investor Protection Act 
        of 1970 (15 U.S.C. 78aaa et seq.) to the contrary 
        (including section 5(b)(2)(C) of that Act (15 U.S.C. 
        78eee(b)(2)(C))), the rights and obligations of any 
        party to a qualified financial contract (as that term 
        is defined in section 210(c)(8)) to which a covered 
        broker or dealer for which the Corporation has been 
        appointed receiver is a party shall be governed 
        exclusively by section 210, including the limitations 
        and restrictions contained in section 210(c)(10)(B).
  [(c) Limitation on Court Action.--Except as otherwise 
provided in this title, no court may take any action, including 
any action pursuant to the Securities Investor Protection Act 
of 1970 (15 U.S.C. 78aaa et seq.) or the Bankruptcy Code, to 
restrain or affect the exercise of powers or functions of the 
Corporation as receiver for a covered broker or dealer and any 
claims against the Corporation as such receiver shall be 
determined in accordance with subsection (e) and such claims 
shall be limited to money damages.
  [(d) Actions by Corporation as Receiver.--
          [(1) In general.--Notwithstanding any other provision 
        of this title, no action taken by the Corporation as 
        receiver with respect to a covered broker or dealer 
        shall--
                  [(A) adversely affect the rights of a 
                customer to customer property or customer name 
                securities;
                  [(B) diminish the amount or timely payment of 
                net equity claims of customers; or
                  [(C) otherwise impair the recoveries provided 
                to a customer under the Securities Investor 
                Protection Act of 1970 (15 U.S.C. 78aaa et 
                seq.).
          [(2) Net proceeds.--The net proceeds from any 
        transfer, sale, or disposition of assets of the covered 
        broker or dealer, or proceeds thereof by the 
        Corporation as receiver for the covered broker or 
        dealer shall be for the benefit of the estate of the 
        covered broker or dealer, as provided in this title.
  [(e) Claims Against the Corporation as Receiver.--Any claim 
against the Corporation as receiver for a covered broker or 
dealer for assets transferred to a bridge financial company 
established with respect to such covered broker or dealer--
          [(1) shall be determined in accordance with section 
        210(a)(2); and
          [(2) may be reviewed by the appropriate district or 
        territorial court of the United States in accordance 
        with section 210(a)(5).
  [(f) Satisfaction of Customer Claims.--
          [(1) Obligations to customers.--Notwithstanding any 
        other provision of this title, all obligations of a 
        covered broker or dealer or of any bridge financial 
        company established with respect to such covered broker 
        or dealer to a customer relating to, or net equity 
        claims based upon, customer property or customer name 
        securities shall be promptly discharged by SIPC, the 
        Corporation, or the bridge financial company, as 
        applicable, by the delivery of securities or the making 
        of payments to or for the account of such customer, in 
        a manner and in an amount at least as beneficial to the 
        customer as would have been the case had the actual 
        proceeds realized from the liquidation of the covered 
        broker or dealer under this title been distributed in a 
        proceeding under the Securities Investor Protection Act 
        of 1970 (15 U.S.C. 78aaa et seq.) without the 
        appointment of the Corporation as receiver and without 
        any transfer of assets or liabilities to a bridge 
        financial company, and with a filing date as of the 
        date on which the Corporation is appointed as receiver.
          [(2) Satisfaction of claims by sipc.--SIPC, as 
        trustee for a covered broker or dealer, shall satisfy 
        customer claims in the manner and amount provided under 
        the Securities Investor Protection Act of 1970 (15 
        U.S.C. 78aaa et seq.), as if the appointment of the 
        Corporation as receiver had not occurred, and with a 
        filing date as of the date on which the Corporation is 
        appointed as receiver. The Corporation shall satisfy 
        customer claims, to the extent that a customer would 
        have received more securities or cash with respect to 
        the allocation of customer property had the covered 
        financial company been subject to a proceeding under 
        the Securities Investor Protection Act (15 U.S.C. 78aaa 
        et seq.) without the appointment of the Corporation as 
        receiver, and with a filing date as of the date on 
        which the Corporation is appointed as receiver.
  [(g) Priorities.--
          [(1) Customer property.--As trustee for a covered 
        broker or dealer, SIPC shall allocate customer property 
        and deliver customer name securities in accordance with 
        section 8(c) of the Securities Investor Protection Act 
        of 1970 (15 U.S.C. 78fff-2(c)).
          [(2) Other claims.--All claims other than those 
        described in paragraph (1) (including any unpaid claim 
        by a customer for the allowed net equity claim of such 
        customer from customer property) shall be paid in 
        accordance with the priorities in section 210(b).
  [(h) Rulemaking.--The Commission and the Corporation, after 
consultation with SIPC, shall jointly issue rules to implement 
this section.

[SEC. 206. MANDATORY TERMS AND CONDITIONS FOR ALL ORDERLY LIQUIDATION 
                    ACTIONS.

  [In taking action under this title, the Corporation shall--
          [(1) determine that such action is necessary for 
        purposes of the financial stability of the United 
        States, and not for the purpose of preserving the 
        covered financial company;
          [(2) ensure that the shareholders of a covered 
        financial company do not receive payment until after 
        all other claims and the Fund are fully paid;
          [(3) ensure that unsecured creditors bear losses in 
        accordance with the priority of claim provisions in 
        section 210;
          [(4) ensure that management responsible for the 
        failed condition of the covered financial company is 
        removed (if such management has not already been 
        removed at the time at which the Corporation is 
        appointed receiver);
          [(5) ensure that the members of the board of 
        directors (or body performing similar functions) 
        responsible for the failed condition of the covered 
        financial company are removed, if such members have not 
        already been removed at the time the Corporation is 
        appointed as receiver; and
          [(6) not take an equity interest in or become a 
        shareholder of any covered financial company or any 
        covered subsidiary.

[SEC. 207. DIRECTORS NOT LIABLE FOR ACQUIESCING IN APPOINTMENT OF 
                    RECEIVER.

  [The members of the board of directors (or body performing 
similar functions) of a covered financial company shall not be 
liable to the shareholders or creditors thereof for acquiescing 
in or consenting in good faith to the appointment of the 
Corporation as receiver for the covered financial company under 
section 203.

[SEC. 208. DISMISSAL AND EXCLUSION OF OTHER ACTIONS.

  [(a) In General.--Effective as of the date of the appointment 
of the Corporation as receiver for the covered financial 
company under section 202 or the appointment of SIPC as trustee 
for a covered broker or dealer under section 205, as 
applicable, any case or proceeding commenced with respect to 
the covered financial company under the Bankruptcy Code or the 
Securities Investor Protection Act of 1970 (15 U.S.C. 78aaa et 
seq.) shall be dismissed, upon notice to the bankruptcy court 
(with respect to a case commenced under the Bankruptcy Code), 
and upon notice to SIPC (with respect to a covered broker or 
dealer) and no such case or proceeding may be commenced with 
respect to a covered financial company at any time while the 
orderly liquidation is pending.
  [(b) Revesting of Assets.--Effective as of the date of 
appointment of the Corporation as receiver, the assets of a 
covered financial company shall, to the extent they have vested 
in any entity other than the covered financial company as a 
result of any case or proceeding commenced with respect to the 
covered financial company under the Bankruptcy Code, the 
Securities Investor Protection Act of 1970 (15 U.S.C. 78aaa et 
seq.), or any similar provision of State liquidation or 
insolvency law applicable to the covered financial company, 
revest in the covered financial company.
  [(c) Limitation.--Notwithstanding subsections (a) and (b), 
any order entered or other relief granted by a bankruptcy court 
prior to the date of appointment of the Corporation as receiver 
shall continue with the same validity as if an orderly 
liquidation had not been commenced.

[SEC. 209. RULEMAKING; NON-CONFLICTING LAW.

  [The Corporation shall, in consultation with the Council, 
prescribe such rules or regulations as the Corporation 
considers necessary or appropriate to implement this title, 
including rules and regulations with respect to the rights, 
interests, and priorities of creditors, counterparties, 
security entitlement holders, or other persons with respect to 
any covered financial company or any assets or other property 
of or held by such covered financial company, and address the 
potential for conflicts of interest between or among individual 
receiverships established under this title or under the Federal 
Deposit Insurance Act. To the extent possible, the Corporation 
shall seek to harmonize applicable rules and regulations 
promulgated under this section with the insolvency laws that 
would otherwise apply to a covered financial company.

[SEC. 210. POWERS AND DUTIES OF THE CORPORATION.

  [(a) Powers and Authorities.--
          [(1) General powers.--
                  [(A) Successor to covered financial 
                company.--The Corporation shall, upon 
                appointment as receiver for a covered financial 
                company under this title, succeed to--
                          [(i) all rights, titles, powers, and 
                        privileges of the covered financial 
                        company and its assets, and of any 
                        stockholder, member, officer, or 
                        director of such company; and
                          [(ii) title to the books, records, 
                        and assets of any previous receiver or 
                        other legal custodian of such covered 
                        financial company.
                  [(B) Operation of the covered financial 
                company during the period of orderly 
                liquidation.--The Corporation, as receiver for 
                a covered financial company, may--
                          [(i) take over the assets of and 
                        operate the covered financial company 
                        with all of the powers of the members 
                        or shareholders, the directors, and the 
                        officers of the covered financial 
                        company, and conduct all business of 
                        the covered financial company;
                          [(ii) collect all obligations and 
                        money owed to the covered financial 
                        company;
                          [(iii) perform all functions of the 
                        covered financial company, in the name 
                        of the covered financial company;
                          [(iv) manage the assets and property 
                        of the covered financial company, 
                        consistent with maximization of the 
                        value of the assets in the context of 
                        the orderly liquidation; and
                          [(v) provide by contract for 
                        assistance in fulfilling any function, 
                        activity, action, or duty of the 
                        Corporation as receiver.
                  [(C) Functions of covered financial company 
                officers, directors, and shareholders.--The 
                Corporation may provide for the exercise of any 
                function by any member or stockholder, 
                director, or officer of any covered financial 
                company for which the Corporation has been 
                appointed as receiver under this title.
                  [(D) Additional powers as receiver.--The 
                Corporation shall, as receiver for a covered 
                financial company, and subject to all legally 
                enforceable and perfected security interests 
                and all legally enforceable security 
                entitlements in respect of assets held by the 
                covered financial company, liquidate, and wind-
                up the affairs of a covered financial company, 
                including taking steps to realize upon the 
                assets of the covered financial company, in 
                such manner as the Corporation deems 
                appropriate, including through the sale of 
                assets, the transfer of assets to a bridge 
                financial company established under subsection 
                (h), or the exercise of any other rights or 
                privileges granted to the receiver under this 
                section.
                  [(E) Additional powers with respect to 
                failing subsidiaries of a covered financial 
                company.--
                          [(i) In general.--In any case in 
                        which a receiver is appointed for a 
                        covered financial company under section 
                        202, the Corporation may appoint itself 
                        as receiver of any covered subsidiary 
                        of the covered financial company that 
                        is organized under Federal law or the 
                        laws of any State, if the Corporation 
                        and the Secretary jointly determine 
                        that--
                                  [(I) the covered subsidiary 
                                is in default or in danger of 
                                default;
                                  [(II) such action would avoid 
                                or mitigate serious adverse 
                                effects on the financial 
                                stability or economic 
                                conditions of the United 
                                States; and
                                  [(III) such action would 
                                facilitate the orderly 
                                liquidation of the covered 
                                financial company.
                          [(ii) Treatment as covered financial 
                        company.--If the Corporation is 
                        appointed as receiver of a covered 
                        subsidiary of a covered financial 
                        company under clause (i), the covered 
                        subsidiary shall thereafter be 
                        considered a covered financial company 
                        under this title, and the Corporation 
                        shall thereafter have all the powers 
                        and rights with respect to that covered 
                        subsidiary as it has with respect to a 
                        covered financial company under this 
                        title.
                  [(F) Organization of bridge companies.--The 
                Corporation, as receiver for a covered 
                financial company, may organize a bridge 
                financial company under subsection (h).
                  [(G) Merger; transfer of assets and 
                liabilities.--
                          [(i) In general.--Subject to clauses 
                        (ii) and (iii), the Corporation, as 
                        receiver for a covered financial 
                        company, may--
                                  [(I) merge the covered 
                                financial company with another 
                                company; or
                                  [(II) transfer any asset or 
                                liability of the covered 
                                financial company (including 
                                any assets and liabilities held 
                                by the covered financial 
                                company for security 
                                entitlement holders, any 
                                customer property, or any 
                                assets and liabilities 
                                associated with any trust or 
                                custody business) without 
                                obtaining any approval, 
                                assignment, or consent with 
                                respect to such transfer.
                          [(ii) Federal agency approval; 
                        antitrust review.--With respect to a 
                        transaction described in clause (i)(I) 
                        that requires approval by a Federal 
                        agency--
                                  [(I) the transaction may not 
                                be consummated before the 5th 
                                calendar day after the date of 
                                approval by the Federal agency 
                                responsible for such approval;
                                  [(II) if, in connection with 
                                any such approval, a report on 
                                competitive factors is 
                                required, the Federal agency 
                                responsible for such approval 
                                shall promptly notify the 
                                Attorney General of the United 
                                States of the proposed 
                                transaction, and the Attorney 
                                General shall provide the 
                                required report not later than 
                                10 days after the date of the 
                                request; and
                                  [(III) if notification under 
                                section 7A of the Clayton Act 
                                is required with respect to 
                                such transaction, then the 
                                required waiting period shall 
                                end on the 15th day after the 
                                date on which the Attorney 
                                General and the Federal Trade 
                                Commission receive such 
                                notification, unless the 
                                waiting period is terminated 
                                earlier under subsection (b)(2) 
                                of such section 7A, or is 
                                extended pursuant to subsection 
                                (e)(2) of such section 7A.
                          [(iii) Setoff.--Subject to the other 
                        provisions of this title, any 
                        transferee of assets from a receiver, 
                        including a bridge financial company, 
                        shall be subject to such claims or 
                        rights as would prevail over the rights 
                        of such transferee in such assets under 
                        applicable noninsolvency law.
                  [(H) Payment of valid obligations.--The 
                Corporation, as receiver for a covered 
                financial company, shall, to the extent that 
                funds are available, pay all valid obligations 
                of the covered financial company that are due 
                and payable at the time of the appointment of 
                the Corporation as receiver, in accordance with 
                the prescriptions and limitations of this 
                title.
                  [(I) Applicable noninsolvency law.--Except as 
                may otherwise be provided in this title, the 
                applicable noninsolvency law shall be 
                determined by the noninsolvency choice of law 
                rules otherwise applicable to the claims, 
                rights, titles, persons, or entities at issue.
                  [(J) Subpoena authority.--
                          [(i) In general.--The Corporation, as 
                        receiver for a covered financial 
                        company, may, for purposes of carrying 
                        out any power, authority, or duty with 
                        respect to the covered financial 
                        company (including determining any 
                        claim against the covered financial 
                        company and determining and realizing 
                        upon any asset of any person in the 
                        course of collecting money due the 
                        covered financial company), exercise 
                        any power established under section 
                        8(n) of the Federal Deposit Insurance 
                        Act, as if the Corporation were the 
                        appropriate Federal banking agency for 
                        the covered financial company, and the 
                        covered financial company were an 
                        insured depository institution.
                          [(ii) Rule of construction.--This 
                        subparagraph may not be construed as 
                        limiting any rights that the 
                        Corporation, in any capacity, might 
                        otherwise have to exercise any powers 
                        described in clause (i) or under any 
                        other provision of law.
                  [(K) Incidental powers.--The Corporation, as 
                receiver for a covered financial company, may 
                exercise all powers and authorities 
                specifically granted to receivers under this 
                title, and such incidental powers as shall be 
                necessary to carry out such powers under this 
                title.
                  [(L) Utilization of private sector.--In 
                carrying out its responsibilities in the 
                management and disposition of assets from the 
                covered financial company, the Corporation, as 
                receiver for a covered financial company, may 
                utilize the services of private persons, 
                including real estate and loan portfolio asset 
                management, property management, auction 
                marketing, legal, and brokerage services, if 
                such services are available in the private 
                sector, and the Corporation determines that 
                utilization of such services is practicable, 
                efficient, and cost effective.
                  [(M) Shareholders and creditors of covered 
                financial company.--Notwithstanding any other 
                provision of law, the Corporation, as receiver 
                for a covered financial company, shall succeed 
                by operation of law to the rights, titles, 
                powers, and privileges described in 
                subparagraph (A), and shall terminate all 
                rights and claims that the stockholders and 
                creditors of the covered financial company may 
                have against the assets of the covered 
                financial company or the Corporation arising 
                out of their status as stockholders or 
                creditors, except for their right to payment, 
                resolution, or other satisfaction of their 
                claims, as permitted under this section. The 
                Corporation shall ensure that shareholders and 
                unsecured creditors bear losses, consistent 
                with the priority of claims provisions under 
                this section.
                  [(N) Coordination with foreign financial 
                authorities.--The Corporation, as receiver for 
                a covered financial company, shall coordinate, 
                to the maximum extent possible, with the 
                appropriate foreign financial authorities 
                regarding the orderly liquidation of any 
                covered financial company that has assets or 
                operations in a country other than the United 
                States.
                  [(O) Restriction on transfers.--
                          [(i) Selection of accounts for 
                        transfer.--If the Corporation 
                        establishes one or more bridge 
                        financial companies with respect to a 
                        covered broker or dealer, the 
                        Corporation shall transfer to one of 
                        such bridge financial companies, all 
                        customer accounts of the covered broker 
                        or dealer, and all associated customer 
                        name securities and customer property, 
                        unless the Corporation, after 
                        consulting with the Commission and 
                        SIPC, determines that--
                                  [(I) the customer accounts, 
                                customer name securities, and 
                                customer property are likely to 
                                be promptly transferred to 
                                another broker or dealer that 
                                is registered with the 
                                Commission under section 15(b) 
                                of the Securities Exchange Act 
                                of 1934 (15 U.S.C. 73o(b)) and 
                                is a member of SIPC; or
                                  [(II) the transfer of the 
                                accounts to a bridge financial 
                                company would materially 
                                interfere with the ability of 
                                the Corporation to avoid or 
                                mitigate serious adverse 
                                effects on financial stability 
                                or economic conditions in the 
                                United States.
                          [(ii) Transfer of property.--SIPC, as 
                        trustee for the liquidation of the 
                        covered broker or dealer, and the 
                        Commission shall provide any and all 
                        reasonable assistance necessary to 
                        complete such transfers by the 
                        Corporation.
                          [(iii) Customer consent and court 
                        approval not required.--Neither 
                        customer consent nor court approval 
                        shall be required to transfer any 
                        customer accounts or associated 
                        customer name securities or customer 
                        property to a bridge financial company 
                        in accordance with this section.
                          [(iv) Notification of sipc and 
                        sharing of information.--The 
                        Corporation shall identify to SIPC the 
                        customer accounts and associated 
                        customer name securities and customer 
                        property transferred to the bridge 
                        financial company. The Corporation and 
                        SIPC shall cooperate in the sharing of 
                        any information necessary for each 
                        entity to discharge its obligations 
                        under this title and under the 
                        Securities Investor Protection Act of 
                        1970 (15 U.S.C. 78aaa et seq.) 
                        including by providing access to the 
                        books and records of the covered 
                        financial company and any bridge 
                        financial company established in 
                        accordance with this title.
          [(2) Determination of claims.--
                  [(A) In general.--The Corporation, as 
                receiver for a covered financial company, shall 
                report on claims, as set forth in section 
                203(c)(3). Subject to paragraph (4) of this 
                subsection, the Corporation, as receiver for a 
                covered financial company, shall determine 
                claims in accordance with the requirements of 
                this subsection and regulations prescribed 
                under section 209.
                  [(B) Notice requirements.--The Corporation, 
                as receiver for a covered financial company, in 
                any case involving the liquidation or winding 
                up of the affairs of a covered financial 
                company, shall--
                          [(i) promptly publish a notice to the 
                        creditors of the covered financial 
                        company to present their claims, 
                        together with proof, to the receiver by 
                        a date specified in the notice, which 
                        shall be not earlier than 90 days after 
                        the date of publication of such notice; 
                        and
                          [(ii) republish such notice 1 month 
                        and 2 months, respectively, after the 
                        date of publication under clause (i).
                  [(C) Mailing required.--The Corporation as 
                receiver shall mail a notice similar to the 
                notice published under clause (i) or (ii) of 
                subparagraph (B), at the time of such 
                publication, to any creditor shown on the books 
                and records of the covered financial company--
                          [(i) at the last address of the 
                        creditor appearing in such books;
                          [(ii) in any claim filed by the 
                        claimant; or
                          [(iii) upon discovery of the name and 
                        address of a claimant not appearing on 
                        the books and records of the covered 
                        financial company, not later than 30 
                        days after the date of the discovery of 
                        such name and address.
          [(3) Procedures for resolution of claims.--
                  [(A) Decision period.--
                          [(i) In general.--Prior to the 180th 
                        day after the date on which a claim 
                        against a covered financial company is 
                        filed with the Corporation as receiver, 
                        or such later date as may be agreed as 
                        provided in clause (ii), the 
                        Corporation shall notify the claimant 
                        whether it allows or disallows the 
                        claim, in accordance with subparagraphs 
                        (B), (C), and (D).
                          [(ii) Extension of time.--By written 
                        agreement executed not later than 180 
                        days after the date on which a claim 
                        against a covered financial company is 
                        filed with the Corporation, the period 
                        described in clause (i) may be extended 
                        by written agreement between the 
                        claimant and the Corporation. Failure 
                        to notify the claimant of any 
                        disallowance within the time period set 
                        forth in clause (i), as it may be 
                        extended by agreement under this 
                        clause, shall be deemed to be a 
                        disallowance of such claim, and the 
                        claimant may file or continue an action 
                        in court, as provided in paragraph (4).
                          [(iii) Mailing of notice 
                        sufficient.--The requirements of clause 
                        (i) shall be deemed to be satisfied if 
                        the notice of any decision with respect 
                        to any claim is mailed to the last 
                        address of the claimant which appears--
                                  [(I) on the books, records, 
                                or both of the covered 
                                financial company;
                                  [(II) in the claim filed by 
                                the claimant; or
                                  [(III) in documents submitted 
                                in proof of the claim.
                          [(iv) Contents of notice of 
                        disallowance.--If the Corporation as 
                        receiver disallows any claim filed 
                        under clause (i), the notice to the 
                        claimant shall contain--
                                  [(I) a statement of each 
                                reason for the disallowance; 
                                and
                                  [(II) the procedures required 
                                to file or continue an action 
                                in court, as provided in 
                                paragraph (4).
                  [(B) Allowance of proven claim.--The receiver 
                shall allow any claim received by the receiver 
                on or before the date specified in the notice 
                under paragraph (2)(B)(i), which is proved to 
                the satisfaction of the receiver.
                  [(C) Disallowance of claims filed after end 
                of filing period.--
                          [(i) In general.--Except as provided 
                        in clause (ii), claims filed after the 
                        date specified in the notice published 
                        under paragraph (2)(B)(i) shall be 
                        disallowed, and such disallowance shall 
                        be final.
                          [(ii) Certain exceptions.--Clause (i) 
                        shall not apply with respect to any 
                        claim filed by a claimant after the 
                        date specified in the notice published 
                        under paragraph (2)(B)(i), and such 
                        claim may be considered by the receiver 
                        under subparagraph (B), if--
                                  [(I) the claimant did not 
                                receive notice of the 
                                appointment of the receiver in 
                                time to file such claim before 
                                such date; and
                                  [(II) such claim is filed in 
                                time to permit payment of such 
                                claim.
                  [(D) Authority to disallow claims.--
                          [(i) In general.--The Corporation may 
                        disallow any portion of any claim by a 
                        creditor or claim of a security, 
                        preference, setoff, or priority which 
                        is not proved to the satisfaction of 
                        the Corporation.
                          [(ii) Payments to undersecured 
                        creditors.--In the case of a claim 
                        against a covered financial company 
                        that is secured by any property or 
                        other asset of such covered financial 
                        company, the receiver--
                                  [(I) may treat the portion of 
                                such claim which exceeds an 
                                amount equal to the fair market 
                                value of such property or other 
                                asset as an unsecured claim; 
                                and
                                  [(II) may not make any 
                                payment with respect to such 
                                unsecured portion of the claim, 
                                other than in connection with 
                                the disposition of all claims 
                                of unsecured creditors of the 
                                covered financial company.
                          [(iii) Exceptions.--No provision of 
                        this paragraph shall apply with respect 
                        to--
                                  [(I) any extension of credit 
                                from any Federal reserve bank, 
                                or the Corporation, to any 
                                covered financial company; or
                                  [(II) subject to clause (ii), 
                                any legally enforceable and 
                                perfected security interest in 
                                the assets of the covered 
                                financial company securing any 
                                such extension of credit.
                  [(E) Legal effect of filing.--
                          [(i) Statute of limitations tolled.--
                        For purposes of any applicable statute 
                        of limitations, the filing of a claim 
                        with the receiver shall constitute a 
                        commencement of an action.
                          [(ii) No prejudice to other 
                        actions.--Subject to paragraph (8), the 
                        filing of a claim with the receiver 
                        shall not prejudice any right of the 
                        claimant to continue any action which 
                        was filed before the date of 
                        appointment of the receiver for the 
                        covered financial company.
          [(4) Judicial determination of claims.--
                  [(A) In general.--Subject to subparagraph 
                (B), a claimant may file suit on a claim (or 
                continue an action commenced before the date of 
                appointment of the Corporation as receiver) in 
                the district or territorial court of the United 
                States for the district within which the 
                principal place of business of the covered 
                financial company is located (and such court 
                shall have jurisdiction to hear such claim).
                  [(B) Timing.--A claim under subparagraph (A) 
                may be filed before the end of the 60-day 
                period beginning on the earlier of--
                          [(i) the end of the period described 
                        in paragraph (3)(A)(i) (or, if extended 
                        by agreement of the Corporation and the 
                        claimant, the period described in 
                        paragraph (3)(A)(ii)) with respect to 
                        any claim against a covered financial 
                        company for which the Corporation is 
                        receiver; or
                          [(ii) the date of any notice of 
                        disallowance of such claim pursuant to 
                        paragraph (3)(A)(i).
                  [(C) Statute of limitations.--If any claimant 
                fails to file suit on such claim (or to 
                continue an action on such claim commenced 
                before the date of appointment of the 
                Corporation as receiver) prior to the end of 
                the 60-day period described in subparagraph 
                (B), the claim shall be deemed to be disallowed 
                (other than any portion of such claim which was 
                allowed by the receiver) as of the end of such 
                period, such disallowance shall be final, and 
                the claimant shall have no further rights or 
                remedies with respect to such claim.
          [(5) Expedited determination of claims.--
                  [(A) Procedure required.--The Corporation 
                shall establish a procedure for expedited 
                relief outside of the claims process 
                established under paragraph (3), for any 
                claimant that alleges--
                          [(i) having a legally valid and 
                        enforceable or perfected security 
                        interest in property of a covered 
                        financial company or control of any 
                        legally valid and enforceable security 
                        entitlement in respect of any asset 
                        held by the covered financial company 
                        for which the Corporation has been 
                        appointed receiver; and
                          [(ii) that irreparable injury will 
                        occur if the claims procedure 
                        established under paragraph (3) is 
                        followed.
                  [(B) Determination period.--Prior to the end 
                of the 90-day period beginning on the date on 
                which a claim is filed in accordance with the 
                procedures established pursuant to subparagraph 
                (A), the Corporation shall--
                          [(i) determine--
                                  [(I) whether to allow or 
                                disallow such claim, or any 
                                portion thereof; or
                                  [(II) whether such claim 
                                should be determined pursuant 
                                to the procedures established 
                                pursuant to paragraph (3);
                          [(ii) notify the claimant of the 
                        determination; and
                          [(iii) if the claim is disallowed, 
                        provide a statement of each reason for 
                        the disallowance and the procedure for 
                        obtaining a judicial determination.
                  [(C) Period for filing or renewing suit.--Any 
                claimant who files a request for expedited 
                relief shall be permitted to file suit (or 
                continue a suit filed before the date of 
                appointment of the Corporation as receiver 
                seeking a determination of the rights of the 
                claimant with respect to such security interest 
                (or such security entitlement) after the 
                earlier of--
                          [(i) the end of the 90-day period 
                        beginning on the date of the filing of 
                        a request for expedited relief; or
                          [(ii) the date on which the 
                        Corporation denies the claim or a 
                        portion thereof.
                  [(D) Statute of limitations.--If an action 
                described in subparagraph (C) is not filed, or 
                the motion to renew a previously filed suit is 
                not made, before the end of the 30-day period 
                beginning on the date on which such action or 
                motion may be filed in accordance with 
                subparagraph (C), the claim shall be deemed to 
                be disallowed as of the end of such period 
                (other than any portion of such claim which was 
                allowed by the receiver), such disallowance 
                shall be final, and the claimant shall have no 
                further rights or remedies with respect to such 
                claim.
                  [(E) Legal effect of filing.--
                          [(i) Statute of limitations tolled.--
                        For purposes of any applicable statute 
                        of limitations, the filing of a claim 
                        with the receiver shall constitute a 
                        commencement of an action.
                          [(ii) No prejudice to other 
                        actions.--Subject to paragraph (8), the 
                        filing of a claim with the receiver 
                        shall not prejudice any right of the 
                        claimant to continue any action which 
                        was filed before the appointment of the 
                        Corporation as receiver for the covered 
                        financial company.
          [(6) Agreements against interest of the receiver.--No 
        agreement that tends to diminish or defeat the interest 
        of the Corporation as receiver in any asset acquired by 
        the receiver under this section shall be valid against 
        the receiver, unless such agreement--
                  [(A) is in writing;
                  [(B) was executed by an authorized officer or 
                representative of the covered financial 
                company, or confirmed in the ordinary course of 
                business by the covered financial company; and
                  [(C) has been, since the time of its 
                execution, an official record of the company or 
                the party claiming under the agreement provides 
                documentation, acceptable to the receiver, of 
                such agreement and its authorized execution or 
                confirmation by the covered financial company.
          [(7) Payment of claims.--
                  [(A) In general.--Subject to subparagraph 
                (B), the Corporation as receiver may, in its 
                discretion and to the extent that funds are 
                available, pay creditor claims, in such manner 
                and amounts as are authorized under this 
                section, which are--
                          [(i) allowed by the receiver;
                          [(ii) approved by the receiver 
                        pursuant to a final determination 
                        pursuant to paragraph (3) or (5), as 
                        applicable; or
                          [(iii) determined by the final 
                        judgment of a court of competent 
                        jurisdiction.
                  [(B) Limitation.--A creditor shall, in no 
                event, receive less than the amount that the 
                creditor is entitled to receive under 
                paragraphs (2) and (3) of subsection (d), as 
                applicable.
                  [(C) Payment of dividends on claims.--The 
                Corporation as receiver may, in its sole 
                discretion, and to the extent otherwise 
                permitted by this section, pay dividends on 
                proven claims at any time, and no liability 
                shall attach to the Corporation as receiver, by 
                reason of any such payment or for failure to 
                pay dividends to a claimant whose claim is not 
                proved at the time of any such payment.
                  [(D) Rulemaking by the corporation.--The 
                Corporation may prescribe such rules, including 
                definitions of terms, as the Corporation deems 
                appropriate to establish an interest rate for 
                or to make payments of post-insolvency interest 
                to creditors holding proven claims against the 
                receivership estate of a covered financial 
                company, except that no such interest shall be 
                paid until the Corporation as receiver has 
                satisfied the principal amount of all creditor 
                claims.
          [(8) Suspension of legal actions.--
                  [(A) In general.--After the appointment of 
                the Corporation as receiver for a covered 
                financial company, the Corporation may request 
                a stay in any judicial action or proceeding in 
                which such covered financial company is or 
                becomes a party, for a period of not to exceed 
                90 days.
                  [(B) Grant of stay by all courts required.--
                Upon receipt of a request by the Corporation 
                pursuant to subparagraph (A), the court shall 
                grant such stay as to all parties.
          [(9) Additional rights and duties.--
                  [(A) Prior final adjudication.--The 
                Corporation shall abide by any final, non-
                appealable judgment of any court of competent 
                jurisdiction that was rendered before the 
                appointment of the Corporation as receiver.
                  [(B) Rights and remedies of receiver.--In the 
                event of any appealable judgment, the 
                Corporation as receiver shall--
                          [(i) have all the rights and remedies 
                        available to the covered financial 
                        company (before the date of appointment 
                        of the Corporation as receiver under 
                        section 202) and the Corporation, 
                        including removal to Federal court and 
                        all appellate rights; and
                          [(ii) not be required to post any 
                        bond in order to pursue such remedies.
                  [(C) No attachment or execution.--No 
                attachment or execution may be issued by any 
                court upon assets in the possession of the 
                Corporation as receiver for a covered financial 
                company.
                  [(D) Limitation on judicial review.--Except 
                as otherwise provided in this title, no court 
                shall have jurisdiction over--
                          [(i) any claim or action for payment 
                        from, or any action seeking a 
                        determination of rights with respect 
                        to, the assets of any covered financial 
                        company for which the Corporation has 
                        been appointed receiver, including any 
                        assets which the Corporation may 
                        acquire from itself as such receiver; 
                        or
                          [(ii) any claim relating to any act 
                        or omission of such covered financial 
                        company or the Corporation as receiver.
                  [(E) Disposition of assets.--In exercising 
                any right, power, privilege, or authority as 
                receiver in connection with any covered 
                financial company for which the Corporation is 
                acting as receiver under this section, the 
                Corporation shall, to the greatest extent 
                practicable, conduct its operations in a manner 
                that--
                          [(i) maximizes the net present value 
                        return from the sale or disposition of 
                        such assets;
                          [(ii) minimizes the amount of any 
                        loss realized in the resolution of 
                        cases;
                          [(iii) mitigates the potential for 
                        serious adverse effects to the 
                        financial system;
                          [(iv) ensures timely and adequate 
                        competition and fair and consistent 
                        treatment of offerors; and
                          [(v) prohibits discrimination on the 
                        basis of race, sex, or ethnic group in 
                        the solicitation and consideration of 
                        offers.
          [(10) Statute of limitations for actions brought by 
        receiver.--
                  [(A) In general.--Notwithstanding any 
                provision of any contract, the applicable 
                statute of limitations with regard to any 
                action brought by the Corporation as receiver 
                for a covered financial company shall be--
                          [(i) in the case of any contract 
                        claim, the longer of--
                                  [(I) the 6-year period 
                                beginning on the date on which 
                                the claim accrues; or
                                  [(II) the period applicable 
                                under State law; and
                          [(ii) in the case of any tort claim, 
                        the longer of--
                                  [(I) the 3-year period 
                                beginning on the date on which 
                                the claim accrues; or
                                  [(II) the period applicable 
                                under State law.
                  [(B) Date on which a claim accrues.--For 
                purposes of subparagraph (A), the date on which 
                the statute of limitations begins to run on any 
                claim described in subparagraph (A) shall be 
                the later of--
                          [(i) the date of the appointment of 
                        the Corporation as receiver under this 
                        title; or
                          [(ii) the date on which the cause of 
                        action accrues.
                  [(C) Revival of expired state causes of 
                action.--
                          [(i) In general.--In the case of any 
                        tort claim described in clause (ii) for 
                        which the applicable statute of 
                        limitations under State law has expired 
                        not more than 5 years before the date 
                        of appointment of the Corporation as 
                        receiver for a covered financial 
                        company, the Corporation may bring an 
                        action as receiver on such claim 
                        without regard to the expiration of the 
                        statute of limitations.
                          [(ii) Claims described.--A tort claim 
                        referred to in clause (i) is a claim 
                        arising from fraud, intentional 
                        misconduct resulting in unjust 
                        enrichment, or intentional misconduct 
                        resulting in substantial loss to the 
                        covered financial company.
          [(11) Avoidable transfers.--
                  [(A) Fraudulent transfers.--The Corporation, 
                as receiver for any covered financial company, 
                may avoid a transfer of any interest of the 
                covered financial company in property, or any 
                obligation incurred by the covered financial 
                company, that was made or incurred at or within 
                2 years before the date on which the 
                Corporation was appointed receiver, if--
                          [(i) the covered financial company 
                        voluntarily or involuntarily--
                                  [(I) made such transfer or 
                                incurred such obligation with 
                                actual intent to hinder, delay, 
                                or defraud any entity to which 
                                the covered financial company 
                                was or became, on or after the 
                                date on which such transfer was 
                                made or such obligation was 
                                incurred, indebted; or
                                  [(II) received less than a 
                                reasonably equivalent value in 
                                exchange for such transferor 
                                obligation; and
                          [(ii) the covered financial company 
                        voluntarily or involuntarily--
                                  [(I) was insolvent on the 
                                date that such transfer was 
                                made or such obligation was 
                                incurred, or became insolvent 
                                as a result of such transfer or 
                                obligation;
                                  [(II) was engaged in business 
                                or a transaction, or was about 
                                to engage in business or a 
                                transaction, for which any 
                                property remaining with the 
                                covered financial company was 
                                an unreasonably small capital;
                                  [(III) intended to incur, or 
                                believed that the covered 
                                financial company would incur, 
                                debts that would be beyond the 
                                ability of the covered 
                                financial company to pay as 
                                such debts matured; or
                                  [(IV) made such transfer to 
                                or for the benefit of an 
                                insider, or incurred such 
                                obligation to or for the 
                                benefit of an insider, under an 
                                employment contract and not in 
                                the ordinary course of 
                                business.
                  [(B) Preferential transfers.--The Corporation 
                as receiver for any covered financial company 
                may avoid a transfer of an interest of the 
                covered financial company in property--
                          [(i) to or for the benefit of a 
                        creditor;
                          [(ii) for or on account of an 
                        antecedent debt that was owed by the 
                        covered financial company before the 
                        transfer was made;
                          [(iii) that was made while the 
                        covered financial company was 
                        insolvent;
                          [(iv) that was made--
                                  [(I) 90 days or less before 
                                the date on which the 
                                Corporation was appointed 
                                receiver; or
                                  [(II) more than 90 days, but 
                                less than 1 year before the 
                                date on which the Corporation 
                                was appointed receiver, if such 
                                creditor at the time of the 
                                transfer was an insider; and
                          [(v) that enables the creditor to 
                        receive more than the creditor would 
                        receive if--
                                  [(I) the covered financial 
                                company had been liquidated 
                                under chapter 7 of the 
                                Bankruptcy Code;
                                  [(II) the transfer had not 
                                been made; and
                                  [(III) the creditor received 
                                payment of such debt to the 
                                extent provided by the 
                                provisions of chapter 7 of the 
                                Bankruptcy Code.
                  [(C) Post-receivership transactions.--The 
                Corporation as receiver for any covered 
                financial company may avoid a transfer of 
                property of the receivership that occurred 
                after the Corporation was appointed receiver 
                that was not authorized under this title by the 
                Corporation as receiver.
                  [(D) Right of recovery.--To the extent that a 
                transfer is avoided under subparagraph (A), 
                (B), or (C), the Corporation may recover, for 
                the benefit of the covered financial company, 
                the property transferred or, if a court so 
                orders, the value of such property (at the time 
                of such transfer) from--
                          [(i) the initial transferee of such 
                        transfer or the person for whose 
                        benefit such transfer was made; or
                          [(ii) any immediate or mediate 
                        transferee of any such initial 
                        transferee.
                  [(E) Rights of transferee or obligee.--The 
                Corporation may not recover under subparagraph 
                (D)(ii) from--
                          [(i) any transferee that takes for 
                        value, including in satisfaction of or 
                        to secure a present or antecedent debt, 
                        in good faith, and without knowledge of 
                        the voidability of the transfer 
                        avoided; or
                          [(ii) any immediate or mediate good 
                        faith transferee of such transferee.
                  [(F) Defenses.--Subject to the other 
                provisions of this title--
                          [(i) a transferee or obligee from 
                        which the Corporation seeks to recover 
                        a transfer or to avoid an obligation 
                        under subparagraph (A), (B), (C), or 
                        (D) shall have the same defenses 
                        available to a transferee or obligee 
                        from which a trustee seeks to recover a 
                        transfer or avoid an obligation under 
                        sections 547, 548, and 549 of the 
                        Bankruptcy Code; and
                          [(ii) the authority of the 
                        Corporation to recover a transfer or 
                        avoid an obligation shall be subject to 
                        subsections (b) and (c) of section 546, 
                        section 547(c), and section 548(c) of 
                        the Bankruptcy Code.
                  [(G) Rights under this section.--The rights 
                of the Corporation as receiver under this 
                section shall be superior to any rights of a 
                trustee or any other party (other than a 
                Federal agency) under the Bankruptcy Code.
                  [(H) Rules of construction; definitions.--For 
                purposes of--
                          [(i) subparagraphs (A) and (B)--
                                  [(I) the term ``insider'' has 
                                the same meaning as in section 
                                101(31) of the Bankruptcy Code;
                                  [(II) a transfer is made when 
                                such transfer is so perfected 
                                that a bona fide purchaser from 
                                the covered financial company 
                                against whom applicable law 
                                permits such transfer to be 
                                perfected cannot acquire an 
                                interest in the property 
                                transferred that is superior to 
                                the interest in such property 
                                of the transferee, but if such 
                                transfer is not so perfected 
                                before the date on which the 
                                Corporation is appointed as 
                                receiver for the covered 
                                financial company, such 
                                transfer is made immediately 
                                before the date of such 
                                appointment; and
                                  [(III) the term ``value'' 
                                means property, or satisfaction 
                                or securing of a present or 
                                antecedent debt of the covered 
                                financial company, but does not 
                                include an unperformed promise 
                                to furnish support to the 
                                covered financial company; and
                          [(ii) subparagraph (B)--
                                  [(I) the covered financial 
                                company is presumed to have 
                                been insolvent on and during 
                                the 90-day period immediately 
                                preceding the date of 
                                appointment of the Corporation 
                                as receiver; and
                                  [(II) the term ``insolvent'' 
                                has the same meaning as in 
                                section 101(32) of the 
                                Bankruptcy Code.
          [(12) Setoff.--
                  [(A) Generally.--Except as otherwise provided 
                in this title, any right of a creditor to 
                offset a mutual debt owed by the creditor to 
                any covered financial company that arose before 
                the Corporation was appointed as receiver for 
                the covered financial company against a claim 
                of such creditor may be asserted if enforceable 
                under applicable noninsolvency law, except to 
                the extent that--
                          [(i) the claim of the creditor 
                        against the covered financial company 
                        is disallowed;
                          [(ii) the claim was transferred, by 
                        an entity other than the covered 
                        financial company, to the creditor--
                                  [(I) after the Corporation 
                                was appointed as receiver of 
                                the covered financial company; 
                                or
                                  [(II)(aa) after the 90-day 
                                period preceding the date on 
                                which the Corporation was 
                                appointed as receiver for the 
                                covered financial company; and
                                          [(bb) while the 
                                        covered financial 
                                        company was insolvent 
                                        (except for a setoff in 
                                        connection with a 
                                        qualified financial 
                                        contract); or
                          [(iii) the debt owed to the covered 
                        financial company was incurred by the 
                        covered financial company--
                                  [(I) after the 90-day period 
                                preceding the date on which the 
                                Corporation was appointed as 
                                receiver for the covered 
                                financial company;
                                  [(II) while the covered 
                                financial company was 
                                insolvent; and
                                  [(III) for the purpose of 
                                obtaining a right of setoff 
                                against the covered financial 
                                company (except for a setoff in 
                                connection with a qualified 
                                financial contract).
                  [(B) Insufficiency.--
                          [(i) In general.--Except with respect 
                        to a setoff in connection with a 
                        qualified financial contract, if a 
                        creditor offsets a mutual debt owed to 
                        the covered financial company against a 
                        claim of the covered financial company 
                        on or within the 90-day period 
                        preceding the date on which the 
                        Corporation is appointed as receiver 
                        for the covered financial company, the 
                        Corporation may recover from the 
                        creditor the amount so offset, to the 
                        extent that any insufficiency on the 
                        date of such setoff is less than the 
                        insufficiency on the later of--
                                  [(I) the date that is 90 days 
                                before the date on which the 
                                Corporation is appointed as 
                                receiver for the covered 
                                financial company; or
                                  [(II) the first day on which 
                                there is an insufficiency 
                                during the 90-day period 
                                preceding the date on which the 
                                Corporation is appointed as 
                                receiver for the covered 
                                financial company.
                          [(ii) Definition of insufficiency.--
                        In this subparagraph, the term 
                        ``insufficiency'' means the amount, if 
                        any, by which a claim against the 
                        covered financial company exceeds a 
                        mutual debt owed to the covered 
                        financial company by the holder of such 
                        claim.
                  [(C) Insolvency.--The term ``insolvent'' has 
                the same meaning as in section 101(32) of the 
                Bankruptcy Code.
                  [(D) Presumption of insolvency.--For purposes 
                of this paragraph, the covered financial 
                company is presumed to have been insolvent on 
                and during the 90-day period preceding the date 
                of appointment of the Corporation as receiver.
                  [(E) Limitation.--Nothing in this paragraph 
                (12) shall be the basis for any right of setoff 
                where no such right exists under applicable 
                noninsolvency law.
                  [(F) Priority claim.--Except as otherwise 
                provided in this title, the Corporation as 
                receiver for the covered financial company may 
                sell or transfer any assets free and clear of 
                the setoff rights of any party, except that 
                such party shall be entitled to a claim, 
                subordinate to the claims payable under 
                subparagraphs (A), (B), (C), and (D) of 
                subsection (b)(1), but senior to all other 
                unsecured liabilities defined in subsection 
                (b)(1)(E), in an amount equal to the value of 
                such setoff rights.
          [(13) Attachment of assets and other injunctive 
        relief.--Subject to paragraph (14), any court of 
        competent jurisdiction may, at the request of the 
        Corporation as receiver for a covered financial 
        company, issue an order in accordance with Rule 65 of 
        the Federal Rules of Civil Procedure, including an 
        order placing the assets of any person designated by 
        the Corporation under the control of the court and 
        appointing a trustee to hold such assets.
          [(14) Standards.--
                  [(A) Showing.--Rule 65 of the Federal Rules 
                of Civil Procedure shall apply with respect to 
                any proceeding under paragraph (13), without 
                regard to the requirement that the applicant 
                show that the injury, loss, or damage is 
                irreparable and immediate.
                  [(B) State proceeding.--If, in the case of 
                any proceeding in a State court, the court 
                determines that rules of civil procedure 
                available under the laws of the State provide 
                substantially similar protections of the right 
                of the parties to due process as provided under 
                Rule 65 (as modified with respect to such 
                proceeding by subparagraph (A)), the relief 
                sought by the Corporation pursuant to paragraph 
                (14) may be requested under the laws of such 
                State.
          [(15) Treatment of claims arising from breach of 
        contracts executed by the corporation as receiver.--
        Notwithstanding any other provision of this title, any 
        final and non-appealable judgment for monetary damages 
        entered against the Corporation as receiver for a 
        covered financial company for the breach of an 
        agreement executed or approved by the Corporation after 
        the date of its appointment shall be paid as an 
        administrative expense of the receiver. Nothing in this 
        paragraph shall be construed to limit the power of a 
        receiver to exercise any rights under contract or law, 
        including to terminate, breach, cancel, or otherwise 
        discontinue such agreement.
          [(16) Accounting and recordkeeping requirements.--
                  [(A) In general.--The Corporation as receiver 
                for a covered financial company shall, 
                consistent with the accounting and reporting 
                practices and procedures established by the 
                Corporation, maintain a full accounting of each 
                receivership or other disposition of any 
                covered financial company.
                  [(B) Annual accounting or report.--With 
                respect to each receivership to which the 
                Corporation is appointed, the Corporation shall 
                make an annual accounting or report, as 
                appropriate, available to the Secretary and the 
                Comptroller General of the United States.
                  [(C) Availability of reports.--Any report 
                prepared pursuant to subparagraph (B) and 
                section 203(c)(3) shall be made available to 
                the public by the Corporation.
                  [(D) Recordkeeping requirement.--
                          [(i) In general.--The Corporation 
                        shall prescribe such regulations and 
                        establish such retention schedules as 
                        are necessary to maintain the documents 
                        and records of the Corporation 
                        generated in exercising the authorities 
                        of this title and the records of a 
                        covered financial company for which the 
                        Corporation is appointed receiver, with 
                        due regard for--
                                  [(I) the avoidance of 
                                duplicative record retention; 
                                and
                                  [(II) the expected 
                                evidentiary needs of the 
                                Corporation as receiver for a 
                                covered financial company and 
                                the public regarding the 
                                records of covered financial 
                                companies.
                          [(ii) Retention of records.--Unless 
                        otherwise required by applicable 
                        Federal law or court order, the 
                        Corporation may not, at any time, 
                        destroy any records that are subject to 
                        clause (i).
                          [(iii) Records defined.--As used in 
                        this subparagraph, the terms 
                        ``records'' and ``records of a covered 
                        financial company'' mean any document, 
                        book, paper, map, photograph, 
                        microfiche, microfilm, computer or 
                        electronically-created record generated 
                        or maintained by the covered financial 
                        company in the course of and necessary 
                        to its transaction of business.
  [(b) Priority of Expenses and Unsecured Claims.--
          [(1) In general.--Unsecured claims against a covered 
        financial company, or the Corporation as receiver for 
        such covered financial company under this section, that 
        are proven to the satisfaction of the receiver shall 
        have priority in the following order:
                  [(A) Administrative expenses of the receiver.
                  [(B) Any amounts owed to the United States, 
                unless the United States agrees or consents 
                otherwise.
                  [(C) Wages, salaries, or commissions, 
                including vacation, severance, and sick leave 
                pay earned by an individual (other than an 
                individual described in subparagraph (G)), but 
                only to the extent of 11,725 for each 
                individual (as indexed for inflation, by 
                regulation of the Corporation) earned not later 
                than 180 days before the date of appointment of 
                the Corporation as receiver.
                  [(D) Contributions owed to employee benefit 
                plans arising from services rendered not later 
                than 180 days before the date of appointment of 
                the Corporation as receiver, to the extent of 
                the number of employees covered by each such 
                plan, multiplied by 11,725 (as indexed for 
                inflation, by regulation of the Corporation), 
                less the aggregate amount paid to such 
                employees under subparagraph (C), plus the 
                aggregate amount paid by the receivership on 
                behalf of such employees to any other employee 
                benefit plan.
                  [(E) Any other general or senior liability of 
                the covered financial company (which is not a 
                liability described under subparagraph (F), 
                (G), or (H)).
                  [(F) Any obligation subordinated to general 
                creditors (which is not an obligation described 
                under subparagraph (G) or (H)).
                  [(G) Any wages, salaries, or commissions, 
                including vacation, severance, and sick leave 
                pay earned, owed to senior executives and 
                directors of the covered financial company.
                  [(H) Any obligation to shareholders, members, 
                general partners, limited partners, or other 
                persons, with interests in the equity of the 
                covered financial company arising as a result 
                of their status as shareholders, members, 
                general partners, limited partners, or other 
                persons with interests in the equity of the 
                covered financial company.
          [(2) Post-receivership financing priority.--In the 
        event that the Corporation, as receiver for a covered 
        financial company, is unable to obtain unsecured credit 
        for the covered financial company from commercial 
        sources, the Corporation as receiver may obtain credit 
        or incur debt on the part of the covered financial 
        company, which shall have priority over any or all 
        administrative expenses of the receiver under paragraph 
        (1)(A).
          [(3) Claims of the united states.--Unsecured claims 
        of the United States shall, at a minimum, have a higher 
        priority than liabilities of the covered financial 
        company that count as regulatory capital.
          [(4) Creditors similarly situated.--All claimants of 
        a covered financial company that are similarly situated 
        under paragraph (1) shall be treated in a similar 
        manner, except that the Corporation may take any action 
        (including making payments, subject to subsection 
        (o)(1)(D)(i)) that does not comply with this 
        subsection, if--
                  [(A) the Corporation determines that such 
                action is necessary--
                          [(i) to maximize the value of the 
                        assets of the covered financial 
                        company;
                          [(ii) to initiate and continue 
                        operations essential to implementation 
                        of the receivership or any bridge 
                        financial company;
                          [(iii) to maximize the present value 
                        return from the sale or other 
                        disposition of the assets of the 
                        covered financial company; or
                          [(iv) to minimize the amount of any 
                        loss realized upon the sale or other 
                        disposition of the assets of the 
                        covered financial company; and
                  [(B) all claimants that are similarly 
                situated under paragraph (1) receive not less 
                than the amount provided in paragraphs (2) and 
                (3) of subsection (d).
          [(5) Secured claims unaffected.--This section shall 
        not affect secured claims or security entitlements in 
        respect of assets or property held by the covered 
        financial company, except to the extent that the 
        security is insufficient to satisfy the claim, and then 
        only with regard to the difference between the claim 
        and the amount realized from the security.
          [(6) Priority of expenses and unsecured claims in the 
        orderly liquidation of sipc member.--Where the 
        Corporation is appointed as receiver for a covered 
        broker or dealer, unsecured claims against such covered 
        broker or dealer, or the Corporation as receiver for 
        such covered broker or dealer under this section, that 
        are proven to the satisfaction of the receiver under 
        section 205(e), shall have the priority prescribed in 
        paragraph (1), except that--
                  [(A) SIPC shall be entitled to recover 
                administrative expenses incurred in performing 
                its responsibilities under section 205 on an 
                equal basis with the Corporation, in accordance 
                with paragraph (1)(A);
                  [(B) the Corporation shall be entitled to 
                recover any amounts paid to customers or to 
                SIPC pursuant to section 205(f), in accordance 
                with paragraph (1)(B);
                  [(C) SIPC shall be entitled to recover any 
                amounts paid out of the SIPC Fund to meet its 
                obligations under section 205 and under the 
                Securities Investor Protection Act of 1970 (15 
                U.S.C. 78aaa et seq.), which claim shall be 
                subordinate to the claims payable under 
                subparagraphs (A) and (B) of paragraph (1), but 
                senior to all other claims; and
                  [(D) the Corporation may, after paying any 
                proven claims to customers under section 205 
                and the Securities Investor Protection Act of 
                1970 (15 U.S.C. 78aaa et seq.), and as provided 
                above, pay dividends on other proven claims, in 
                its discretion, and to the extent that funds 
                are available, in accordance with the 
                priorities set forth in paragraph (1).
  [(c) Provisions Relating to Contracts Entered Into Before 
Appointment of Receiver.--
          [(1) Authority to repudiate contracts.--In addition 
        to any other rights that a receiver may have, the 
        Corporation as receiver for any covered financial 
        company may disaffirm or repudiate any contract or 
        lease--
                  [(A) to which the covered financial company 
                is a party;
                  [(B) the performance of which the Corporation 
                as receiver, in the discretion of the 
                Corporation, determines to be burdensome; and
                  [(C) the disaffirmance or repudiation of 
                which the Corporation as receiver determines, 
                in the discretion of the Corporation, will 
                promote the orderly administration of the 
                affairs of the covered financial company.
          [(2) Timing of repudiation.--The Corporation, as 
        receiver for any covered financial company, shall 
        determine whether or not to exercise the rights of 
        repudiation under this section within a reasonable 
        period of time.
          [(3) Claims for damages for repudiation.--
                  [(A) In general.--Except as provided in 
                paragraphs (4), (5), and (6) and in 
                subparagraphs (C), (D), and (E) of this 
                paragraph, the liability of the Corporation as 
                receiver for a covered financial company for 
                the disaffirmance or repudiation of any 
                contract pursuant to paragraph (1) shall be--
                          [(i) limited to actual direct 
                        compensatory damages; and
                          [(ii) determined as of--
                                  [(I) the date of the 
                                appointment of the Corporation 
                                as receiver; or
                                  [(II) in the case of any 
                                contract or agreement referred 
                                to in paragraph (8), the date 
                                of the disaffirmance or 
                                repudiation of such contract or 
                                agreement.
                  [(B) No liability for other damages.--For 
                purposes of subparagraph (A), the term ``actual 
                direct compensatory damages'' does not 
                include--
                          [(i) punitive or exemplary damages;
                          [(ii) damages for lost profits or 
                        opportunity; or
                          [(iii) damages for pain and 
                        suffering.
                  [(C) Measure of damages for repudiation of 
                qualified financial contracts.--In the case of 
                any qualified financial contract or agreement 
                to which paragraph (8) applies, compensatory 
                damages shall be--
                          [(i) deemed to include normal and 
                        reasonable costs of cover or other 
                        reasonable measures of damages utilized 
                        in the industries for such contract and 
                        agreement claims; and
                          [(ii) paid in accordance with this 
                        paragraph and subsection (d), except as 
                        otherwise specifically provided in this 
                        subsection.
                  [(D) Measure of damages for repudiation or 
                disaffirmance of debt obligation.--In the case 
                of any debt for borrowed money or evidenced by 
                a security, actual direct compensatory damages 
                shall be no less than the amount lent plus 
                accrued interest plus any accreted original 
                issue discount as of the date the Corporation 
                was appointed receiver of the covered financial 
                company and, to the extent that an allowed 
                secured claim is secured by property the value 
                of which is greater than the amount of such 
                claim and any accrued interest through the date 
                of repudiation or disaffirmance, such accrued 
                interest pursuant to paragraph (1).
                  [(E) Measure of damages for repudiation or 
                disaffirmance of contingent obligation.--In the 
                case of any contingent obligation of a covered 
                financial company consisting of any obligation 
                under a guarantee, letter of credit, loan 
                commitment, or similar credit obligation, the 
                Corporation may, by rule or regulation, 
                prescribe that actual direct compensatory 
                damages shall be no less than the estimated 
                value of the claim as of the date the 
                Corporation was appointed receiver of the 
                covered financial company, as such value is 
                measured based on the likelihood that such 
                contingent claim would become fixed and the 
                probable magnitude thereof.
          [(4) Leases under which the covered financial company 
        is the lessee.--
                  [(A) In general.--If the Corporation as 
                receiver disaffirms or repudiates a lease under 
                which the covered financial company is the 
                lessee, the receiver shall not be liable for 
                any damages (other than damages determined 
                pursuant to subparagraph (B)) for the 
                disaffirmance or repudiation of such lease.
                  [(B) Payments of rent.--Notwithstanding 
                subparagraph (A), the lessor under a lease to 
                which subparagraph (A) would otherwise apply 
                shall--
                          [(i) be entitled to the contractual 
                        rent accruing before the later of the 
                        date on which--
                                  [(I) the notice of 
                                disaffirmance or repudiation is 
                                mailed; or
                                  [(II) the disaffirmance or 
                                repudiation becomes effective, 
                                unless the lessor is in default 
                                or breach of the terms of the 
                                lease;
                          [(ii) have no claim for damages under 
                        any acceleration clause or other 
                        penalty provision in the lease; and
                          [(iii) have a claim for any unpaid 
                        rent, subject to all appropriate 
                        offsets and defenses, due as of the 
                        date of the appointment which shall be 
                        paid in accordance with this paragraph 
                        and subsection (d).
          [(5) Leases under which the covered financial company 
        is the lessor.--
                  [(A) In general.--If the Corporation as 
                receiver for a covered financial company 
                repudiates an unexpired written lease of real 
                property of the covered financial company under 
                which the covered financial company is the 
                lessor and the lessee is not, as of the date of 
                such repudiation, in default, the lessee under 
                such lease may either--
                          [(i) treat the lease as terminated by 
                        such repudiation; or
                          [(ii) remain in possession of the 
                        leasehold interest for the balance of 
                        the term of the lease, unless the 
                        lessee defaults under the terms of the 
                        lease after the date of such 
                        repudiation.
                  [(B) Provisions applicable to lessee 
                remaining in possession.--If any lessee under a 
                lease described in subparagraph (A) remains in 
                possession of a leasehold interest pursuant to 
                clause (ii) of subparagraph (A)--
                          [(i) the lessee--
                                  [(I) shall continue to pay 
                                the contractual rent pursuant 
                                to the terms of the lease after 
                                the date of the repudiation of 
                                such lease; and
                                  [(II) may offset against any 
                                rent payment which accrues 
                                after the date of the 
                                repudiation of the lease, any 
                                damages which accrue after such 
                                date due to the nonperformance 
                                of any obligation of the 
                                covered financial company under 
                                the lease after such date; and
                          [(ii) the Corporation as receiver 
                        shall not be liable to the lessee for 
                        any damages arising after such date as 
                        a result of the repudiation, other than 
                        the amount of any offset allowed under 
                        clause (i)(II).
          [(6) Contracts for the sale of real property.--
                  [(A) In general.--If the receiver repudiates 
                any contract (which meets the requirements of 
                subsection (a)(6)) for the sale of real 
                property, and the purchaser of such real 
                property under such contract is in possession 
                and is not, as of the date of such repudiation, 
                in default, such purchaser may either--
                          [(i) treat the contract as terminated 
                        by such repudiation; or
                          [(ii) remain in possession of such 
                        real property.
                  [(B) Provisions applicable to purchaser 
                remaining in possession.--If any purchaser of 
                real property under any contract described in 
                subparagraph (A) remains in possession of such 
                property pursuant to clause (ii) of 
                subparagraph (A)--
                          [(i) the purchaser--
                                  [(I) shall continue to make 
                                all payments due under the 
                                contract after the date of the 
                                repudiation of the contract; 
                                and
                                  [(II) may offset against any 
                                such payments any damages which 
                                accrue after such date due to 
                                the nonperformance (after such 
                                date) of any obligation of the 
                                covered financial company under 
                                the contract; and
                          [(ii) the Corporation as receiver 
                        shall--
                                  [(I) not be liable to the 
                                purchaser for any damages 
                                arising after such date as a 
                                result of the repudiation, 
                                other than the amount of any 
                                offset allowed under clause 
                                (i)(II);
                                  [(II) deliver title to the 
                                purchaser in accordance with 
                                the provisions of the contract; 
                                and
                                  [(III) have no obligation 
                                under the contract other than 
                                the performance required under 
                                subclause (II).
                  [(C) Assignment and sale allowed.--
                          [(i) In general.--No provision of 
                        this paragraph shall be construed as 
                        limiting the right of the Corporation 
                        as receiver to assign the contract 
                        described in subparagraph (A) and sell 
                        the property, subject to the contract 
                        and the provisions of this paragraph.
                          [(ii) No liability after assignment 
                        and sale.--If an assignment and sale 
                        described in clause (i) is consummated, 
                        the Corporation as receiver shall have 
                        no further liability under the contract 
                        described in subparagraph (A) or with 
                        respect to the real property which was 
                        the subject of such contract.
          [(7) Provisions applicable to service contracts.--
                  [(A) Services performed before appointment.--
                In the case of any contract for services 
                between any person and any covered financial 
                company for which the Corporation has been 
                appointed receiver, any claim of such person 
                for services performed before the date of 
                appointment shall be--
                          [(i) a claim to be paid in accordance 
                        with subsections (a), (b), and (d); and
                          [(ii) deemed to have arisen as of the 
                        date on which the receiver was 
                        appointed.
                  [(B) Services performed after appointment and 
                prior to repudiation.--If, in the case of any 
                contract for services described in subparagraph 
                (A), the Corporation as receiver accepts 
                performance by the other person before making 
                any determination to exercise the right of 
                repudiation of such contract under this 
                section--
                          [(i) the other party shall be paid 
                        under the terms of the contract for the 
                        services performed; and
                          [(ii) the amount of such payment 
                        shall be treated as an administrative 
                        expense of the receivership.
                  [(C) Acceptance of performance no bar to 
                subsequent repudiation.--The acceptance by the 
                Corporation as receiver for services referred 
                to in subparagraph (B) in connection with a 
                contract described in subparagraph (B) shall 
                not affect the right of the Corporation as 
                receiver to repudiate such contract under this 
                section at any time after such performance.
          [(8) Certain qualified financial contracts.--
                  [(A) Rights of parties to contracts.--Subject 
                to subsection (a)(8) and paragraphs (9) and 
                (10) of this subsection, and notwithstanding 
                any other provision of this section, any other 
                provision of Federal law, or the law of any 
                State, no person shall be stayed or prohibited 
                from exercising--
                          [(i) any right that such person has 
                        to cause the termination, liquidation, 
                        or acceleration of any qualified 
                        financial contract with a covered 
                        financial company which arises upon the 
                        date of appointment of the Corporation 
                        as receiver for such covered financial 
                        company or at any time after such 
                        appointment;
                          [(ii) any right under any security 
                        agreement or arrangement or other 
                        credit enhancement related to one or 
                        more qualified financial contracts 
                        described in clause (i); or
                          [(iii) any right to offset or net out 
                        any termination value, payment amount, 
                        or other transfer obligation arising 
                        under or in connection with 1 or more 
                        contracts or agreements described in 
                        clause (i), including any master 
                        agreement for such contracts or 
                        agreements.
                  [(B) Applicability of other provisions.--
                Subsection (a)(8) shall apply in the case of 
                any judicial action or proceeding brought 
                against the Corporation as receiver referred to 
                in subparagraph (A), or the subject covered 
                financial company, by any party to a contract 
                or agreement described in subparagraph (A)(i) 
                with such covered financial company.
                  [(C) Certain transfers not avoidable.--
                          [(i) In general.--Notwithstanding 
                        subsection (a)(11), (a)(12), or 
                        (c)(12), section 5242 of the Revised 
                        Statutes of the United States, or any 
                        other provision of Federal or State law 
                        relating to the avoidance of 
                        preferential or fraudulent transfers, 
                        the Corporation, whether acting as the 
                        Corporation or as receiver for a 
                        covered financial company, may not 
                        avoid any transfer of money or other 
                        property in connection with any 
                        qualified financial contract with a 
                        covered financial company.
                          [(ii) Exception for certain 
                        transfers.--Clause (i) shall not apply 
                        to any transfer of money or other 
                        property in connection with any 
                        qualified financial contract with a 
                        covered financial company if the 
                        transferee had actual intent to hinder, 
                        delay, or defraud such company, the 
                        creditors of such company, or the 
                        Corporation as receiver appointed for 
                        such company.
                  [(D) Certain contracts and agreements 
                defined.--For purposes of this subsection, the 
                following definitions shall apply:
                          [(i) Qualified financial contract.--
                        The term ``qualified financial 
                        contract'' means any securities 
                        contract, commodity contract, forward 
                        contract, repurchase agreement, swap 
                        agreement, and any similar agreement 
                        that the Corporation determines by 
                        regulation, resolution, or order to be 
                        a qualified financial contract for 
                        purposes of this paragraph.
                          [(ii) Securities contract.--The term 
                        ``securities contract''--
                                  [(I) means a contract for the 
                                purchase, sale, or loan of a 
                                security, a certificate of 
                                deposit, a mortgage loan, any 
                                interest in a mortgage loan, a 
                                group or index of securities, 
                                certificates of deposit, or 
                                mortgage loans or interests 
                                therein (including any interest 
                                therein or based on the value 
                                thereof), or any option on any 
                                of the foregoing, including any 
                                option to purchase or sell any 
                                such security, certificate of 
                                deposit, mortgage loan, 
                                interest, group or index, or 
                                option, and including any 
                                repurchase or reverse 
                                repurchase transaction on any 
                                such security, certificate of 
                                deposit, mortgage loan, 
                                interest, group or index, or 
                                option (whether or not such 
                                repurchase or reverse 
                                repurchase transaction is a 
                                ``repurchase agreement'', as 
                                defined in clause (v));
                                  [(II) does not include any 
                                purchase, sale, or repurchase 
                                obligation under a 
                                participation in a commercial 
                                mortgage loan unless the 
                                Corporation determines by 
                                regulation, resolution, or 
                                order to include any such 
                                agreement within the meaning of 
                                such term;
                                  [(III) means any option 
                                entered into on a national 
                                securities exchange relating to 
                                foreign currencies;
                                  [(IV) means the guarantee 
                                (including by novation) by or 
                                to any securities clearing 
                                agency of any settlement of 
                                cash, securities, certificates 
                                of deposit, mortgage loans or 
                                interests therein, group or 
                                index of securities, 
                                certificates of deposit or 
                                mortgage loans or interests 
                                therein (including any interest 
                                therein or based on the value 
                                thereof) or an option on any of 
                                the foregoing, including any 
                                option to purchase or sell any 
                                such security, certificate of 
                                deposit, mortgage loan, 
                                interest, group or index, or 
                                option (whether or not such 
                                settlement is in connection 
                                with any agreement or 
                                transaction referred to in 
                                subclauses (I) through (XII) 
                                (other than subclause (II)));
                                  [(V) means any margin loan;
                                  [(VI) means any extension of 
                                credit for the clearance or 
                                settlement of securities 
                                transactions;
                                  [(VII) means any loan 
                                transaction coupled with a 
                                securities collar transaction, 
                                any prepaid securities forward 
                                transaction, or any total 
                                return swap transaction coupled 
                                with a securities sale 
                                transaction;
                                  [(VIII) means any other 
                                agreement or transaction that 
                                is similar to any agreement or 
                                transaction referred to in this 
                                clause;
                                  [(IX) means any combination 
                                of the agreements or 
                                transactions referred to in 
                                this clause;
                                  [(X) means any option to 
                                enter into any agreement or 
                                transaction referred to in this 
                                clause;
                                  [(XI) means a master 
                                agreement that provides for an 
                                agreement or transaction 
                                referred to in any of 
                                subclauses (I) through (X), 
                                other than subclause (II), 
                                together with all supplements 
                                to any such master agreement, 
                                without regard to whether the 
                                master agreement provides for 
                                an agreement or transaction 
                                that is not a securities 
                                contract under this clause, 
                                except that the master 
                                agreement shall be considered 
                                to be a securities contract 
                                under this clause only with 
                                respect to each agreement or 
                                transaction under the master 
                                agreement that is referred to 
                                in any of subclauses (I) 
                                through (X), other than 
                                subclause (II); and
                                  [(XII) means any security 
                                agreement or arrangement or 
                                other credit enhancement 
                                related to any agreement or 
                                transaction referred to in this 
                                clause, including any guarantee 
                                or reimbursement obligation in 
                                connection with any agreement 
                                or transaction referred to in 
                                this clause.
                          [(iii) Commodity contract.--The term 
                        ``commodity contract'' means--
                                  [(I) with respect to a 
                                futures commission merchant, a 
                                contract for the purchase or 
                                sale of a commodity for future 
                                delivery on, or subject to the 
                                rules of, a contract market or 
                                board of trade;
                                  [(II) with respect to a 
                                foreign futures commission 
                                merchant, a foreign future;
                                  [(III) with respect to a 
                                leverage transaction merchant, 
                                a leverage transaction;
                                  [(IV) with respect to a 
                                clearing organization, a 
                                contract for the purchase or 
                                sale of a commodity for future 
                                delivery on, or subject to the 
                                rules of, a contract market or 
                                board of trade that is cleared 
                                by such clearing organization, 
                                or commodity option traded on, 
                                or subject to the rules of, a 
                                contract market or board of 
                                trade that is cleared by such 
                                clearing organization;
                                  [(V) with respect to a 
                                commodity options dealer, a 
                                commodity option;
                                  [(VI) any other agreement or 
                                transaction that is similar to 
                                any agreement or transaction 
                                referred to in this clause;
                                  [(VII) any combination of the 
                                agreements or transactions 
                                referred to in this clause;
                                  [(VIII) any option to enter 
                                into any agreement or 
                                transaction referred to in this 
                                clause;
                                  [(IX) a master agreement that 
                                provides for an agreement or 
                                transaction referred to in any 
                                of subclauses (I) through 
                                (VIII), together with all 
                                supplements to any such master 
                                agreement, without regard to 
                                whether the master agreement 
                                provides for an agreement or 
                                transaction that is not a 
                                commodity contract under this 
                                clause, except that the master 
                                agreement shall be considered 
                                to be a commodity contract 
                                under this clause only with 
                                respect to each agreement or 
                                transaction under the master 
                                agreement that is referred to 
                                in any of subclauses (I) 
                                through (VIII); or
                                  [(X) any security agreement 
                                or arrangement or other credit 
                                enhancement related to any 
                                agreement or transaction 
                                referred to in this clause, 
                                including any guarantee or 
                                reimbursement obligation in 
                                connection with any agreement 
                                or transaction referred to in 
                                this clause.
                          [(iv) Forward contract.--The term 
                        ``forward contract'' means--
                                  [(I) a contract (other than a 
                                commodity contract) for the 
                                purchase, sale, or transfer of 
                                a commodity or any similar 
                                good, article, service, right, 
                                or interest which is presently 
                                or in the future becomes the 
                                subject of dealing in the 
                                forward contract trade, or 
                                product or byproduct thereof, 
                                with a maturity date that is 
                                more than 2 days after the date 
                                on which the contract is 
                                entered into, including a 
                                repurchase or reverse 
                                repurchase transaction (whether 
                                or not such repurchase or 
                                reverse repurchase transaction 
                                is a ``repurchase agreement'', 
                                as defined in clause (v)), 
                                consignment, lease, swap, hedge 
                                transaction, deposit, loan, 
                                option, allocated transaction, 
                                unallocated transaction, or any 
                                other similar agreement;
                                  [(II) any combination of 
                                agreements or transactions 
                                referred to in subclauses (I) 
                                and (III);
                                  [(III) any option to enter 
                                into any agreement or 
                                transaction referred to in 
                                subclause (I) or (II);
                                  [(IV) a master agreement that 
                                provides for an agreement or 
                                transaction referred to in 
                                subclause (I), (II), or (III), 
                                together with all supplements 
                                to any such master agreement, 
                                without regard to whether the 
                                master agreement provides for 
                                an agreement or transaction 
                                that is not a forward contract 
                                under this clause, except that 
                                the master agreement shall be 
                                considered to be a forward 
                                contract under this clause only 
                                with respect to each agreement 
                                or transaction under the master 
                                agreement that is referred to 
                                in subclause (I), (II), or 
                                (III); or
                                  [(V) any security agreement 
                                or arrangement or other credit 
                                enhancement related to any 
                                agreement or transaction 
                                referred to in subclause (I), 
                                (II), (III), or (IV), including 
                                any guarantee or reimbursement 
                                obligation in connection with 
                                any agreement or transaction 
                                referred to in any such 
                                subclause.
                          [(v) Repurchase agreement.--The term 
                        ``repurchase agreement'' (which 
                        definition also applies to a reverse 
                        repurchase agreement)--
                                  [(I) means an agreement, 
                                including related terms, which 
                                provides for the transfer of 
                                one or more certificates of 
                                deposit, mortgage related 
                                securities (as such term is 
                                defined in section 3 of the 
                                Securities Exchange Act of 
                                1934), mortgage loans, 
                                interests in mortgage-related 
                                securities or mortgage loans, 
                                eligible bankers' acceptances, 
                                qualified foreign government 
                                securities (which, for purposes 
                                of this clause, means a 
                                security that is a direct 
                                obligation of, or that is fully 
                                guaranteed by, the central 
                                government of a member of the 
                                Organization for Economic 
                                Cooperation and Development, as 
                                determined by regulation or 
                                order adopted by the Board of 
                                Governors), or securities that 
                                are direct obligations of, or 
                                that are fully guaranteed by, 
                                the United States or any agency 
                                of the United States against 
                                the transfer of funds by the 
                                transferee of such certificates 
                                of deposit, eligible bankers' 
                                acceptances, securities, 
                                mortgage loans, or interests 
                                with a simultaneous agreement 
                                by such transferee to transfer 
                                to the transferor thereof 
                                certificates of deposit, 
                                eligible bankers' acceptances, 
                                securities, mortgage loans, or 
                                interests as described above, 
                                at a date certain not later 
                                than 1 year after such 
                                transfers or on demand, against 
                                the transfer of funds, or any 
                                other similar agreement;
                                  [(II) does not include any 
                                repurchase obligation under a 
                                participation in a commercial 
                                mortgage loan, unless the 
                                Corporation determines, by 
                                regulation, resolution, or 
                                order to include any such 
                                participation within the 
                                meaning of such term;
                                  [(III) means any combination 
                                of agreements or transactions 
                                referred to in subclauses (I) 
                                and (IV);
                                  [(IV) means any option to 
                                enter into any agreement or 
                                transaction referred to in 
                                subclause (I) or (III);
                                  [(V) means a master agreement 
                                that provides for an agreement 
                                or transaction referred to in 
                                subclause (I), (III), or (IV), 
                                together with all supplements 
                                to any such master agreement, 
                                without regard to whether the 
                                master agreement provides for 
                                an agreement or transaction 
                                that is not a repurchase 
                                agreement under this clause, 
                                except that the master 
                                agreement shall be considered 
                                to be a repurchase agreement 
                                under this subclause only with 
                                respect to each agreement or 
                                transaction under the master 
                                agreement that is referred to 
                                in subclause (I), (III), or 
                                (IV); and
                                  [(VI) means any security 
                                agreement or arrangement or 
                                other credit enhancement 
                                related to any agreement or 
                                transaction referred to in 
                                subclause (I), (III), (IV), or 
                                (V), including any guarantee or 
                                reimbursement obligation in 
                                connection with any agreement 
                                or transaction referred to in 
                                any such subclause.
                          [(vi) Swap agreement.--The term 
                        ``swap agreement'' means--
                                  [(I) any agreement, including 
                                the terms and conditions 
                                incorporated by reference in 
                                any such agreement, which is an 
                                interest rate swap, option, 
                                future, or forward agreement, 
                                including a rate floor, rate 
                                cap, rate collar, cross-
                                currency rate swap, and basis 
                                swap; a spot, same day-
                                tomorrow, tomorrow-next, 
                                forward, or other foreign 
                                exchange, precious metals, or 
                                other commodity agreement; a 
                                currency swap, option, future, 
                                or forward agreement; an equity 
                                index or equity swap, option, 
                                future, or forward agreement; a 
                                debt index or debt swap, 
                                option, future, or forward 
                                agreement; a total return, 
                                credit spread or credit swap, 
                                option, future, or forward 
                                agreement; a commodity index or 
                                commodity swap, option, future, 
                                or forward agreement; weather 
                                swap, option, future, or 
                                forward agreement; an emissions 
                                swap, option, future, or 
                                forward agreement; or an 
                                inflation swap, option, future, 
                                or forward agreement;
                                  [(II) any agreement or 
                                transaction that is similar to 
                                any other agreement or 
                                transaction referred to in this 
                                clause and that is of a type 
                                that has been, is presently, or 
                                in the future becomes, the 
                                subject of recurrent dealings 
                                in the swap or other 
                                derivatives markets (including 
                                terms and conditions 
                                incorporated by reference in 
                                such agreement) and that is a 
                                forward, swap, future, option, 
                                or spot transaction on one or 
                                more rates, currencies, 
                                commodities, equity securities 
                                or other equity instruments, 
                                debt securities or other debt 
                                instruments, quantitative 
                                measures associated with an 
                                occurrence, extent of an 
                                occurrence, or contingency 
                                associated with a financial, 
                                commercial, or economic 
                                consequence, or economic or 
                                financial indices or measures 
                                of economic or financial risk 
                                or value;
                                  [(III) any combination of 
                                agreements or transactions 
                                referred to in this clause;
                                  [(IV) any option to enter 
                                into any agreement or 
                                transaction referred to in this 
                                clause;
                                  [(V) a master agreement that 
                                provides for an agreement or 
                                transaction referred to in 
                                subclause (I), (II), (III), or 
                                (IV), together with all 
                                supplements to any such master 
                                agreement, without regard to 
                                whether the master agreement 
                                contains an agreement or 
                                transaction that is not a swap 
                                agreement under this clause, 
                                except that the master 
                                agreement shall be considered 
                                to be a swap agreement under 
                                this clause only with respect 
                                to each agreement or 
                                transaction under the master 
                                agreement that is referred to 
                                in subclause (I), (II), (III), 
                                or (IV); and
                                  [(VI) any security agreement 
                                or arrangement or other credit 
                                enhancement related to any 
                                agreement or transaction 
                                referred to in any of 
                                subclauses (I) through (V), 
                                including any guarantee or 
                                reimbursement obligation in 
                                connection with any agreement 
                                or transaction referred to in 
                                any such clause.
                          [(vii) Definitions relating to 
                        default.--When used in this paragraph 
                        and paragraphs (9) and (10)--
                                  [(I) the term ``default'' 
                                means, with respect to a 
                                covered financial company, any 
                                adjudication or other official 
                                decision by any court of 
                                competent jurisdiction, or 
                                other public authority pursuant 
                                to which the Corporation has 
                                been appointed receiver; and
                                  [(II) the term ``in danger of 
                                default'' means a covered 
                                financial company with respect 
                                to which the Corporation or 
                                appropriate State authority has 
                                determined that--
                                          [(aa) in the opinion 
                                        of the Corporation or 
                                        such authority--
                                                  [(AA) the 
                                                covered 
                                                financial 
                                                company is not 
                                                likely to be 
                                                able to pay its 
                                                obligations in 
                                                the normal 
                                                course of 
                                                business; and
                                                  [(BB) there 
                                                is no 
                                                reasonable 
                                                prospect that 
                                                the covered 
                                                financial 
                                                company will be 
                                                able to pay 
                                                such 
                                                obligations 
                                                without Federal 
                                                assistance; or
                                          [(bb) in the opinion 
                                        of the Corporation or 
                                        such authority--
                                                  [(AA) the 
                                                covered 
                                                financial 
                                                company has 
                                                incurred or is 
                                                likely to incur 
                                                losses that 
                                                will deplete 
                                                all or 
                                                substantially 
                                                all of its 
                                                capital; and
                                                  [(BB) there 
                                                is no 
                                                reasonable 
                                                prospect that 
                                                the capital 
                                                will be 
                                                replenished 
                                                without Federal 
                                                assistance.
                          [(viii) Treatment of master agreement 
                        as one agreement.--Any master agreement 
                        for any contract or agreement described 
                        in any of clauses (i) through (vi) (or 
                        any master agreement for such master 
                        agreement or agreements), together with 
                        all supplements to such master 
                        agreement, shall be treated as a single 
                        agreement and a single qualified 
                        financial contact. If a master 
                        agreement contains provisions relating 
                        to agreements or transactions that are 
                        not themselves qualified financial 
                        contracts, the master agreement shall 
                        be deemed to be a qualified financial 
                        contract only with respect to those 
                        transactions that are themselves 
                        qualified financial contracts.
                          [(ix) Transfer.--The term 
                        ``transfer'' means every mode, direct 
                        or indirect, absolute or conditional, 
                        voluntary or involuntary, of disposing 
                        of or parting with property or with an 
                        interest in property, including 
                        retention of title as a security 
                        interest and foreclosure of the equity 
                        of redemption of the covered financial 
                        company.
                          [(x) Person.--The term ``person'' 
                        includes any governmental entity in 
                        addition to any entity included in the 
                        definition of such term in section 1, 
                        title 1, United States Code.
                  [(E) Clarification.--No provision of law 
                shall be construed as limiting the right or 
                power of the Corporation, or authorizing any 
                court or agency to limit or delay, in any 
                manner, the right or power of the Corporation 
                to transfer any qualified financial contract or 
                to disaffirm or repudiate any such contract in 
                accordance with this subsection.
                  [(F) Walkaway clauses not effective.--
                          [(i) In general.--Notwithstanding the 
                        provisions of subparagraph (A) of this 
                        paragraph and sections 403 and 404 of 
                        the Federal Deposit Insurance 
                        Corporation Improvement Act of 1991, no 
                        walkaway clause shall be enforceable in 
                        a qualified financial contract of a 
                        covered financial company in default.
                          [(ii) Limited suspension of certain 
                        obligations.--In the case of a 
                        qualified financial contract referred 
                        to in clause (i), any payment or 
                        delivery obligations otherwise due from 
                        a party pursuant to the qualified 
                        financial contract shall be suspended 
                        from the time at which the Corporation 
                        is appointed as receiver until the 
                        earlier of--
                                  [(I) the time at which such 
                                party receives notice that such 
                                contract has been transferred 
                                pursuant to paragraph (10)(A); 
                                or
                                  [(II) 5:00 p.m. (eastern 
                                time) on the business day 
                                following the date of the 
                                appointment of the Corporation 
                                as receiver.
                          [(iii) Walkaway clause defined.--For 
                        purposes of this subparagraph, the term 
                        ``walkaway clause'' means any provision 
                        in a qualified financial contract that 
                        suspends, conditions, or extinguishes a 
                        payment obligation of a party, in whole 
                        or in part, or does not create a 
                        payment obligation of a party that 
                        would otherwise exist, solely because 
                        of the status of such party as a 
                        nondefaulting party in connection with 
                        the insolvency of a covered financial 
                        company that is a party to the contract 
                        or the appointment of or the exercise 
                        of rights or powers by the Corporation 
                        as receiver for such covered financial 
                        company, and not as a result of the 
                        exercise by a party of any right to 
                        offset, setoff, or net obligations that 
                        exist under the contract, any other 
                        contract between those parties, or 
                        applicable law.
                  [(G) Certain obligations to clearing 
                organizations.--In the event that the 
                Corporation has been appointed as receiver for 
                a covered financial company which is a party to 
                any qualified financial contract cleared by or 
                subject to the rules of a clearing organization 
                (as defined in paragraph (9)(D)), the receiver 
                shall use its best efforts to meet all margin, 
                collateral, and settlement obligations of the 
                covered financial company that arise under 
                qualified financial contracts (other than any 
                margin, collateral, or settlement obligation 
                that is not enforceable against the receiver 
                under paragraph (8)(F)(i) or paragraph 
                (10)(B)), as required by the rules of the 
                clearing organization when due. Notwithstanding 
                any other provision of this title, if the 
                receiver fails to satisfy any such margin, 
                collateral, or settlement obligations under the 
                rules of the clearing organization, the 
                clearing organization shall have the immediate 
                right to exercise, and shall not be stayed from 
                exercising, all of its rights and remedies 
                under its rules and applicable law with respect 
                to any qualified financial contract of the 
                covered financial company, including, without 
                limitation, the right to liquidate all 
                positions and collateral of such covered 
                financial company under the company's qualified 
                financial contracts, and suspend or cease to 
                act for such covered financial company, all in 
                accordance with the rules of the clearing 
                organization.
                  [(H) Recordkeeping.--
                          [(i) Joint rulemaking.--The Federal 
                        primary financial regulatory agencies 
                        shall jointly prescribe regulations 
                        requiring that financial companies 
                        maintain such records with respect to 
                        qualified financial contracts 
                        (including market valuations) that the 
                        Federal primary financial regulatory 
                        agencies determine to be necessary or 
                        appropriate in order to assist the 
                        Corporation as receiver for a covered 
                        financial company in being able to 
                        exercise its rights and fulfill its 
                        obligations under this paragraph or 
                        paragraph (9) or (10).
                          [(ii) Time frame.--The Federal 
                        primary financial regulatory agencies 
                        shall prescribe joint final or interim 
                        final regulations not later than 24 
                        months after the date of enactment of 
                        this Act.
                          [(iii) Back-up rulemaking 
                        authority.--If the Federal primary 
                        financial regulatory agencies do not 
                        prescribe joint final or interim final 
                        regulations within the time frame in 
                        clause (ii), the Chairperson of the 
                        Council shall prescribe, in 
                        consultation with the Corporation, the 
                        regulations required by clause (i).
                          [(iv) Categorization and tiering.--
                        The joint regulations prescribed under 
                        clause (i) shall, as appropriate, 
                        differentiate among financial companies 
                        by taking into consideration their 
                        size, risk, complexity, leverage, 
                        frequency and dollar amount of 
                        qualified financial contracts, 
                        interconnectedness to the financial 
                        system, and any other factors deemed 
                        appropriate.
          [(9) Transfer of qualified financial contracts.--
                  [(A) In general.--In making any transfer of 
                assets or liabilities of a covered financial 
                company in default, which includes any 
                qualified financial contract, the Corporation 
                as receiver for such covered financial company 
                shall either--
                          [(i) transfer to one financial 
                        institution, other than a financial 
                        institution for which a conservator, 
                        receiver, trustee in bankruptcy, or 
                        other legal custodian has been 
                        appointed or which is otherwise the 
                        subject of a bankruptcy or insolvency 
                        proceeding--
                                  [(I) all qualified financial 
                                contracts between any person or 
                                any affiliate of such person 
                                and the covered financial 
                                company in default;
                                  [(II) all claims of such 
                                person or any affiliate of such 
                                person against such covered 
                                financial company under any 
                                such contract (other than any 
                                claim which, under the terms of 
                                any such contract, is 
                                subordinated to the claims of 
                                general unsecured creditors of 
                                such company);
                                  [(III) all claims of such 
                                covered financial company 
                                against such person or any 
                                affiliate of such person under 
                                any such contract; and
                                  [(IV) all property securing 
                                or any other credit enhancement 
                                for any contract described in 
                                subclause (I) or any claim 
                                described in subclause (II) or 
                                (III) under any such contract; 
                                or
                          [(ii) transfer none of the qualified 
                        financial contracts, claims, property 
                        or other credit enhancement referred to 
                        in clause (i) (with respect to such 
                        person and any affiliate of such 
                        person).
                  [(B) Transfer to foreign bank, financial 
                institution, or branch or agency thereof.--In 
                transferring any qualified financial contracts 
                and related claims and property under 
                subparagraph (A)(i), the Corporation as 
                receiver for the covered financial company 
                shall not make such transfer to a foreign bank, 
                financial institution organized under the laws 
                of a foreign country, or a branch or agency of 
                a foreign bank or financial institution unless, 
                under the law applicable to such bank, 
                financial institution, branch or agency, to the 
                qualified financial contracts, and to any 
                netting contract, any security agreement or 
                arrangement or other credit enhancement related 
                to one or more qualified financial contracts, 
                the contractual rights of the parties to such 
                qualified financial contracts, netting 
                contracts, security agreements or arrangements, 
                or other credit enhancements are enforceable 
                substantially to the same extent as permitted 
                under this section.
                  [(C) Transfer of contracts subject to the 
                rules of a clearing organization.--In the event 
                that the Corporation as receiver for a 
                financial institution transfers any qualified 
                financial contract and related claims, 
                property, or credit enhancement pursuant to 
                subparagraph (A)(i) and such contract is 
                cleared by or subject to the rules of a 
                clearing organization, the clearing 
                organization shall not be required to accept 
                the transferee as a member by virtue of the 
                transfer.
                  [(D) Definitions.--For purposes of this 
                paragraph--
                          [(i) the term ``financial 
                        institution'' means a broker or dealer, 
                        a depository institution, a futures 
                        commission merchant, a bridge financial 
                        company, or any other institution 
                        determined by the Corporation, by 
                        regulation, to be a financial 
                        institution; and
                          [(ii) the term ``clearing 
                        organization'' has the same meaning as 
                        in section 402 of the Federal Deposit 
                        Insurance Corporation Improvement Act 
                        of 1991.
          [(10) Notification of transfer.--
                  [(A) In general.--
                          [(i) Notice.--The Corporation shall 
                        provide notice in accordance with 
                        clause (ii), if--
                                  [(I) the Corporation as 
                                receiver for a covered 
                                financial company in default or 
                                in danger of default transfers 
                                any assets or liabilities of 
                                the covered financial company; 
                                and
                                  [(II) the transfer includes 
                                any qualified financial 
                                contract.
                          [(ii) Timing.--The Corporation as 
                        receiver for a covered financial 
                        company shall notify any person who is 
                        a party to any contract described in 
                        clause (i) of such transfer not later 
                        than 5:00 p.m. (eastern time) on the 
                        business day following the date of the 
                        appointment of the Corporation as 
                        receiver.
                  [(B) Certain rights not enforceable.--
                          [(i) Receivership.--A person who is a 
                        party to a qualified financial contract 
                        with a covered financial company may 
                        not exercise any right that such person 
                        has to terminate, liquidate, or net 
                        such contract under paragraph (8)(A) 
                        solely by reason of or incidental to 
                        the appointment under this section of 
                        the Corporation as receiver for the 
                        covered financial company (or the 
                        insolvency or financial condition of 
                        the covered financial company for which 
                        the Corporation has been appointed as 
                        receiver)--
                                  [(I) until 5:00 p.m. (eastern 
                                time) on the business day 
                                following the date of the 
                                appointment; or
                                  [(II) after the person has 
                                received notice that the 
                                contract has been transferred 
                                pursuant to paragraph (9)(A).
                          [(ii) Notice.--For purposes of this 
                        paragraph, the Corporation as receiver 
                        for a covered financial company shall 
                        be deemed to have notified a person who 
                        is a party to a qualified financial 
                        contract with such covered financial 
                        company, if the Corporation has taken 
                        steps reasonably calculated to provide 
                        notice to such person by the time 
                        specified in subparagraph (A).
                  [(C) Treatment of bridge financial company.--
                For purposes of paragraph (9), a bridge 
                financial company shall not be considered to be 
                a financial institution for which a 
                conservator, receiver, trustee in bankruptcy, 
                or other legal custodian has been appointed, or 
                which is otherwise the subject of a bankruptcy 
                or insolvency proceeding.
                  [(D) Business day defined.--For purposes of 
                this paragraph, the term ``business day'' means 
                any day other than any Saturday, Sunday, or any 
                day on which either the New York Stock Exchange 
                or the Federal Reserve Bank of New York is 
                closed.
          [(11) Disaffirmance or repudiation of qualified 
        financial contracts.--In exercising the rights of 
        disaffirmance or repudiation of the Corporation as 
        receiver with respect to any qualified financial 
        contract to which a covered financial company is a 
        party, the Corporation shall either--
                  [(A) disaffirm or repudiate all qualified 
                financial contracts between--
                          [(i) any person or any affiliate of 
                        such person; and
                          [(ii) the covered financial company 
                        in default; or
                  [(B) disaffirm or repudiate none of the 
                qualified financial contracts referred to in 
                subparagraph (A) (with respect to such person 
                or any affiliate of such person).
          [(12) Certain security and customer interests not 
        avoidable.--No provision of this subsection shall be 
        construed as permitting the avoidance of any--
                  [(A) legally enforceable or perfected 
                security interest in any of the assets of any 
                covered financial company, except in accordance 
                with subsection (a)(11); or
                  [(B) legally enforceable interest in customer 
                property, security entitlements in respect of 
                assets or property held by the covered 
                financial company for any security entitlement 
                holder.
          [(13) Authority to enforce contracts.--
                  [(A) In general.--The Corporation, as 
                receiver for a covered financial company, may 
                enforce any contract, other than a liability 
                insurance contract of a director or officer, a 
                financial institution bond entered into by the 
                covered financial company, notwithstanding any 
                provision of the contract providing for 
                termination, default, acceleration, or exercise 
                of rights upon, or solely by reason of, 
                insolvency, the appointment of or the exercise 
                of rights or powers by the Corporation as 
                receiver, the filing of the petition pursuant 
                to section 202(a)(1), or the issuance of the 
                recommendations or determination, or any 
                actions or events occurring in connection 
                therewith or as a result thereof, pursuant to 
                section 203.
                  [(B) Certain rights not affected.--No 
                provision of this paragraph may be construed as 
                impairing or affecting any right of the 
                Corporation as receiver to enforce or recover 
                under a liability insurance contract of a 
                director or officer or financial institution 
                bond under other applicable law.
                  [(C) Consent requirement and ipso facto 
                clauses.--
                          [(i) In general.--Except as otherwise 
                        provided by this section, no person may 
                        exercise any right or power to 
                        terminate, accelerate, or declare a 
                        default under any contract to which the 
                        covered financial company is a party 
                        (and no provision in any such contract 
                        providing for such default, 
                        termination, or acceleration shall be 
                        enforceable), or to obtain possession 
                        of or exercise control over any 
                        property of the covered financial 
                        company or affect any contractual 
                        rights of the covered financial 
                        company, without the consent of the 
                        Corporation as receiver for the covered 
                        financial company during the 90 day 
                        period beginning from the appointment 
                        of the Corporation as receiver.
                          [(ii) Exceptions.--No provision of 
                        this subparagraph shall apply to a 
                        director or officer liability insurance 
                        contract or a financial institution 
                        bond, to the rights of parties to 
                        certain qualified financial contracts 
                        pursuant to paragraph (8), or to the 
                        rights of parties to netting contracts 
                        pursuant to subtitle A of title IV of 
                        the Federal Deposit Insurance 
                        Corporation Improvement Act of 1991 (12 
                        U.S.C. 4401 et seq.), or shall be 
                        construed as permitting the Corporation 
                        as receiver to fail to comply with 
                        otherwise enforceable provisions of 
                        such contract.
                  [(D) Contracts to extend credit.--
                Notwithstanding any other provision in this 
                title, if the Corporation as receiver enforces 
                any contract to extend credit to the covered 
                financial company or bridge financial company, 
                any valid and enforceable obligation to repay 
                such debt shall be paid by the Corporation as 
                receiver, as an administrative expense of the 
                receivership.
          [(14) Exception for federal reserve banks and 
        corporation security interest.--No provision of this 
        subsection shall apply with respect to--
                  [(A) any extension of credit from any Federal 
                reserve bank or the Corporation to any covered 
                financial company; or
                  [(B) any security interest in the assets of 
                the covered financial company securing any such 
                extension of credit.
          [(15) Savings clause.--The meanings of terms used in 
        this subsection are applicable for purposes of this 
        subsection only, and shall not be construed or applied 
        so as to challenge or affect the characterization, 
        definition, or treatment of any similar terms under any 
        other statute, regulation, or rule, including the 
        Gramm-Leach-Bliley Act, the Legal Certainty for Bank 
        Products Act of 2000, the securities laws (as that term 
        is defined in section 3(a)(47) of the Securities 
        Exchange Act of 1934), and the Commodity Exchange Act.
          [(16) Enforcement of contracts guaranteed by the 
        covered financial company.--
                  [(A) In general.--The Corporation, as 
                receiver for a covered financial company or as 
                receiver for a subsidiary of a covered 
                financial company (including an insured 
                depository institution) shall have the power to 
                enforce contracts of subsidiaries or affiliates 
                of the covered financial company, the 
                obligations under which are guaranteed or 
                otherwise supported by or linked to the covered 
                financial company, notwithstanding any 
                contractual right to cause the termination, 
                liquidation, or acceleration of such contracts 
                based solely on the insolvency, financial 
                condition, or receivership of the covered 
                financial company, if--
                          [(i) such guaranty or other support 
                        and all related assets and liabilities 
                        are transferred to and assumed by a 
                        bridge financial company or a third 
                        party (other than a third party for 
                        which a conservator, receiver, trustee 
                        in bankruptcy, or other legal custodian 
                        has been appointed, or which is 
                        otherwise the subject of a bankruptcy 
                        or insolvency proceeding) within the 
                        same period of time as the Corporation 
                        is entitled to transfer the qualified 
                        financial contracts of such covered 
                        financial company; or
                          [(ii) the Corporation, as receiver, 
                        otherwise provides adequate protection 
                        with respect to such obligations.
                  [(B) Rule of construction.--For purposes of 
                this paragraph, a bridge financial company 
                shall not be considered to be a third party for 
                which a conservator, receiver, trustee in 
                bankruptcy, or other legal custodian has been 
                appointed, or which is otherwise the subject of 
                a bankruptcy or insolvency proceeding.
  [(d) Valuation of Claims in Default.--
          [(1) In general.--Notwithstanding any other provision 
        of Federal law or the law of any State, and regardless 
        of the method utilized by the Corporation for a covered 
        financial company, including transactions authorized 
        under subsection (h), this subsection shall govern the 
        rights of the creditors of any such covered financial 
        company.
          [(2) Maximum liability.--The maximum liability of the 
        Corporation, acting as receiver for a covered financial 
        company or in any other capacity, to any person having 
        a claim against the Corporation as receiver or the 
        covered financial company for which the Corporation is 
        appointed shall equal the amount that such claimant 
        would have received if--
                  [(A) the Corporation had not been appointed 
                receiver with respect to the covered financial 
                company; and
                  [(B) the covered financial company had been 
                liquidated under chapter 7 of the Bankruptcy 
                Code, or any similar provision of State 
                insolvency law applicable to the covered 
                financial company.
          [(3) Special provision for orderly liquidation by 
        sipc.--The maximum liability of the Corporation, acting 
        as receiver or in its corporate capacity for any 
        covered broker or dealer to any customer of such 
        covered broker or dealer, with respect to customer 
        property of such customer, shall be--
                  [(A) equal to the amount that such customer 
                would have received with respect to such 
                customer property in a case initiated by SIPC 
                under the Securities Investor Protection Act of 
                1970 (15 U.S.C. 78aaa et seq.); and
                  [(B) determined as of the close of business 
                on the date on which the Corporation is 
                appointed as receiver.
          [(4) Additional payments authorized.--
                  [(A) In general.--Subject to subsection 
                (o)(1)(D)(i), the Corporation, with the 
                approval of the Secretary, may make additional 
                payments or credit additional amounts to or 
                with respect to or for the account of any 
                claimant or category of claimants of the 
                covered financial company, if the Corporation 
                determines that such payments or credits are 
                necessary or appropriate to minimize losses to 
                the Corporation as receiver from the orderly 
                liquidation of the covered financial company 
                under this section.
                  [(B) Limitations.--
                          [(i) Prohibition.--The Corporation 
                        shall not make any payments or credit 
                        amounts to any claimant or category of 
                        claimants that would result in any 
                        claimant receiving more than the face 
                        value amount of any claim that is 
                        proven to the satisfaction of the 
                        Corporation.
                          [(ii) No obligation.--Notwithstanding 
                        any other provision of Federal or State 
                        law, or the Constitution of any State, 
                        the Corporation shall not be obligated, 
                        as a result of having made any payment 
                        under subparagraph (A) or credited any 
                        amount described in subparagraph (A) to 
                        or with respect to, or for the account, 
                        of any claimant or category of 
                        claimants, to make payments to any 
                        other claimant or category of 
                        claimants.
                  [(C) Manner of payment.--The Corporation may 
                make payments or credit amounts under 
                subparagraph (A) directly to the claimants or 
                may make such payments or credit such amounts 
                to a company other than a covered financial 
                company or a bridge financial company 
                established with respect thereto in order to 
                induce such other company to accept liability 
                for such claims.
  [(e) Limitation on Court Action.--Except as provided in this 
title, no court may take any action to restrain or affect the 
exercise of powers or functions of the receiver hereunder, and 
any remedy against the Corporation or receiver shall be limited 
to money damages determined in accordance with this title.
  [(f) Liability of Directors and Officers.--
          [(1) In general.--A director or officer of a covered 
        financial company may be held personally liable for 
        monetary damages in any civil action described in 
        paragraph (2) by, on behalf of, or at the request or 
        direction of the Corporation, which action is 
        prosecuted wholly or partially for the benefit of the 
        Corporation--
                  [(A) acting as receiver for such covered 
                financial company;
                  [(B) acting based upon a suit, claim, or 
                cause of action purchased from, assigned by, or 
                otherwise conveyed by the Corporation as 
                receiver; or
                  [(C) acting based upon a suit, claim, or 
                cause of action purchased from, assigned by, or 
                otherwise conveyed in whole or in part by a 
                covered financial company or its affiliate in 
                connection with assistance provided under this 
                title.
          [(2) Actions covered.--Paragraph (1) shall apply with 
        respect to actions for gross negligence, including any 
        similar conduct or conduct that demonstrates a greater 
        disregard of a duty of care (than gross negligence) 
        including intentional tortious conduct, as such terms 
        are defined and determined under applicable State law.
          [(3) Savings clause.--Nothing in this subsection 
        shall impair or affect any right of the Corporation 
        under other applicable law.
  [(g) Damages.--In any proceeding related to any claim against 
a director, officer, employee, agent, attorney, accountant, or 
appraiser of a covered financial company, or any other party 
employed by or providing services to a covered financial 
company, recoverable damages determined to result from the 
improvident or otherwise improper use or investment of any 
assets of the covered financial company shall include principal 
losses and appropriate interest.
  [(h) Bridge Financial Companies.--
          [(1) Organization.--
                  [(A) Purpose.--The Corporation, as receiver 
                for one or more covered financial companies or 
                in anticipation of being appointed receiver for 
                one or more covered financial companies, may 
                organize one or more bridge financial companies 
                in accordance with this subsection.
                  [(B) Authorities.--Upon the creation of a 
                bridge financial company under subparagraph (A) 
                with respect to a covered financial company, 
                such bridge financial company may--
                          [(i) assume such liabilities 
                        (including liabilities associated with 
                        any trust or custody business, but 
                        excluding any liabilities that count as 
                        regulatory capital) of such covered 
                        financial company as the Corporation 
                        may, in its discretion, determine to be 
                        appropriate;
                          [(ii) purchase such assets (including 
                        assets associated with any trust or 
                        custody business) of such covered 
                        financial company as the Corporation 
                        may, in its discretion, determine to be 
                        appropriate; and
                          [(iii) perform any other temporary 
                        function which the Corporation may, in 
                        its discretion, prescribe in accordance 
                        with this section.
          [(2) Charter and establishment.--
                  [(A) Establishment.--Except as provided in 
                subparagraph (H), where the covered financial 
                company is a covered broker or dealer, the 
                Corporation, as receiver for a covered 
                financial company, may grant a Federal charter 
                to and approve articles of association for one 
                or more bridge financial company or companies, 
                with respect to such covered financial company 
                which shall, by operation of law and 
                immediately upon issuance of its charter and 
                approval of its articles of association, be 
                established and operate in accordance with, and 
                subject to, such charter, articles, and this 
                section.
                  [(B) Management.--Upon its establishment, a 
                bridge financial company shall be under the 
                management of a board of directors appointed by 
                the Corporation.
                  [(C) Articles of association.--The articles 
                of association and organization certificate of 
                a bridge financial company shall have such 
                terms as the Corporation may provide, and shall 
                be executed by such representatives as the 
                Corporation may designate.
                  [(D) Terms of charter; rights and 
                privileges.--Subject to and in accordance with 
                the provisions of this subsection, the 
                Corporation shall--
                          [(i) establish the terms of the 
                        charter of a bridge financial company 
                        and the rights, powers, authorities, 
                        and privileges of a bridge financial 
                        company granted by the charter or as an 
                        incident thereto; and
                          [(ii) provide for, and establish the 
                        terms and conditions governing, the 
                        management (including the bylaws and 
                        the number of directors of the board of 
                        directors) and operations of the bridge 
                        financial company.
                  [(E) Transfer of rights and privileges of 
                covered financial company.--
                          [(i) In general.--Notwithstanding any 
                        other provision of Federal or State 
                        law, the Corporation may provide for a 
                        bridge financial company to succeed to 
                        and assume any rights, powers, 
                        authorities, or privileges of the 
                        covered financial company with respect 
                        to which the bridge financial company 
                        was established and, upon such 
                        determination by the Corporation, the 
                        bridge financial company shall 
                        immediately and by operation of law 
                        succeed to and assume such rights, 
                        powers, authorities, and privileges.
                          [(ii) Effective without approval.--
                        Any succession to or assumption by a 
                        bridge financial company of rights, 
                        powers, authorities, or privileges of a 
                        covered financial company under clause 
                        (i) or otherwise shall be effective 
                        without any further approval under 
                        Federal or State law, assignment, or 
                        consent with respect thereto.
                  [(F) Corporate governance and election and 
                designation of body of law.--To the extent 
                permitted by the Corporation and consistent 
                with this section and any rules, regulations, 
                or directives issued by the Corporation under 
                this section, a bridge financial company may 
                elect to follow the corporate governance 
                practices and procedures that are applicable to 
                a corporation incorporated under the general 
                corporation law of the State of Delaware, or 
                the State of incorporation or organization of 
                the covered financial company with respect to 
                which the bridge financial company was 
                established, as such law may be amended from 
                time to time.
                  [(G) Capital.--
                          [(i) Capital not required.--
                        Notwithstanding any other provision of 
                        Federal or State law, a bridge 
                        financial company may, if permitted by 
                        the Corporation, operate without any 
                        capital or surplus, or with such 
                        capital or surplus as the Corporation 
                        may in its discretion determine to be 
                        appropriate.
                          [(ii) No contribution by the 
                        corporation required.--The Corporation 
                        is not required to pay capital into a 
                        bridge financial company or to issue 
                        any capital stock on behalf of a bridge 
                        financial company established under 
                        this subsection.
                          [(iii) Authority.--If the Corporation 
                        determines that such action is 
                        advisable, the Corporation may cause 
                        capital stock or other securities of a 
                        bridge financial company established 
                        with respect to a covered financial 
                        company to be issued and offered for 
                        sale in such amounts and on such terms 
                        and conditions as the Corporation may, 
                        in its discretion, determine.
                          [(iv) Operating funds in lieu of 
                        capital and implementation plan.--Upon 
                        the organization of a bridge financial 
                        company, and thereafter as the 
                        Corporation may, in its discretion, 
                        determine to be necessary or advisable, 
                        the Corporation may make available to 
                        the bridge financial company, subject 
                        to the plan described in subsection 
                        (n)(9), funds for the operation of the 
                        bridge financial company in lieu of 
                        capital.
                  [(H) Bridge brokers or dealers.--
                          [(i) In general.--The Corporation, as 
                        receiver for a covered broker or 
                        dealer, may approve articles of 
                        association for one or more bridge 
                        financial companies with respect to 
                        such covered broker or dealer, which 
                        bridge financial company or companies 
                        shall, by operation of law and 
                        immediately upon approval of its 
                        articles of association--
                                  [(I) be established and 
                                deemed registered with the 
                                Commission under the Securities 
                                Exchange Act of 1934 and a 
                                member of SIPC;
                                  [(II) operate in accordance 
                                with such articles and this 
                                section; and
                                  [(III) succeed to any and all 
                                registrations and memberships 
                                of the covered financial 
                                company with or in any self-
                                regulatory organizations.
                          [(ii) Other requirements.--Except as 
                        provided in clause (i), and 
                        notwithstanding any other provision of 
                        this section, the bridge financial 
                        company shall be subject to the Federal 
                        securities laws and all requirements 
                        with respect to being a member of a 
                        self-regulatory organization, unless 
                        exempted from any such requirements by 
                        the Commission, as is necessary or 
                        appropriate in the public interest or 
                        for the protection of investors.
                          [(iii) Treatment of customers.--
                        Except as otherwise provided by this 
                        title, any customer of the covered 
                        broker or dealer whose account is 
                        transferred to a bridge financial 
                        company shall have all the rights, 
                        privileges, and protections under 
                        section 205(f) and under the Securities 
                        Investor Protection Act of 1970 (15 
                        U.S.C. 78aaa et seq.), that such 
                        customer would have had if the account 
                        were not transferred from the covered 
                        financial company under this 
                        subparagraph.
                          [(iv) Operation of bridge brokers or 
                        dealers.--Notwithstanding any other 
                        provision of this title, the 
                        Corporation shall not operate any 
                        bridge financial company created by the 
                        Corporation under this title with 
                        respect to a covered broker or dealer 
                        in such a manner as to adversely affect 
                        the ability of customers to promptly 
                        access their customer property in 
                        accordance with applicable law.
          [(3) Interests in and assets and obligations of 
        covered financial company.--Notwithstanding paragraph 
        (1) or (2) or any other provision of law--
                  [(A) a bridge financial company shall assume, 
                acquire, or succeed to the assets or 
                liabilities of a covered financial company 
                (including the assets or liabilities associated 
                with any trust or custody business) only to the 
                extent that such assets or liabilities are 
                transferred by the Corporation to the bridge 
                financial company in accordance with, and 
                subject to the restrictions set forth in, 
                paragraph (1)(B); and
                  [(B) a bridge financial company shall not 
                assume, acquire, or succeed to any obligation 
                that a covered financial company for which the 
                Corporation has been appointed receiver may 
                have to any shareholder, member, general 
                partner, limited partner, or other person with 
                an interest in the equity of the covered 
                financial company that arises as a result of 
                the status of that person having an equity 
                claim in the covered financial company.
          [(4) Bridge financial company treated as being in 
        default for certain purposes.--A bridge financial 
        company shall be treated as a covered financial company 
        in default at such times and for such purposes as the 
        Corporation may, in its discretion, determine.
          [(5) Transfer of assets and liabilities.--
                  [(A) Authority of corporation.--The 
                Corporation, as receiver for a covered 
                financial company, may transfer any assets and 
                liabilities of a covered financial company 
                (including any assets or liabilities associated 
                with any trust or custody business) to one or 
                more bridge financial companies, in accordance 
                with and subject to the restrictions of 
                paragraph (1).
                  [(B) Subsequent transfers.--At any time after 
                the establishment of a bridge financial company 
                with respect to a covered financial company, 
                the Corporation, as receiver, may transfer any 
                assets and liabilities of such covered 
                financial company as the Corporation may, in 
                its discretion, determine to be appropriate in 
                accordance with and subject to the restrictions 
                of paragraph (1).
                  [(C) Treatment of trust or custody 
                business.--For purposes of this paragraph, the 
                trust or custody business, including fiduciary 
                appointments, held by any covered financial 
                company is included among its assets and 
                liabilities.
                  [(D) Effective without approval.--The 
                transfer of any assets or liabilities, 
                including those associated with any trust or 
                custody business of a covered financial 
                company, to a bridge financial company shall be 
                effective without any further approval under 
                Federal or State law, assignment, or consent 
                with respect thereto.
                  [(E) Equitable treatment of similarly 
                situated creditors.--The Corporation shall 
                treat all creditors of a covered financial 
                company that are similarly situated under 
                subsection (b)(1), in a similar manner in 
                exercising the authority of the Corporation 
                under this subsection to transfer any assets or 
                liabilities of the covered financial company to 
                one or more bridge financial companies 
                established with respect to such covered 
                financial company, except that the Corporation 
                may take any action (including making payments, 
                subject to subsection (o)(1)(D)(i)) that does 
                not comply with this subparagraph, if--
                          [(i) the Corporation determines that 
                        such action is necessary--
                                  [(I) to maximize the value of 
                                the assets of the covered 
                                financial company;
                                  [(II) to maximize the present 
                                value return from the sale or 
                                other disposition of the assets 
                                of the covered financial 
                                company; or
                                  [(III) to minimize the amount 
                                of any loss realized upon the 
                                sale or other disposition of 
                                the assets of the covered 
                                financial company; and
                          [(ii) all creditors that are 
                        similarly situated under subsection 
                        (b)(1) receive not less than the amount 
                        provided under paragraphs (2) and (3) 
                        of subsection (d).
                  [(F) Limitation on transfer of liabilities.--
                Notwithstanding any other provision of law, the 
                aggregate amount of liabilities of a covered 
                financial company that are transferred to, or 
                assumed by, a bridge financial company from a 
                covered financial company may not exceed the 
                aggregate amount of the assets of the covered 
                financial company that are transferred to, or 
                purchased by, the bridge financial company from 
                the covered financial company.
          [(6) Stay of judicial action.--Any judicial action to 
        which a bridge financial company becomes a party by 
        virtue of its acquisition of any assets or assumption 
        of any liabilities of a covered financial company shall 
        be stayed from further proceedings for a period of not 
        longer than 45 days (or such longer period as may be 
        agreed to upon the consent of all parties) at the 
        request of the bridge financial company.
          [(7) Agreements against interest of the bridge 
        financial company.--No agreement that tends to diminish 
        or defeat the interest of the bridge financial company 
        in any asset of a covered financial company acquired by 
        the bridge financial company shall be valid against the 
        bridge financial company, unless such agreement--
                  [(A) is in writing;
                  [(B) was executed by an authorized officer or 
                representative of the covered financial company 
                or confirmed in the ordinary course of business 
                by the covered financial company; and
                  [(C) has been on the official record of the 
                company, since the time of its execution, or 
                with which, the party claiming under the 
                agreement provides documentation of such 
                agreement and its authorized execution or 
                confirmation by the covered financial company 
                that is acceptable to the receiver.
          [(8) No federal status.--
                  [(A) Agency status.--A bridge financial 
                company is not an agency, establishment, or 
                instrumentality of the United States.
                  [(B) Employee status.--Representatives for 
                purposes of paragraph (1)(B), directors, 
                officers, employees, or agents of a bridge 
                financial company are not, solely by virtue of 
                service in any such capacity, officers or 
                employees of the United States. Any employee of 
                the Corporation or of any Federal 
                instrumentality who serves at the request of 
                the Corporation as a representative for 
                purposes of paragraph (1)(B), director, 
                officer, employee, or agent of a bridge 
                financial company shall not--
                          [(i) solely by virtue of service in 
                        any such capacity lose any existing 
                        status as an officer or employee of the 
                        United States for purposes of title 5, 
                        United States Code, or any other 
                        provision of law; or
                          [(ii) receive any salary or benefits 
                        for service in any such capacity with 
                        respect to a bridge financial company 
                        in addition to such salary or benefits 
                        as are obtained through employment with 
                        the Corporation or such Federal 
                        instrumentality.
          [(9) Funding authorized.--The Corporation may, 
        subject to the plan described in subsection (n)(9), 
        provide funding to facilitate any transaction described 
        in subparagraph (A), (B), (C), or (D) of paragraph (13) 
        with respect to any bridge financial company, or 
        facilitate the acquisition by a bridge financial 
        company of any assets, or the assumption of any 
        liabilities, of a covered financial company for which 
        the Corporation has been appointed receiver.
          [(10) Exempt tax status.--Notwithstanding any other 
        provision of Federal or State law, a bridge financial 
        company, its franchise, property, and income shall be 
        exempt from all taxation now or hereafter imposed by 
        the United States, by any territory, dependency, or 
        possession thereof, or by any State, county, 
        municipality, or local taxing authority.
          [(11) Federal agency approval; antitrust review.--If 
        a transaction involving the merger or sale of a bridge 
        financial company requires approval by a Federal 
        agency, the transaction may not be consummated before 
        the 5th calendar day after the date of approval by the 
        Federal agency responsible for such approval with 
        respect thereto. If, in connection with any such 
        approval a report on competitive factors from the 
        Attorney General is required, the Federal agency 
        responsible for such approval shall promptly notify the 
        Attorney General of the proposed transaction and the 
        Attorney General shall provide the required report 
        within 10 days of the request. If a notification is 
        required under section 7A of the Clayton Act with 
        respect to such transaction, the required waiting 
        period shall end on the 15th day after the date on 
        which the Attorney General and the Federal Trade 
        Commission receive such notification, unless the 
        waiting period is terminated earlier under section 
        7A(b)(2) of the Clayton Act, or extended under section 
        7A(e)(2) of that Act.
          [(12) Duration of bridge financial company.--Subject 
        to paragraphs (13) and (14), the status of a bridge 
        financial company as such shall terminate at the end of 
        the 2-year period following the date on which it was 
        granted a charter. The Corporation may, in its 
        discretion, extend the status of the bridge financial 
        company as such for no more than 3 additional 1-year 
        periods.
          [(13) Termination of bridge financial company 
        status.--The status of any bridge financial company as 
        such shall terminate upon the earliest of--
                  [(A) the date of the merger or consolidation 
                of the bridge financial company with a company 
                that is not a bridge financial company;
                  [(B) at the election of the Corporation, the 
                sale of a majority of the capital stock of the 
                bridge financial company to a company other 
                than the Corporation and other than another 
                bridge financial company;
                  [(C) the sale of 80 percent, or more, of the 
                capital stock of the bridge financial company 
                to a person other than the Corporation and 
                other than another bridge financial company;
                  [(D) at the election of the Corporation, 
                either the assumption of all or substantially 
                all of the liabilities of the bridge financial 
                company by a company that is not a bridge 
                financial company, or the acquisition of all or 
                substantially all of the assets of the bridge 
                financial company by a company that is not a 
                bridge financial company, or other entity as 
                permitted under applicable law; and
                  [(E) the expiration of the period provided in 
                paragraph (12), or the earlier dissolution of 
                the bridge financial company, as provided in 
                paragraph (15).
          [(14) Effect of termination events.--
                  [(A) Merger or consolidation.--A merger or 
                consolidation, described in paragraph (13)(A) 
                shall be conducted in accordance with, and 
                shall have the effect provided in, the 
                provisions of applicable law. For the purpose 
                of effecting such a merger or consolidation, 
                the bridge financial company shall be treated 
                as a corporation organized under the laws of 
                the State of Delaware (unless the law of 
                another State has been selected by the bridge 
                financial company in accordance with paragraph 
                (2)(F)), and the Corporation shall be treated 
                as the sole shareholder thereof, 
                notwithstanding any other provision of State or 
                Federal law.
                  [(B) Charter conversion.--Following the sale 
                of a majority of the capital stock of the 
                bridge financial company, as provided in 
                paragraph (13)(B), the Corporation may amend 
                the charter of the bridge financial company to 
                reflect the termination of the status of the 
                bridge financial company as such, whereupon the 
                company shall have all of the rights, powers, 
                and privileges under its constituent documents 
                and applicable Federal or State law. In 
                connection therewith, the Corporation may take 
                such steps as may be necessary or convenient to 
                reincorporate the bridge financial company 
                under the laws of a State and, notwithstanding 
                any provisions of Federal or State law, such 
                State-chartered corporation shall be deemed to 
                succeed by operation of law to such rights, 
                titles, powers, and interests of the bridge 
                financial company as the Corporation may 
                provide, with the same effect as if the bridge 
                financial company had merged with the State-
                chartered corporation under provisions of the 
                corporate laws of such State.
                  [(C) Sale of stock.--Following the sale of 80 
                percent or more of the capital stock of a 
                bridge financial company, as provided in 
                paragraph (13)(C), the company shall have all 
                of the rights, powers, and privileges under its 
                constituent documents and applicable Federal or 
                State law. In connection therewith, the 
                Corporation may take such steps as may be 
                necessary or convenient to reincorporate the 
                bridge financial company under the laws of a 
                State and, notwithstanding any provisions of 
                Federal or State law, the State-chartered 
                corporation shall be deemed to succeed by 
                operation of law to such rights, titles, powers 
                and interests of the bridge financial company 
                as the Corporation may provide, with the same 
                effect as if the bridge financial company had 
                merged with the State-chartered corporation 
                under provisions of the corporate laws of such 
                State.
                  [(D) Assumption of liabilities and sale of 
                assets.--Following the assumption of all or 
                substantially all of the liabilities of the 
                bridge financial company, or the sale of all or 
                substantially all of the assets of the bridge 
                financial company, as provided in paragraph 
                (13)(D), at the election of the Corporation, 
                the bridge financial company may retain its 
                status as such for the period provided in 
                paragraph (12) or may be dissolved at the 
                election of the Corporation.
                  [(E) Amendments to charter.--Following the 
                consummation of a transaction described in 
                subparagraph (A), (B), (C), or (D) of paragraph 
                (13), the charter of the resulting company 
                shall be amended to reflect the termination of 
                bridge financial company status, if 
                appropriate.
          [(15) Dissolution of bridge financial company.--
                  [(A) In general.--Notwithstanding any other 
                provision of Federal or State law, if the 
                status of a bridge financial company as such 
                has not previously been terminated by the 
                occurrence of an event specified in 
                subparagraph (A), (B), (C), or (D) of paragraph 
                (13)--
                          [(i) the Corporation may, in its 
                        discretion, dissolve the bridge 
                        financial company in accordance with 
                        this paragraph at any time; and
                          [(ii) the Corporation shall promptly 
                        commence dissolution proceedings in 
                        accordance with this paragraph upon the 
                        expiration of the 2-year period 
                        following the date on which the bridge 
                        financial company was chartered, or any 
                        extension thereof, as provided in 
                        paragraph (12).
                  [(B) Procedures.--The Corporation shall 
                remain the receiver for a bridge financial 
                company for the purpose of dissolving the 
                bridge financial company. The Corporation as 
                receiver for a bridge financial company shall 
                wind up the affairs of the bridge financial 
                company in conformity with the provisions of 
                law relating to the liquidation of covered 
                financial companies under this title. With 
                respect to any such bridge financial company, 
                the Corporation as receiver shall have all the 
                rights, powers, and privileges and shall 
                perform the duties related to the exercise of 
                such rights, powers, or privileges granted by 
                law to the Corporation as receiver for a 
                covered financial company under this title and, 
                notwithstanding any other provision of law, in 
                the exercise of such rights, powers, and 
                privileges, the Corporation shall not be 
                subject to the direction or supervision of any 
                State agency or other Federal agency.
          [(16) Authority to obtain credit.--
                  [(A) In general.--A bridge financial company 
                may obtain unsecured credit and issue unsecured 
                debt.
                  [(B) Inability to obtain credit.--If a bridge 
                financial company is unable to obtain unsecured 
                credit or issue unsecured debt, the Corporation 
                may authorize the obtaining of credit or the 
                issuance of debt by the bridge financial 
                company--
                          [(i) with priority over any or all of 
                        the obligations of the bridge financial 
                        company;
                          [(ii) secured by a lien on property 
                        of the bridge financial company that is 
                        not otherwise subject to a lien; or
                          [(iii) secured by a junior lien on 
                        property of the bridge financial 
                        company that is subject to a lien.
                  [(C) Limitations.--
                          [(i) In general.--The Corporation, 
                        after notice and a hearing, may 
                        authorize the obtaining of credit or 
                        the issuance of debt by a bridge 
                        financial company that is secured by a 
                        senior or equal lien on property of the 
                        bridge financial company that is 
                        subject to a lien, only if--
                                  [(I) the bridge financial 
                                company is unable to otherwise 
                                obtain such credit or issue 
                                such debt; and
                                  [(II) there is adequate 
                                protection of the interest of 
                                the holder of the lien on the 
                                property with respect to which 
                                such senior or equal lien is 
                                proposed to be granted.
                          [(ii) Hearing.--The hearing required 
                        pursuant to this subparagraph shall be 
                        before a court of the United States, 
                        which shall have jurisdiction to 
                        conduct such hearing and to authorize a 
                        bridge financial company to obtain 
                        secured credit under clause (i).
                  [(D) Burden of proof.--In any hearing under 
                this paragraph, the Corporation has the burden 
                of proof on the issue of adequate protection.
                  [(E) Qualified financial contracts.--No 
                credit or debt obtained or issued by a bridge 
                financial company may contain terms that impair 
                the rights of a counterparty to a qualified 
                financial contract upon a default by the bridge 
                financial company, other than the priority of 
                such counterparty's unsecured claim (after the 
                exercise of rights) relative to the priority of 
                the bridge financial company's obligations in 
                respect of such credit or debt, unless such 
                counterparty consents in writing to any such 
                impairment.
          [(17) Effect on debts and liens.--The reversal or 
        modification on appeal of an authorization under this 
        subsection to obtain credit or issue debt, or of a 
        grant under this section of a priority or a lien, does 
        not affect the validity of any debt so issued, or any 
        priority or lien so granted, to an entity that extended 
        such credit in good faith, whether or not such entity 
        knew of the pendency of the appeal, unless such 
        authorization and the issuance of such debt, or the 
        granting of such priority or lien, were stayed pending 
        appeal.
  [(i) Sharing Records.--If the Corporation has been appointed 
as receiver for a covered financial company, other Federal 
regulators shall make all records relating to the covered 
financial company available to the Corporation, which may be 
used by the Corporation in any manner that the Corporation 
determines to be appropriate.
  [(j) Expedited Procedures for Certain Claims.--
          [(1) Time for filing notice of appeal.--The notice of 
        appeal of any order, whether interlocutory or final, 
        entered in any case brought by the Corporation against 
        a director, officer, employee, agent, attorney, 
        accountant, or appraiser of the covered financial 
        company, or any other person employed by or providing 
        services to a covered financial company, shall be filed 
        not later than 30 days after the date of entry of the 
        order. The hearing of the appeal shall be held not 
        later than 120 days after the date of the notice of 
        appeal. The appeal shall be decided not later than 180 
        days after the date of the notice of appeal.
          [(2) Scheduling.--The court shall expedite the 
        consideration of any case brought by the Corporation 
        against a director, officer, employee, agent, attorney, 
        accountant, or appraiser of a covered financial company 
        or any other person employed by or providing services 
        to a covered financial company. As far as practicable, 
        the court shall give such case priority on its docket.
          [(3) Judicial discretion.--The court may modify the 
        schedule and limitations stated in paragraphs (1) and 
        (2) in a particular case, based on a specific finding 
        that the ends of justice that would be served by making 
        such a modification would outweigh the best interest of 
        the public in having the case resolved expeditiously.
  [(k) Foreign Investigations.--The Corporation, as receiver 
for any covered financial company, and for purposes of carrying 
out any power, authority, or duty with respect to a covered 
financial company--
          [(1) may request the assistance of any foreign 
        financial authority and provide assistance to any 
        foreign financial authority in accordance with section 
        8(v) of the Federal Deposit Insurance Act, as if the 
        covered financial company were an insured depository 
        institution, the Corporation were the appropriate 
        Federal banking agency for the company, and any foreign 
        financial authority were the foreign banking authority; 
        and
          [(2) may maintain an office to coordinate foreign 
        investigations or investigations on behalf of foreign 
        financial authorities.
  [(l) Prohibition on Entering Secrecy Agreements and 
Protective Orders.--The Corporation may not enter into any 
agreement or approve any protective order which prohibits the 
Corporation from disclosing the terms of any settlement of an 
administrative or other action for damages or restitution 
brought by the Corporation in its capacity as receiver for a 
covered financial company.
  [(m) Liquidation of Certain Covered Financial Companies or 
Bridge Financial Companies.--
          [(1) In general.--Except as specifically provided in 
        this section, and notwithstanding any other provision 
        of law, the Corporation, in connection with the 
        liquidation of any covered financial company or bridge 
        financial company with respect to which the Corporation 
        has been appointed as receiver, shall--
                  [(A) in the case of any covered financial 
                company or bridge financial company that is a 
                stockbroker, but is not a member of the 
                Securities Investor Protection Corporation, 
                apply the provisions of subchapter III of 
                chapter 7 of the Bankruptcy Code, in respect of 
                the distribution to any customer of all 
                customer name security and customer property 
                and member property, as if such covered 
                financial company or bridge financial company 
                were a debtor for purposes of such subchapter; 
                or
                  [(B) in the case of any covered financial 
                company or bridge financial company that is a 
                commodity broker, apply the provisions of 
                subchapter IV of chapter 7 the Bankruptcy Code, 
                in respect of the distribution to any customer 
                of all customer property and member property, 
                as if such covered financial company or bridge 
                financial company were a debtor for purposes of 
                such subchapter.
          [(2) Definitions.--For purposes of this subsection--
                  [(A) the terms ``customer'', ``customer name 
                security'', and ``customer property and member 
                property'' have the same meanings as in 
                sections 741 and 761 of title 11, United States 
                Code; and
                  [(B) the terms ``commodity broker'' and 
                ``stockbroker'' have the same meanings as in 
                section 101 of the Bankruptcy Code.
  [(n) Orderly Liquidation Fund.--
          [(1) Establishment.--There is established in the 
        Treasury of the United States a separate fund to be 
        known as the ``Orderly Liquidation Fund'', which shall 
        be available to the Corporation to carry out the 
        authorities contained in this title, for the cost of 
        actions authorized by this title, including the orderly 
        liquidation of covered financial companies, payment of 
        administrative expenses, the payment of principal and 
        interest by the Corporation on obligations issued under 
        paragraph (5), and the exercise of the authorities of 
        the Corporation under this title.
          [(2) Proceeds.--Amounts received by the Corporation, 
        including assessments received under subsection (o), 
        proceeds of obligations issued under paragraph (5), 
        interest and other earnings from investments, and 
        repayments to the Corporation by covered financial 
        companies, shall be deposited into the Fund.
          [(3) Management.--The Corporation shall manage the 
        Fund in accordance with this subsection and the 
        policies and procedures established under section 
        203(d).
          [(4) Investments.--At the request of the Corporation, 
        the Secretary may invest such portion of amounts held 
        in the Fund that are not, in the judgment of the 
        Corporation, required to meet the current needs of the 
        Corporation, in obligations of the United States having 
        suitable maturities, as determined by the Corporation. 
        The interest on and the proceeds from the sale or 
        redemption of such obligations shall be credited to the 
        Fund.
          [(5) Authority to issue obligations.--
                  [(A) Corporation authorized to issue 
                obligations.--Upon appointment by the Secretary 
                of the Corporation as receiver for a covered 
                financial company, the Corporation is 
                authorized to issue obligations to the 
                Secretary.
                  [(B) Secretary authorized to purchase 
                obligations.--The Secretary may, under such 
                terms and conditions as the Secretary may 
                require, purchase or agree to purchase any 
                obligations issued under subparagraph (A), and 
                for such purpose, the Secretary is authorized 
                to use as a public debt transaction the 
                proceeds of the sale of any securities issued 
                under chapter 31 of title 31, United States 
                Code, and the purposes for which securities may 
                be issued under chapter 31 of title 31, United 
                States Code, are extended to include such 
                purchases.
                  [(C) Interest rate.--Each purchase of 
                obligations by the Secretary under this 
                paragraph shall be upon such terms and 
                conditions as to yield a return at a rate 
                determined by the Secretary, taking into 
                consideration the current average yield on 
                outstanding marketable obligations of the 
                United States of comparable maturity, plus an 
                interest rate surcharge to be determined by the 
                Secretary, which shall be greater than the 
                difference between--
                          [(i) the current average rate on an 
                        index of corporate obligations of 
                        comparable maturity; and
                          [(ii) the current average rate on 
                        outstanding marketable obligations of 
                        the United States of comparable 
                        maturity.
                  [(D) Secretary authorized to sell 
                obligations.--The Secretary may sell, upon such 
                terms and conditions as the Secretary shall 
                determine, any of the obligations acquired 
                under this paragraph.
                  [(E) Public debt transactions.--All purchases 
                and sales by the Secretary of such obligations 
                under this paragraph shall be treated as public 
                debt transactions of the United States, and the 
                proceeds from the sale of any obligations 
                acquired by the Secretary under this paragraph 
                shall be deposited into the Treasury of the 
                United States as miscellaneous receipts.
          [(6) Maximum obligation limitation.--The Corporation 
        may not, in connection with the orderly liquidation of 
        a covered financial company, issue or incur any 
        obligation, if, after issuing or incurring the 
        obligation, the aggregate amount of such obligations 
        outstanding under this subsection for each covered 
        financial company would exceed--
                  [(A) an amount that is equal to 10 percent of 
                the total consolidated assets of the covered 
                financial company, based on the most recent 
                financial statement available, during the 30-
                day period immediately following the date of 
                appointment of the Corporation as receiver (or 
                a shorter time period if the Corporation has 
                calculated the amount described under 
                subparagraph (B)); and
                  [(B) the amount that is equal to 90 percent 
                of the fair value of the total consolidated 
                assets of each covered financial company that 
                are available for repayment, after the time 
                period described in subparagraph (A).
          [(7) Rulemaking.--The Corporation and the Secretary 
        shall jointly, in consultation with the Council, 
        prescribe regulations governing the calculation of the 
        maximum obligation limitation defined in this 
        paragraph.
          [(8) Rule of construction.--
                  [(A) In general.--Nothing in this section 
                shall be construed to affect the authority of 
                the Corporation under subsection (a) or (b) of 
                section 14 or section 15(c)(5) of the Federal 
                Deposit Insurance Act (12 U.S.C. 1824, 
                1825(c)(5)), the management of the Deposit 
                Insurance Fund by the Corporation, or the 
                resolution of insured depository institutions, 
                provided that--
                          [(i) the authorities of the 
                        Corporation contained in this title 
                        shall not be used to assist the Deposit 
                        Insurance Fund or to assist any 
                        financial company under applicable law 
                        other than this Act;
                          [(ii) the authorities of the 
                        Corporation relating to the Deposit 
                        Insurance Fund, or any other 
                        responsibilities of the Corporation 
                        under applicable law other than this 
                        title, shall not be used to assist a 
                        covered financial company pursuant to 
                        this title; and
                          [(iii) the Deposit Insurance Fund may 
                        not be used in any manner to otherwise 
                        circumvent the purposes of this title.
                  [(B) Valuation.--For purposes of determining 
                the amount of obligations under this 
                subsection--
                          [(i) the Corporation shall include as 
                        an obligation any contingent liability 
                        of the Corporation pursuant to this 
                        title; and
                          [(ii) the Corporation shall value any 
                        contingent liability at its expected 
                        cost to the Corporation.
          [(9) Orderly liquidation and repayment plans.--
                  [(A) Orderly liquidation plan.--Amounts in 
                the Fund shall be available to the Corporation 
                with regard to a covered financial company for 
                which the Corporation is appointed receiver 
                after the Corporation has developed an orderly 
                liquidation plan that is acceptable to the 
                Secretary with regard to such covered financial 
                company, including the provision and use of 
                funds, including taking any actions specified 
                under section 204(d) and subsection 
                (h)(2)(G)(iv) and (h)(9) of this section, and 
                payments to third parties. The orderly 
                liquidation plan shall take into account 
                actions to avoid or mitigate potential adverse 
                effects on low income, minority, or underserved 
                communities affected by the failure of the 
                covered financial company, and shall provide 
                for coordination with the primary financial 
                regulatory agencies, as appropriate, to ensure 
                that such actions are taken. The Corporation 
                may, at any time, amend any orderly liquidation 
                plan approved by the Secretary with the 
                concurrence of the Secretary.
                  [(B) Mandatory repayment plan.--
                          [(i) In general.--No amount 
                        authorized under paragraph (6)(B) may 
                        be provided by the Secretary to the 
                        Corporation under paragraph (5), unless 
                        an agreement is in effect between the 
                        Secretary and the Corporation that--
                                  [(I) provides a specific plan 
                                and schedule to achieve the 
                                repayment of the outstanding 
                                amount of any borrowing under 
                                paragraph (5); and
                                  [(II) demonstrates that 
                                income to the Corporation from 
                                the liquidated assets of the 
                                covered financial company and 
                                assessments under subsection 
                                (o) will be sufficient to 
                                amortize the outstanding 
                                balance within the period 
                                established in the repayment 
                                schedule and pay the interest 
                                accruing on such balance within 
                                the time provided in subsection 
                                (o)(1)(B).
                          [(ii) Consultation with and report to 
                        congress.--The Secretary and the 
                        Corporation shall--
                                  [(I) consult with the 
                                Committee on Banking, Housing, 
                                and Urban Affairs of the Senate 
                                and the Committee on Financial 
                                Services of the House of 
                                Representatives on the terms of 
                                any repayment schedule 
                                agreement; and
                                  [(II) submit a copy of the 
                                repayment schedule agreement to 
                                the Committees described in 
                                subclause (I) before the end of 
                                the 30-day period beginning on 
                                the date on which any amount is 
                                provided by the Secretary to 
                                the Corporation under paragraph 
                                (5).
          [(10) Implementation expenses.--
                  [(A) In general.--Reasonable implementation 
                expenses of the Corporation incurred after the 
                date of enactment of this Act shall be treated 
                as expenses of the Council.
                  [(B) Requests for reimbursement.--The 
                Corporation shall periodically submit a request 
                for reimbursement for implementation expenses 
                to the Chairperson of the Council, who shall 
                arrange for prompt reimbursement to the 
                Corporation of reasonable implementation 
                expenses.
                  [(C) Definition.--As used in this paragraph, 
                the term ``implementation expenses''--
                          [(i) means costs incurred by the 
                        Corporation beginning on the date of 
                        enactment of this Act, as part of its 
                        efforts to implement this title that do 
                        not relate to a particular covered 
                        financial company; and
                          [(ii) includes the costs incurred in 
                        connection with the development of 
                        policies, procedures, rules, and 
                        regulations and other planning 
                        activities of the Corporation 
                        consistent with carrying out this 
                        title.
  [(o) Assessments.--
          [(1) Risk-based assessments.--
                  [(A) Eligible financial companies defined.--
                For purposes of this subsection, the term 
                ``eligible financial company'' means any bank 
                holding company with total consolidated assets 
                equal to or greater than $50,000,000,000 and 
                any nonbank financial company supervised by the 
                Board of Governors.
                  [(B) Assessments.--The Corporation shall 
                charge one or more risk-based assessments in 
                accordance with the provisions of subparagraph 
                (D), if such assessments are necessary to pay 
                in full the obligations issued by the 
                Corporation to the Secretary under this title 
                within 60 months of the date of issuance of 
                such obligations.
                  [(C) Extensions authorized.--The Corporation 
                may, with the approval of the Secretary, extend 
                the time period under subparagraph (B), if the 
                Corporation determines that an extension is 
                necessary to avoid a serious adverse effect on 
                the financial system of the United States.
                  [(D) Application of assessments.--To meet the 
                requirements of subparagraph (B), the 
                Corporation shall--
                          [(i) impose assessments, as soon as 
                        practicable, on any claimant that 
                        received additional payments or amounts 
                        from the Corporation pursuant to 
                        subsection (b)(4), (d)(4), or 
                        (h)(5)(E), except for payments or 
                        amounts necessary to initiate and 
                        continue operations essential to 
                        implementation of the receivership or 
                        any bridge financial company, to 
                        recover on a cumulative basis, the 
                        entire difference between--
                                  [(I) the aggregate value the 
                                claimant received from the 
                                Corporation on a claim pursuant 
                                to this title (including 
                                pursuant to subsection (b)(4), 
                                (d)(4), and (h)(5)(E)), as of 
                                the date on which such value 
                                was received; and
                                  [(II) the value the claimant 
                                was entitled to receive from 
                                the Corporation on such claim 
                                solely from the proceeds of the 
                                liquidation of the covered 
                                financial company under this 
                                title; and
                          [(ii) if the amounts to be recovered 
                        on a cumulative basis under clause (i) 
                        are insufficient to meet the 
                        requirements of subparagraph (B), after 
                        taking into account the considerations 
                        set forth in paragraph (4), impose 
                        assessments on--
                                  [(I) eligible financial 
                                companies; and
                                  [(II) financial companies 
                                with total consolidated assets 
                                equal to or greater than 
                                $50,000,000,000 that are not 
                                eligible financial companies.
                  [(E) Provision of financing.--Payments or 
                amounts necessary to initiate and continue 
                operations essential to implementation of the 
                receivership or any bridge financial company 
                described in subparagraph (D)(i) shall not 
                include the provision of financing, as defined 
                by rule of the Corporation, to third parties.
          [(2) Graduated assessment rate.--The Corporation 
        shall impose assessments on a graduated basis, with 
        financial companies having greater assets and risk 
        being assessed at a higher rate.
          [(3) Notification and payment.--The Corporation shall 
        notify each financial company of that company's 
        assessment under this subsection. Any financial company 
        subject to assessment under this subsection shall pay 
        such assessment in accordance with the regulations 
        prescribed pursuant to paragraph (6).
          [(4) Risk-based assessment considerations.--In 
        imposing assessments under paragraph (1)(D)(ii), the 
        Corporation shall use a risk matrix. The Council shall 
        make a recommendation to the Corporation on the risk 
        matrix to be used in imposing such assessments, and the 
        Corporation shall take into account any such 
        recommendation in the establishment of the risk matrix 
        to be used to impose such assessments. In recommending 
        or establishing such risk matrix, the Council and the 
        Corporation, respectively, shall take into account--
                  [(A) economic conditions generally affecting 
                financial companies so as to allow assessments 
                to increase during more favorable economic 
                conditions and to decrease during less 
                favorable economic conditions;
                  [(B) any assessments imposed on a financial 
                company or an affiliate of a financial company 
                that--
                          [(i) is an insured depository 
                        institution, assessed pursuant to 
                        section 7 or 13(c)(4)(G) of the Federal 
                        Deposit Insurance Act;
                          [(ii) is a member of the Securities 
                        Investor Protection Corporation, 
                        assessed pursuant to section 4 of the 
                        Securities Investor Protection Act of 
                        1970 (15 U.S.C. 78ddd);
                          [(iii) is an insured credit union, 
                        assessed pursuant to section 
                        202(c)(1)(A)(i) of the Federal Credit 
                        Union Act (12 U.S.C. 1782(c)(1)(A)(i)); 
                        or
                          [(iv) is an insurance company, 
                        assessed pursuant to applicable State 
                        law to cover (or reimburse payments 
                        made to cover) the costs of the 
                        rehabilitation, liquidation, or other 
                        State insolvency proceeding with 
                        respect to 1 or more insurance 
                        companies;
                  [(C) the risks presented by the financial 
                company to the financial system and the extent 
                to which the financial company has benefitted, 
                or likely would benefit, from the orderly 
                liquidation of a financial company under this 
                title, including--
                          [(i) the amount, different 
                        categories, and concentrations of 
                        assets of the financial company and its 
                        affiliates, including both on-balance 
                        sheet and off-balance sheet assets;
                          [(ii) the activities of the financial 
                        company and its affiliates;
                          [(iii) the relevant market share of 
                        the financial company and its 
                        affiliates;
                          [(iv) the extent to which the 
                        financial company is leveraged;
                          [(v) the potential exposure to sudden 
                        calls on liquidity precipitated by 
                        economic distress;
                          [(vi) the amount, maturity, 
                        volatility, and stability of the 
                        company's financial obligations to, and 
                        relationship with, other financial 
                        companies;
                          [(vii) the amount, maturity, 
                        volatility, and stability of the 
                        liabilities of the company, including 
                        the degree of reliance on short-term 
                        funding, taking into consideration 
                        existing systems for measuring a 
                        company's risk-based capital;
                          [(viii) the stability and variety of 
                        the company's sources of funding;
                          [(ix) the company's importance as a 
                        source of credit for households, 
                        businesses, and State and local 
                        governments and as a source of 
                        liquidity for the financial system;
                          [(x) the extent to which assets are 
                        simply managed and not owned by the 
                        financial company and the extent to 
                        which ownership of assets under 
                        management is diffuse; and
                          [(xi) the amount, different 
                        categories, and concentrations of 
                        liabilities, both insured and 
                        uninsured, contingent and 
                        noncontingent, including both on-
                        balance sheet and off-balance sheet 
                        liabilities, of the financial company 
                        and its affiliates;
                  [(D) any risks presented by the financial 
                company during the 10-year period immediately 
                prior to the appointment of the Corporation as 
                receiver for the covered financial company that 
                contributed to the failure of the covered 
                financial company; and
                  [(E) such other risk-related factors as the 
                Corporation, or the Council, as applicable, may 
                determine to be appropriate.
          [(5) Collection of information.--The Corporation may 
        impose on covered financial companies such collection 
        of information requirements as the Corporation deems 
        necessary to carry out this subsection after the 
        appointment of the Corporation as receiver under this 
        title.
          [(6) Rulemaking.--
                  [(A) In general.--The Corporation shall 
                prescribe regulations to carry out this 
                subsection. The Corporation shall consult with 
                the Secretary in the development and 
                finalization of such regulations.
                  [(B) Equitable treatment.--The regulations 
                prescribed under subparagraph (A) shall take 
                into account the differences in risks posed to 
                the financial stability of the United States by 
                financial companies, the differences in the 
                liability structures of financial companies, 
                and the different bases for other assessments 
                that such financial companies may be required 
                to pay, to ensure that assessed financial 
                companies are treated equitably and that 
                assessments under this subsection reflect such 
                differences.
  [(p) Unenforceability of Certain Agreements.--
          [(1) In general.--No provision described in paragraph 
        (2) shall be enforceable against or impose any 
        liability on any person, as such enforcement or 
        liability shall be contrary to public policy.
          [(2) Prohibited provisions.--A provision described in 
        this paragraph is any term contained in any existing or 
        future standstill, confidentiality, or other agreement 
        that, directly or indirectly--
                  [(A) affects, restricts, or limits the 
                ability of any person to offer to acquire or 
                acquire;
                  [(B) prohibits any person from offering to 
                acquire or acquiring; or
                  [(C) prohibits any person from using any 
                previously disclosed information in connection 
                with any such offer to acquire or acquisition 
                of,
        all or part of any covered financial company, including 
        any liabilities, assets, or interest therein, in 
        connection with any transaction in which the 
        Corporation exercises its authority under this title.
  [(q) Other Exemptions.--
          [(1) In general.--When acting as a receiver under 
        this title--
                  [(A) the Corporation, including its 
                franchise, its capital, reserves and surplus, 
                and its income, shall be exempt from all 
                taxation imposed by any State, county, 
                municipality, or local taxing authority, except 
                that any real property of the Corporation shall 
                be subject to State, territorial, county, 
                municipal, or local taxation to the same extent 
                according to its value as other real property 
                is taxed, except that, notwithstanding the 
                failure of any person to challenge an 
                assessment under State law of the value of such 
                property, such value, and the tax thereon, 
                shall be determined as of the period for which 
                such tax is imposed;
                  [(B) no property of the Corporation shall be 
                subject to levy, attachment, garnishment, 
                foreclosure, or sale without the consent of the 
                Corporation, nor shall any involuntary lien 
                attach to the property of the Corporation; and
                  [(C) the Corporation shall not be liable for 
                any amounts in the nature of penalties or 
                fines, including those arising from the failure 
                of any person to pay any real property, 
                personal property, probate, or recording tax or 
                any recording or filing fees when due; and
                  [(D) the Corporation shall be exempt from all 
                prosecution by the United States or any State, 
                county, municipality, or local authority for 
                any criminal offense arising under Federal, 
                State, county, municipal, or local law, which 
                was allegedly committed by the covered 
                financial company, or persons acting on behalf 
                of the covered financial company, prior to the 
                appointment of the Corporation as receiver.
          [(2) Limitation.--Paragraph (1) shall not apply with 
        respect to any tax imposed (or other amount arising) 
        under the Internal Revenue Code of 1986.
  [(r) Certain Sales of Assets Prohibited.--
          [(1) Persons who engaged in improper conduct with, or 
        caused losses to, covered financial companies.--The 
        Corporation shall prescribe regulations which, at a 
        minimum, shall prohibit the sale of assets of a covered 
        financial company by the Corporation to--
                  [(A) any person who--
                          [(i) has defaulted, or was a member 
                        of a partnership or an officer or 
                        director of a corporation that has 
                        defaulted, on 1 or more obligations, 
                        the aggregate amount of which exceeds 
                        $1,000,000, to such covered financial 
                        company;
                          [(ii) has been found to have engaged 
                        in fraudulent activity in connection 
                        with any obligation referred to in 
                        clause (i); and
                          [(iii) proposes to purchase any such 
                        asset in whole or in part through the 
                        use of the proceeds of a loan or 
                        advance of credit from the Corporation 
                        or from any covered financial company;
                  [(B) any person who participated, as an 
                officer or director of such covered financial 
                company or of any affiliate of such company, in 
                a material way in any transaction that resulted 
                in a substantial loss to such covered financial 
                company; or
                  [(C) any person who has demonstrated a 
                pattern or practice of defalcation regarding 
                obligations to such covered financial company.
          [(2) Convicted debtors.--Except as provided in 
        paragraph (3), a person may not purchase any asset of 
        such institution from the receiver, if that person--
                  [(A) has been convicted of an offense under 
                section 215, 656, 657, 1005, 1006, 1007, 1008, 
                1014, 1032, 1341, 1343, or 1344 of title 18, 
                United States Code, or of conspiring to commit 
                such an offense, affecting any covered 
                financial company; and
                  [(B) is in default on any loan or other 
                extension of credit from such covered financial 
                company which, if not paid, will cause 
                substantial loss to the Fund or the 
                Corporation.
          [(3) Settlement of claims.--Paragraphs (1) and (2) 
        shall not apply to the sale or transfer by the 
        Corporation of any asset of any covered financial 
        company to any person, if the sale or transfer of the 
        asset resolves or settles, or is part of the resolution 
        or settlement, of 1 or more claims that have been, or 
        could have been, asserted by the Corporation against 
        the person.
          [(4) Definition of default.--For purposes of this 
        subsection, the term ``default'' means a failure to 
        comply with the terms of a loan or other obligation to 
        such an extent that the property securing the 
        obligation is foreclosed upon.
  [(s) Recoupment of Compensation From Senior Executives and 
Directors.--
          [(1) In general.--The Corporation, as receiver of a 
        covered financial company, may recover from any current 
        or former senior executive or director substantially 
        responsible for the failed condition of the covered 
        financial company any compensation received during the 
        2-year period preceding the date on which the 
        Corporation was appointed as the receiver of the 
        covered financial company, except that, in the case of 
        fraud, no time limit shall apply.
          [(2) Cost considerations.--In seeking to recover any 
        such compensation, the Corporation shall weigh the 
        financial and deterrent benefits of such recovery 
        against the cost of executing the recovery.
          [(3) Rulemaking.--The Corporation shall promulgate 
        regulations to implement the requirements of this 
        subsection, including defining the term 
        ``compensation'' to mean any financial remuneration, 
        including salary, bonuses, incentives, benefits, 
        severance, deferred compensation, or golden parachute 
        benefits, and any profits realized from the sale of the 
        securities of the covered financial company.

[SEC. 211. MISCELLANEOUS PROVISIONS.

  [(a) Clarification of Prohibition Regarding Concealment of 
Assets From Receiver or Liquidating Agent.--Section 1032(1) of 
title 18, United States Code, is amended by inserting ``the 
Federal Deposit Insurance Corporation acting as receiver for a 
covered financial company, in accordance with title II of the 
Dodd-Frank Wall Street Reform and Consumer Protection Act,'' 
before ``or the National Credit''.
  [(b) Conforming Amendment.--Section 1032 of title 18, United 
States Code, is amended in the section heading, by striking 
``of financial institution''.
  [(c) Federal Deposit Insurance Corporation Improvement Act of 
1991.--Section 403(a) of the Federal Deposit Insurance 
Corporation Improvement Act of 1991 (12 U.S.C. 4403(a)) is 
amended by inserting ``section 210(c) of the Dodd-Frank Wall 
Street Reform and Consumer Protection Act, section 1367 of the 
Federal Housing Enterprises Financial Safety and Soundness Act 
of 1992 (12 U.S.C. 4617(d)),'' after ``section 11(e) of the 
Federal Deposit Insurance Act,''.
  [(d) FDIC Inspector General Reviews.--
          [(1) Scope.--The Inspector General of the Corporation 
        shall conduct, supervise, and coordinate audits and 
        investigations of the liquidation of any covered 
        financial company by the Corporation as receiver under 
        this title, including collecting and summarizing--
                  [(A) a description of actions taken by the 
                Corporation as receiver;
                  [(B) a description of any material sales, 
                transfers, mergers, obligations, purchases, and 
                other material transactions entered into by the 
                Corporation;
                  [(C) an evaluation of the adequacy of the 
                policies and procedures of the Corporation 
                under section 203(d) and orderly liquidation 
                plan under section 210(n)(14);
                  [(D) an evaluation of the utilization by the 
                Corporation of the private sector in carrying 
                out its functions, including the adequacy of 
                any conflict-of-interest reviews; and
                  [(E) an evaluation of the overall performance 
                of the Corporation in liquidating the covered 
                financial company, including administrative 
                costs, timeliness of liquidation process, and 
                impact on the financial system.
          [(2) Frequency.--Not later than 6 months after the 
        date of appointment of the Corporation as receiver 
        under this title and every 6 months thereafter, the 
        Inspector General of the Corporation shall conduct the 
        audit and investigation described in paragraph (1).
          [(3) Reports and testimony.--The Inspector General of 
        the Corporation shall include in the semiannual reports 
        required by section 5(a) of the Inspector General Act 
        of 1978 (5 U.S.C. App.), a summary of the findings and 
        evaluations under paragraph (1), and shall appear 
        before the appropriate committees of Congress, if 
        requested, to present each such report.
          [(4) Funding.--
                  [(A) Initial funding.--The expenses of the 
                Inspector General of the Corporation in 
                carrying out this subsection shall be 
                considered administrative expenses of the 
                receivership.
                  [(B) Additional funding.--If the maximum 
                amount available to the Corporation as receiver 
                under this title is insufficient to enable the 
                Inspector General of the Corporation to carry 
                out the duties under this subsection, the 
                Corporation shall pay such additional amounts 
                from assessments imposed under section 210.
          [(5) Termination of responsibilities.--The duties and 
        responsibilities of the Inspector General of the 
        Corporation under this subsection shall terminate 1 
        year after the date of termination of the receivership 
        under this title.
  [(e) Treasury Inspector General Reviews.--
          [(1) Scope.--The Inspector General of the Department 
        of the Treasury shall conduct, supervise, and 
        coordinate audits and investigations of actions taken 
        by the Secretary related to the liquidation of any 
        covered financial company under this title, including 
        collecting and summarizing--
                  [(A) a description of actions taken by the 
                Secretary under this title;
                  [(B) an analysis of the approval by the 
                Secretary of the policies and procedures of the 
                Corporation under section 203 and acceptance of 
                the orderly liquidation plan of the Corporation 
                under section 210; and
                  [(C) an assessment of the terms and 
                conditions underlying the purchase by the 
                Secretary of obligations of the Corporation 
                under section 210.
          [(2) Frequency.--Not later than 6 months after the 
        date of appointment of the Corporation as receiver 
        under this title and every 6 months thereafter, the 
        Inspector General of the Department of the Treasury 
        shall conduct the audit and investigation described in 
        paragraph (1).
          [(3) Reports and testimony.--The Inspector General of 
        the Department of the Treasury shall include in the 
        semiannual reports required by section 5(a) of the 
        Inspector General Act of 1978 (5 U.S.C. App.), a 
        summary of the findings and assessments under paragraph 
        (1), and shall appear before the appropriate committees 
        of Congress, if requested, to present each such report.
          [(4) Termination of responsibilities.--The duties and 
        responsibilities of the Inspector General of the 
        Department of the Treasury under this subsection shall 
        terminate 1 year after the date on which the 
        obligations purchased by the Secretary from the 
        Corporation under section 210 are fully redeemed.
  [(f) Primary Financial Regulatory Agency Inspector General 
Reviews.--
          [(1) Scope.--Upon the appointment of the Corporation 
        as receiver for a covered financial company supervised 
        by a Federal primary financial regulatory agency or the 
        Board of Governors under section 165, the Inspector 
        General of the agency or the Board of Governors shall 
        make a written report reviewing the supervision by the 
        agency or the Board of Governors of the covered 
        financial company, which shall--
                  [(A) evaluate the effectiveness of the agency 
                or the Board of Governors in carrying out its 
                supervisory responsibilities with respect to 
                the covered financial company;
                  [(B) identify any acts or omissions on the 
                part of agency or Board of Governors officials 
                that contributed to the covered financial 
                company being in default or in danger of 
                default;
                  [(C) identify any actions that could have 
                been taken by the agency or the Board of 
                Governors that would have prevented the company 
                from being in default or in danger of default; 
                and
                  [(D) recommend appropriate administrative or 
                legislative action.
          [(2) Reports and testimony.--Not later than 1 year 
        after the date of appointment of the Corporation as 
        receiver under this title, the Inspector General of the 
        Federal primary financial regulatory agency or the 
        Board of Governors shall provide the report required by 
        paragraph (1) to such agency or the Board of Governors, 
        and along with such agency or the Board of Governors, 
        as applicable, shall appear before the appropriate 
        committees of Congress, if requested, to present the 
        report required by paragraph (1). Not later than 90 
        days after the date of receipt of the report required 
        by paragraph (1), such agency or the Board of 
        Governors, as applicable, shall provide a written 
        report to Congress describing any actions taken in 
        response to the recommendations in the report, and if 
        no such actions were taken, describing the reasons why 
        no actions were taken.

[SEC. 212. PROHIBITION OF CIRCUMVENTION AND PREVENTION OF CONFLICTS OF 
                    INTEREST.

  [(a) No Other Funding.--Funds for the orderly liquidation of 
any covered financial company under this title shall only be 
provided as specified under this title.
  [(b) Limit on Governmental Actions.--No governmental entity 
may take any action to circumvent the purposes of this title.
  [(c) Conflict of Interest.--In the event that the Corporation 
is appointed receiver for more than 1 covered financial company 
or is appointed receiver for a covered financial company and 
receiver for any insured depository institution that is an 
affiliate of such covered financial company, the Corporation 
shall take appropriate action, as necessary to avoid any 
conflicts of interest that may arise in connection with 
multiple receiverships.

[SEC. 213. BAN ON CERTAIN ACTIVITIES BY SENIOR EXECUTIVES AND 
                    DIRECTORS.

  [(a) Prohibition Authority.--The Board of Governors or, if 
the covered financial company was not supervised by the Board 
of Governors, the Corporation, may exercise the authority 
provided by this section.
  [(b) Authority To Issue Order.--The appropriate agency 
described in subsection (a) may take any action authorized by 
subsection (c), if the agency determines that--
          [(1) a senior executive or a director of the covered 
        financial company, prior to the appointment of the 
        Corporation as receiver, has, directly or indirectly--
                  [(A) violated--
                          [(i) any law or regulation;
                          [(ii) any cease-and-desist order 
                        which has become final;
                          [(iii) any condition imposed in 
                        writing by a Federal agency in 
                        connection with any action on any 
                        application, notice, or request by such 
                        company or senior executive; or
                          [(iv) any written agreement between 
                        such company and such agency;
                  [(B) engaged or participated in any unsafe or 
                unsound practice in connection with any 
                financial company; or
                  [(C) committed or engaged in any act, 
                omission, or practice which constitutes a 
                breach of the fiduciary duty of such senior 
                executive or director;
          [(2) by reason of the violation, practice, or breach 
        described in any subparagraph of paragraph (1), such 
        senior executive or director has received financial 
        gain or other benefit by reason of such violation, 
        practice, or breach and such violation, practice, or 
        breach contributed to the failure of the company; and
          [(3) such violation, practice, or breach--
                  [(A) involves personal dishonesty on the part 
                of such senior executive or director; or
                  [(B) demonstrates willful or continuing 
                disregard by such senior executive or director 
                for the safety or soundness of such company.
  [(c) Authorized Actions.--
          [(1) In general.--The appropriate agency for a 
        financial company, as described in subsection (a), may 
        serve upon a senior executive or director described in 
        subsection (b) a written notice of the intention of the 
        agency to prohibit any further participation by such 
        person, in any manner, in the conduct of the affairs of 
        any financial company for a period of time determined 
        by the appropriate agency to be commensurate with such 
        violation, practice, or breach, provided such period 
        shall be not less than 2 years.
          [(2) Procedures.--The due process requirements and 
        other procedures under section 8(e) of the Federal 
        Deposit Insurance Act (12 U.S.C. 1818(e)) shall apply 
        to actions under this section as if the covered 
        financial company were an insured depository 
        institution and the senior executive or director were 
        an institution-affiliated party, as those terms are 
        defined in that Act.
  [(d) Regulations.--The Corporation and the Board of 
Governors, in consultation with the Council, shall jointly 
prescribe rules or regulations to administer and carry out this 
section, including rules, regulations, or guidelines to further 
define the term senior executive for the purposes of this 
section.

[SEC. 214. PROHIBITION ON TAXPAYER FUNDING.

  [(a) Liquidation Required.--All financial companies put into 
receivership under this title shall be liquidated. No taxpayer 
funds shall be used to prevent the liquidation of any financial 
company under this title.
  [(b) Recovery of Funds.--All funds expended in the 
liquidation of a financial company under this title shall be 
recovered from the disposition of assets of such financial 
company, or shall be the responsibility of the financial 
sector, through assessments.
  [(c) No Losses to Taxpayers.--Taxpayers shall bear no losses 
from the exercise of any authority under this title.

[SEC. 215. STUDY ON SECURED CREDITOR HAIRCUTS.

  [(a) Study Required.--The Council shall conduct a study 
evaluating the importance of maximizing United States taxpayer 
protections and promoting market discipline with respect to the 
treatment of fully secured creditors in the utilization of the 
orderly liquidation authority authorized by this Act. In 
carrying out such study, the Council shall--
          [(1) not be prejudicial to current or past laws or 
        regulations with respect to secured creditor treatment 
        in a resolution process;
          [(2) study the similarities and differences between 
        the resolution mechanisms authorized by the Bankruptcy 
        Code, the Federal Deposit Insurance Corporation 
        Improvement Act of 1991, and the orderly liquidation 
        authority authorized by this Act;
          [(3) determine how various secured creditors are 
        treated in such resolution mechanisms and examine how a 
        haircut (of various degrees) on secured creditors could 
        improve market discipline and protect taxpayers;
          [(4) compare the benefits and dynamics of prudent 
        lending practices by depository institutions in secured 
        loans for consumers and small businesses to the lending 
        practices of secured creditors to large, interconnected 
        financial firms;
          [(5) consider whether credit differs according to 
        different types of collateral and different terms and 
        timing of the extension of credit; amd
          [(6) include an examination of stakeholders who were 
        unsecured or under-collateralized and seek collateral 
        when a firm is failing, and the impact that such 
        behavior has on financial stability and an orderly 
        resolution that protects taxpayers if the firm fails.
  [(b) Report.--Not later than the end of the 1-year period 
beginning on the date of enactment of this Act, the Council 
shall issue a report to the Congress containing all findings 
and conclusions made by the Council in carrying out the study 
required under subsection (a).

[SEC. 216. STUDY ON BANKRUPTCY PROCESS FOR FINANCIAL AND NONBANK 
                    FINANCIAL INSTITUTIONS.

  [(a) Study.--
          [(1) In general.--Upon enactment of this Act, the 
        Board of Governors, in consultation with the 
        Administrative Office of the United States Courts, 
        shall conduct a study regarding the resolution of 
        financial companies under the Bankruptcy Code, under 
        chapter 7 or 11 thereof.
          [(2) Issues to be studied.--Issues to be studied 
        under this section include--
                  [(A) the effectiveness of chapter 7 and 
                chapter 11 of the Bankruptcy Code in 
                facilitating the orderly resolution or 
                reorganization of systemic financial companies;
                  [(B) whether a special financial resolution 
                court or panel of special masters or judges 
                should be established to oversee cases 
                involving financial companies to provide for 
                the resolution of such companies under the 
                Bankruptcy Code, in a manner that minimizes 
                adverse impacts on financial markets without 
                creating moral hazard;
                  [(C) whether amendments to the Bankruptcy 
                Code should be adopted to enhance the ability 
                of the Code to resolve financial companies in a 
                manner that minimizes adverse impacts on 
                financial markets without creating moral 
                hazard;
                  [(D) whether amendments should be made to the 
                Bankruptcy Code, the Federal Deposit Insurance 
                Act, and other insolvency laws to address the 
                manner in which qualified financial contracts 
                of financial companies are treated; and
                  [(E) the implications, challenges, and 
                benefits to creating a new chapter or 
                subchapter of the Bankruptcy Code to deal with 
                financial companies.
  [(b) Reports to Congress.--Not later than 1 year after the 
date of enactment of this Act, and in each successive year 
until the fifth year after the date of enactment of this Act, 
the Administrative Office of the United States courts shall 
submit to the Committees on Banking, Housing, and Urban Affairs 
and the Judiciary of the Senate and the Committees on Financial 
Services and the Judiciary of the House of Representatives a 
report summarizing the results of the study conducted under 
subsection (a).

[SEC. 217. STUDY ON INTERNATIONAL COORDINATION RELATING TO BANKRUPTCY 
                    PROCESS FOR NONBANK FINANCIAL INSTITUTIONS.

  [(a) Study.--
          [(1) In general.--The Board of Governors, in 
        consultation with the Administrative Office of the 
        United States Courts, shall conduct a study regarding 
        international coordination relating to the resolution 
        of systemic financial companies under the United States 
        Bankruptcy Code and applicable foreign law.
          [(2) Issues to be studied.--With respect to the 
        bankruptcy process for financial companies, issues to 
        be studied under this section include--
                  [(A) the extent to which international 
                coordination currently exists;
                  [(B) current mechanisms and structures for 
                facilitating international cooperation;
                  [(C) barriers to effective international 
                coordination; and
                  [(D) ways to increase and make more effective 
                international coordination of the resolution of 
                financial companies, so as to minimize the 
                impact on the financial system without creating 
                moral hazard.
  [(b) Report to Congress.--Not later than 1 year after the 
date of enactment of this Act, the Administrative office of the 
United States Courts shall submit to the Committees on Banking, 
Housing, and Urban Affairs and the Judiciary of the Senate and 
the Committees on Financial Services and the Judiciary of the 
House of Representatives a report summarizing the results of 
the study conducted under subsection (a).]

 TITLE III--TRANSFER OF POWERS TO THE COMPTROLLER OF THE CURRENCY, THE 
CORPORATION, AND THE BOARD OF GOVERNORS

           *       *       *       *       *       *       *


Subtitle B--Transitional Provisions

           *       *       *       *       *       *       *


SEC. 327. IMPLEMENTATION PLAN AND REPORTS.

  (a) Plan Submission.--Within 180 days of the enactment of the 
Dodd-Frank Wall Street Reform and Consumer Protection Act, the 
Board of Governors, the Corporation, the Office of the 
Comptroller of the Currency, and the Office of Thrift 
Supervision, shall jointly submit a plan to the Committee on 
Banking, Housing, and Urban Affairs of the Senate, the 
Committee on Financial Services of the House of 
Representatives, and the Inspectors General of the Department 
of the Treasury, the Corporation, and the Board of Governors 
detailing the steps the Board of Governors, the Corporation, 
the Office of the Comptroller of the Currency, and the Office 
of Thrift Supervision will take to implement the provisions of 
sections 301 through 326, and the provisions of the amendments 
made by such sections.
  (b) Inspectors General Review of the Plan.--Within 60 days of 
receiving the plan required under subsection (a), the 
Inspectors General of the Department of the Treasury, the 
Corporation, and the Board of Governors shall jointly provide a 
written report to the Board of Governors, the Corporation, the 
Office of the Comptroller of the Currency, and the Office of 
Thrift Supervision and shall submit a copy to the Committee on 
Banking, Housing, and Urban Affairs of the Senate and the 
Committee on Financial Services of the House of Representatives 
detailing whether the plan conforms with the provisions of 
sections 301 through 326, and the provisions of the amendments 
made by such sections, including--
          (1) whether the plan sufficiently takes into 
        consideration the orderly transfer of personnel;
          (2) whether the plan describes procedures and 
        safeguards to ensure that the Office of Thrift 
        Supervision employees are not unfairly disadvantaged 
        relative to employees of the Office of the Comptroller 
        of the Currency and the Corporation;
          (3) whether the plan sufficiently takes into 
        consideration the orderly transfer of authority and 
        responsibilities;
          (4) whether the plan sufficiently takes into 
        consideration the effective transfer of funds;
          (5) whether the plan sufficiently takes [in] into 
        consideration the orderly transfer of property; and
          (6) any additional recommendations for an orderly and 
        effective process.
  (c) Implementation Reports.--Not later than 6 months after 
the date on which the Committee on Banking, Housing, and Urban 
Affairs of the Senate and the Committee on Financial Services 
of the House of Representatives receives the report required 
under subsection (b), and every 6 months thereafter until all 
aspects of the plan have been implemented, the Inspectors 
General of the Department of the Treasury, the Corporation, and 
the Board of Governors shall jointly provide a written report 
on the status of the implementation of the plan to the Board of 
Governors, the Corporation, the Office of the Comptroller of 
the Currency, and the Office of Thrift Supervision and shall 
submit a copy to the Committee on Banking, Housing, and Urban 
Affairs of the Senate and the Committee on Financial Services 
of the House of Representatives.

           *       *       *       *       *       *       *


SEC. 333. ENHANCED ACCESS TO INFORMATION FOR DEPOSIT INSURANCE 
                    PURPOSES.

  (a) Section 7(a)(2)(B) of the Federal Deposit Insurance Act 
is amended by striking ``agreement'' and inserting 
``consultation''.
  (b) Section 7(b)(1)(E) of the Federal Deposit Insurance Act 
is amended--
          (1) in clause (i), by striking ``such as'' and 
        inserting ``including''; and
          (2) in clause (iii), by striking ``Corporation'' the 
        second place that term appears and inserting 
        ``Corporation, except as provided in section 
        7(a)(2)(B)''.

           *       *       *       *       *       *       *


Subtitle D--Other Matters

           *       *       *       *       *       *       *


SEC. 342. OFFICE OF MINORITY AND WOMEN INCLUSION.

  (a) Office of Minority and Women Inclusion.--
          (1) Establishment.--
                  (A) In general.--Except as provided in 
                subparagraph (B), not later than 6 months after 
                the date of enactment of this Act, each agency 
                shall establish an Office of Minority and Women 
                Inclusion that shall be responsible for all 
                matters of the agency relating to diversity in 
                management, employment, and business 
                activities.
                  (B) [Bureau] Agency.--The [Bureau] Agency 
                shall establish an Office of Minority and Women 
                Inclusion not later than 6 months after the 
                designated transfer date established under 
                section 1062.
          (2) Transfer of responsibilities.--Each agency that, 
        on the day before the date of enactment of this Act, 
        assigned the responsibilities described in paragraph 
        (1) (or comparable responsibilities) to another office 
        of the agency shall ensure that such responsibilities 
        are transferred to the Office.
          (3) Duties with respect to civil rights laws.--The 
        responsibilities described in paragraph (1) do not 
        include enforcement of statutes, regulations, or 
        executive orders pertaining to civil rights, except 
        each Director shall coordinate with the agency 
        administrator, or the designee of the agency 
        administrator, regarding the design and implementation 
        of any remedies resulting from violations of such 
        statutes, regulations, or executive orders.
  (b) Director.--
          (1) In general.--The Director of each Office shall be 
        appointed by, and shall report to, the agency 
        administrator. The position of Director shall be a 
        career reserved position in the Senior Executive 
        Service, as that position is defined in section 3132 of 
        title 5, United States Code, or an equivalent 
        designation.
          (2) Duties.--Each Director shall develop standards 
        for--
                  (A) equal employment opportunity and the 
                racial, ethnic, and gender diversity of the 
                workforce and senior management of the agency;
                  (B) increased participation of minority-owned 
                and women-owned businesses in the programs and 
                contracts of the agency, including standards 
                for coordinating technical assistance to such 
                businesses; and
                  (C) assessing the diversity policies and 
                practices of entities regulated by the agency.
          (3) Other duties.--Each Director shall advise the 
        agency administrator on the impact of the policies and 
        regulations of the agency on minority-owned and women-
        owned businesses.
          (4) Rule of construction.--Nothing in paragraph 
        (2)(C) may be construed to mandate any requirement on 
        or otherwise affect the lending policies and practices 
        of any regulated entity, or to require any specific 
        action based on the findings of the assessment.
  (c) Inclusion in All Levels of Business Activities.--
          (1) In general.--The Director of each Office shall 
        develop and implement standards and procedures to 
        ensure, to the maximum extent possible, the fair 
        inclusion and utilization of minorities, women, and 
        minority-owned and women-owned businesses in all 
        business and activities of the agency at all levels, 
        including in procurement, insurance, and all types of 
        contracts.
          (2) Contracts.--The procedures established by each 
        agency for review and evaluation of contract proposals 
        and for hiring service providers shall include, to the 
        extent consistent with applicable law, a component that 
        gives consideration to the diversity of the applicant. 
        Such procedure shall include a written statement, in a 
        form and with such content as the Director shall 
        prescribe, that a contractor shall ensure, to the 
        maximum extent possible, the fair inclusion of women 
        and minorities in the workforce of the contractor and, 
        as applicable, subcontractors.
          (3) Termination.--
                  (A) Determination.--The standards and 
                procedures developed and implemented under this 
                subsection shall include a procedure for the 
                Director to make a determination whether an 
                agency contractor, and, as applicable, a 
                subcontractor has failed to make a good faith 
                effort to include minorities and women in their 
                workforce.
                  (B) Effect of determination.--
                          (i) Recommendation to agency 
                        administrator.--Upon a determination 
                        described in subparagraph (A), the 
                        Director shall make a recommendation to 
                        the agency administrator that the 
                        contract be terminated.
                          (ii) Action by agency 
                        administrator.--Upon receipt of a 
                        recommendation under clause (i), the 
                        agency administrator may--
                                  (I) terminate the contract;
                                  (II) make a referral to the 
                                Office of Federal Contract 
                                Compliance Programs of the 
                                Department of Labor; or
                                  (III) take other appropriate 
                                action.
  (d) Applicability.--This section shall apply to all contracts 
of an agency for services of any kind, including the services 
of financial institutions, investment banking firms, mortgage 
banking firms, asset management firms, brokers, dealers, 
financial services entities, underwriters, accountants, 
investment consultants, and providers of legal services. The 
contracts referred to in this subsection include all contracts 
for all business and activities of an agency, at all levels, 
including contracts for the issuance or guarantee of any debt, 
equity, or security, the sale of assets, the management of the 
assets of the agency, the making of equity investments by the 
agency, and the implementation by the agency of programs to 
address economic recovery.
  (e) Reports.--Each Office shall submit to Congress an annual 
report regarding the actions taken by the agency and the Office 
pursuant to this section, which shall include--
          (1) a statement of the total amounts paid by the 
        agency to contractors since the previous report;
          (2) the percentage of the amounts described in 
        paragraph (1) that were paid to contractors described 
        in subsection (c)(1);
          (3) the successes achieved and challenges faced by 
        the agency in operating minority and women outreach 
        programs;
          (4) the challenges the agency may face in hiring 
        qualified minority and women employees and contracting 
        with qualified minority-owned and women-owned 
        businesses; and
          (5) any other information, findings, conclusions, and 
        recommendations for legislative or agency action, as 
        the Director determines appropriate.
  (f) Diversity in Agency Workforce.--Each agency shall take 
affirmative steps to seek diversity in the workforce of the 
agency at all levels of the agency in a manner consistent with 
applicable law. Such steps shall include--
          (1) recruiting at historically black colleges and 
        universities, Hispanic-serving institutions, women's 
        colleges, and colleges that typically serve majority 
        minority populations;
          (2) sponsoring and recruiting at job fairs in urban 
        communities;
          (3) placing employment advertisements in newspapers 
        and magazines oriented toward minorities and women;
          (4) partnering with organizations that are focused on 
        developing opportunities for minorities and women to 
        place talented young minorities and women in industry 
        internships, summer employment, and full-time 
        positions;
          (5) where feasible, partnering with inner-city high 
        schools, girls' high schools, and high schools with 
        majority minority populations to establish or enhance 
        financial literacy programs and provide mentoring; and
          (6) any other mass media communications that the 
        Office determines necessary.
  (g) Definitions.--For purposes of this section, the following 
definitions shall apply:
          (1) Agency.--The term ``agency'' means--
                  (A) the Departmental Offices of the 
                Department of the Treasury;
                  (B) the Corporation;
                  (C) the Federal Housing Finance Agency;
                  (D) each of the Federal reserve banks;
                  (E) the Board;
                  (F) the National Credit Union Administration;
                  (G) the Office of the Comptroller of the 
                Currency;
                  (H) the Commission; and
                  (I) the [Bureau] Agency.
          (2) Agency administrator.--The term ``agency 
        administrator'' means the head of an agency.
          (3) Minority.--The term ``minority'' has the same 
        meaning as in section 1204(c) of the Financial 
        Institutions Reform, Recovery, and Enforcement Act of 
        1989 (12 U.S.C. 1811 note).
          (4) Minority-owned business.--The term ``minority-
        owned business'' has the same meaning as in section 
        21A(r)(4)(A) of the Federal Home Loan Bank Act (12 
        U.S.C. 1441a(r)(4)(A)), as in effect on the day before 
        the transfer date.
          (5) Office.--The term ``Office'' means the Office of 
        Minority and Women Inclusion established by an agency 
        under subsection (a).
          (6) Women-owned business.--The term ``women-owned 
        business'' has the meaning given the term ``women's 
        business'' in section 21A(r)(4)(B) of the Federal Home 
        Loan Bank Act (12 U.S.C. 1441a(r)(4)(B)), as in effect 
        on the day before the transfer date.

           *       *       *       *       *       *       *


Subtitle E--Technical and Conforming Amendments

           *       *       *       *       *       *       *


SEC. 369. HOME OWNERS' LOAN ACT.

  The Home Owners' Loan Act (12 U.S.C. 1461 et seq.) is 
amended--
          (1) [Omitted--Amendatory]

           *       *       *       *       *       *       *

          (5) in section 5 (12 U.S.C. 1464)--
                  (A) in subsection (a), by striking 
                ``Director'', each place such term appears and 
                inserting ``Comptroller of the Currency'';
                  (B) in subsection (b), by striking 
                ``Director'', each place such term appears and 
                inserting ``Comptroller of the Currency'';
                  (C) in subsection (c)--
                          (i) in paragraph (5)--
                                  (I) in subparagraph (A), by 
                                striking ``Director'' and 
                                inserting ``appropriate Federal 
                                banking agency''; and
                                  (II) in subparagraph (B)--
                                          (aa) by striking 
                                        ``The Director'' and 
                                        inserting ``The 
                                        appropriate Federal 
                                        banking agency''; and
                                          (bb) by striking 
                                        ``the Director'' and 
                                        inserting ``the 
                                        appropriate Federal 
                                        banking agency'';
                  (D) in subsection (d)--
                          (i) in paragraph (1)--
                                  (I) in subparagraph (A)--
                                          (aa) in the first 
                                        sentence, by striking 
                                        ``Director'' and 
                                        inserting ``appropriate 
                                        Federal banking 
                                        agency'';
                                          (bb) in the second 
                                        sentence--
                                                  (AA) by 
                                                striking 
                                                ``Director's 
                                                own name and 
                                                through the 
                                                Director's own 
                                                attorneys'' and 
                                                inserting 
                                                ``name of the 
                                                appropriate 
                                                Federal banking 
                                                agency and 
                                                through the 
                                                attorneys of 
                                                the appropriate 
                                                Federal banking 
                                                agency''; and
                                                  (BB) by 
                                                striking 
                                                ``Director'' 
                                                each place that 
                                                term appears 
                                                and inserting 
                                                ``appropriate 
                                                Federal banking 
                                                agency''; and
                                          (cc) in the third 
                                        sentence, by striking 
                                        ``Director'' each place 
                                        that term appears and 
                                        inserting 
                                        ``Comptroller'';
                                  (II) in subparagraph (B)--
                                          (aa) in clauses (i) 
                                        through (iv), by 
                                        striking ``Director'' 
                                        each place that term 
                                        appears and inserting 
                                        ``appropriate Federal 
                                        banking agency'';
                                          [(III)] (bb) in 
                                        clause (v)--
                                                  [(aa)] (AA) 
                                                in the matter 
                                                preceding 
                                                subclause (I), 
                                                by striking 
                                                ``Director'' 
                                                and inserting 
                                                ``appropriate 
                                                Federal banking 
                                                agency'';
                                                  [(bb)] (BB) 
                                                in subclause 
                                                (II), by 
                                                striking 
                                                ``subpenas'' 
                                                and inserting 
                                                ``subpoenas''; 
                                                and
                                                  [(cc)] (CC) 
                                                in the matter 
                                                following 
                                                subclause (II), 
                                                by striking 
                                                ``subpena'' and 
                                                inserting 
                                                ``subpoena'';
                                          [(IV)] (cc) in clause 
                                        (vi)--
                                                  [(aa)] (AA) 
                                                in the first 
                                                sentence, by 
                                                striking 
                                                ``Director'' 
                                                and inserting 
                                                ``appropriate 
                                                Federal banking 
                                                agency''; and
                                                  [(bb)] (BB) 
                                                in the second 
                                                sentence, by 
                                                striking 
                                                ``Director'' 
                                                and inserting 
                                                ``Comptroller'';

                                          [(V)] (dd) in clause 
                                        (vii)--
                                                  [(aa)] (AA) 
                                                in the first 
                                                sentence, by 
                                                striking 
                                                ``subpena'' and 
                                                inserting 
                                                ``subpoena'';
                                                  [(bb)] (BB) 
                                                in the second 
                                                sentence, by 
                                                striking 
                                                ``subpenaed'' 
                                                and inserting 
                                                ``subpoenaed''; 
                                                and
                                                  [(cc)] (CC) 
                                                in the third 
                                                sentence, by 
                                                striking 
                                                ``Director'' 
                                                and inserting 
                                                ``appropriate 
                                                Federal banking 
                                                agency'';
                          (ii) in paragraph (2)--
                                  (I) in subparagraph (A)--
                                          (aa) by striking 
                                        ``Director of the 
                                        Office of Thrift 
                                        Supervision'' and 
                                        inserting ``appropriate 
                                        Federal banking 
                                        agency'';
                                          (bb) by striking 
                                        ``any insured savings 
                                        association'' and 
                                        inserting ``an insured 
                                        savings association''; 
                                        and
                                          (cc) by striking 
                                        ``Director determines, 
                                        in the Director's 
                                        discretion'' and 
                                        inserting ``appropriate 
                                        Federal banking agency 
                                        determines, in the 
                                        discretion of the 
                                        appropriate Federal 
                                        banking agency'';
                                  (II) in subparagraph (B), by 
                                striking ``Director'' each 
                                place that term appears and 
                                inserting ``appropriate Federal 
                                banking agency'';
                                  (III) in subparagraphs (C) 
                                and (D), by striking 
                                ``Director'' and inserting 
                                ``appropriate Federal banking 
                                agency'';
                                  (IV) in subparagraph (E)--
                                          (aa) in clause (ii)--
                                                  (AA) in the 
                                                clause heading, 
                                                by striking 
                                                ``or rtc''; and
                                                  (BB) by 
                                                striking ``or 
                                                the Resolution 
                                                Trust 
                                                Corporation, as 
                                                appropriate,'' 
                                                each place that 
                                                term appears; 
                                                and
                                          (bb) by striking 
                                        ``Director'' each place 
                                        that term appears and 
                                        inserting ``appropriate 
                                        Federal banking 
                                        agency''; and
                          (iii) in paragraph (3)--
                                  (I) in subparagraph (A), by 
                                striking ``Director'' each 
                                place that term appears and 
                                inserting ``Comptroller''; and
                                  (II) in subparagraph (B)--
                                          (aa) in the 
                                        subparagraph heading, 
                                        by striking ``or rtc'';
                                          (bb) by striking 
                                        ``Corporation or the 
                                        Resolution Trust''; and
                                          (cc) by striking 
                                        ``Director'' and 
                                        inserting 
                                        ``Comptroller'';
                          (iv) in paragraph (4), by striking 
                        ``Director'' and inserting 
                        ``appropriate Federal banking agency'';
                          (v) in paragraph (6)--
                                  (I) in subparagraph (A), by 
                                striking ``Director'' and 
                                inserting ``Comptroller''; and
                                  (II) in subparagraphs (B) and 
                                (C), by striking ``Director'' 
                                each place that term appears 
                                and inserting ``appropriate 
                                Federal banking agency'';
                          (vi) in paragraph (7)--
                                  (I) in subparagraphs (A), 
                                (B), and (D), by striking 
                                ``Director'' each place that 
                                term appears and inserting 
                                ``appropriate Federal banking 
                                agency'';
                                  (II) in subparagraph (C), by 
                                striking ``Director'' and 
                                inserting ``Federal Deposit 
                                Insurance Corporation or the 
                                Comptroller, as appropriate,''; 
                                and
                                  (III) by striking 
                                subparagraph (E) and inserting 
                                the following:
                  ``(E) Administration by the comptroller and 
                the corporation.--The Comptroller may issue 
                such regulations, and the appropriate Federal 
                banking agency may issue such orders, including 
                those issued pursuant to section 8 of the 
                Federal Deposit Insurance Act, as may be 
                necessary to administer and carry out this 
                paragraph and to prevent evasion of this 
                paragraph.'';
                  (E) in subsection (e)(2), strike ``Director'' 
                and insert ``Comptroller'';
                  (F) in subsection (i)--
                          (i) by striking ``Director'', each 
                        place such term appears, and inserting 
                        ``Comptroller'';
                          (ii) in paragraph (2), in the 
                        heading, by striking ``director'' and 
                        inserting ``Comptroller''; and
                          (iii) in paragraph (5)(A), by 
                        striking ``of the Currency''[; and].
                          [(iv) except as provided in clauses 
                        (i) through (iii), by striking 
                        ``Director'' each place such term 
                        appears and inserting ``Comptroller'';]
                  (G) in subsection (o)--
                          (i) in paragraph (1), by striking 
                        ``Director'' each place such term 
                        appears and inserting ``Comptroller''; 
                        and
                          (ii) in paragraph (2)(B), by striking 
                        ``Director's determination'' and 
                        inserting ``determination of the 
                        Comptroller'';
                  (H) in subsections (m), (n), (o), and (p), by 
                striking ``Director'', each place such term 
                appears, and inserting ``Comptroller'';
                  (I) in subsection (q)--
                          (i) in paragraph (6), by striking 
                        ``of Governors of the Federal Reserve 
                        System'';
                          (ii) by striking ``Director'' each 
                        place that term appears and inserting 
                        ``Board''; and
                          (iii) by inserting ``in consultation 
                        with the Comptroller and the 
                        Corporation,'' before ``considers'';
                  (J) in subsection (r)(3), by striking 
                ``Director'' and inserting ``Comptroller of the 
                Currency'';
                  (K) in subsection (s)--
                          (i) in paragraph (1), strike 
                        ``Director'' and insert ``Comptroller 
                        of the Currency'';
                          (ii) in paragraph (2), strike 
                        ``Director'' and insert ``Comptroller 
                        of the Currency'';
                          (iii) in paragraph (3), by striking 
                        ``Director's discretion, the Director'' 
                        and inserting ``discretion of the 
                        appropriate Federal banking agency, the 
                        appropriate Federal banking agency,'';
                          (iv) in paragraph (4), by striking 
                        ``Director'' each place that term 
                        appears and inserting ``appropriate 
                        Federal banking agency''; and
                          (v) in paragraph (5)--
                                  (I) by striking ``Director'', 
                                each place such term appears, 
                                and inserting ``appropriate 
                                Federal banking agency''; and
                                  (II) by striking ``Director's 
                                approval'' and inserting 
                                ``approval of the appropriate 
                                Federal banking agency'';
                  (L) in subsection (t)--
                          (i) in paragraph (1), by striking 
                        subparagraph (D);
                          (ii) by striking paragraph (3) and 
                        inserting the following:
          ``(3) [Repealed].'';
                          (iii) in paragraph (5)--
                                  (I) in subparagraph (B), by 
                                striking ``Corporation, in its 
                                sole discretion'' and inserting 
                                ``appropriate Federal banking 
                                agency, in the sole discretion 
                                of the appropriate Federal 
                                banking agency''; and
                                  (II) by striking subparagraph 
                                (D);
                          (iv) in paragraph (6)--
                                  (I) by striking subparagraph 
                                (A) and inserting the 
                                following:
                  ``(A) [Reserved].'';
                                  (II) in subparagraph (B), by 
                                striking ``Director'' each 
                                place that term appears and 
                                inserting ``appropriate Federal 
                                banking agency'';
                                  (III) in subparagraph (C)--
                                          (aa) in clause (i), 
                                        by striking 
                                        ``Director's prior 
                                        approval'' and 
                                        inserting ``prior 
                                        approval of the 
                                        appropriate Federal 
                                        banking agency'';
                                          (bb) in clause (ii), 
                                        by striking 
                                        ``Director's 
                                        discretion'' and 
                                        inserting ``discretion 
                                        of the appropriate 
                                        Federal banking 
                                        agency''; and
                                          (cc) by striking 
                                        ``Director'' each place 
                                        that term appears and 
                                        inserting ``appropriate 
                                        Federal banking 
                                        agency'';
                                  (IV) in subparagraph (E), by 
                                striking ``Director shall'' and 
                                inserting ``appropriate Federal 
                                banking agency may''; and
                                  (V) in subparagraph (F), by 
                                striking ``Director'' and all 
                                that follows through the end of 
                                the subparagraph and inserting 
                                ``appropriate Federal banking 
                                agency under this Act or any 
                                other provision of law.'';
                          (v) in paragraph (7), by striking 
                        ``Director'' each place that term 
                        appears and inserting ``appropriate 
                        Federal banking agency'';
                          (vi) by striking paragraph (8) and 
                        inserting the following:
          ``(8) [Repealed].'';
                          (vii) in paragraph (9)--
                                  (I) in subparagraph (A), by 
                                striking ``Director'' and 
                                inserting ``Comptroller'';
                                  (II) in subparagraph (C), by 
                                striking ``of the Currency''; 
                                and
                                  (III) by striking 
                                subparagraph (B) and 
                                redesignating subparagraphs (C) 
                                and (D) as subparagraphs (B) 
                                and (C), respectively; and
                          (viii) except as provided in clauses 
                        (i) through (vii), by striking 
                        ``Director'' each place that term 
                        appears and inserting ``appropriate 
                        Federal banking agency'';
                  (M) in subsection (u), by striking 
                ``Director'' each place that term appears and 
                inserting ``appropriate Federal banking 
                agency'';
                  (N) in subsection (v)--
                          (i) in paragraph (2), by striking 
                        ``Director's determinations'' and 
                        inserting ``determinations of the 
                        appropriate Federal banking agency''; 
                        and
                          (ii) by striking ``Director'' each 
                        place that term appears and inserting 
                        ``appropriate Federal banking agency'';
                  (O) in subsection (w)(1)--
                          (i) in subparagraph (A)(II), by 
                        striking ``Director's intention'' and 
                        inserting ``intention of the 
                        Comptroller''; and
                          (ii) in subparagraph (B), by striking 
                        ``Director's intention'' and inserting 
                        ``intention of the Comptroller''; and
                  (P) except as provided in subparagraphs (A) 
                through (J), by striking ``Director'' each 
                place that term appears and inserting 
                ``Comptroller'';

TITLE IV--REGULATION OF ADVISERS TO HEDGE FUNDS AND OTHERS

           *       *       *       *       *       *       *


[SEC. 412. COMPTROLLER GENERAL STUDY ON CUSTODY RULE COSTS.

  [The Comptroller General of the United States shall--
          [(1) conduct a study of--
                  [(A) the compliance costs associated with the 
                current Securities and Exchange Commission 
                rules 204-2 (17 C.F.R. Parts 275.204-2) and 
                rule 206(4)-2 (17 C.F.R. 275.206(4)-2) under 
                the Investment Advisers Act of 1940 regarding 
                custody of funds or securities of clients by 
                investment advisers; and
                  [(B) the additional costs if subsection 
                (b)(6) of rule 206(4)-2 (17 C.F.R. 275.206(4)-
                2(b)(6)) relating to operational independence 
                were eliminated; and
          [(2) submit a report to the Committee on Banking, 
        Housing, and Urban Affairs of the Senate and the 
        Committee on Financial Services of the House of 
        Representatives on the results of such study, not later 
        than 3 years after the date of enactment of this Act.

[SEC. 413. ADJUSTING THE ACCREDITED INVESTOR STANDARD.

  [(a) In General.--The Commission shall adjust any net worth 
standard for an accredited investor, as set forth in the rules 
of the Commission under the Securities Act of 1933, so that the 
individual net worth of any natural person, or joint net worth 
with the spouse of that person, at the time of purchase, is 
more than $1,000,000 (as such amount is adjusted periodically 
by rule of the Commission), excluding the value of the primary 
residence of such natural person, except that during the 4-year 
period that begins on the date of enactment of this Act, any 
net worth standard shall be $1,000,000, excluding the value of 
the primary residence of such natural person.
  [(b) Review and Adjustment.--
          [(1) Initial review and adjustment.--
                  [(A) Initial review.--The Commission may 
                undertake a review of the definition of the 
                term ``accredited investor'', as such term 
                applies to natural persons, to determine 
                whether the requirements of the definition, 
                excluding the requirement relating to the net 
                worth standard described in subsection (a), 
                should be adjusted or modified for the 
                protection of investors, in the public 
                interest, and in light of the economy.
                  [(B) Adjustment or modification.--Upon 
                completion of a review under subparagraph (A), 
                the Commission may, by notice and comment 
                rulemaking, make such adjustments to the 
                definition of the term ``accredited investor'', 
                excluding adjusting or modifying the 
                requirement relating to the net worth standard 
                described in subsection (a), as such term 
                applies to natural persons, as the Commission 
                may deem appropriate for the protection of 
                investors, in the public interest, and in light 
                of the economy.
          [(2) Subsequent reviews and adjustment.--
                  [(A) Subsequent reviews.--Not earlier than 4 
                years after the date of enactment of this Act, 
                and not less frequently than once every 4 years 
                thereafter, the Commission shall undertake a 
                review of the definition, in its entirety, of 
                the term ``accredited investor'', as defined in 
                section 230.215 of title 17, Code of Federal 
                Regulations, or any successor thereto, as such 
                term applies to natural persons, to determine 
                whether the requirements of the definition 
                should be adjusted or modified for the 
                protection of investors, in the public 
                interest, and in light of the economy.
                  [(B) Adjustment or modification.--Upon 
                completion of a review under subparagraph (A), 
                the Commission may, by notice and comment 
                rulemaking, make such adjustments to the 
                definition of the term ``accredited investor'', 
                as defined in section 230.215 of title 17, Code 
                of Federal Regulations, or any successor 
                thereto, as such term applies to natural 
                persons, as the Commission may deem appropriate 
                for the protection of investors, in the public 
                interest, and in light of the economy.]

SEC. 414. RULE OF CONSTRUCTION RELATING TO THE [COMMODITIES]  COMMODITY 
                    EXCHANGE ACT

  The Investment Advisers Act of 1940 (15 U.S.C. 80b-1 et seq.) 
is further amended by adding at the end the following new 
section:

``SEC. 224. RULE OF CONSTRUCTION RELATING TO THE COMMODITIES EXCHANGE 
                    ACT

  ``Nothing in this title shall relieve any person of any 
obligation or duty, or affect the availability of any right or 
remedy available to the Commodity Futures Trading Commission or 
any private party, arising under the Commodity Exchange Act (7 
U.S.C. 1 et seq.) governing commodity pools, commodity pool 
operators, or commodity trading advisors.''.

[SEC. 415. GAO STUDY AND REPORT ON ACCREDITED INVESTORS.

  [The Comptroller General of the United States shall conduct a 
study on the appropriate criteria for determining the financial 
thresholds or other criteria needed to qualify for accredited 
investor status and eligibility to invest in private funds, and 
shall submit a report to the Committee on Banking, Housing, and 
Urban Affairs of the Senate and the Committee on Financial 
Services of the House of Representatives on the results of such 
study not later than 3 years after the date of enactment of 
this Act.

[SEC. 416. GAO STUDY ON SELF-REGULATORY ORGANIZATION FOR PRIVATE FUNDS.

  [The Comptroller General of the United States shall--
          [(1) conduct a study of the feasibility of forming a 
        self-regulatory organization to oversee private funds; 
        and
          [(2) submit a report to the Committee on Banking, 
        Housing, and Urban Affairs of the Senate and the 
        Committee on Financial Services of the House of 
        Representatives on the results of such study, not later 
        than 1 year after the date of enactment of this Act.

[SEC. 417. COMMISSION STUDY AND REPORT ON SHORT SELLING.

  [(a) Studies.-- The Division of Risk, Strategy, and Financial 
Innovation of the Commission shall conduct--
          [(1) a study, taking into account current 
        scholarship, on the state of short selling on national 
        securities exchanges and in the over-the-counter 
        markets, with particular attention to the impact of 
        recent rule changes and the incidence of--
                  [(A) the failure to deliver shares sold 
                short; or
                  [(B) delivery of shares on the fourth day 
                following the short sale transaction; and
          [(2) a study of--
                  [(A) the feasibility, benefits, and costs of 
                requiring reporting publicly, in real time 
                short sale positions of publicly listed 
                securities, or, in the alternative, reporting 
                such short positions in real time only to the 
                Commission and the Financial Industry 
                Regulatory Authority; and
                  [(B) the feasibility, benefits, and costs of 
                conducting a voluntary pilot program in which 
                public companies will agree to have all trades 
                of their shares marked ``short'', ``market 
                maker short'', ``buy'', ``buy-to-cover'', or 
                ``long'', and reported in real time through the 
                Consolidated Tape.
  [(b) Reports.-- The Commission shall submit a report to the 
Committee on Banking, Housing, and Urban Affairs of the Senate 
and the Committee on Financial Services of the House of 
Representatives.--
          [(1) on the results of the study required under 
        subsection (a)(1), including recommendations for market 
        improvements, not later than 2 years after the date of 
        enactment of this Act; and
          [(2) on the results of the study required under 
        subsection (a)(2), not later than 1 year after the date 
        of enactment of this Act.]

           *       *       *       *       *       *       *


 TITLE VI--IMPROVEMENTS TO REGULATION OF BANK AND SAVINGS ASSOCIATION 
HOLDING COMPANIES AND DEPOSITORY INSTITUTIONS

           *       *       *       *       *       *       *


[SEC. 603. MORATORIUM AND STUDY ON TREATMENT OF CREDIT CARD BANKS, 
                    INDUSTRIAL LOAN COMPANIES, AND CERTAIN OTHER 
                    COMPANIES UNDER THE BANK HOLDING COMPANY ACT OF 
                    1956.

  [(a) Moratorium.--
          [(1) Definitions.--In this subsection--
                  [(A) the term ``credit card bank'' means an 
                institution described in section 2(c)(2)(F) of 
                the Bank Holding Company Act of 1956 (12 U.S.C. 
                1841(c)(2)(F));
                  [(B) the term ``industrial bank'' means an 
                institution described in section 2(c)(2)(H) of 
                the Bank Holding Company Act of 1956 (12 U.S.C. 
                1841(c)(2)(H)); and
                  [(C) the term ``trust bank'' means an 
                institution described in section 2(c)(2)(D) of 
                the Bank Holding Company Act of 1956 (12 U.S.C. 
                1841(c)(2)(D)).
          [(2) Moratorium on provision of deposit insurance.--
        The Corporation may not approve an application for 
        deposit insurance under section 5 of the Federal 
        Deposit Insurance Act (12 U.S.C. 1815) that is received 
        after November 23, 2009, for an industrial bank, a 
        credit card bank, or a trust bank that is directly or 
        indirectly owned or controlled by a commercial firm.
          [(3) Change in control.--
                  [(A) In general.--Except as provided in 
                subparagraph (B), the appropriate Federal 
                banking agency shall disapprove a change in 
                control, as provided in section 7(j) of the 
                Federal Deposit Insurance Act (12 U.S.C. 
                1817(j)), of an industrial bank, a credit card 
                bank, or a trust bank if the change in control 
                would result in direct or indirect control of 
                the industrial bank, credit card bank, or trust 
                bank by a commercial firm.
                  [(B) Exceptions.--Subparagraph (A) shall not 
                apply to a change in control of an industrial 
                bank, credit card bank, or trust bank--
                          [(i) that--
                                  [(I) is in danger of default, 
                                as determined by the 
                                appropriate Federal banking 
                                agency;
                                  [(II) results from the merger 
                                or whole acquisition of a 
                                commercial firm that directly 
                                or indirectly controls the 
                                industrial bank, credit card 
                                bank, or trust bank in a bona 
                                fide merger with or acquisition 
                                by another commercial firm, as 
                                determined by the appropriate 
                                Federal banking agency; or
                                  [(III) results from an 
                                acquisition of voting shares of 
                                a publicly traded company that 
                                controls an industrial bank, 
                                credit card bank, or trust 
                                bank, if, after the 
                                acquisition, the acquiring 
                                shareholder (or group of 
                                shareholders acting in concert) 
                                holds less than 25 percent of 
                                any class of the voting shares 
                                of the company; and
                          [(ii) that has obtained all 
                        regulatory approvals otherwise required 
                        for such change of control under any 
                        applicable Federal or State law, 
                        including section 7(j) of the Federal 
                        Deposit Insurance Act (12 U.S.C. 
                        1817(j)).
          [(4) Sunset.--This subsection shall cease to have 
        effect 3 years after the date of enactment of this Act.
  [(b) Government Accountability Office Study of Exceptions 
Under the Bank Holding Company Act of 1956.--
          [(1) Study Required.--The Comptroller General of the 
        United States shall carry out a study to determine 
        whether it is necessary, in order to strengthen the 
        safety and soundness of institutions or the stability 
        of the financial system, to eliminate the exceptions 
        under section 2 of the Bank Holding Company Act of 1956 
        (12 U.S.C. 1841) for institutions described in--
                  [(A) section 2(a)(5)(E) of the Bank Holding 
                Company Act of 1956 (12 U.S.C. 1841(a)(5)(E));
                  [(B) section 2(a)(5)(F) of the Bank Holding 
                Company Act of 1956 (12 U.S.C. 1841(a)(5)(F));
                  [(C) section 2(c)(2)(D) of the Bank Holding 
                Company Act of 1956 (12 U.S.C. 1841(c)(2)(D));
                  [(D) section 2(c)(2)(F) of the Bank Holding 
                Company Act of 1956 (12 U.S.C. 1841(c)(2)(F));
                  [(E) section 2(c)(2)(H) of the Bank Holding 
                Company Act of 1956 (12 U.S.C. 1841(c)(2)(H)); 
                and
                  [(F) section 2(c)(2)(B) of the Bank Holding 
                Company Act of 1956 (12 U.S.C. 1841(c)(2)(B)).
          [(2) Content of Study.--
                  [(A) In general.--The study required under 
                paragraph (1), with respect to the institutions 
                referenced in each of subparagraphs (A) through 
                (E) of paragraph (1), shall, to the extent 
                feasible be based on information provided to 
                the Comptroller General by the appropriate 
                Federal or State regulator, and shall--
                          [(i) identify the types and number of 
                        institutions excepted from section 2 of 
                        the Bank Holding Company Act of 1956 
                        (12 U.S.C. 1841) under each of the 
                        subparagraphs described in 
                        subparagraphs (A) through (E) of 
                        paragraph (1);
                          [(ii) generally describe the size and 
                        geographic locations of the 
                        institutions described in clause (i);
                          [(iii) determine the extent to which 
                        the institutions described in clause 
                        (i) are held by holding companies that 
                        are commercial firms;
                          [(iv) determine whether the 
                        institutions described in clause (i) 
                        have any affiliates that are commercial 
                        firms;
                          [(v) identify the Federal banking 
                        agency responsible for the supervision 
                        of the institutions described in clause 
                        (i) on and after the transfer date;
                          [(vi) determine the adequacy of the 
                        Federal bank regulatory framework 
                        applicable to each category of 
                        institution described in clause (i), 
                        including any restrictions (including 
                        limitations on affiliate transactions 
                        or cross-marketing) that apply to 
                        transactions between an institution, 
                        the holding company of the institution, 
                        and any other affiliate of the 
                        institution; and
                          [(vii) evaluate the potential 
                        consequences of subjecting the 
                        institutions described in clause (i) to 
                        the requirements of the Bank Holding 
                        Company Act of 1956, including with 
                        respect to the availability and 
                        allocation of credit, the stability of 
                        the financial system and the economy, 
                        the safe and sound operation of each 
                        category of institution, and the impact 
                        on the types of activities in which 
                        such institutions, and the holding 
                        companies of such institutions, may 
                        engage.
                  [(B) Savings Associations.--With respect to 
                institutions described in paragraph (1)(F), the 
                study required under paragraph (1) shall--
                          [(i) determine the adequacy of the 
                        Federal bank regulatory framework 
                        applicable to such institutions, 
                        including any restrictions (including 
                        limitations on affiliate transactions 
                        or cross-marketing) that apply to 
                        transactions between an institution, 
                        the holding company of the institution, 
                        and any other affiliate of the 
                        institution; and
                          [(ii) evaluate the potential 
                        consequences of subjecting the 
                        institutions described in paragraph 
                        (1)(F) to the requirements of the Bank 
                        Holding Company Act of 1956, including 
                        with respect to the availability and 
                        allocation of credit, the stability of 
                        the financial system and the economy, 
                        the safe and sound operation of such 
                        institutions, and the impact on the 
                        types of activities in which such 
                        institutions, and the holding companies 
                        of such institutions, may engage.
          [(3) Report.--Not later than 18 months after the date 
        of enactment of this Act, the Comptroller General shall 
        submit to the Committee on Banking, Housing, and Urban 
        Affairs of the Senate and the Committee on Financial 
        Services of the House of Representatives a report on 
        the study required under paragraph (1).]

           *       *       *       *       *       *       *


SEC. 610. LENDING LIMITS APPLICABLE TO CREDIT EXPOSURE ON DERIVATIVE 
                    TRANSACTIONS, REPURCHASE AGREEMENTS, REVERSE 
                    REPURCHASE AGREEMENTS, AND SECURITIES LENDING AND 
                    BORROWING TRANSACTIONS.

  (a) National Banks.--Section 5200(b) of the Revised Statutes 
of the United States (12 U.S.C. 84(b)) is amended--
          (1) in paragraph (1), by striking ``shall include'' 
        and all that follows through the end of the paragraph 
        and inserting the following:`` shall include--
                  ``(A) all direct or indirect advances of 
                funds to a person made on the basis of any 
                obligation of that person to repay the funds or 
                repayable from specific property pledged by or 
                on behalf of the person;
                  ``(B) to the extent specified by the 
                Comptroller of the Currency, any liability of a 
                national banking association to advance funds 
                to or on behalf of a person pursuant to a 
                contractual commitment; and
                  ``(C) any credit exposure to a person arising 
                from a derivative transaction, repurchase 
                agreement, reverse repurchase agreement, 
                securities lending transaction, or securities 
                borrowing transaction between the national 
                banking association and the person;'';
          (2) in paragraph (2), by striking the period at the 
        end and inserting ``; and''; and
          (3) by adding at the end the following:
          ``(3) the term `derivative transaction' includes any 
        transaction that is a contract, agreement, swap, 
        warrant, note, or option that is based, in whole or in 
        part, on the value of, any interest in, or any 
        quantitative measure or the occurrence of any event 
        relating to, one or more commodities, securities, 
        currencies, interest or other rates, indices, or other 
        assets.''.
  [(b) Savings Associations.--Section 5(u)(3) of the Home 
Owners' Loan Act (12 U.S.C. 1464(u)(3)) is amended by striking 
``Director'' each place that term appears and inserting 
``Comptroller of the Currency''.]
  [(c)] (b) Effective Date.--The amendments made by this 
section shall take effect 1 year after the transfer date.

           *       *       *       *       *       *       *


[SEC. 618. SECURITIES HOLDING COMPANIES.

  [(a) Definitions.--In this section--
          [(1) the term ``associated person of a securities 
        holding company'' means a person directly or indirectly 
        controlling, controlled by, or under common control 
        with, a securities holding company;
          [(2) the term ``foreign bank'' has the same meaning 
        as in section 1(b)(7) of the International Banking Act 
        of 1978 (12 U.S.C. 3101(7));
          [(3) the term ``insured bank'' has the same meaning 
        as in section 3 of the Federal Deposit Insurance Act 
        (12 U.S.C. 1813);
          [(4) the term ``securities holding company''--
                  [(A) means--
                          [(i) a person (other than a natural 
                        person) that owns or controls 1 or more 
                        brokers or dealers registered with the 
                        Commission; and
                          [(ii) the associated persons of a 
                        person described in clause (i); and
                  [(B) does not include a person that is--
                          [(i) a nonbank financial company 
                        supervised by the Board under title I;
                          [(ii) an insured bank (other than an 
                        institution described in subparagraphs 
                        (D), (F), or (H) of section 2(c)(2) of 
                        the Bank Holding Company Act of 1956 
                        (12 U.S.C. 1841(c)(2)) or a savings 
                        association;
                          [(iii) an affiliate of an insured 
                        bank (other than an institution 
                        described in subparagraphs (D), (F), or 
                        (H) of section 2(c)(2) of the Bank 
                        Holding Company Act of 1956 (12 U.S.C. 
                        1841(c)(2)) or an affiliate of a 
                        savings association;
                          [(iv) a foreign bank, foreign 
                        company, or company that is described 
                        in section 8(a) of the International 
                        Banking Act of 1978 (12 U.S.C. 
                        3106(a));
                          [(v) a foreign bank that controls, 
                        directly or indirectly, a corporation 
                        chartered under section 25A of the 
                        Federal Reserve Act (12 U.S.C. 611 et 
                        seq.); or
                          [(vi) subject to comprehensive 
                        consolidated supervision by a foreign 
                        regulator;
          [(5) the term ``supervised securities holding 
        company'' means a securities holding company that is 
        supervised by the Board of Governors under this 
        section; and
          [(6) the terms ``affiliate'', ``bank'', ``bank 
        holding company'', ``company'', ``control'', ``savings 
        association'', and ``subsidiary'' have the same 
        meanings as in section 2 of the Bank Holding Company 
        Act of 1956.
  [(b) Supervision of a Securities Holding Company Not Having a 
Bank or Savings Association Affiliate.--
          [(1) In general.--A securities holding company that 
        is required by a foreign regulator or provision of 
        foreign law to be subject to comprehensive consolidated 
        supervision may register with the Board of Governors 
        under paragraph (2) to become a supervised securities 
        holding company. Any securities holding company filing 
        such a registration shall be supervised in accordance 
        with this section, and shall comply with the rules and 
        orders prescribed by the Board of Governors applicable 
        to supervised securities holding companies.
          [(2) Registration as a supervised securities holding 
        company.--
                  [(A) Registration.--A securities holding 
                company that elects to be subject to 
                comprehensive consolidated supervision shall 
                register by filing with the Board of Governors 
                such information and documents as the Board of 
                Governors, by regulation, may prescribe as 
                necessary or appropriate in furtherance of the 
                purposes of this section.
                  [(B) Effective date.--A securities holding 
                company that registers under subparagraph (A) 
                shall be deemed to be a supervised securities 
                holding company, effective on the date that is 
                45 days after the date of receipt of the 
                registration information and documents under 
                subparagraph (A) by the Board of Governors, or 
                within such shorter period as the Board of 
                Governors, by rule or order, may determine.
  [(c) Supervision of Securities Holding Companies.--
          [(1) Recordkeeping and reporting.--
                  [(A) Recordkeeping and reporting required.--
                Each supervised securities holding company and 
                each affiliate of a supervised securities 
                holding company shall make and keep for periods 
                determined by the Board of Governors such 
                records, furnish copies of such records, and 
                make such reports, as the Board of Governors 
                determines to be necessary or appropriate to 
                carry out this section, to prevent evasions 
                thereof, and to monitor compliance by the 
                supervised securities holding company or 
                affiliate with applicable provisions of law.
                  [(B) Form and contents.--
                          [(i) In general.--Any record or 
                        report required to be made, furnished, 
                        or kept under this paragraph shall--
                                  [(I) be prepared in such form 
                                and according to such 
                                specifications (including 
                                certification by a registered 
                                public accounting firm), as the 
                                Board of Governors may require; 
                                and
                                  [(II) be provided promptly to 
                                the Board of Governors at any 
                                time, upon request by the Board 
                                of Governors.
                          [(ii) Contents.--Records and reports 
                        required to be made, furnished, or kept 
                        under this paragraph may include--
                                  [(I) a balance sheet or 
                                income statement of the 
                                supervised securities holding 
                                company or an affiliate of a 
                                supervised securities holding 
                                company;
                                  [(II) an assessment of the 
                                consolidated capital and 
                                liquidity of the supervised 
                                securities holding company;
                                  [(III) a report by an 
                                independent auditor attesting 
                                to the compliance of the 
                                supervised securities holding 
                                company with the internal risk 
                                management and internal control 
                                objectives of the supervised 
                                securities holding company; and
                                  [(IV) a report concerning the 
                                extent to which the supervised 
                                securities holding company or 
                                affiliate has complied with the 
                                provisions of this section and 
                                any regulations prescribed and 
                                orders issued under this 
                                section.
          [(2) Use of existing reports.--
                  [(A) In general.--The Board of Governors 
                shall, to the fullest extent possible, accept 
                reports in fulfillment of the requirements of 
                this paragraph that a supervised securities 
                holding company or an affiliate of a supervised 
                securities holding company has been required to 
                provide to another regulatory agency or a self-
                regulatory organization.
                  [(B) Availability.--A supervised securities 
                holding company or an affiliate of a supervised 
                securities holding company shall promptly 
                provide to the Board of Governors, at the 
                request of the Board of Governors, any report 
                described in subparagraph (A), as permitted by 
                law.
          [(3) Examination authority.--
                  [(A) Focus of examination authority.--The 
                Board of Governors may make examinations of any 
                supervised securities holding company and any 
                affiliate of a supervised securities holding 
                company to carry out this subsection, to 
                prevent evasions thereof, and to monitor 
                compliance by the supervised securities holding 
                company or affiliate with applicable provisions 
                of law.
                  [(B) Deference to other examinations.--For 
                purposes of this subparagraph, the Board of 
                Governors shall, to the fullest extent 
                possible, use the reports of examination made 
                by other appropriate Federal or State 
                regulatory authorities with respect to any 
                functionally regulated subsidiary or any 
                institution described in subparagraph (D), (F), 
                or (H) of section 2(c)(2) of the Bank Holding 
                Company Act of 1956 (12 U.S.C. 1841(c)(2)).
  [(d) Capital and Risk Management.--
          [(1) In general.--The Board of Governors shall, by 
        regulation or order, prescribe capital adequacy and 
        other risk management standards for supervised 
        securities holding companies that are appropriate to 
        protect the safety and soundness of the supervised 
        securities holding companies and address the risks 
        posed to financial stability by supervised securities 
        holding companies.
          [(2) Differentiation.--In imposing standards under 
        this subsection, the Board of Governors may 
        differentiate among supervised securities holding 
        companies on an individual basis, or by category, 
        taking into consideration the requirements under 
        paragraph (3).
          [(3) Content.--Any standards imposed on a supervised 
        securities holding company under this subsection shall 
        take into account--
                  [(A) the differences among types of business 
                activities carried out by the supervised 
                securities holding company;
                  [(B) the amount and nature of the financial 
                assets of the supervised securities holding 
                company;
                  [(C) the amount and nature of the liabilities 
                of the supervised securities holding company, 
                including the degree of reliance on short-term 
                funding;
                  [(D) the extent and nature of the off-balance 
                sheet exposures of the supervised securities 
                holding company;
                  [(E) the extent and nature of the 
                transactions and relationships of the 
                supervised securities holding company with 
                other financial companies;
                  [(F) the importance of the supervised 
                securities holding company as a source of 
                credit for households, businesses, and State 
                and local governments, and as a source of 
                liquidity for the financial system; and
                  [(G) the nature, scope, and mix of the 
                activities of the supervised securities holding 
                company.
          [(4) Notice.--A capital requirement imposed under 
        this subsection may not take effect earlier than 180 
        days after the date on which a supervised securities 
        holding company is provided notice of the capital 
        requirement.
  [(e) Other Provisions of Law Applicable to Supervised 
Securities Holding Companies.--
          [(1) Federal deposit insurance act.--Subsections (b), 
        (c) through (s), and (u) of section 8 of the Federal 
        Deposit Insurance Act (12 U.S.C. 1818) shall apply to 
        any supervised securities holding company, and to any 
        subsidiary (other than a bank or an institution 
        described in subparagraph (D), (F), or (H) of section 
        2(c)(2) of the Bank Holding Company Act of 1956 (12 
        U.S.C. 1841(c)(2))) of a supervised securities holding 
        company, in the same manner as such subsections apply 
        to a bank holding company for which the Board of 
        Governors is the appropriate Federal banking agency. 
        For purposes of applying such subsections to a 
        supervised securities holding company or a subsidiary 
        (other than a bank or an institution described in 
        subparagraph (D), (F), or (H) of section 2(c)(2) of the 
        Bank Holding Company Act of 1956 (12 U.S.C. 
        1841(c)(2))) of a supervised securities holding 
        company, the Board of Governors shall be deemed the 
        appropriate Federal banking agency for the supervised 
        securities holding company or subsidiary.
          [(2) Bank holding company act of 1956.--Except as the 
        Board of Governors may otherwise provide by regulation 
        or order, a supervised securities holding company shall 
        be subject to the provisions of the Bank Holding 
        Company Act of 1956 (12 U.S.C. 1841 et seq.) in the 
        same manner and to the same extent a bank holding 
        company is subject to such provisions, except that a 
        supervised securities holding company may not, by 
        reason of this paragraph, be deemed to be a bank 
        holding company for purposes of section 4 of the Bank 
        Holding Company Act of 1956 (12 U.S.C. 1843).

[SEC. 619. PROHIBITIONS ON PROPRIETARY TRADING AND CERTAIN 
                    RELATIONSHIPS WITH HEDGE FUNDS AND PRIVATE EQUITY 
                    FUNDS

  [The Bank Holding Company Act of 1956 (12 U.S.C. 1841 et 
seq.) is amended by adding at the end the following:

[``SEC. 13. PROHIBITIONS ON PROPRIETARY TRADING AND CERTAIN 
                    RELATIONSHIPS WITH HEDGE FUNDS AND PRIVATE EQUITY 
                    FUNDS

  [``(a) In general.--
          [``(1) Prohibition.--Unless otherwise provided in 
        this section, a banking entity shall not--
                  [``(A) engage in proprietary trading; or
                  [``(B) acquire or retain any equity, 
                partnership, or other ownership interest in or 
                sponsor a hedge fund or a private equity fund.
          [``(2) Nonbank financial companies supervised by the 
        board.--Any nonbank financial company supervised by the 
        Board that engages in proprietary trading or takes or 
        retains any equity, partnership, or other ownership 
        interest in or sponsors a hedge fund or a private 
        equity fund shall be subject, by rule, as provided in 
        subsection (b)(2), to additional capital requirements 
        for and additional quantitative limits with regards to 
        such proprietary trading and taking or retaining any 
        equity, partnership, or other ownership interest in or 
        sponsorship of a hedge fund or a private equity fund, 
        except that permitted activities as described in 
        subsection (d) shall not be subject to the additional 
        capital and additional quantitative limits except as 
        provided in subsection (d)(3), as if the nonbank 
        financial company supervised by the Board were a 
        banking entity.
  [``(b) Study and Rulemaking.--
          [``(1) Study.--Not later than 6 months after the date 
        of enactment of this section, the Financial Stability 
        Oversight Council shall study and make recommendations 
        on implementing the provisions of this section so as 
        to--
                  [``(A) promote and enhance the safety and 
                soundness of banking entities;
                  [``(B) protect taxpayers and consumers and 
                enhance financial stability by minimizing the 
                risk that insured depository institutions and 
                the affiliates of insured depository 
                institutions will engage in unsafe and unsound 
                activities;
                  [``(C) limit the inappropriate transfer of 
                Federal subsidies from institutions that 
                benefit from deposit insurance and liquidity 
                facilities of the Federal Government to 
                unregulated entities;
                  [``(D) reduce conflicts of interest between 
                the self-interest of banking entities and 
                nonbank financial companies supervised by the 
                Board, and the interests of the customers of 
                such entities and companies;
                  [``(E) limit activities that have caused 
                undue risk or loss in banking entities and 
                nonbank financial companies supervised by the 
                Board, or that might reasonably be expected to 
                create undue risk or loss in such banking 
                entities and nonbank financial companies 
                supervised by the Board;
                  [``(F) appropriately accommodate the business 
                of insurance within an insurance company, 
                subject to regulation in accordance with the 
                relevant insurance company investment laws, 
                while protecting the safety and soundness of 
                any banking entity with which such insurance 
                company is affiliated and of the United States 
                financial system; and
                  [``(G) appropriately time the divestiture of 
                illiquid assets that are affected by the 
                implementation of the prohibitions under 
                subsection (a).
          [``(2) Rulemaking.--
                  [``(A) In general.--Unless otherwise provided 
                in this section, not later than 9 months after 
                the completion of the study under paragraph 
                (1), the appropriate Federal banking agencies, 
                the Securities and Exchange Commission, and the 
                Commodity Futures Trading Commission, shall 
                consider the findings of the study under 
                paragraph (1) and adopt rules to carry out this 
                section, as provided in subparagraph (B).
                  [``(B) Coordinated rulemaking.--
                          [``(i) Regulatory Authority.--The 
                        regulations issued under this paragraph 
                        shall be issued by--
                                  [``(I) the appropriate 
                                Federal banking agencies, 
                                jointly, with respect to 
                                insured depository 
                                institutions;
                                  [``(II) the Board, with 
                                respect to any company that 
                                controls an insured depository 
                                institution, or that is treated 
                                as a bank holding company for 
                                purposes of section 8 of the 
                                International Banking Act, any 
                                nonbank financial company 
                                supervised by the Board, and 
                                any subsidiary of any of the 
                                foregoing (other than a 
                                subsidiary for which an agency 
                                described in subclause (I), 
                                (III), or (IV) is the primary 
                                financial regulatory agency);
                                  [``(III) the Commodity 
                                Futures Trading Commission, 
                                with respect to any entity for 
                                which the Commodity Futures 
                                Trading Commission is the 
                                primary financial regulatory 
                                agency, as defined in section 2 
                                of the Dodd-Frank Wall Street 
                                Reform and Consumer Protection 
                                Act; and
                                  [``(IV) the Securities and 
                                Exchange Commission, with 
                                respect to any entity for which 
                                the Securities and Exchange 
                                Commission is the primary 
                                financial regulatory agency, as 
                                defined in section 2 of the 
                                Dodd-Frank Wall Street Reform 
                                and Consumer Protection Act.
                          [``(ii) Coordination, consistency, 
                        and comparability.--In developing and 
                        issuing regulations pursuant to this 
                        section, the appropriate Federal 
                        banking agencies, the Securities and 
                        Exchange Commission, and the Commodity 
                        Futures Trading Commission shall 
                        consult and coordinate with each other, 
                        as appropriate, for the purposes of 
                        assuring, to the extent possible, that 
                        such regulations are comparable and 
                        provide for consistent application and 
                        implementation of the applicable 
                        provisions of this section to avoid 
                        providing advantages or imposing 
                        disadvantages to the companies affected 
                        by this subsection and to protect the 
                        safety and soundness of banking 
                        entities and nonbank financial 
                        companies supervised by the Board.
                          [``(iii) Council role.--The 
                        Chairperson of the Financial Stability 
                        Oversight Council shall be responsible 
                        for coordination of the regulations 
                        issued under this section.
  [``(c) Effective Date.--
          [``(1) In general.--Except as provided in paragraphs 
        (2) and (3), this section shall take effect on the 
        earlier of--
                  [``(A) 12 months after the date of the 
                issuance of final rules under subsection (b); 
                or
                  [``(B) 2 years after the date of enactment of 
                this section.
          [``(2) Conformance period for divestiture.--A banking 
        entity or nonbank financial company supervised by the 
        Board shall bring its activities and investments into 
        compliance with the requirements of this section not 
        later than 2 years after the date on which the 
        requirements become effective pursuant to this section 
        or 2 years after the date on which the entity or 
        company becomes a nonbank financial company supervised 
        by the Board. The Board may, by rule or order, extend 
        this two-year period for not more than one year at a 
        time, if, in the judgment of the Board, such an 
        extension is consistent with the purposes of this 
        section and would not be detrimental to the public 
        interest. The extensions made by the Board under the 
        preceding sentence may not exceed an aggregate of 3 
        years.
          [``(3) Extended transition for illiquid funds.--
                  [``(A) Application.--The Board may, upon the 
                application of a banking entity, extend the 
                period during which the banking entity, to the 
                extent necessary to fulfill a contractual 
                obligation that was in effect on May 1, 2010, 
                may take or retain its equity, partnership, or 
                other ownership interest in, or otherwise 
                provide additional capital to, an illiquid 
                fund.
                  [``(B) Time limit on approval.--The Board may 
                grant 1 extension under subparagraph (A), which 
                may not exceed 5 years.
          [``(4) Divestiture required.--Except as otherwise 
        provided in subsection (d)(1)(G), a banking entity may 
        not engage in any activity prohibited under subsection 
        (a)(1)(B) after the earlier of--
                  [``(A) the date on which the contractual 
                obligation to invest in the illiquid fund 
                terminates; and
                  [``(B) the date on which any extensions 
                granted by the Board under paragraph (3) 
                expire.
          [``(5) Additional capital during transition period.--
        Notwithstanding paragraph (2), on the date on which the 
        rules are issued under subsection (b)(2), the 
        appropriate Federal banking agencies, the Securities 
        and Exchange Commission, and the Commodity Futures 
        Trading Commission shall issue rules, as provided in 
        subsection (b)(2), to impose additional capital 
        requirements, and any other restrictions, as 
        appropriate, on any equity, partnership, or ownership 
        interest in or sponsorship of a hedge fund or private 
        equity fund by a banking entity.
          [``(6) Special rulemaking.--Not later than 6 months 
        after the date of enactment of this section, the Board 
        shall issues rules to implement paragraphs (2) and (3).
  [``(d) Permitted Activities.--
          [``(1) In general.--Notwithstanding the restrictions 
        under subsection (a), to the extent permitted by any 
        other provision of Federal or State law, and subject to 
        the limitations under paragraph (2) and any 
        restrictions or limitations that the appropriate 
        Federal banking agencies, the Securities and Exchange 
        Commission, and the Commodity Futures Trading 
        Commission, may determine, the following activities (in 
        this section referred to as `permitted activities') are 
        permitted:
                  [``(A) The purchase, sale, acquisition, or 
                disposition of obligations of the United States 
                or any agency thereof, obligations, 
                participations, or other instruments of or 
                issued by the Government National Mortgage 
                Association, the Federal National Mortgage 
                Association, the Federal Home Loan Mortgage 
                Corporation, a Federal Home Loan Bank, the 
                Federal Agricultural Mortgage Corporation, or a 
                Farm Credit System institution chartered under 
                and subject to the provisions of the Farm 
                Credit Act of 1971 (12 U.S.C. 2001 et seq.), 
                and obligations of any State or of any 
                political subdivision thereof.
                  [``(B) The purchase, sale, acquisition, or 
                disposition of securities and other instruments 
                described in subsection (h)(4) in connection 
                with underwriting or market-making-related 
                activities, to the extent that any such 
                activities permitted by this subparagraph are 
                designed not to exceed the reasonably expected 
                near term demands of clients, customers, or 
                counterparties.
                  [``(C) Risk-mitigating hedging activities in 
                connection with and related to individual or 
                aggregated positions, contracts, or other 
                holdings of a banking entity that are designed 
                to reduce the specific risks to the banking 
                entity in connection with and related to such 
                positions, contracts, or other holdings.
                  [``(D) The purchase, sale, acquisition, or 
                disposition of securities and other instruments 
                described in subsection (h)(4) on behalf of 
                customers.
                  [``(E) Investments in one or more small 
                business investment companies, as defined in 
                section 102 of the Small Business Investment 
                Act of 1958 (15 U.S.C. 662), investments 
                designed primarily to promote the public 
                welfare, of the type permitted under paragraph 
                (11) of section 5136 of the Revised Statutes of 
                the United States (12 U.S.C. 24), or 
                investments that are qualified rehabilitation 
                expenditures with respect to a qualified 
                rehabilitated building or certified historic 
                structure, as such terms are defined in section 
                47 of the Internal Revenue Code of 1986 or a 
                similar State historic tax credit program.
                  [``(F) The purchase, sale, acquisition, or 
                disposition of securities and other instruments 
                described in subsection (h)(4) by a regulated 
                insurance company directly engaged in the 
                business of insurance for the general account 
                of the company and by any affiliate of such 
                regulated insurance company, provided that such 
                activities by any affiliate are solely for the 
                general account of the regulated insurance 
                company, if--
                          [``(i) the purchase, sale, 
                        acquisition, or disposition is 
                        conducted in compliance with, and 
                        subject to, the insurance company 
                        investment laws, regulations, and 
                        written guidance of the State or 
                        jurisdiction in which each such 
                        insurance company is domiciled; and
                          [``(ii) the appropriate Federal 
                        banking agencies, after consultation 
                        with the Financial Stability Oversight 
                        Council and the relevant insurance 
                        commissioners of the States and 
                        territories of the United States, have 
                        not jointly determined, after notice 
                        and comment, that a particular law, 
                        regulation, or written guidance 
                        described in clause (i) is insufficient 
                        to protect the safety and soundness of 
                        the banking entity, or of the financial 
                        stability of the United States.
                  [``(G) Organizing and offering a private 
                equity or hedge fund, including serving as a 
                general partner, managing member, or trustee of 
                the fund and in any manner selecting or 
                controlling (or having employees, officers, 
                directors, or agents who constitute) a majority 
                of the directors, trustees, or management of 
                the fund, including any necessary expenses for 
                the foregoing, only if--
                          [``(i) the banking entity provides 
                        bona fide trust, fiduciary, or 
                        investment advisory services;
                          [``(ii) the fund is organized and 
                        offered only in connection with the 
                        provision of bona fide trust, 
                        fiduciary, or investment advisory 
                        services and only to persons that are 
                        customers of such services of the 
                        banking entity;
                          [``(iii) the banking entity does not 
                        acquire or retain an equity interest, 
                        partnership interest, or other 
                        ownership interest in the funds except 
                        for a de minimis investment subject to 
                        and in compliance with paragraph (4);
                          [``(iv) the banking entity complies 
                        with the restrictions under paragraphs 
                        (1) and (2) of subparagraph (f);
                          [``(v) the banking entity does not, 
                        directly or indirectly, guarantee, 
                        assume, or otherwise insure the 
                        obligations or performance of the hedge 
                        fund or private equity fund or of any 
                        hedge fund or private equity fund in 
                        which such hedge fund or private equity 
                        fund invests;
                          [``(vi) the banking entity does not 
                        share with the hedge fund or private 
                        equity fund, for corporate, marketing, 
                        promotional, or other purposes, the 
                        same name or a variation of the same 
                        name;
                          [``(vii) no director or employee of 
                        the banking entity takes or retains an 
                        equity interest, partnership interest, 
                        or other ownership interest in the 
                        hedge fund or private equity fund, 
                        except for any director or employee of 
                        the banking entity who is directly 
                        engaged in providing investment 
                        advisory or other services to the hedge 
                        fund or private equity fund; and
                          [``(viii) the banking entity 
                        discloses to prospective and actual 
                        investors in the fund, in writing, that 
                        any losses in such hedge fund or 
                        private equity fund are borne solely by 
                        investors in the fund and not by the 
                        banking entity, and otherwise complies 
                        with any additional rules of the 
                        appropriate Federal banking agencies, 
                        the Securities and Exchange Commission, 
                        or the Commodity Futures Trading 
                        Commission, as provided in subsection 
                        (b)(2), designed to ensure that losses 
                        in such hedge fund or private equity 
                        fund are borne solely by investors in 
                        the fund and not by the banking entity.
                  [``(H) Proprietary trading conducted by a 
                banking entity pursuant to paragraph (9) or 
                (13) of section 4(c), provided that the trading 
                occurs solely outside of the United States and 
                that the banking entity is not directly or 
                indirectly controlled by a banking entity that 
                is organized under the laws of the United 
                States or of one or more States.
                  [``(I) The acquisition or retention of any 
                equity, partnership, or other ownership 
                interest in, or the sponsorship of, a hedge 
                fund or a private equity fund by a banking 
                entity pursuant to paragraph (9) or (13) of 
                section 4(c) solely outside of the United 
                States, provided that no ownership interest in 
                such hedge fund or private equity fund is 
                offered for sale or sold to a resident of the 
                United States and that the banking entity is 
                not directly or indirectly controlled by a 
                banking entity that is organized under the laws 
                of the United States or of one or more States.
                  [``(J) Such other activity as the appropriate 
                Federal banking agencies, the Securities and 
                Exchange Commission, and the Commodity Futures 
                Trading Commission determine, by rule, as 
                provided in subsection (b)(2), would promote 
                and protect the safety and soundness of the 
                banking entity and the financial stability of 
                the United States.
          [``(2) Limitation on permitted activities.--
                  [``(A) In general.--No transaction, class of 
                transactions, or activity may be deemed a 
                permitted activity under paragraph (1) if the 
                transaction, class of transactions, or 
                activity--
                          [``(i) would involve or result in a 
                        material conflict of interest (as such 
                        term shall be defined by rule as 
                        provided in subsection (b)(2)) between 
                        the banking entity and its clients, 
                        customers, or counterparties;
                          [``(ii) would result, directly or 
                        indirectly, in a material exposure by 
                        the banking entity to high-risk assets 
                        or high-risk trading strategies (as 
                        such terms shall be defined by rule as 
                        provided in subsection (b)(2));
                          [``(iii) would pose a threat to the 
                        safety and soundness of such banking 
                        entity; or
                          [``(iv) would pose a threat to the 
                        financial stability of the United 
                        States.
                  [``(B) Rulemaking.--The appropriate Federal 
                banking agencies, the Securities and Exchange 
                Commission, and the Commodity Futures Trading 
                Commission shall issue regulations to implement 
                subparagraph (A), as part of the regulations 
                issued under subsection (b)(2).
          [``(3) Capital and quantitative limitations.--The 
        appropriate Federal banking agencies, the Securities 
        and Exchange Commission, and the Commodity Futures 
        Trading Commission shall, as provided in subsection 
        (b)(2), adopt rules imposing additional capital 
        requirements and quantitative limitations, including 
        diversification requirements, regarding the activities 
        permitted under this section if the appropriate Federal 
        banking agencies, the Securities and Exchange 
        Commission, and the Commodity Futures Trading 
        Commission determine that additional capital and 
        quantitative limitations are appropriate to protect the 
        safety and soundness of banking entities engaged in 
        such activities.
          [``(4) De minimis investment.--
                  [``(A) In general.--A banking entity may make 
                and retain an investment in a hedge fund or 
                private equity fund that the banking entity 
                organizes and offers, subject to the 
                limitations and restrictions in subparagraph 
                (B) for the purposes of--
                          [``(i) establishing the fund and 
                        providing the fund with sufficient 
                        initial equity for investment to permit 
                        the fund to attract unaffiliated 
                        investors; or
                          [``(ii) making a de minimis 
                        investment.
                  [``(B) Limitations and restrictions on 
                investments.--
                          [``(i) Requirement to seek other 
                        investors.--A banking entity shall 
                        actively seek unaffiliated investors to 
                        reduce or dilute the investment of the 
                        banking entity to the amount permitted 
                        under clause (ii).
                          [``(ii) Limitations on size of 
                        investments.--Notwithstanding any other 
                        provision of law, investments by a 
                        banking entity in a hedge fund or 
                        private equity fund shall--
                                  [``(I) not later than 1 year 
                                after the date of establishment 
                                of the fund, be reduced through 
                                redemption, sale, or dilution 
                                to an amount that is not more 
                                than 3 percent of the total 
                                ownership interests of the 
                                fund;
                                  [``(II) be immaterial to the 
                                banking entity, as defined, by 
                                rule, pursuant to subsection 
                                (b)(2), but in no case may the 
                                aggregate of all of the 
                                interests of the banking entity 
                                in all such funds exceed 3 
                                percent of the Tier 1 capital 
                                of the banking entity.
                          [``(iii) Capital.--For purposes of 
                        determining compliance with applicable 
                        capital standards under paragraph (3), 
                        the aggregate amount of the outstanding 
                        investments by a banking entity under 
                        this paragraph, including retained 
                        earnings, shall be deducted from the 
                        assets and tangible equity of the 
                        banking entity, and the amount of the 
                        deduction shall increase commensurate 
                        with the leverage of the hedge fund or 
                        private equity fund.
                  [``(C) Extension.--Upon an application by a 
                banking entity, the Board may extend the period 
                of time to meet the requirements under 
                subparagraph (B)(ii)(I) for 2 additional years, 
                if the Board finds that an extension would be 
                consistent with safety and soundness and in the 
                public interest.
  [``(e) Anti-evasion.--
          [``(1) Rulemaking.--The appropriate Federal banking 
        agencies, the Securities and Exchange Commission, and 
        the Commodity Futures Trading Commission shall issue 
        regulations, as part of the rulemaking provided for in 
        subsection (b)(2), regarding internal controls and 
        recordkeeping, in order to insure compliance with this 
        section.
          [``(2) Termination of activities or investment.--
        Notwithstanding any other provision of law, whenever an 
        appropriate Federal banking agency, the Securities and 
        Exchange Commission, or the Commodity Futures Trading 
        Commission, as appropriate, has reasonable cause to 
        believe that a banking entity or nonbank financial 
        company supervised by the Board under the respective 
        agency's jurisdiction has made an investment or engaged 
        in an activity in a manner that functions as an evasion 
        of the requirements of this section (including through 
        an abuse of any permitted activity) or otherwise 
        violates the restrictions under this section, the 
        appropriate Federal banking agency, the Securities and 
        Exchange Commission, or the Commodity Futures Trading 
        Commission, as appropriate, shall order, after due 
        notice and opportunity for hearing, the banking entity 
        or nonbank financial company supervised by the Board to 
        terminate the activity and, as relevant, dispose of the 
        investment. Nothing in this paragraph shall be 
        construed to limit the inherent authority of any 
        Federal agency or State regulatory authority to further 
        restrict any investments or activities under otherwise 
        applicable provisions of law.
  [``(f) Limitations on Relationships With Hedge Funds and 
Private Equity Funds.--
          [``(1) In general.--No banking entity that serves, 
        directly or indirectly, as the investment manager, 
        investment adviser, or sponsor to a hedge fund or 
        private equity fund, or that organizes and offers a 
        hedge fund or private equity fund pursuant to paragraph 
        (d)(1)(G), and no affiliate of such entity, may enter 
        into a transaction with the fund, or with any other 
        hedge fund or private equity fund that is controlled by 
        such fund, that would be a covered transaction, as 
        defined in section 23A of the Federal Reserve Act (12 
        U.S.C. 371c), with the hedge fund or private equity 
        fund, as if such banking entity and the affiliate 
        thereof were a member bank and the hedge fund or 
        private equity fund were an affiliate thereof.
          [``(2) Treatment as member bank.--A banking entity 
        that serves, directly or indirectly, as the investment 
        manager, investment adviser, or sponsor to a hedge fund 
        or private equity fund, or that organizes and offers a 
        hedge fund or private equity fund pursuant to paragraph 
        (d)(1)(G), shall be subject to section 23B of the 
        Federal Reserve Act (12 U.S.C. 371c-1), as if such 
        banking entity were a member bank and such hedge fund 
        or private equity fund were an affiliate thereof.
          [``(3) Permitted services.--
                  [``(A) In general.--Notwithstanding paragraph 
                (1), the Board may permit a banking entity to 
                enter into any prime brokerage transaction with 
                any hedge fund or private equity fund in which 
                a hedge fund or private equity fund managed, 
                sponsored, or advised by such banking entity 
                has taken an equity, partnership, or other 
                ownership interest, if--
                          [``(i) the banking entity is in 
                        compliance with each of the limitations 
                        set forth in subsection (d)(1)(G) with 
                        regard to a hedge fund or private 
                        equity fund organized and offered by 
                        such banking entity;
                          [``(ii) the chief executive officer 
                        (or equivalent officer) of the banking 
                        entity certifies in writing annually 
                        (with a duty to update the 
                        certification if the information in the 
                        certification materially changes) that 
                        the conditions specified in subsection 
                        (d)(1)(g)(v) are satisfied; and
                          [``(iii) the Board has determined 
                        that such transaction is consistent 
                        with the safe and sound operation and 
                        condition of the banking entity.
                  [``(B) Treatment of prime brokerage 
                transactions.--For purposes of subparagraph 
                (A), a prime brokerage transaction described in 
                subparagraph (A) shall be subject to section 
                23B of the Federal Reserve Act (12 U.S.C. 371c-
                1) as if the counterparty were an affiliate of 
                the banking entity.
          [``(4) Application to nonbank financial companies 
        supervised by the board.--The appropriate Federal 
        banking agencies, the Securities and Exchange 
        Commission, and the Commodity Futures Trading 
        Commission shall adopt rules, as provided in subsection 
        (b)(2), imposing additional capital charges or other 
        restrictions for nonbank financial companies supervised 
        by the Board to address the risks to and conflicts of 
        interest of banking entities described in paragraphs 
        (1), (2), and (3) of this subsection.
  [``(g) Rules of construction.--
          [``(1) Limitation on contrary authority.--Except as 
        provided in this section, notwithstanding any other 
        provision of law, the prohibitions and restrictions 
        under this section shall apply to activities of a 
        banking entity or nonbank financial company supervised 
        by the Board, even if such activities are authorized 
        for a banking entity or nonbank financial company 
        supervised by the Board.
          [``(2) Sale or securitization of loans.--Nothing in 
        this section shall be construed to limit or restrict 
        the ability of a banking entity or nonbank financial 
        company supervised by the Board to sell or securitize 
        loans in a manner otherwise permitted by law.
          [``(3) Authority of federal agencies and state 
        regulatory authorities.--Nothing in this section shall 
        be construed to limit the inherent authority of any 
        Federal agency or State regulatory authority under 
        otherwise applicable provisions of law.
  [``(h) Definitions.--In this section, the following 
definitions shall apply:
          [``(1) Banking entity.--The term `banking entity' 
        means any insured depository institution (as defined in 
        section 3 of the Federal Deposit Insurance Act (12 
        U.S.C. 1813)), any company that controls an insured 
        depository institution, or that is treated as a bank 
        holding company for purposes of section 8 of the 
        International Banking Act of 1978, and any affiliate or 
        subsidiary of any such entity. For purposes of this 
        paragraph, the term `insured depository institution' 
        does not include an institution that functions solely 
        in a trust or fiduciary capacity, if--
                  [``(A) all or substantially all of the 
                deposits of such institution are in trust funds 
                and are received in a bona fide fiduciary 
                capacity;
                  [``(B) no deposits of such institution which 
                are insured by the Federal Deposit Insurance 
                Corporation are offered or marketed by or 
                through an affiliate of such institution;
                  [``(C) such institution does not accept 
                demand deposits or deposits that the depositor 
                may withdraw by check or similar means for 
                payment to third parties or others or make 
                commercial loans; and
                  [``(D) such institution does not--
                          [``(i) obtain payment or payment 
                        related services from any Federal 
                        Reserve bank, including any service 
                        referred to in section 11A of the 
                        Federal Reserve Act (12 U.S.C. 248a); 
                        or
                          [``(ii) exercise discount or 
                        borrowing privileges pursuant to 
                        section 19(b)(7) of the Federal Reserve 
                        Act (12 U.S.C. 461(b)(7)).
          [``(2) Hedge fund; private equity fund.--The terms 
        `hedge fund' and `private equity fund' mean an issuer 
        that would be an investment company, as defined in the 
        Investment Company Act of 1940 (15 U.S.C. 80a-1 et 
        seq.), but for section 3(c)(1) or 3(c)(7) of that Act, 
        or such similar funds as the appropriate Federal 
        banking agencies, the Securities and Exchange 
        Commission, and the Commodity Futures Trading 
        Commission may, by rule, as provided in subsection 
        (b)(2), determine.
          [``(3) Nonbank financial company supervised by the 
        board.--The term `nonbank financial company supervised 
        by the Board' means a nonbank financial company 
        supervised by the Board of Governors, as defined in 
        section 102 of the Financial Stability Act of 2010.
          [``(4) Proprietary trading.--The term `proprietary 
        trading', when used with respect to a banking entity or 
        nonbank financial company supervised by the Board, 
        means engaging as a principal for the trading account 
        of the banking entity or nonbank financial company 
        supervised by the Board in any transaction to purchase 
        or sell, or otherwise acquire or dispose of, any 
        security, any derivative, any contract of sale of a 
        commodity for future delivery, any option on any such 
        security, derivative, or contract, or any other 
        security or financial instrument that the appropriate 
        Federal banking agencies, the Securities and Exchange 
        Commission, and the Commodity Futures Trading 
        Commission may, by rule as provided in subsection 
        (b)(2), determine.
          [``(5) Sponsor.--The term to `sponsor' a fund means--
                  [``(A) to serve as a general partner, 
                managing member, or trustee of a fund;
                  [``(B) in any manner to select or to control 
                (or to have employees, officers, or directors, 
                or agents who constitute) a majority of the 
                directors, trustees, or management of a fund; 
                or
                  [``(C) to share with a fund, for corporate, 
                marketing, promotional, or other purposes, the 
                same name or a variation of the same name.
          [``(6) Trading account.--The term `trading account' 
        means any account used for acquiring or taking 
        positions in the securities and instruments described 
        in paragraph (4) principally for the purpose of selling 
        in the near term (or otherwise with the intent to 
        resell in order to profit from short-term price 
        movements), and any such other accounts as the 
        appropriate Federal banking agencies, the Securities 
        and Exchange Commission, and the Commodity Futures 
        Trading Commission may, by rule as provided in 
        subsection (b)(2), determine.
          [``(7) Illiquid fund.--
                  [``(A) In general.--The term `illiquid fund' 
                means a hedge fund or private equity fund 
                that--
                          [``(i) as of May 1, 2010, was 
                        principally invested in, or was 
                        invested and contractually committed to 
                        principally invest in, illiquid assets, 
                        such as portfolio companies, real 
                        estate investments, and venture capital 
                        investments; and
                          [``(ii) makes all investments 
                        pursuant to, and consistent with, an 
                        investment strategy to principally 
                        invest in illiquid assets. In issuing 
                        rules regarding this subparagraph, the 
                        Board shall take into consideration the 
                        terms of investment for the hedge fund 
                        or private equity fund, including 
                        contractual obligations, the ability of 
                        the fund to divest of assets held by 
                        the fund, and any other factors that 
                        the Board determines are appropriate.
                  [``(B) Hedge fund.--For the purposes of this 
                paragraph, the term `hedge fund' means any fund 
                identified under subsection (h)(2), and does 
                not include a private equity fund, as such term 
                is used in section 203(m) of the Investment 
                Advisers Act of 1940 (15 U.S.C. 80b-3(m)).''.

[SEC. 620. STUDY OF BANK INVESTMENT ACTIVITIES

  [(a) Study.--
          [(1) In general.--Not later than 18 months after the 
        date of enactment of this Act, the appropriate Federal 
        banking agencies shall jointly review and prepare a 
        report on the activities that a banking entity, as such 
        term is defined in the Bank Holding Company Act of 1956 
        (12 U.S.C. 1841 et. seq.), may engage in under Federal 
        and State law, including activities authorized by 
        statute and by order, interpretation and guidance.
          [(2) Content.--In carrying out the study under 
        paragraph (1), the appropriate Federal banking agencies 
        shall review and consider--
                  [(A) the type of activities or investments;
                  [(B) any financial, operational, managerial, 
                or reputation risks associated with or 
                presented as a result of the banking entity 
                engaged in the activity or making the 
                investment; and
                  [(C) risk mitigation activities undertaken by 
                the banking entity with regard to the risks.
  [(b) Report and Recommendations to the Council and to 
Congress.--The appropriate Federal banking agencies shall 
submit to the Council, the Committee on Financial Services of 
the House of Representatives, and the Committee on Banking, 
Housing, and Urban Affairs of the Senate the study conducted 
pursuant to subsection (a) no later than 2 months after its 
completion. In addition to the information described in 
subsection (a), the report shall include recommendations 
regarding--
          [(1) whether each activity or investment has or could 
        have a negative effect on the safety and soundness of 
        the banking entity or the United States financial 
        system;
          [(2) the appropriateness of the conduct of each 
        activity or type of investment by banking entities; and
          [(3) additional restrictions as may be necessary to 
        address risks to safety and soundness arising from the 
        activities or types of investments described in 
        subsection (a).

[SEC. 621. CONFLICTS OF INTEREST

  [(a) In general.--The Securities Act of 1933 (15 U.S.C. 77a 
et seq.) is amended by inserting after section 27A the 
following:

[``SEC. 27B. CONFLICTS OF INTEREST RELATING TO CERTAIN SECURITIZATIONS

  [``(a) In general.--An underwriter, placement agent, initial 
purchaser, or sponsor, or any affiliate or subsidiary of any 
such entity, of an asset-backed security (as such term is 
defined in section 3 of the Securities and Exchange Act of 1934 
(15 U.S.C. 78c), which for the purposes of this section shall 
include a synthetic asset-backed security), shall not, at any 
time for a period ending on the date that is one year after the 
date of the first closing of the sale of the asset-backed 
security, engage in any transaction that would involve or 
result in any material conflict of interest with respect to any 
investor in a transaction arising out of such activity.
  [``(b) Rulemaking.--Not later than 270 days after the date of 
enactment of this section, the Commission shall issue rules for 
the purpose of implementing subsection (a).
  [``(c) Exception.--The prohibitions of subsection (a) shall 
not apply to--
          [``(1) risk-mitigating hedging activities in 
        connection with positions or holdings arising out of 
        the underwriting, placement, initial purchase, or 
        sponsorship of an asset-backed security, provided that 
        such activities are designed to reduce the specific 
        risks to the underwriter, placement agent, initial 
        purchaser, or sponsor associated with positions or 
        holdings arising out of such underwriting, placement, 
        initial purchase, or sponsorship; or
          [``(2) purchases or sales of asset-backed securities 
        made pursuant to and consistent with--
                  [``(A) commitments of the underwriter, 
                placement agent, initial purchaser, or sponsor, 
                or any affiliate or subsidiary of any such 
                entity, to provide liquidity for the asset-
                backed security, or
                  [``(B) bona fide market-making in the asset 
                backed security.
  [``(d) Rule of construction.--This subsection shall not 
otherwise limit the application of section 15G of the 
Securities Exchange Act of 1934.''.
  [(b) Effective Date.--Section 27B of the Securities Act of 
1933, as added by this section, shall take effect on the 
effective date of final rules issued by the Commission under 
subsection (b) of such section 27B, except that subsections (b) 
and (d) of such section 27B shall take effect on the date of 
enactment of this Act.]

           *       *       *       *       *       *       *


TITLE VII--WALL STREET TRANSPARENCY AND ACCOUNTABILITY

           *       *       *       *       *       *       *


        Subtitle A--Regulation of Over-the-Counter Swaps Markets

PART I--REGULATORY AUTHORITY

           *       *       *       *       *       *       *


SEC. 716. PROHIBITION AGAINST FEDERAL GOVERNMENT BAILOUTS OF SWAPS 
                    ENTITIES.

  (a) Prohibition on Federal Assistance.--Notwithstanding any 
other provision of law (including regulations), no Federal 
assistance may be provided to any swaps entity with respect to 
any swap, security-based swap, or other activity of the swaps 
entity.
  (b) Definitions.--In this section:
          (1) Federal assistance.--The term ``Federal 
        assistance'' means the use of any advances from any 
        Federal Reserve credit facility or discount window that 
        is not part of a program or facility with broad-based 
        eligibility under section 13(3)(A) of the Federal 
        Reserve Act, Federal Deposit Insurance Corporation 
        insurance or guarantees for the purpose of--
                  (A) making any loan to, or purchasing any 
                stock, equity interest, or debt obligation of, 
                any swaps entity;
                  (B) purchasing the assets of any swaps 
                entity;
                  (C) guaranteeing any loan or debt issuance of 
                any swaps entity; or
                  (D) entering into any assistance arrangement 
                (including tax breaks), loss sharing, or profit 
                sharing with any swaps entity.
          (2) Swaps entity.--
                  (A) In general.--The term ``swaps entity'' 
                means any swap dealer, security-based swap 
                dealer, major swap participant, major security-
                based swap participant, that is registered 
                under--
                          (i) the Commodity Exchange Act (7 
                        U.S.C. 1 et seq.); or
                          (ii) the Securities Exchange Act of 
                        1934 (15 U.S.C. 78a et seq.).
                  (B) Exclusion.--The term ``swaps entity'' 
                does not include any major swap participant or 
                major security-based swap participant that is 
                an covered depository institution.
          (3) Covered depository institution.--The term 
        ``covered depository institution'' means--
                  (A) an insured depository institution, as 
                that term is defined in section 3 of the 
                Federal Deposit Insurance Act (12 U.S.C. 1813); 
                and
                  (B) a United States uninsured branch or 
                agency of a foreign bank.
  (c) Affiliates of Covered Depository Institutions.--The 
prohibition on Federal assistance contained in subsection (a) 
does not apply to and shall not prevent a covered depository 
institution from having or establishing an affiliate which is a 
swaps entity, as long as such covered depository institution is 
part of a bank holding company, savings and loan holding 
company, or foreign banking organization (as such term is 
defined under Regulation K of the Board of Governors of the 
Federal Reserve System (12 CFR 211.21(o))), that is supervised 
by the Federal Reserve and such swaps entity affiliate complies 
with sections 23A and 23B of the Federal Reserve Act and such 
other requirements as the Commodity Futures Trading Commission 
or the Securities Exchange Commission, as appropriate, and the 
Board of Governors of the Federal Reserve System, may determine 
to be necessary and appropriate.
  (d) Only Bona Fide Hedging and Traditional Bank Activities 
Permitted.--
          (1) In general.--The prohibition in subsection (a) 
        shall not apply to any covered depository institution 
        that limits its swap and security-based swap activities 
        to the following:
                  (A) Hedging and other similar risk mitigation 
                activities.--Hedging and other similar risk 
                mitigating activities directly related to the 
                covered depository institution's activities.
                  (B) Non-structured finance swap activities.--
                Acting as a swaps entity for swaps or security-
                based swaps other than a structured finance 
                swap.
                  (C) Certain structured finance swap 
                activities.--Acting as a swaps entity for swaps 
                or security-based swaps that are structured 
                finance swaps, if--
                          (i) such structured finance swaps are 
                        undertaken for hedging or risk 
                        management purposes; or
                          (ii) each asset-backed security 
                        underlying such structured finance 
                        swaps is of a credit quality and of a 
                        type or category with respect to which 
                        the prudential regulators have jointly 
                        adopted rules authorizing swap or 
                        security-based swap activity by covered 
                        depository institutions.
          (2) Definitions.--For purposes of this subsection:
                  (A) Structured finance swap.--The term 
                ``structured finance swap'' means a swap or 
                security-based swap based on an asset-backed 
                security (or group or index primarily comprised 
                of asset-backed securities).
                  (B) Asset-backed security.--The term ``asset-
                backed security'' has the meaning given such 
                term under section 3(a) of the Securities 
                Exchange Act of 1934 (15 U.S.C. 78c(a)).
  (e) Existing Swaps and Security-based Swaps.--The prohibition 
in subsection (a) shall only apply to swaps or security-based 
swaps entered into by a covered depository institution after 
the end of the transition period described in subsection (f).
  (f) Transition Period.--To the extent a covered depository 
institution qualifies as a ``swaps entity'' and would be 
subject to the Federal assistance prohibition in subsection 
(a), the appropriate Federal banking agency, after consulting 
with and considering the views of the Commodity Futures Trading 
Commission or the Securities Exchange Commission, as 
appropriate, shall permit the covered depository institution up 
to 24 months to divest the swaps entity or cease the activities 
that require registration as a swaps entity. In establishing 
the appropriate transition period to effect such divestiture or 
cessation of activities, which may include making the swaps 
entity an affiliate of the covered depository institution, the 
appropriate Federal banking agency shall take into account and 
make written findings regarding the potential impact of such 
divestiture or cessation of activities on the covered 
depository institution's (1) mortgage lending, (2) small 
business lending, (3) job creation, and (4) capital formation 
versus the potential negative impact on insured depositors and 
the Deposit Insurance Fund of the Federal Deposit Insurance 
Corporation. The appropriate Federal banking agency may 
consider such other factors as may be appropriate. The 
appropriate Federal banking agency may place such conditions on 
the covered depository institution's divestiture or ceasing of 
activities of the swaps entity as it deems necessary and 
appropriate. The transition period under this subsection may be 
extended by the appropriate Federal banking agency, after 
consultation with the Commodity Futures Trading Commission and 
the Securities and Exchange Commission, for a period of up to 1 
additional year.
  (g) Excluded Entities.--For purposes of this section, the 
term ``swaps entity'' shall not include any insured depository 
institution under the Federal Deposit Insurance Act [or a 
covered financial company under title II] which is in a 
conservatorship, receivership, or a bridge bank operated by the 
Federal Deposit Insurance Corporation.
  (h) Effective Date.--The prohibition in subsection (a) shall 
be effective 2 years following the date on which this Act is 
effective.
  (i) Liquidation Required.--
          (1) In general.--
                  (A) FDIC insured institutions.--All swaps 
                entities that are FDIC insured institutions 
                that are put into receivership or declared 
                insolvent as a result of swap or security-based 
                swap activity of the swaps entities shall be 
                subject to the termination or transfer of that 
                swap or security-based swap activity in 
                accordance with applicable law prescribing the 
                treatment of those contracts. No taxpayer funds 
                shall be used to prevent the receivership of 
                any swap entity resulting from swap or 
                security-based swap activity of the swaps 
                entity.
                  (B) Institutions that pose a systemic risk 
                and are subject to heightened prudential 
                supervision as regulated under section 113.--
                All swaps entities that are institutions that 
                pose a systemic risk and are subject to 
                heightened prudential supervision as regulated 
                under section 113, that are put into 
                receivership or declared insolvent as a result 
                of swap or security-based swap activity of the 
                swaps entities shall be subject to the 
                termination or transfer of that swap or 
                security-based swap activity in accordance with 
                applicable law prescribing the treatment of 
                those contracts. No taxpayer funds shall be 
                used to prevent the receivership of any swap 
                entity resulting from swap or security-based 
                swap activity of the swaps entity.
                  (C) Non-FDIC insured, non-systemically 
                significant institutions not subject to 
                heightened prudential supervision as regulated 
                under section 113.--No taxpayer resources shall 
                be used for the orderly liquidation of any 
                swaps entities that are non-FDIC insured, non-
                systemically significant institutions not 
                subject to heightened prudential supervision as 
                regulated under section 113.
          (2) Recovery of funds.--All funds expended on the 
        termination or transfer of the swap or security-based 
        swap activity of the swaps entity shall be recovered in 
        accordance with applicable law from the disposition of 
        assets of such swap entity or through assessments, 
        including on the financial sector as provided under 
        applicable law.
          (3) No losses to taxpayers.--Taxpayers shall bear no 
        losses from the exercise of any authority under this 
        title.
  (j) Prohibition on Unregulated Combination of Swaps Entities 
and Banking.--At no time following adoption of the rules in 
subsection (k) may a bank or bank holding company be permitted 
to be or become a swap entity unless it conducts its swap or 
security-based swap activity in compliance with such minimum 
standards set by its prudential regulator as are reasonably 
calculated to permit the swaps entity to conduct its swap or 
security-based swap activities in a safe and sound manner and 
mitigate systemic risk.
  (k) Rules.--In prescribing rules, the prudential regulator 
for a swaps entity shall consider the following factors:
          (1) The expertise and managerial strength of the 
        swaps entity, including systems for effective 
        oversight.
          (2) The financial strength of the swaps entity.
          (3) Systems for identifying, measuring and 
        controlling risks arising from the swaps entity's 
        operations.
          (4) Systems for identifying, measuring and 
        controlling the swaps entity's participation in 
        existing markets.
          (5) Systems for controlling the swaps entity's 
        participation or entry into in new markets and 
        products.
  (l) Authority of the Financial Stability Oversight Council.--
The Financial Stability Oversight Council may determine that, 
when other provisions established by this Act are insufficient 
to effectively mitigate systemic risk and protect taxpayers, 
that swaps entities may no longer access Federal assistance 
with respect to any swap, security-based swap, or other 
activity of the swaps entity. Any such determination by the 
Financial Stability Oversight Council of a prohibition of 
federal assistance shall be made on an institution-by-
institution basis, and shall require the vote of not fewer than 
two-thirds of the members of the Financial Stability Oversight 
Council, which must include the vote by the Chairman of the 
Council, the Chairman of the Board of Governors of the Federal 
Reserve System, and the Chairperson of the Federal Deposit 
Insurance Corporation. Notice and hearing requirements for such 
determinations shall be consistent with the standards provided 
in title I.
  (m) Ban on Proprietary Trading in Derivatives.--An insured 
depository institution shall comply with the prohibition on 
proprietary trading in derivatives as required by section 619 
of the Dodd-Frank Wall Street Reform and Consumer Protection 
Act.

           *       *       *       *       *       *       *


SEC. 719. STUDIES.

  (a) Study on Effects of Position Limits on Trading on 
Exchanges in the United States.--
          (1) Study.--The Commodity Futures Trading Commission, 
        in consultation with each entity that is a designated 
        contract market under the Commodity Exchange Act, shall 
        conduct a study of the effects (if any) of the position 
        limits imposed pursuant to the other provisions of this 
        title on excessive speculation and on the movement of 
        transactions from exchanges in the United States to 
        trading venues outside the United States.
          (2) Report to the congress.--Within 12 months after 
        the imposition of position limits pursuant to the other 
        provisions of this title, the Commodity Futures Trading 
        Commission, in consultation with each entity that is a 
        designated contract market under the Commodity Exchange 
        Act, shall submit to the Congress a report on the 
        matters described in paragraph (1).
          (3) Required hearing.--Within 30 legislative days 
        after the submission to the Congress of the report 
        described in paragraph (2), the Committee on 
        Agriculture of the House of Representatives shall hold 
        a hearing examining the findings of the report.
          (4) Biennial reporting.--In addition to the study 
        required in paragraph (1), the Chairman of the 
        Commodity Futures Trading Commission shall prepare and 
        submit to the Congress biennial reports on the growth 
        or decline of the derivatives markets in the United 
        States and abroad, which shall include assessments of 
        the causes of any such growth or decline, the 
        effectiveness of regulatory regimes in managing 
        systemic risk, a comparison of the costs of compliance 
        at the time of the report for market participants 
        subject to regulation by the United States with the 
        costs of compliance in December 2008 for the market 
        participants, and the quality of the available data. In 
        preparing the report, the Chairman shall solicit the 
        views of, consult with, and address the concerns raised 
        by, market participants, regulators, legislators, and 
        other interested parties.
  (b) Study on Feasibility of Requiring Use of Standardized 
Algorithmic Descriptions for Financial Derivatives.--
          (1) In general.--The Securities and Exchange 
        Commission and the Commodity Futures Trading Commission 
        shall conduct a joint study of the feasibility of 
        requiring the derivatives industry to adopt 
        standardized computer-readable algorithmic descriptions 
        which may be used to describe complex and standardized 
        financial derivatives.
          (2) Goals.--The algorithmic descriptions defined in 
        the study shall be designed to facilitate computerized 
        analysis of individual derivative contracts and to 
        calculate net exposures to complex derivatives. The 
        algorithmic descriptions shall be optimized for 
        simultaneous use by--
                  (A) commercial users and traders of 
                derivatives;
                  (B) derivative clearing houses, exchanges and 
                electronic trading platforms;
                  (C) trade repositories and regulator 
                investigations of market activities; and
                  (D) systemic risk regulators.
        The study will also examine the extent to which the 
        algorithmic description, together with standardized and 
        extensible legal definitions, may serve as the binding 
        legal definition of derivative contracts. The study 
        will examine the logistics of possible implementations 
        of standardized algorithmic descriptions for 
        derivatives contracts. The study shall be limited to 
        electronic formats for exchange of derivative contract 
        descriptions and will not contemplate disclosure of 
        proprietary valuation models.
          (3) International coordination.--In conducting the 
        study, the Securities and Exchange Commission and the 
        Commodity Futures Trading Commission shall coordinate 
        the study with international financial institutions and 
        regulators as appropriate and practical.
          (4) Report.--Within 8 months after the date of the 
        enactment of this Act, the Securities and Exchange 
        Commission and the Commodity Futures Trading Commission 
        shall jointly submit to the Committees on Agriculture 
        and on Financial Services of the House of 
        Representatives and the Committees on Agriculture, 
        Nutrition, and Forestry and on Banking, Housing, and 
        Urban Affairs of the Senate a written report which 
        contains the results of the study required by 
        paragraphs (1) through (3).
  (c) International Swap Regulation.--
          (1) In general.--The Commodity Futures Trading 
        Commission and the Securities and Exchange Commission 
        shall jointly conduct a study--
                  (A) relating to--
                          (i) swap regulation in the United 
                        States, Asia, and Europe; and
                          (ii) clearing house and clearing 
                        agency regulation in the United States, 
                        Asia, and Europe; and
                  (B) that identifies areas of regulation that 
                are similar in the United States, Asia and 
                Europe and other areas of regulation that could 
                be harmonized.
          (2) Report.--Not later than 18 months after the date 
        of enactment of this Act, the Commodity Futures Trading 
        Commission and the Securities and Exchange Commission 
        shall submit to the Committee on Agriculture, 
        Nutrition, and Forestry and the Committee on Banking, 
        Housing, and Urban Affairs of the Senate and the 
        Committee on Agriculture and the Committee on Financial 
        Services of the House of Representatives a report that 
        includes a description of the results of the study 
        under subsection (a), including--
                  (A) identification of the major exchanges and 
                their regulator in each geographic area for the 
                trading of swaps and security-based swaps 
                including a listing of the major contracts and 
                their trading volumes and notional values as 
                well as identification of the major swap 
                dealers participating in such markets;
                  (B) identification of the major clearing 
                houses and clearing agencies and their 
                regulator in each geographic area for the 
                clearing of swaps and security-based swaps, 
                including a listing of the major contracts and 
                the clearing volumes and notional values as 
                well as identification of the major clearing 
                members of such clearing houses and clearing 
                agencies in such markets;
                  (C) a description of the comparative methods 
                of clearing swaps in the United States, Asia, 
                and Europe; and
                  (D) a description of the various systems used 
                for establishing margin on individual swaps, 
                security-based swaps, and swap portfolios.
  (d) Stable Value Contracts.--
          (1) Determination.--
                  (A) Status.--Not later than 15 months after 
                the date of the enactment of this Act, the 
                Securities and Exchange Commission and the 
                Commodity Futures Trading Commission shall, 
                jointly, conduct a study to determine whether 
                stable value contracts fall within the 
                definition of a swap. In making the 
                determination required under this subparagraph, 
                the Commissions jointly shall consult with the 
                Department of Labor, the Department of the 
                Treasury, and the State entities that regulate 
                the issuers of stable value contracts.
                  (B) Regulations.--If the Commissions 
                determine that stable value contracts fall 
                within the definition of a swap, the 
                Commissions jointly shall determine if an 
                exemption for stable value contracts from the 
                definition of swap is appropriate and in the 
                public interest. The Commissions shall issue 
                regulations implementing the determinations 
                required under this paragraph. Until the 
                effective date of such regulations, and 
                notwithstanding any other provision of this 
                title, the requirements of this title shall not 
                apply to stable value contracts.
                  (C) Legal certainty.--Stable value contracts 
                in effect prior to the effective date of the 
                regulations described in subparagraph (B) shall 
                not be considered swaps.
          (2) Definition.--For purposes of this subsection, the 
        term ``stable value contract'' means any contract, 
        agreement, or transaction that provides a crediting 
        interest rate and guaranty or financial assurance of 
        liquidity at contract or book value prior to maturity 
        offered by a bank, insurance company, or other State or 
        federally regulated financial institution for the 
        benefit of any individual or commingled fund available 
        as an investment in an employee benefit plan (as 
        defined in section 3(3) of the Employee Retirement 
        Income Security Act of 1974, including plans described 
        in section 3(32) of such Act) subject to participant 
        direction, an eligible deferred compensation plan (as 
        defined in section 457(b) of the Internal Revenue Code 
        of 1986) that is maintained by an eligible employer 
        described in section 457(e)(1)(A) of such Code, an 
        arrangement described in section 403(b) of such Code, 
        or a qualified tuition program (as defined in section 
        529 of such Code).

           *       *       *       *       *       *       *


SEC. 723. CLEARING

  (a) Clearing Requirement.--
          (1) In general.--Section 2 of the Commodity Exchange 
        Act (7 U.S.C. 2) is amended--
                  (A) by striking subsections (d), (e), (g), 
                and (h); and
                  (B) by redesignating subsection (i), as added 
                by section 107 of the Commodity Futures 
                Modernization Act of 2000 (Appendix E of Public 
                Law 106-554; 114 Stat. 2763A-382), as 
                subsection (g).
          (2) Swaps; limitation on participation.--Section 2 of 
        the Commodity Exchange Act (7 U.S.C. 2) (as amended by 
        paragraph (1)) is amended by inserting after subsection 
        (c) the following:
  ``(d) Swaps.--Nothing in this Act (other than subparagraphs 
(A), (B), (C), (D), (G), and (H) of subsection (a)(1), 
subsections (f) and (g), sections 1a, 2(a)(13), 2(c)(2)(A)(ii), 
2(e), 2(h), 4(c), 4a, 4b, and 4b-1, subsections (a), (b), and 
(g) of section 4c, sections 4d, 4e, 4f, 4g, 4h, 4i, 4j, 4k, 4l, 
4m, 4n, 4o, 4p, 4r, 4s, 4t, 5, 5b, 5c, 5e, and 5h, subsections 
(c) and (d) of section 6, sections 6c, 6d, 8, 8a, and 9, 
subsections (e)(2), (f), and (h) of section 12, subsections (a) 
and (b) of section 13, sections 17, 20, 21, and 22(a)(4), and 
any other provision of this Act that is applicable to 
registered entities or Commission registrants) governs or 
applies to a swap.
  ``(e) Limitation on Participation.--It shall be unlawful for 
any person, other than an eligible contract participant, to 
enter into a swap unless the swap is entered into on, or 
subject to the rules of, a board of trade designated as a 
contract market under section 5.''.
          (3) Mandatory clearing of swaps.--Section 2 of the 
        Commodity Exchange Act (7 U.S.C. 2) is amended by 
        inserting after subsection (g) (as redesignated by 
        paragraph (1)(B)) the following:
  ``(h) Clearing Requirement.--
          ``(1) In general.--
                  ``(A) Standard for clearing.--It shall be 
                unlawful for any person to engage in a swap 
                unless that person submits such swap for 
                clearing to a derivatives clearing organization 
                that is registered under this Act or a 
                derivatives clearing organization that is 
                exempt from registration under this Act if the 
                swap is required to be cleared.
                  ``(B) Open access.--The rules of a 
                derivatives clearing organization described in 
                subparagraph (A) shall--
                          ``(i) prescribe that all swaps (but 
                        not contracts of sale of a commodity 
                        for future delivery or options on such 
                        contracts) submitted to the derivatives 
                        clearing organization with the same 
                        terms and conditions are economically 
                        equivalent within the derivatives 
                        clearing organization and may be offset 
                        with each other within the derivatives 
                        clearing organization; and
                          ``(ii) provide for non-discriminatory 
                        clearing of a swap (but not a contract 
                        of sale of a commodity for future 
                        delivery or option on such contract) 
                        executed bilaterally or on or through 
                        the rules of an unaffiliated designated 
                        contract market or swap execution 
                        facility.
          ``(2) Commission Review.--
                  ``(A) Commission-initiated review.--
                          ``(i) The Commission on an ongoing 
                        basis shall review each swap, or any 
                        group, category, type, or class of 
                        swaps to make a determination as to 
                        whether the swap or group, category, 
                        type, or class of swaps should be 
                        required to be cleared.
                          ``(ii) The Commission shall provide 
                        at least a 30-day public comment period 
                        regarding any determination made under 
                        clause (i).
                  ``(B) Swap submissions.--
                          ``(i) A derivatives clearing 
                        organization shall submit to the 
                        Commission each swap, or any group, 
                        category, type, or class of swaps that 
                        it plans to accept for clearing, and 
                        provide notice to its members (in a 
                        manner to be determined by the 
                        Commission) of the submission.
                          ``(ii) Any swap or group, category, 
                        type, or class of swaps listed for 
                        clearing by a derivative clearing 
                        organization as of the date of 
                        enactment of this subsection shall be 
                        considered submitted to the Commission.
                          ``(iii) The Commission shall--
                                  ``(I) make available to the 
                                public submissions received 
                                under clauses (i) and (ii);
                                  ``(II) review each submission 
                                made under clauses (i) and 
                                (ii), and determine whether the 
                                swap, or group, category, type, 
                                or class of swaps described in 
                                the submission is required to 
                                be cleared; and
                                  ``(III) provide at least a 
                                30-day public comment period 
                                regarding its determination as 
                                to whether the clearing 
                                requirement under paragraph 
                                (1)(A) shall apply to the 
                                submission.
                  ``(C) Deadline.--The Commission shall make 
                its determination under subparagraph (B)(iii) 
                not later than 90 days after receiving a 
                submission made under subparagraphs (B)(i) and 
                (B)(ii), unless the submitting derivatives 
                clearing organization agrees to an extension 
                for the time limitation established under this 
                subparagraph.
                  ``(D) Determination.--
                          ``(i) In reviewing a submission made 
                        under subparagraph (B), the Commission 
                        shall review whether the submission is 
                        consistent with section 5b(c)(2).
                          ``(ii) In reviewing a swap, group of 
                        swaps, or class of swaps pursuant to 
                        subparagraph (A) or a submission made 
                        under subparagraph (B), the Commission 
                        shall take into account the following 
                        factors:
                                  ``(I) The existence of 
                                significant outstanding 
                                notional exposures, trading 
                                liquidity, and adequate pricing 
                                data.
                                  ``(II) The availability of 
                                rule framework, capacity, 
                                operational expertise and 
                                resources, and credit support 
                                infrastructure to clear the 
                                contract on terms that are 
                                consistent with the material 
                                terms and trading conventions 
                                on which the contract is then 
                                traded.
                                  ``(III) The effect on the 
                                mitigation of systemic risk, 
                                taking into account the size of 
                                the market for such contract 
                                and the resources of the 
                                derivatives clearing 
                                organization available to clear 
                                the contract.
                                  ``(IV) The effect on 
                                competition, including 
                                appropriate fees and charges 
                                applied to clearing.
                                  ``(V) The existence of 
                                reasonable legal certainty in 
                                the event of the insolvency of 
                                the relevant derivatives 
                                clearing organization or 1 or 
                                more of its clearing members 
                                with regard to the treatment of 
                                customer and swap counterparty 
                                positions, funds, and property.
                          ``(iii) In making a determination 
                        under subparagraph (A) or (B)(iii) that 
                        the clearing requirement shall apply, 
                        the Commission may require such terms 
                        and conditions to the requirement as 
                        the Commission determines to be 
                        appropriate.
                  ``(E) Rules.--Not later than 1 year after the 
                date of the enactment of this subsection, the 
                Commission shall adopt rules for a derivatives 
                clearing organization's submission for review, 
                pursuant to this paragraph, of a swap, or a 
                group, category, type, or class of swaps, that 
                it seeks to accept for clearing. Nothing in 
                this subparagraph limits the Commission from 
                making a determination under subparagraph 
                (B)(iii) for swaps described in subparagraph 
                (B)(ii).
          ``(3) Stay of Clearing Requirement.--
                  ``(A) In general.--After making a 
                determination pursuant to paragraph (2)(B), the 
                Commission, on application of a counterparty to 
                a swap or on its own initiative, may stay the 
                clearing requirement of paragraph (1) until the 
                Commission completes a review of the terms of 
                the swap (or the group, category, type, or 
                class of swaps) and the clearing arrangement.
                  ``(B) Deadline.--The Commission shall 
                complete a review undertaken pursuant to 
                subparagraph (A) not later than 90 days after 
                issuance of the stay, unless the derivatives 
                clearing organization that clears the swap, or 
                group, category, type, or class of swaps agrees 
                to an extension of the time limitation 
                established under this subparagraph.
                  ``(C) Determination.--Upon completion of the 
                review undertaken pursuant to subparagraph (A), 
                the Commission may--
                          ``(i) determine, unconditionally or 
                        subject to such terms and conditions as 
                        the Commission determines to be 
                        appropriate, that the swap, or group, 
                        category, type, or class of swaps must 
                        be cleared pursuant to this subsection 
                        if it finds that such clearing is 
                        consistent with paragraph (2)(D); or
                          ``(ii) determine that the clearing 
                        requirement of paragraph (1) shall not 
                        apply to the swap, or group, category, 
                        type, or class of swaps.
                  ``(D) Rules.--Not later than 1 year after the 
                date of the enactment of the Wall Street 
                Transparency and Accountability Act of 2010, 
                the Commission shall adopt rules for reviewing, 
                pursuant to this paragraph, a derivatives 
                clearing organization's clearing of a swap, or 
                a group, category, type, or class of swaps, 
                that it has accepted for clearing.
          ``(4) Prevention of Evasion.--
                  ``(A) In general.--The Commission shall 
                prescribe rules under this subsection (and 
                issue interpretations of rules prescribed under 
                this subsection) as determined by the 
                Commission to be necessary to prevent evasions 
                of the mandatory clearing requirements under 
                this Act.
                  ``(B) Duty of commission to investigate and 
                take certain actions.--To the extent the 
                Commission finds that a particular swap, group, 
                category, type, or class of swaps would 
                otherwise be subject to mandatory clearing but 
                no derivatives clearing organization has listed 
                the swap, group, category, type, or class of 
                swaps for clearing, the Commission shall--
                          ``(i) investigate the relevant facts 
                        and circumstances;
                          ``(ii) within 30 days issue a public 
                        report containing the results of the 
                        investigation; and
                          ``(iii) take such actions as the 
                        Commission determines to be necessary 
                        and in the public interest, which may 
                        include requiring the retaining of 
                        adequate margin or capital by parties 
                        to the swap, group, category, type, or 
                        class of swaps.
                  ``(C) Effect on authority.--Nothing in this 
                paragraph--
                          ``(i) authorizes the Commission to 
                        adopt rules requiring a derivatives 
                        clearing organization to list for 
                        clearing a swap, group, category, type, 
                        or class of swaps if the clearing of 
                        the swap, group, category, type, or 
                        class of swaps would threaten the 
                        financial integrity of the derivatives 
                        clearing organization; and
                          ``(ii) affects the authority of the 
                        Commission to enforce the open access 
                        provisions of paragraph (1)(B) with 
                        respect to a swap, group, category, 
                        type, or class of swaps that is listed 
                        for clearing by a derivatives clearing 
                        organization.
          ``(5) Reporting transition rules.--Rules adopted by 
        the Commission under this section shall provide for the 
        reporting of data, as follows:
                  ``(A) Swaps entered into before the date of 
                the enactment of this subsection shall be 
                reported to a registered swap data repository 
                or the Commission no later than 180 days after 
                the effective date of this subsection.
                  ``(B) Swaps entered into on or after such 
                date of enactment shall be reported to a 
                registered swap data repository or the 
                Commission no later than the later of--
                          ``(i) 90 days after such effective 
                        date; or
                          ``(ii) such other time after entering 
                        into the swap as the Commission may 
                        prescribe by rule or regulation.
          ``(6) Clearing Transition Rules.--
                  ``(A) Swaps entered into before the date of 
                the enactment of this subsection are exempt 
                from the clearing requirements of this 
                subsection if reported pursuant to paragraph 
                (5)(A).
                  ``(B) Swaps entered into before application 
                of the clearing requirement pursuant to this 
                subsection are exempt from the clearing 
                requirements of this subsection if reported 
                pursuant to paragraph (5)(B).
          ``(7) Exceptions.--
                  ``(A) In general.--The requirements of 
                paragraph (1)(A) shall not apply to a swap if 1 
                of the counterparties to the swap--
                          ``(i) is not a financial entity;
                          ``(ii) is using swaps to hedge or 
                        mitigate commercial risk; and
                          ``(iii) notifies the Commission, in a 
                        manner set forth by the Commission, how 
                        it generally meets its financial 
                        obligations associated with entering 
                        into non-cleared swaps.
                  ``(B) Option to clear.--The application of 
                the clearing exception in subparagraph (A) is 
                solely at the discretion of the counterparty to 
                the swap that meets the conditions of clauses 
                (i) through (iii) of subparagraph (A).
                  ``(C) Financial entity definition.--
                          ``(i) In general.--For the purposes 
                        of this paragraph, the term `financial 
                        entity' means--
                                  ``(I) a swap dealer;
                                  ``(II) a security-based swap 
                                dealer;
                                  ``(III) a major swap 
                                participant;
                                  ``(IV) a major security-based 
                                swap participant;
                                  ``(V) a commodity pool;
                                  ``(VI) a private fund as 
                                defined in section 202(a) of 
                                the Investment Advisers Act of 
                                1940 (15 U.S.C. 80-b-2(a));
                                  ``(VII) an employee benefit 
                                plan as defined in paragraphs 
                                (3) and (32) of section 3 of 
                                the Employee Retirement Income 
                                Security Act of 1974 (29 U.S.C. 
                                1002);
                                  ``(VIII) a person 
                                predominantly engaged in 
                                activities that are in the 
                                business of banking, or in 
                                activities that are financial 
                                in nature, as defined in 
                                section 4(k) of the Bank 
                                Holding Company Act of 1956.
                          ``(ii) Exclusion.--The Commission 
                        shall consider whether to exempt small 
                        banks, savings associations, farm 
                        credit system institutions, and credit 
                        unions, including--
                                  ``(I) depository institutions 
                                with total assets of 
                                $10,000,000,000 or less;
                                  ``(II) farm credit system 
                                institutions with total assets 
                                of $10,000,000,000 or less; or
                                  ``(III) credit unions with 
                                total assets of $10,000,000,000 
                                or less.
                          ``(iii) Limitation.--Such definition 
                        shall not include an entity whose 
                        primary business is providing 
                        financing, and uses derivatives for the 
                        purpose of hedging underlying 
                        commercial risks related to interest 
                        rate and foreign currency exposures, 90 
                        percent or more of which arise from 
                        financing that facilitates the purchase 
                        or lease of products, 90 percent or 
                        more of which are manufactured by the 
                        parent company or another subsidiary of 
                        the parent company.
                  ``(D) Treatment of affiliates.--
                          ``(i) In general.--An affiliate of a 
                        person that qualifies for an exception 
                        under subparagraph (A) (including 
                        affiliate entities predominantly 
                        engaged in providing financing for the 
                        purchase of the merchandise or 
                        manufactured goods of the person) may 
                        qualify for the exception only if the 
                        affiliate, acting on behalf of the 
                        person and as an agent, uses the swap 
                        to hedge or mitigate the commercial 
                        risk of the person or other affiliate 
                        of the person that is not a financial 
                        entity.
                          ``(ii) Prohibition relating to 
                        certain affiliates.--The exception in 
                        clause (i) shall not apply if the 
                        affiliate is--
                                  ``(I) a swap dealer;
                                  ``(II) a security-based swap 
                                dealer;
                                  ``(III) a major swap 
                                participant;
                                  ``(IV) a major security-based 
                                swap participant;
                                  ``(V) an issuer that would be 
                                an investment company, as 
                                defined in section 3 of the 
                                Investment Company Act of 1940 
                                (15 U.S.C. 80a-3), but for 
                                paragraph (1) or (7) of 
                                subsection (c) of that Act (15 
                                U.S.C. 80a-3(c));
                                  ``(VI) a commodity pool; or
                                  ``(VII) a bank holding 
                                company with over 
                                $50,000,000,000 in consolidated 
                                assets.
                          ``(iii) Transition rule for 
                        affiliates.--An affiliate, subsidiary, 
                        or a wholly owned entity of a person 
                        that qualifies for an exception under 
                        subparagraph (A) and is predominantly 
                        engaged in providing financing for the 
                        purchase or lease of merchandise or 
                        manufactured goods of the person shall 
                        be exempt from the margin requirement 
                        described in section 4s(e) and the 
                        clearing requirement described in 
                        paragraph (1) with regard to swaps 
                        entered into to mitigate the risk of 
                        the financing activities for not less 
                        than a 2-year period beginning on the 
                        date of enactment of this clause.
                  ``(E) Election of counterparty.--
                          ``(i) Swaps required to be cleared.--
                        With respect to any swap that is 
                        subject to the mandatory clearing 
                        requirement under this subsection and 
                        entered into by a swap dealer or a 
                        major swap participant with a 
                        counterparty that is not a swap dealer, 
                        major swap participant, security-based 
                        swap dealer, or major security-based 
                        swap participant, the counterparty 
                        shall have the sole right to select the 
                        derivatives clearing organization at 
                        which the swap will be cleared.
                          ``(ii) Swaps not required to be 
                        cleared.--With respect to any swap that 
                        is not subject to the mandatory 
                        clearing requirement under this 
                        subsection and entered into by a swap 
                        dealer or a major swap participant with 
                        a counterparty that is not a swap 
                        dealer, major swap participant, 
                        security-based swap dealer, or major 
                        security-based swap participant, the 
                        counterparty--
                                  ``(I) may elect to require 
                                clearing of the swap; and
                                  ``(II) shall have the sole 
                                right to select the derivatives 
                                clearing organization at which 
                                the swap will be cleared.
                  ``(F) Abuse of exception.--The Commission may 
                prescribe such rules or issue interpretations 
                of the rules as the Commission determines to be 
                necessary to prevent abuse of the exceptions 
                described in this paragraph. The Commission may 
                also request information from those persons 
                claiming the clearing exception as necessary to 
                prevent abuse of the exceptions described in 
                this paragraph.
          ``(8) Trade Execution.--
                  ``(A) In general.--With respect to 
                transactions involving swaps subject to the 
                clearing requirement of paragraph (1), 
                counterparties shall--
                          ``(i) execute the transaction on a 
                        board of trade designated as a contract 
                        market under section 5; or
                          ``(ii) execute the transaction on a 
                        swap execution facility registered 
                        under 5h or a swap execution facility 
                        that is exempt from registration under 
                        section 5h(f) of this Act.
                  ``(B) Exception.--The requirements of clauses 
                (i) and (ii) of subparagraph (A) shall not 
                apply if no board of trade or swap execution 
                facility makes the swap available to trade or 
                for swap transactions subject to the clearing 
                exception under paragraph (7).''.
  (b) Commodity Exchange Act.--Section 2 of the Commodity 
Exchange Act (7 U.S.C. 2) is amended by adding at the end the 
following:
  ``(j) Committee Approval by Board.--Exemptions from the 
requirements of subsection (h)(1) to clear a swap and 
subsection (h)(8) to execute a swap through a board of trade or 
swap execution facility shall be available to a counterparty 
that is an issuer of securities that are registered under 
section 12 of the Securities Exchange Act of 1934 (15 U.S.C. 
78l) or that is required to file reports pursuant to section 
15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78o) 
only if an appropriate committee of the issuer's board or 
governing body has reviewed and approved its decision to enter 
into swaps that are subject to such exemptions.''.
  (c) Grandfather Provisions.--
          (1) Legal certainty for certain transactions in 
        exempt commodities.--Not later than 60 days after the 
        date of enactment of this Act, a person may submit to 
        the Commodity Futures Trading Commission a petition to 
        remain subject to section 2(h) of the Commodity 
        Exchange Act (7 U.S.C. 2(h)) (as in effect on the day 
        before the date of enactment of this Act).
          (2) Consideration; authority of commodity futures 
        trading commission.--The Commodity Futures Trading 
        Commission--
                  (A) shall consider any petition submitted 
                under subparagraph (A) in a prompt manner; and
                  (B) may allow a person to continue operating 
                subject to section 2(h) of the Commodity 
                Exchange Act (7 U.S.C. 2(h)) (as in effect on 
                the day before the date of enactment of this 
                Act) for not longer than a 1-year period.
          (3) Agricultural swaps.--
                  (A) In general.--Except as provided in 
                subparagraph (B), no person shall offer to 
                enter into, enter into, or confirm the 
                execution of, any swap in an agricultural 
                commodity (as defined by the Commodity Futures 
                Trading Commission).
                  (B) Exception.--Notwithstanding subparagraph 
                (A), a person may offer to enter into, enter 
                into, or confirm the execution of, any swap in 
                an agricultural commodity pursuant to section 
                4(c) of the Commodity Exchange Act (7 U.S.C. 
                6(c)) or any rule, regulation, or order issued 
                thereunder (including any rule, regulation, or 
                order in effect as of the date of enactment of 
                this Act) by the Commodity Futures Trading 
                Commission to allow swaps under such terms and 
                conditions as the Commission shall prescribe.
          (4) Required reporting.--If the exception described 
        in section 2(h)(8)(B) of the Commodity Exchange Act 
        applies, the counterparties shall comply with any 
        recordkeeping and transaction reporting requirements 
        that may be prescribed by the Commission with respect 
        to swaps subject to section 2(h)(8)(B) of the Commodity 
        Exchange Act.

           *       *       *       *       *       *       *


SEC. 734. DERIVATIVES TRANSACTION EXECUTION FACILITIES AND EXEMPT 
                    BOARDS OF TRADE

  (a) In general.--Sections 5a and 5d of the Commodity Exchange 
Act (7 U.S.C. 7a, 7a-3) are repealed.
  (b) Conforming Amendments.--
          (1) Section 2 of the Commodity Exchange Act (7 U.S.C. 
        2) [is amended--]
                  [(A) in subsection (a)(1)(A), in the first 
                sentence, by striking ``or 5a''; and
                  [(B) in] is amended in paragraph (2) of 
                subsection (g) (as redesignated by section 
                723(a)(1)(B)), by striking ``section 5a of this 
                Act'' and all that follows through ``5d of this 
                Act'' and inserting ``section 5b of this Act''.
          (2) Section 6(g)(1)(A) of the Securities Exchange Act 
        of 1934 (15 U.S.C. 78f(g)(1)(A)) is amended--
                  (A) by striking ``that--'' and all that 
                follows through ``(i) has been designated'' and 
                inserting ``that has been designated'';
                  (B) by striking ``; or'' and inserting ``; 
                and'' and
                  (C) by striking clause (ii).
  (c) Ability to Petition Commission.--
          (1) In general.--Prior to the final effective dates 
        in this title, a person may petition the Commodity 
        Futures Trading Commission to remain subject to the 
        provisions of section 5d of the Commodity Exchange Act, 
        as such provisions existed prior to the effective date 
        of this subtitle.
          (2) Consideration of petition.--The Commodity Futures 
        Trading Commission shall consider any petition 
        submitted under paragraph (1) in a prompt manner and 
        may allow a person to continue operating subject to the 
        provisions of section 5d of the Commodity Exchange Act 
        for up to 1 year after the effective date of this 
        subtitle.

           *       *       *       *       *       *       *


SEC. 741. ENFORCEMENT.

  (a) Enforcement Authority.--The Commodity Exchange Act is 
amended by inserting after section 4b (7 U.S.C. 6b) the 
following:

``SEC. 4B-1. ENFORCEMENT AUTHORITY

  ``(a) Commodity futures trading commission.--Except as 
provided in subsections (b), (c), and (d), the Commission shall 
have exclusive authority to enforce the provisions of subtitle 
A of the Wall Street Transparency and Accountability Act of 
2010 with respect to any person.
  ``(b) Prudential regulators.--The prudential regulators shall 
have exclusive authority to enforce the provisions of section 
4s(e) with respect to swap dealers or major swap participants 
for which they are the prudential regulator.
  ``(c) Referrals.--
          ``(1) Prudential regulators.--If the prudential 
        regulator for a swap dealer or major swap participant 
        has cause to believe that the swap dealer or major swap 
        participant, or any affiliate or division of the swap 
        dealer or major swap participant, may have engaged in 
        conduct that constitutes a violation of the 
        nonprudential requirements of this Act (including 
        section 4s or rules adopted by the Commission under 
        that section), the prudential regulator may promptly 
        notify the Commission in a written report that 
        includes--
                  ``(A) a request that the Commission initiate 
                an enforcement proceeding under this Act; and
                  ``(B) an explanation of the facts and 
                circumstances that led to the preparation of 
                the written report.
          ``(2) Commission.--If the Commission has cause to 
        believe that a swap dealer or major swap participant 
        that has a prudential regulator may have engaged in 
        conduct that constitutes a violation of any prudential 
        requirement of section 4s or rules adopted by the 
        Commission under that section, the Commission may 
        notify the prudential regulator of the conduct in a 
        written report that includes--
                  ``(A) a request that the prudential regulator 
                initiate an enforcement proceeding under this 
                Act or any other Federal law (including 
                regulations); and
                  ``(B) an explanation of the concerns of the 
                Commission, and a description of the facts and 
                circumstances, that led to the preparation of 
                the written report.
  ``(d) Backstop enforcement authority.--
          ``(1) Initiation of enforcement proceeding by 
        prudential regulator.--If the Commission does not 
        initiate an enforcement proceeding before the end of 
        the 90-day period beginning on the date on which the 
        Commission receives a written report under subsection 
        (c)(1), the prudential regulator may initiate an 
        enforcement proceeding.
          ``(2) Initiation of enforcement proceeding by 
        commission.--If the prudential regulator does not 
        initiate an enforcement proceeding before the end of 
        the 90-day period beginning on the date on which the 
        prudential regulator receives a written report under 
        subsection (c)(2), the Commission may initiate an 
        enforcement proceeding.''.
  (b) Conforming Amendments.--
          (1) Section 4b of the Commodity Exchange Act (7 
        U.S.C. 6b) is amended--
                  (A) in subsection (a)(2), by striking ``or 
                other agreement, contract, or transaction 
                subject to paragraphs (1) and (2) of section 
                5a(g),'' and inserting ``or swap,'';
                  (B) in subsection (b), by striking ``or other 
                agreement, contract or transaction subject to 
                paragraphs (1) and (2) of section 5a(g),'' and 
                inserting ``or swap,''; and
                  (C) by adding at the end the following:
  ``(e) It shall be unlawful for any person, directly or 
indirectly, by the use of any means or instrumentality of 
interstate commerce, or of the mails, or of any facility of any 
registered entity, in or in connection with any order to make, 
or the making of, any contract of sale of any commodity for 
future delivery (or option on such a contract), or any swap, on 
a group or index of securities (or any interest therein or 
based on the value thereof)--
          ``(1) to employ any device, scheme, or artifice to 
        defraud;
          ``(2) to make any untrue statement of a material fact 
        or to omit to state a material fact necessary in order 
        to make the statements made, in the light of the 
        circumstances under which they were made, not 
        misleading; or
          ``(3) to engage in any act, practice, or course of 
        business which operates or would operate as a fraud or 
        deceit upon any person.''.
          (2) Section 4c(a)(1) of the Commodity Exchange Act (7 
        U.S.C. 6c(a)(1)) is amended by inserting ``or swap'' 
        before ``if the transaction is used or may be used''.
          (3) Section 6(c) of the Commodity Exchange Act (7 
        U.S.C. 9) is amended in the first sentence by inserting 
        ``or of any swap,'' before ``or has willfully made''.
          (4) Section 6(d) of the Commodity Exchange Act (7 
        U.S.C. 13b) is amended in the first sentence, in the 
        matter preceding the proviso, by inserting ``or of any 
        swap,'' before ``or otherwise is violating''.
          (5) Section 6c(a) of the Commodity Exchange Act (7 
        U.S.C. 13a-1(a)) is amended in the matter preceding the 
        proviso by inserting ``or any swap'' after ``commodity 
        for future delivery''.
          (6) Section 9 of the Commodity Exchange Act (7 U.S.C. 
        13) is amended--
                  (A) in subsection (a)--
                          (i) in paragraph (2), by inserting 
                        ``or of any swap,'' before ``or to 
                        corner''; and
                          (ii) in paragraph (4), by inserting 
                        ``swap data repository,'' before ``or 
                        futures association'' and
                  (B) in subsection (e)(1)--
                          (i) by inserting ``swap data 
                        repository,'' before ``or registered 
                        futures association''; and
                          (ii) by inserting ``, or swaps,'' 
                        before ``on the basis''.
          (7) Section 9(a) of the Commodity Exchange Act (7 
        U.S.C. 13(a)) is amended by adding at the end the 
        following:
          ``(6) Any person to abuse the end user clearing 
        exemption under section 2(h)(4), as determined by the 
        Commission.''.
          (8) Section 2(c)(2)(B) of the Commodity Exchange Act 
        (7 U.S.C. 2(c)(2)(B)) is amended--
                  (A) by striking ``(dd),'' each place it 
                appears;
                  (B) in clause (iii), by inserting ``, and 
                accounts or pooled investment vehicles 
                described in clause (vi),'' before ``shall be 
                subject to''; and
                  (C) by adding at the end the following:
                          ``(vi) This Act applies to, and the 
                        Commission shall have jurisdiction 
                        over, an account or pooled investment 
                        vehicle that is offered for the purpose 
                        of trading, or that trades, any 
                        agreement, contract, or transaction in 
                        foreign currency described in clause 
                        (i).''.
          (9) Section 2(c)(2)(C) of the Commodity Exchange Act 
        (7 U.S.C. 2(c)(2)(C)) is amended--
                  (A) by striking ``(dd),'' each place it 
                appears;
                  (B) in clause (ii)(I), by inserting ``, and 
                accounts or pooled investment vehicles 
                described in clause (vii),'' before ``shall be 
                subject to''; and
                  (C) by adding at the end the following:
                          ``(vii) This Act applies to, and the 
                        Commission shall have jurisdiction 
                        over, an account or pooled investment 
                        vehicle that is offered for the purpose 
                        of trading, or that trades, any 
                        agreement, contract, or transaction in 
                        foreign currency described in clause 
                        (i).''.
          (10) Section [1a(19)(A)(iv)(II)] 1a(18)(A)(iv)(II) of 
        the Commodity Exchange Act (7 U.S.C. 
        [1a(19)(A)(iv)(II)] 1a(18)(A)(iv)(II)) (as redesignated 
        by section 721(a)(1)) is amended by inserting before 
        the semicolon at the end the following: ``provided, 
        however, that for purposes of section 2(c)(2)(B)(vi) 
        and section 2(c)(2)(C)(vii), the term `eligible 
        contract participant' shall not include a commodity 
        pool in which any participant is not otherwise an 
        eligible contract participant''.
          (11) Section 6(e) of the Commodity Exchange Act (7 
        U.S.C. 9a) is amended by adding at the end the 
        following:
          ``(4) Any designated clearing organization that 
        knowingly or recklessly evades or participates in or 
        facilitates an evasion of the requirements of section 
        2(h) shall be liable for a civil money penalty in twice 
        the amount otherwise available for a violation of 
        section 2(h).
          ``(5) Any swap dealer or major swap participant that 
        knowingly or recklessly evades or participates in or 
        facilitates an evasion of the requirements of section 
        2(h) shall be liable for a civil money penalty in twice 
        the amount otherwise available for a violation of 
        section 2(h).''.
  (c) Savings Clause.--Notwithstanding any other provision of 
this title, nothing in this subtitle shall be construed as 
divesting any appropriate Federal banking agency of any 
authority it may have to establish or enforce, with respect to 
a person for which such agency is the appropriate Federal 
banking agency, prudential or other standards pursuant to 
authority granted by Federal law other than this title.

           *       *       *       *       *       *       *


SEC. 749. CONFORMING AMENDMENTS.

  (a) Section 4d of the Commodity Exchange Act (7 U.S.C. 6d) 
(as amended by section 724) is amended--
          (1) in subsection (a)--
                  (A) in the matter preceding paragraph (1)--
                          (i) by striking ``engage as'' and 
                        inserting ``be a''; and
                          (ii) by striking ``or introducing 
                        broker'' and all that follows through 
                        ``or derivatives transaction execution 
                        facility'';
                  (B) in paragraph (1), by striking ``or 
                introducing broker''; and
                  (C) in paragraph (2), by striking ``if a 
                futures commission merchant,''; and
          (2) by [adding at the end] inserting after subsection 
        (f) the following:
  ``(g) It shall be unlawful for any person to be an 
introducing broker unless such person shall have registered 
under this Act with the Commission as an introducing broker and 
such registration shall not have expired nor been suspended nor 
revoked.''.
  (b) Section 4m(3) of the Commodity Exchange Act (7 U.S.C. 
6m(3)) is amended--
          (1) by striking ``(3) Subsection (1) of this 
        section'' and inserting the following:
  ``(3) Exception.--
          ``(A) In general.--Paragraph (1)''; and
          (2) by striking ``to any investment trust'' and all 
        that follows through the period at the end and 
        inserting the following:`` to any commodity pool that 
        is engaged primarily in trading commodity interests.
          ``(B) Engaged primarily.--For purposes of 
        subparagraph (A), a commodity trading advisor or a 
        commodity pool shall be considered to be `engaged 
        primarily' in the business of being a commodity trading 
        advisor or commodity pool if it is or holds itself out 
        to the public as being engaged primarily, or proposes 
        to engage primarily, in the business of advising on 
        commodity interests or investing, reinvesting, owning, 
        holding, or trading in commodity interests, 
        respectively.
          ``(C) Commodity interests.--For purposes of this 
        paragraph, commodity interests shall include contracts 
        of sale of a commodity for future delivery, options on 
        such contracts, security futures, swaps, leverage 
        contracts, foreign exchange, spot and forward contracts 
        on physical commodities, and any monies held in an 
        account used for trading commodity interests.''.
  (c) Section 5c of the Commodity Exchange Act (7 U.S.C. 7a-2) 
is amended--
          (1) in subsection (a)(1)--
                  (A) by striking ``, 5a(d),''; and
                  (B) by striking ``and section (2)(h)(7) with 
                respect to significant price discovery 
                contracts,''; and
          (2) in subsection (f)(1), by striking ``section 4d(c) 
        of this Act'' and inserting ``section 4d(e)''.
  (d) Section 5e of the Commodity Exchange Act (7 U.S.C. 7b) is 
amended by striking ``or revocation of the right of an 
electronic trading facility to rely on the exemption set forth 
in section 2(h)(3) with respect to a significant price 
discovery contract,''.
  (e) Section 6(b) of the Commodity Exchange Act (7 U.S.C. 
8(b)) is amended in the first sentence by striking ``, or to 
revoke the right of an electronic trading facility to rely on 
the exemption set forth in section 2(h)(3) with respect to a 
significant price discovery contract,''.
  (f) Section 12(e)(2)(B) of the Commodity Exchange Act (7 
U.S.C. 16(e)(2)(B)) is amended--
          (1) by striking ``section 2(c), 2(d), 2(f), or 2(g) 
        of this Act'' and inserting ``section 2(c) or 2(f) of 
        this Act''; and
          (2) by striking ``2(h) or''.
  (g) Section 17(r)(1) of the Commodity Exchange Act (7 U.S.C. 
21(r)(1)) is amended by striking ``section 4d(c) of this Act'' 
and inserting ``section 4d(e)''.
  (h) Section 22 of the Commodity Exchange Act is amended--
          (1) in subsection (a)(1)(B), by--
                  (A) inserting ``or any swap'' after 
                ``commodity)''; and
                  (B) inserting ``or any swap'' after ``such 
                contract'' the second place that term appears;
          (2) in subsection (a)(1)(C), by adding at the end the 
        following:
                          ``(iv) a swap; or''; and
          (3) in subsection (b)(1)(A), by striking ``section 
        2(h)(7) or sections 5 through 5c'' and inserting 
        ``section 5, 5b, 5c, 5h, or 21''.
  (i) Section 408(2)(C) of the Federal Deposit Insurance 
Corporation Improvement Act of 1991 (12 U.S.C. 4421(2)(C)) is 
amended--
          (1) by striking ``section 2(c), 2(d), 2(f), or (2)(g) 
        of such Act'' and inserting ``section 2(c), 2(f), or 
        2(i) of that Act''; and
          (2) by striking ``2(h) or''.

           *       *       *       *       *       *       *


       [TITLE VIII--PAYMENT, CLEARING, AND SETTLEMENT SUPERVISION

[SEC. 801. SHORT TITLE.

  [This title may be cited as the ``Payment, Clearing, and 
Settlement Supervision Act of 2010''.

[SEC. 802. FINDINGS AND PURPOSES.

  [(a) Findings.--Congress finds the following:
          [(1) The proper functioning of the financial markets 
        is dependent upon safe and efficient arrangements for 
        the clearing and settlement of payment, securities, and 
        other financial transactions.
          [(2) Financial market utilities that conduct or 
        support multilateral payment, clearing, or settlement 
        activities may reduce risks for their participants and 
        the broader financial system, but such utilities may 
        also concentrate and create new risks and thus must be 
        well designed and operated in a safe and sound manner.
          [(3) Payment, clearing, and settlement activities 
        conducted by financial institutions also present 
        important risks to the participating financial 
        institutions and to the financial system.
          [(4) Enhancements to the regulation and supervision 
        of systemically important financial market utilities 
        and the conduct of systemically important payment, 
        clearing, and settlement activities by financial 
        institutions are necessary--
                  [(A) to provide consistency;
                  [(B) to promote robust risk management and 
                safety and soundness;
                  [(C) to reduce systemic risks; and
                  [(D) to support the stability of the broader 
                financial system.
  [(b) Purpose.--The purpose of this title is to mitigate 
systemic risk in the financial system and promote financial 
stability by--
          [(1) authorizing the Board of Governors to promote 
        uniform standards for the--
                  [(A) management of risks by systemically 
                important financial market utilities; and
                  [(B) conduct of systemically important 
                payment, clearing, and settlement activities by 
                financial institutions;
          [(2) providing the Board of Governors an enhanced 
        role in the supervision of risk management standards 
        for systemically important financial market utilities;
          [(3) strengthening the liquidity of systemically 
        important financial market utilities; and
          [(4) providing the Board of Governors an enhanced 
        role in the supervision of risk management standards 
        for systemically important payment, clearing, and 
        settlement activities by financial institutions.

[SEC. 803. DEFINITIONS.

  [In this title, the following definitions shall apply:
          [(1) Appropriate financial regulator.--The term 
        ``appropriate financial regulator'' means--
                  [(A) the primary financial regulatory agency, 
                as defined in section 2 of this Act;
                  [(B) the National Credit Union 
                Administration, with respect to any insured 
                credit union under the Federal Credit Union Act 
                (12 U.S.C. 1751 et seq.); and
                  [(C) the Board of Governors, with respect to 
                organizations operating under section 25A of 
                the Federal Reserve Act (12 U.S.C. 611), and 
                any other financial institution engaged in a 
                designated activity.
          [(2) Designated activity.--The term ``designated 
        activity'' means a payment, clearing, or settlement 
        activity that the Council has designated as 
        systemically important under section 804.
          [(3) Designated clearing entity.--The term 
        ``designated clearing entity'' means a designated 
        financial market utility that is a derivatives clearing 
        organization registered under section 5b of the 
        Commodity Exchange Act (7 U.S.C. 7a-1) or a clearing 
        agency registered with the Securities and Exchange 
        Commission under section 17A of the Securities Exchange 
        Act of 1934 (15 U.S.C. 78q-1).
          [(4) Designated financial market utility.--The term 
        ``designated financial market utility'' means a 
        financial market utility that the Council has 
        designated as systemically important under section 804.
          [(5) Financial institution.--
                  [(A) In general.--The term ``financial 
                institution'' means--
                          [(i) a depository institution, as 
                        defined in section 3 of the Federal 
                        Deposit Insurance Act (12 U.S.C. 1813);
                          [(ii) a branch or agency of a foreign 
                        bank, as defined in section 1(b) of the 
                        International Banking Act of 1978 (12 
                        U.S.C. 3101);
                          [(iii) an organization operating 
                        under section 25 or 25A of the Federal 
                        Reserve Act (12 U.S.C. 601-604a and 611 
                        through 631);
                          [(iv) a credit union, as defined in 
                        section 101 of the Federal Credit Union 
                        Act (12 U.S.C. 1752);
                          [(v) a broker or dealer, as defined 
                        in section 3 of the Securities Exchange 
                        Act of 1934 (15 U.S.C. 78c);
                          [(vi) an investment company, as 
                        defined in section 3 of the Investment 
                        Company Act of 1940 (15 U.S.C. 80a-3);
                          [(vii) an insurance company, as 
                        defined in section 2 of the Investment 
                        Company Act of 1940 (15 U.S.C. 80a-2);
                          [(viii) an investment adviser, as 
                        defined in section 202 of the 
                        Investment Advisers Act of 1940 (15 
                        U.S.C. 80b-2);
                          [(ix) a futures commission merchant, 
                        commodity trading advisor, or commodity 
                        pool operator, as defined in section 1a 
                        of the Commodity Exchange Act (7 U.S.C. 
                        1a); and
                          [(x) any company engaged in 
                        activities that are financial in nature 
                        or incidental to a financial activity, 
                        as described in section 4 of the Bank 
                        Holding Company Act of 1956 (12 U.S.C. 
                        1843(k)).
                  [(B) Exclusions.--The term ``financial 
                institution'' does not include designated 
                contract markets, registered futures 
                associations, swap data repositories, and swap 
                execution facilities registered under the 
                Commodity Exchange Act (7 U.S.C. 1 et seq.), or 
                national securities exchanges, national 
                securities associations, alternative trading 
                systems, securities information processors 
                solely with respect to the activities of the 
                entity as a securities information processor, 
                security-based swap data repositories, and swap 
                execution facilities registered under the 
                Securities Exchange Act of 1934 (15 U.S.C. 78a 
                et seq.), or designated clearing entities, 
                provided that the exclusions in this 
                subparagraph apply only with respect to the 
                activities that require the entity to be so 
                registered.
          [(6) Financial market utility.--
                  [(A) Inclusion.--The term ``financial market 
                utility'' means any person that manages or 
                operates a multilateral system for the purpose 
                of transferring, clearing, or settling 
                payments, securities, or other financial 
                transactions among financial institutions or 
                between financial institutions and the person.
                  [(B) Exclusions.--The term ``financial market 
                utility'' does not include--
                          [(i) designated contract markets, 
                        registered futures associations, swap 
                        data repositories, and swap execution 
                        facilities registered under the 
                        Commodity Exchange Act (7 U.S.C. 1 et 
                        seq.), or national securities 
                        exchanges, national securities 
                        associations, alternative trading 
                        systems, security-based swap data 
                        repositories, and swap execution 
                        facilities registered under the 
                        Securities Exchange Act of 1934 (15 
                        U.S.C. 78a et seq.), solely by reason 
                        of their providing facilities for 
                        comparison of data respecting the terms 
                        of settlement of securities or futures 
                        transactions effected on such exchange 
                        or by means of any electronic system 
                        operated or controlled by such 
                        entities, provided that the exclusions 
                        in this clause apply only with respect 
                        to the activities that require the 
                        entity to be so registered; and
                          [(ii) any broker, dealer, transfer 
                        agent, or investment company, or any 
                        futures commission merchant, 
                        introducing broker, commodity trading 
                        advisor, or commodity pool operator, 
                        solely by reason of functions performed 
                        by such institution as part of 
                        brokerage, dealing, transfer agency, or 
                        investment company activities, or 
                        solely by reason of acting on behalf of 
                        a financial market utility or a 
                        participant therein in connection with 
                        the furnishing by the financial market 
                        utility of services to its participants 
                        or the use of services of the financial 
                        market utility by its participants, 
                        provided that services performed by 
                        such institution do not constitute 
                        critical risk management or processing 
                        functions of the financial market 
                        utility.
          [(7) Payment, clearing, or settlement activity.--
                  [(A) In general.--The term ``payment, 
                clearing, or settlement activity'' means an 
                activity carried out by 1 or more financial 
                institutions to facilitate the completion of 
                financial transactions, but shall not include 
                any offer or sale of a security under the 
                Securities Act of 1933 (15 U.S.C. 77a et seq.), 
                or any quotation, order entry, negotiation, or 
                other pre-trade activity or execution activity.
                  [(B) Financial transaction.--For the purposes 
                of subparagraph (A), the term ``financial 
                transaction'' includes--
                          [(i) funds transfers;
                          [(ii) securities contracts;
                          [(iii) contracts of sale of a 
                        commodity for future delivery;
                          [(iv) forward contracts;
                          [(v) repurchase agreements;
                          [(vi) swaps;
                          [(vii) security-based swaps;
                          [(viii) swap agreements;
                          [(ix) security-based swap agreements;
                          [(x) foreign exchange contracts;
                          [(xi) financial derivatives 
                        contracts; and
                          [(xii) any similar transaction that 
                        the Council determines to be a 
                        financial transaction for purposes of 
                        this title.
                  [(C) Included activities.--When conducted 
                with respect to a financial transaction, 
                payment, clearing, and settlement activities 
                may include--
                          [(i) the calculation and 
                        communication of unsettled financial 
                        transactions between counterparties;
                          [(ii) the netting of transactions;
                          [(iii) provision and maintenance of 
                        trade, contract, or instrument 
                        information;
                          [(iv) the management of risks and 
                        activities associated with continuing 
                        financial transactions;
                          [(v) transmittal and storage of 
                        payment instructions;
                          [(vi) the movement of funds;
                          [(vii) the final settlement of 
                        financial transactions; and
                          [(viii) other similar functions that 
                        the Council may determine.
                  [(D) Exclusion.--Payment, clearing, and 
                settlement activities shall not include public 
                reporting of swap transaction data under 
                section 727 or 763(i) of the Wall Street 
                Transparency and Accountability Act of 2010.
          [(8) Supervisory agency.--
                  [(A) In general.--The term ``Supervisory 
                Agency'' means the Federal agency that has 
                primary jurisdiction over a designated 
                financial market utility under Federal banking, 
                securities, or commodity futures laws, as 
                follows:
                          [(i) The Securities and Exchange 
                        Commission, with respect to a 
                        designated financial market utility 
                        that is a clearing agency registered 
                        with the Securities and Exchange 
                        Commission.
                          [(ii) The Commodity Futures Trading 
                        Commission, with respect to a 
                        designated financial market utility 
                        that is a derivatives clearing 
                        organization registered with the 
                        Commodity Futures Trading Commission.
                          [(iii) The appropriate Federal 
                        banking agency, with respect to a 
                        designated financial market utility 
                        that is an institution described in 
                        section 3(q) of the Federal Deposit 
                        Insurance Act.
                          [(iv) The Board of Governors, with 
                        respect to a designated financial 
                        market utility that is otherwise not 
                        subject to the jurisdiction of any 
                        agency listed in clauses (i), (ii), and 
                        (iii).
                  [(B) Multiple agency jurisdiction.--If a 
                designated financial market utility is subject 
                to the jurisdictional supervision of more than 
                1 agency listed in subparagraph (A), then such 
                agencies should agree on 1 agency to act as the 
                Supervisory Agency, and if such agencies cannot 
                agree on which agency has primary jurisdiction, 
                the Council shall decide which agency is the 
                Supervisory Agency for purposes of this title.
          [(9) Systemically important and systemic 
        importance.--The terms ``systemically important'' and 
        ``systemic importance'' mean a situation where the 
        failure of or a disruption to the functioning of a 
        financial market utility or the conduct of a payment, 
        clearing, or settlement activity could create, or 
        increase, the risk of significant liquidity or credit 
        problems spreading among financial institutions or 
        markets and thereby threaten the stability of the 
        financial system of the United States.

[SEC. 804. DESIGNATION OF SYSTEMIC IMPORTANCE.

  [(a) Designation.--
          [(1) Financial stability oversight council.--The 
        Council, on a nondelegable basis and by a vote of not 
        fewer than \2/3\ of members then serving, including an 
        affirmative vote by the Chairperson of the Council, 
        shall designate those financial market utilities or 
        payment, clearing, or settlement activities that the 
        Council determines are, or are likely to become, 
        systemically important.
          [(2) Considerations.--In determining whether a 
        financial market utility or payment, clearing, or 
        settlement activity is, or is likely to become, 
        systemically important, the Council shall take into 
        consideration the following:
                  [(A) The aggregate monetary value of 
                transactions processed by the financial market 
                utility or carried out through the payment, 
                clearing, or settlement activity.
                  [(B) The aggregate exposure of the financial 
                market utility or a financial institution 
                engaged in payment, clearing, or settlement 
                activities to its counterparties.
                  [(C) The relationship, interdependencies, or 
                other interactions of the financial market 
                utility or payment, clearing, or settlement 
                activity with other financial market utilities 
                or payment, clearing, or settlement activities.
                  [(D) The effect that the failure of or a 
                disruption to the financial market utility or 
                payment, clearing, or settlement activity would 
                have on critical markets, financial 
                institutions, or the broader financial system.
                  [(E) Any other factors that the Council deems 
                appropriate.
  [(b) Rescission of Designation.--
          [(1) In general.--The Council, on a nondelegable 
        basis and by a vote of not fewer than \2/3\ of members 
        then serving, including an affirmative vote by the 
        Chairperson of the Council, shall rescind a designation 
        of systemic importance for a designated financial 
        market utility or designated activity if the Council 
        determines that the utility or activity no longer meets 
        the standards for systemic importance.
          [(2) Effect of rescission.--Upon rescission, the 
        financial market utility or financial institutions 
        conducting the activity will no longer be subject to 
        the provisions of this title or any rules or orders 
        prescribed under this title.
  [(c) Consultation and Notice and Opportunity for Hearing.--
          [(1) Consultation.--Before making any determination 
        under subsection (a) or (b), the Council shall consult 
        with the relevant Supervisory Agency and the Board of 
        Governors.
          [(2) Advance notice and opportunity for hearing.--
                  [(A) In general.--Before making any 
                determination under subsection (a) or (b), the 
                Council shall provide the financial market 
                utility or, in the case of a payment, clearing, 
                or settlement activity, financial institutions 
                with advance notice of the proposed 
                determination of the Council.
                  [(B) Notice in federal register.--The Council 
                shall provide such advance notice to financial 
                institutions by publishing a notice in the 
                Federal Register.
                  [(C) Requests for hearing.--Within 30 days 
                from the date of any notice of the proposed 
                determination of the Council, the financial 
                market utility or, in the case of a payment, 
                clearing, or settlement activity, a financial 
                institution engaged in the designated activity 
                may request, in writing, an opportunity for a 
                written or oral hearing before the Council to 
                demonstrate that the proposed designation or 
                rescission of designation is not supported by 
                substantial evidence.
                  [(D) Written submissions.--Upon receipt of a 
                timely request, the Council shall fix a time, 
                not more than 30 days after receipt of the 
                request, unless extended at the request of the 
                financial market utility or financial 
                institution, and place at which the financial 
                market utility or financial institution may 
                appear, personally or through counsel, to 
                submit written materials, or, at the sole 
                discretion of the Council, oral testimony or 
                oral argument.
          [(3) Emergency exception.--
                  [(A) Waiver or modification by vote of the 
                council.--The Council may waive or modify the 
                requirements of paragraph (2) if the Council 
                determines, by an affirmative vote of not fewer 
                than \2/3\ of members then serving, including 
                an affirmative vote by the Chairperson of the 
                Council, that the waiver or modification is 
                necessary to prevent or mitigate an immediate 
                threat to the financial system posed by the 
                financial market utility or the payment, 
                clearing, or settlement activity.
                  [(B) Notice of waiver or modification.--The 
                Council shall provide notice of the waiver or 
                modification to the financial market utility 
                concerned or, in the case of a payment, 
                clearing, or settlement activity, to financial 
                institutions, as soon as practicable, which 
                shall be no later than 24 hours after the 
                waiver or modification in the case of a 
                financial market utility and 3 business days in 
                the case of financial institutions. The Council 
                shall provide the notice to financial 
                institutions by posting a notice on the website 
                of the Council and by publishing a notice in 
                the Federal Register.
  [(d) Notification of Final Determination.--
          [(1) After hearing.--Within 60 days of any hearing 
        under subsection (c)(2), the Council shall notify the 
        financial market utility or financial institutions of 
        the final determination of the Council in writing, 
        which shall include findings of fact upon which the 
        determination of the Council is based.
          [(2) When no hearing requested.--If the Council does 
        not receive a timely request for a hearing under 
        subsection (c)(2), the Council shall notify the 
        financial market utility or financial institutions of 
        the final determination of the Council in writing not 
        later than 30 days after the expiration of the date by 
        which a financial market utility or a financial 
        institution could have requested a hearing. All notices 
        to financial institutions under this subsection shall 
        be published in the Federal Register.
  [(e) Extension of Time Periods.--The Council may extend the 
time periods established in subsections (c) and (d) as the 
Council determines to be necessary or appropriate.

[SEC. 805. STANDARDS FOR SYSTEMICALLY IMPORTANT FINANCIAL MARKET 
                    UTILITIES AND PAYMENT, CLEARING, OR SETTLEMENT 
                    ACTIVITIES.

  [(a) Authority to Prescribe Standards.--
          [(1) Board of governors.--Except as provided in 
        paragraph (2), the Board of Governors, by rule or 
        order, and in consultation with the Council and the 
        Supervisory Agencies, shall prescribe risk management 
        standards, taking into consideration relevant 
        international standards and existing prudential 
        requirements, governing--
                  [(A) the operations related to the payment, 
                clearing, and settlement activities of 
                designated financial market utilities; and
                  [(B) the conduct of designated activities by 
                financial institutions.
          [(2) Special procedures for designated clearing 
        entities and designated activities of certain financial 
        institutions.--
                  [(A) CFTC and commission.--The Commodity 
                Futures Trading Commission and the Commission 
                may each prescribe regulations, in consultation 
                with the Council and the Board of Governors, 
                containing risk management standards, taking 
                into consideration relevant international 
                standards and existing prudential requirements, 
                for those designated clearing entities and 
                financial institutions engaged in designated 
                activities for which each is the Supervisory 
                Agency or the appropriate financial regulator, 
                governing--
                          [(i) the operations related to 
                        payment, clearing, and settlement 
                        activities of such designated clearing 
                        entities; and
                          [(ii) the conduct of designated 
                        activities by such financial 
                        institutions.
                  [(B) Review and determination.--The Board of 
                Governors may determine that existing 
                prudential requirements of the Commodity 
                Futures Trading Commission, the Commission, or 
                both (including requirements prescribed 
                pursuant to subparagraph (A)) with respect to 
                designated clearing entities and financial 
                institutions engaged in designated activities 
                for which the Commission or the Commodity 
                Futures Trading Commission is the Supervisory 
                Agency or the appropriate financial regulator 
                are insufficient to prevent or mitigate 
                significant liquidity, credit, operational, or 
                other risks to the financial markets or to the 
                financial stability of the United States.
                  [(C) Written determination.--Any 
                determination by the Board of Governors under 
                subparagraph (B) shall be provided in writing 
                to the Commodity Futures Trading Commission or 
                the Commission, as applicable, and the Council, 
                and shall explain why existing prudential 
                requirements, considered as a whole, are 
                insufficient to ensure that the operations and 
                activities of the designated clearing entities 
                or the activities of financial institutions 
                described in subparagraph (B) will not pose 
                significant liquidity, credit, operational, or 
                other risks to the financial markets or to the 
                financial stability of the United States. The 
                Board of Governors' determination shall contain 
                a detailed analysis supporting its findings and 
                identify the specific prudential requirements 
                that are insufficient.
                  [(D) CFTC and commission response.--The 
                Commodity Futures Trading Commission or the 
                Commission, as applicable, shall within 60 days 
                either object to the Board of Governors' 
                determination with a detailed analysis as to 
                why existing prudential requirements are 
                sufficient, or submit an explanation to the 
                Council and the Board of Governors describing 
                the actions to be taken in response to the 
                Board of Governors' determination.
                  [(E) Authorization.--Upon an affirmative vote 
                by not fewer than 2/3 of members then serving 
                on the Council, the Council shall either find 
                that the response submitted under subparagraph 
                (D) is sufficient, or require the Commodity 
                Futures Trading Commission, or the Commission, 
                as applicable, to prescribe such risk 
                management standards as the Council determines 
                is necessary to address the specific prudential 
                requirements that are determined to be 
                insufficient.''
  [(b) Objectives and Principles.--The objectives and 
principles for the risk management standards prescribed under 
subsection (a) shall be to--
          [(1) promote robust risk management;
          [(2) promote safety and soundness;
          [(3) reduce systemic risks; and
          [(4) support the stability of the broader financial 
        system.
  [(c) Scope.--The standards prescribed under subsection (a) 
may address areas such as--
          [(1) risk management policies and procedures;
          [(2) margin and collateral requirements;
          [(3) participant or counterparty default policies and 
        procedures;
          [(4) the ability to complete timely clearing and 
        settlement of financial transactions;
          [(5) capital and financial resource requirements for 
        designated financial market utilities; and
          [(6) other areas that are necessary to achieve the 
        objectives and principles in subsection (b).
  [(d) Limitation on Scope.--Except as provided in subsections 
(e) and (f) of section 807, nothing in this title shall be 
construed to permit the Council or the Board of Governors to 
take any action or exercise any authority granted to the 
Commodity Futures Trading Commission under section 2(h) of the 
Commodity Exchange Act or the Securities and Exchange 
Commission under section 3C(a) of the Securities Exchange Act 
of 1934, including--
          [(1) the approval of, disapproval of, or stay of the 
        clearing requirement for any group, category, type, or 
        class of swaps that a designated clearing entity may 
        accept for clearing;
          [(2) the determination that any group, category, 
        type, or class of swaps shall be subject to the 
        mandatory clearing requirement of section 2(h)(1) of 
        the Commodity Exchange Act or section 3C(a)(1) of the 
        Securities Exchange Act of 1934;
          [(3) the determination that any person is exempt from 
        the mandatory clearing requirement of section 2(h)(1) 
        of the Commodity Exchange Act or section 3C(a)(1) of 
        the Securities Exchange Act of 1934; or
          [(4) any authority granted to the Commodity Futures 
        Trading Commission or the Securities and Exchange 
        Commission with respect to transaction reporting or 
        trade execution.
  [(e) Threshold Level.--The standards prescribed under 
subsection (a) governing the conduct of designated activities 
by financial institutions shall, where appropriate, establish a 
threshold as to the level or significance of engagement in the 
activity at which a financial institution will become subject 
to the standards with respect to that activity.
  [(f) Compliance Required.--Designated financial market 
utilities and financial institutions subject to the standards 
prescribed under subsection (a) for a designated activity shall 
conduct their operations in compliance with the applicable risk 
management standards.

[SEC. 806. OPERATIONS OF DESIGNATED FINANCIAL MARKET UTILITIES.

  [(a) Federal Reserve Account and Services.--The Board of 
Governors may authorize a Federal Reserve Bank to establish and 
maintain an account for a designated financial market utility 
and provide the services listed in section 11A(b) of the 
Federal Reserve Act (12 U.S.C. 248a(b)) and deposit accounts 
under the first undesignated paragraph of section 13 of the 
Federal Reserve Act (12 U.S.C. 342) to the designated financial 
market utility that the Federal Reserve Bank is authorized 
under the Federal Reserve Act to provide to a depository 
institution, subject to any applicable rules, orders, 
standards, or guidelines prescribed by the Board of Governors.
  [(b) Advances.--The Board of Governors may authorize a 
Federal Reserve bank under section 10B of the Federal Reserve 
Act (12 U.S.C. 347b) to provide to a designated financial 
market utility discount and borrowing privileges only in 
unusual or exigent circumstances, upon the affirmative vote of 
a majority of the Board of Governors then serving (or such 
other number in accordance with the provisions of section 
11(r)(2) of the Federal Reserve Act (12 U.S.C. 248(r)(2)) after 
consultation with the Secretary, and upon a showing by the 
designated financial market utility that it is unable to secure 
adequate credit accommodations from other banking institutions. 
All such discounts and borrowing privileges shall be subject to 
such other limitations, restrictions, and regulations as the 
Board of Governors may prescribe. Access to discount and 
borrowing privileges under section 10B of the Federal Reserve 
Act as authorized in this section does not require a designated 
financial market utility to be or become a bank or bank holding 
company.
  [(c) Earnings on Federal Reserve Balances.--A Federal Reserve 
Bank may pay earnings on balances maintained by or on behalf of 
a designated financial market utility in the same manner and to 
the same extent as the Federal Reserve Bank may pay earnings to 
a depository institution under the Federal Reserve Act, subject 
to any applicable rules, orders, standards, or guidelines 
prescribed by the Board of Governors.
  [(d) Reserve Requirements.--The Board of Governors may exempt 
a designated financial market utility from, or modify any, 
reserve requirements under section 19 of the Federal Reserve 
Act (12 U.S.C. 461) applicable to a designated financial market 
utility.
  [(e) Changes to Rules, Procedures, or Operations.--
          [(1) Advance notice.--
                  [(A) Advance notice of proposed changes 
                required.--A designated financial market 
                utility shall provide notice 60 days in advance 
                notice to its Supervisory Agency of any 
                proposed change to its rules, procedures, or 
                operations that could, as defined in rules of 
                each Supervisory Agency, materially affect, the 
                nature or level of risks presented by the 
                designated financial market utility.
                  [(B) Terms and standards prescribed by the 
                supervisory agencies.--Each Supervisory Agency, 
                in consultation with the Board of Governors, 
                shall prescribe regulations that define and 
                describe the standards for determining when 
                notice is required to be provided under 
                subparagraph (A).
                  [(C) Contents of notice.--The notice of a 
                proposed change shall describe--
                          [(i) the nature of the change and 
                        expected effects on risks to the 
                        designated financial market utility, 
                        its participants, or the market; and
                          [(ii) how the designated financial 
                        market utility plans to manage any 
                        identified risks.
                  [(D) Additional information.--The Supervisory 
                Agency may require a designated financial 
                market utility to provide any information 
                necessary to assess the effect the proposed 
                change would have on the nature or level of 
                risks associated with the designated financial 
                market utility's payment, clearing, or 
                settlement activities and the sufficiency of 
                any proposed risk management techniques.
                  [(E) Notice of objection.--The Supervisory 
                Agency shall notify the designated financial 
                market utility of any objection regarding the 
                proposed change within 60 days from the later 
                of--
                          [(i) the date that the notice of the 
                        proposed change is received; or
                          [(ii) the date any further 
                        information requested for consideration 
                        of the notice is received.
                  [(F) Change not allowed if objection.--A 
                designated financial market utility shall not 
                implement a change to which the Supervisory 
                Agency has an objection.
                  [(G) Change allowed if no objection within 60 
                days.--A designated financial market utility 
                may implement a change if it has not received 
                an objection to the proposed change within 60 
                days of the later of--
                          [(i) the date that the Supervisory 
                        Agency receives the notice of proposed 
                        change; or
                          [(ii) the date the Supervisory Agency 
                        receives any further information it 
                        requests for consideration of the 
                        notice.
                  [(H) Review extension for novel or complex 
                issues.--The Supervisory Agency may, during the 
                60-day review period, extend the review period 
                for an additional 60 days for proposed changes 
                that raise novel or complex issues, subject to 
                the Supervisory Agency providing the designated 
                financial market utility with prompt written 
                notice of the extension. Any extension under 
                this subparagraph will extend the time periods 
                under subparagraphs (E) and (G).
                  [(I) Change allowed earlier if notified of no 
                objection.--A designated financial market 
                utility may implement a change in less than 60 
                days from the date of receipt of the notice of 
                proposed change by the Supervisory Agency, or 
                the date the Supervisory Agency receives any 
                further information it requested, if the 
                Supervisory Agency notifies the designated 
                financial market utility in writing that it 
                does not object to the proposed change and 
                authorizes the designated financial market 
                utility to implement the change on an earlier 
                date, subject to any conditions imposed by the 
                Supervisory Agency.
          [(2) Emergency changes.--
                  [(A) In general.--A designated financial 
                market utility may implement a change that 
                would otherwise require advance notice under 
                this subsection if it determines that--
                          [(i) an emergency exists; and
                          [(ii) immediate implementation of the 
                        change is necessary for the designated 
                        financial market utility to continue to 
                        provide its services in a safe and 
                        sound manner.
                  [(B) Notice required within 24 hours.--The 
                designated financial market utility shall 
                provide notice of any such emergency change to 
                its Supervisory Agency, as soon as practicable, 
                which shall be no later than 24 hours after 
                implementation of the change.
                  [(C) Contents of emergency notice.--In 
                addition to the information required for 
                changes requiring advance notice, the notice of 
                an emergency change shall describe--
                          [(i) the nature of the emergency; and
                          [(ii) the reason the change was 
                        necessary for the designated financial 
                        market utility to continue to provide 
                        its services in a safe and sound 
                        manner.
                  [(D) Modification or rescission of change may 
                be required.--The Supervisory Agency may 
                require modification or rescission of the 
                change if it finds that the change is not 
                consistent with the purposes of this Act or any 
                applicable rules, orders, or standards 
                prescribed under section 805(a).
          [(3) Copying the board of governors.--The Supervisory 
        Agency shall provide the Board of Governors 
        concurrently with a complete copy of any notice, 
        request, or other information it issues, submits, or 
        receives under this subsection.
          [(4) Consultation with board of governors.--Before 
        taking any action on, or completing its review of, a 
        change proposed by a designated financial market 
        utility, the Supervisory Agency shall consult with the 
        Board of Governors.

[SEC. 807. EXAMINATION OF AND ENFORCEMENT ACTIONS AGAINST DESIGNATED 
                    FINANCIAL MARKET UTILITIES.

  [(a) Examination.--Notwithstanding any other provision of law 
and subject to subsection (d), the Supervisory Agency shall 
conduct examinations of a designated financial market utility 
at least once annually in order to determine the following:
          [(1) The nature of the operations of, and the risks 
        borne by, the designated financial market utility.
          [(2) The financial and operational risks presented by 
        the designated financial market utility to financial 
        institutions, critical markets, or the broader 
        financial system.
          [(3) The resources and capabilities of the designated 
        financial market utility to monitor and control such 
        risks.
          [(4) The safety and soundness of the designated 
        financial market utility.
          [(5) The designated financial market utility's 
        compliance with--
                  [(A) this title; and
                  [(B) the rules and orders prescribed under 
                this title.
  [(b) Service Providers.--Whenever a service integral to the 
operation of a designated financial market utility is performed 
for the designated financial market utility by another entity, 
whether an affiliate or non-affiliate and whether on or off the 
premises of the designated financial market utility, the 
Supervisory Agency may examine whether the provision of that 
service is in compliance with applicable law, rules, orders, 
and standards to the same extent as if the designated financial 
market utility were performing the service on its own premises.
  [(c) Enforcement.--For purposes of enforcing the provisions 
of this title, a designated financial market utility shall be 
subject to, and the appropriate Supervisory Agency shall have 
authority under the provisions of subsections (b) through (n) 
of section 8 of the Federal Deposit Insurance Act (12 U.S.C. 
1818) in the same manner and to the same extent as if the 
designated financial market utility was an insured depository 
institution and the Supervisory Agency was the appropriate 
Federal banking agency for such insured depository institution.
  [(d) Board of Governors Involvement in Examinations.--
          [(1) Board of governors consultation on examination 
        planning.--The Supervisory Agency shall consult 
        annually with the Board of Governors regarding the 
        scope and methodology of any examination conducted 
        under subsections (a) and (b). The Supervisory Agency 
        shall lead all examinations conducted under subsections 
        (a) and (b)
          [(2) Board of governors participation in 
        examination.--The Board of Governors may, in its 
        discretion, participate in any examination led by a 
        Supervisory Agency and conducted under subsections (a) 
        and (b).
  [(e) Board of Governors Enforcement Recommendations.--
          [(1) Recommendation.--The Board of Governors may, 
        after consulting with the Council and the Supervisory 
        Agency, at any time recommend to the Supervisory Agency 
        that such agency take enforcement action against a 
        designated financial market utility in order to prevent 
        or mitigate significant liquidity, credit, operational, 
        or other risks to the financial markets or to the 
        financial stability of the United States. Any such 
        recommendation for enforcement action shall provide a 
        detailed analysis supporting the recommendation of the 
        Board of Governors.
          [(2) Consideration.--The Supervisory Agency shall 
        consider the recommendation of the Board of Governors 
        and submit a response to the Board of Governors within 
        60 days.
          [(3) Binding arbitration.--If the Supervisory Agency 
        rejects, in whole or in part, the recommendation of the 
        Board of Governors, the Board of Governors may refer 
        the recommendation to the Council for a binding 
        decision on whether an enforcement action is warranted.
          [(4) Enforcement action.--Upon an affirmative vote by 
        a majority of the Council in favor of the Board of 
        Governors' recommendation under paragraph (3), the 
        Council may require the Supervisory Agency to--
                  [(A) exercise the enforcement authority 
                referenced in subsection (c); and
                  [(B) take enforcement action against the 
                designated financial market utility.
  [(f) Emergency Enforcement Actions by the Board of 
Governors.--
          [(1) Imminent risk of substantial harm.--The Board of 
        Governors may, after consulting with the Supervisory 
        Agency and upon an affirmative vote by a majority the 
        Council, take enforcement action against a designated 
        financial market utility if the Board of Governors has 
        reasonable cause to conclude that--
                  [(A) either--
                          [(i) an action engaged in, or 
                        contemplated by, a designated financial 
                        market utility (including any change 
                        proposed by the designated financial 
                        market utility to its rules, 
                        procedures, or operations that would 
                        otherwise be subject to section 806(e)) 
                        poses an imminent risk of substantial 
                        harm to financial institutions, 
                        critical markets, or the broader 
                        financial system of the United States; 
                        or
                          [(ii) the condition of a designated 
                        financial market utility poses an 
                        imminent risk of substantial harm to 
                        financial institutions, critical 
                        markets, or the broader financial 
                        system; and
                  [(B) the imminent risk of substantial harm 
                precludes the Board of Governors' use of the 
                procedures in subsection (e).
          [(2) Enforcement authority.--For purposes of taking 
        enforcement action under paragraph (1), a designated 
        financial market utility shall be subject to, and the 
        Board of Governors shall have authority under the 
        provisions of subsections (b) through (n) of section 8 
        of the Federal Deposit Insurance Act (12 U.S.C. 1818) 
        in the same manner and to the same extent as if the 
        designated financial market utility was an insured 
        depository institution and the Board of Governors was 
        the appropriate Federal banking agency for such insured 
        depository institution.

[SEC. 808. EXAMINATION OF AND ENFORCEMENT ACTIONS AGAINST FINANCIAL 
                    INSTITUTIONS SUBJECT TO STANDARDS FOR DESIGNATED 
                    ACTIVITIES.

  [(a) Examination.--The appropriate financial regulator is 
authorized to examine a financial institution subject to the 
standards prescribed under section 805(a) for a designated 
activity in order to determine the following:
          [(1) The nature and scope of the designated 
        activities engaged in by the financial institution.
          [(2) The financial and operational risks the 
        designated activities engaged in by the financial 
        institution may pose to the safety and soundness of the 
        financial institution.
          [(3) The financial and operational risks the 
        designated activities engaged in by the financial 
        institution may pose to other financial institutions, 
        critical markets, or the broader financial system.
          [(4) The resources available to and the capabilities 
        of the financial institution to monitor and control the 
        risks described in paragraphs (2) and (3).
          [(5) The financial institution's compliance with this 
        title and the rules and orders prescribed under section 
        805(a).
  [(b) Enforcement.--For purposes of enforcing the provisions 
of this title, and the rules and orders prescribed under this 
section, a financial institution subject to the standards 
prescribed under section 805(a) for a designated activity shall 
be subject to, and the appropriate financial regulator shall 
have authority under the provisions of subsections (b) through 
(n) of section 8 of the Federal Deposit Insurance Act (12 
U.S.C. 1818) in the same manner and to the same extent as if 
the financial institution was an insured depository institution 
and the appropriate financial regulator was the appropriate 
Federal banking agency for such insured depository institution.
  [(c) Technical Assistance.--The Board of Governors shall 
consult with and provide such technical assistance as may be 
required by the appropriate financial regulators to ensure that 
the rules and orders prescribed under this title are 
interpreted and applied in as consistent and uniform a manner 
as practicable.
  [(d) Delegation.--
          [(1) Examination.--
                  [(A) Request to board of governors.--The 
                appropriate financial regulator may request the 
                Board of Governors to conduct or participate in 
                an examination of a financial institution 
                subject to the standards prescribed under 
                section 805(a) for a designated activity in 
                order to assess the compliance of such 
                financial institution with--
                          [(i) this title; or
                          [(ii) the rules or orders prescribed 
                        under this title.
                  [(B) Examination by board of governors.--Upon 
                receipt of an appropriate written request, the 
                Board of Governors will conduct the examination 
                under such terms and conditions to which the 
                Board of Governors and the appropriate 
                financial regulator mutually agree.
          [(2) Enforcement.--
                  [(A) Request to board of governors.--The 
                appropriate financial regulator may request the 
                Board of Governors to enforce this title or the 
                rules or orders prescribed under this title 
                against a financial institution that is subject 
                to the standards prescribed under section 
                805(a) for a designated activity.
                  [(B) Enforcement by board of governors.--Upon 
                receipt of an appropriate written request, the 
                Board of Governors shall determine whether an 
                enforcement action is warranted, and, if so, it 
                shall enforce compliance with this title or the 
                rules or orders prescribed under this title 
                and, if so, the financial institution shall be 
                subject to, and the Board of Governors shall 
                have authority under the provisions of 
                subsections (b) through (n) of section 8 of the 
                Federal Deposit Insurance Act (12 U.S.C. 1818) 
                in the same manner and to the same extent as if 
                the financial institution was an insured 
                depository institution and the Board of 
                Governors was the appropriate Federal banking 
                agency for such insured depository institution.
  [(e) Back-up Authority of the Board of Governors.--
          [(1) Examination and enforcement.--Notwithstanding 
        any other provision of law, the Board of Governors 
        may--
                  [(A) conduct an examination of the type 
                described in subsection (a) of any financial 
                institution that is subject to the standards 
                prescribed under section 805(a) for a 
                designated activity; and
                  [(B) enforce the provisions of this title or 
                any rules or orders prescribed under this title 
                against any financial institution that is 
                subject to the standards prescribed under 
                section 805(a) for a designated activity.
          [(2) Limitations.--
                  [(A) Examination.--The Board of Governors may 
                exercise the authority described in paragraph 
                (1)(A) only if the Board of Governors has--
                          [(i) reasonable cause to believe that 
                        a financial institution is not in 
                        compliance with this title or the rules 
                        or orders prescribed under this title 
                        with respect to a designated activity;
                          [(ii) notified, in writing, the 
                        appropriate financial regulator and the 
                        Council of its belief under clause (i) 
                        with supporting documentation included;
                          [(iii) requested the appropriate 
                        financial regulator to conduct a prompt 
                        examination of the financial 
                        institution;
                          [(iv) either--
                                  [(I) not been afforded a 
                                reasonable opportunity to 
                                participate in an examination 
                                of the financial institution by 
                                the appropriate financial 
                                regulator within 30 days after 
                                the date of the Board's 
                                notification under clause (ii); 
                                or
                                  [(II) reasonable cause to 
                                believe that the financial 
                                institution's noncompliance 
                                with this title or the rules or 
                                orders prescribed under this 
                                title poses a substantial risk 
                                to other financial 
                                institutions, critical markets, 
                                or the broader financial 
                                system, subject to the Board of 
                                Governors affording the 
                                appropriate financial regulator 
                                a reasonable opportunity to 
                                participate in the examination; 
                                and
                          [(v) obtained the approval of the 
                        Council upon an affirmative vote by a 
                        majority of the Council.
                  [(B) Enforcement.--The Board of Governors may 
                exercise the authority described in paragraph 
                (1)(B) only if the Board of Governors has--
                          [(i) reasonable cause to believe that 
                        a financial institution is not in 
                        compliance with this title or the rules 
                        or orders prescribed under this title 
                        with respect to a designated activity;
                          [(ii) notified, in writing, the 
                        appropriate financial regulator and the 
                        Council of its belief under clause (i) 
                        with supporting documentation included 
                        and with a recommendation that the 
                        appropriate financial regulator take 1 
                        or more specific enforcement actions 
                        against the financial institution;
                          [(iii) either--
                                  [(I) not been notified, in 
                                writing, by the appropriate 
                                financial regulator of the 
                                commencement of an enforcement 
                                action recommended by the Board 
                                of Governors against the 
                                financial institution within 60 
                                days from the date of the 
                                notification under clause (ii); 
                                or
                                  [(II) reasonable cause to 
                                believe that the financial 
                                institution's noncompliance 
                                with this title or the rules or 
                                orders prescribed under this 
                                title poses significant 
                                liquidity, credit, operational, 
                                or other risks to the financial 
                                markets or to the financial 
                                stability of the United States, 
                                subject to the Board of 
                                Governors notifying the 
                                appropriate financial regulator 
                                of the Board's enforcement 
                                action; and
                          [(iv) obtained the approval of the 
                        Council upon an affirmative vote by a 
                        majority of the Council.
          [(3) Enforcement provisions.--For purposes of taking 
        enforcement action under paragraph (1), the financial 
        institution shall be subject to, and the Board of 
        Governors shall have authority under the provisions of 
        subsections (b) through (n) of section 8 of the Federal 
        Deposit Insurance Act (12 U.S.C. 1818) in the same 
        manner and to the same extent as if the financial 
        institution was an insured depository institution and 
        the Board of Governors was the appropriate Federal 
        banking agency for such insured depository institution.

[SEC. 809. REQUESTS FOR INFORMATION, REPORTS, OR RECORDS.

  [(a) Information To Assess Systemic Importance.--
          [(1) Financial market utilities.--The Council is 
        authorized to require any financial market utility to 
        submit such information as the Council may require for 
        the sole purpose of assessing whether that financial 
        market utility is systemically important, but only if 
        the Council has reasonable cause to believe that the 
        financial market utility meets the standards for 
        systemic importance set forth in section 804.
          [(2) Financial institutions engaged in payment, 
        clearing, or settlement activities.--The Council is 
        authorized to require any financial institution to 
        submit such information as the Council may require for 
        the sole purpose of assessing whether any payment, 
        clearing, or settlement activity engaged in or 
        supported by a financial institution is systemically 
        important, but only if the Council has reasonable cause 
        to believe that the activity meets the standards for 
        systemic importance set forth in section 804.
  [(b) Reporting After Designation.--
          [(1) Designated financial market utilities.--The 
        Board of Governors and the Council may each require a 
        designated financial market utility to submit reports 
        or data to the Board of Governors and the Council in 
        such frequency and form as deemed necessary by the 
        Board of Governors or the Council in order to assess 
        the safety and soundness of the utility and the 
        systemic risk that the utility's operations pose to the 
        financial system.
          [(2) Financial institutions subject to standards for 
        designated activities.--The Board of Governors and the 
        Council may each require 1 or more financial 
        institutions subject to the standards prescribed under 
        section 805(a) for a designated activity to submit, in 
        such frequency and form as deemed necessary by the 
        Board of Governors or the Council, reports and data to 
        the Board of Governors and the Council solely with 
        respect to the conduct of the designated activity and 
        solely to assess whether--
                  [(A) the rules, orders, or standards 
                prescribed under section 805(a) with respect to 
                the designated activity appropriately address 
                the risks to the financial system presented by 
                such activity; and
                  [(B) the financial institutions are in 
                compliance with this title and the rules and 
                orders prescribed under section 805(a) with 
                respect to the designated activity.
          [(3) Limitation.--The Board of Governors may, upon an 
        affirmative vote by a majority of the Council, 
        prescribe regulations under this section that impose a 
        recordkeeping or reporting requirement on designated 
        clearing entities or financial institutions engaged in 
        designated activities that are subject to standards 
        that have been prescribed under section 805(a)(2).
  [(c) Coordination With Appropriate Federal Supervisory 
Agency.--
          [(1) Advance coordination.--Before requesting any 
        material information from, or imposing reporting or 
        recordkeeping requirements on, any financial market 
        utility or any financial institution engaged in a 
        payment, clearing, or settlement activity, the Board of 
        Governors or the Council shall coordinate with the 
        Supervisory Agency for a financial market utility or 
        the appropriate financial regulator for a financial 
        institution to determine if the information is 
        available from or may be obtained by the agency in the 
        form, format, or detail required by the Board of 
        Governors or the Council.
          [(2) Supervisory reports.--Notwithstanding any other 
        provision of law, the Supervisory Agency, the 
        appropriate financial regulator, and the Board of 
        Governors are authorized to disclose to each other and 
        the Council copies of its examination reports or 
        similar reports regarding any financial market utility 
        or any financial institution engaged in payment, 
        clearing, or settlement activities.
  [(d) Timing of Response From Appropriate Federal Supervisory 
Agency.--If the information, report, records, or data requested 
by the Board of Governors or the Council under subsection 
(c)(1) are not provided in full by the Supervisory Agency or 
the appropriate financial regulator in less than 15 days after 
the date on which the material is requested, the Board of 
Governors or the Council may request the information or impose 
recordkeeping or reporting requirements directly on such 
persons as provided in subsections (a) and (b) with notice to 
the agency.
  [(e) Sharing of Information.--
          [(1) Material concerns.--Notwithstanding any other 
        provision of law, the Board of Governors, the Council, 
        the appropriate financial regulator, and any 
        Supervisory Agency are authorized to--
                  [(A) promptly notify each other of material 
                concerns about a designated financial market 
                utility or any financial institution engaged in 
                designated activities; and
                  [(B) share appropriate reports, information, 
                or data relating to such concerns.
          [(2) Other information.--Notwithstanding any other 
        provision of law, the Board of Governors, the Council, 
        the appropriate financial regulator, or any Supervisory 
        Agency may, under such terms and conditions as it deems 
        appropriate, provide confidential supervisory 
        information and other information obtained under this 
        title to each other, and to the Secretary, Federal 
        Reserve Banks, State financial institution supervisory 
        agencies, foreign financial supervisors, foreign 
        central banks, and foreign finance ministries, subject 
        to reasonable assurances of confidentiality, provided, 
        however, that no person or entity receiving information 
        pursuant to this section may disseminate such 
        information to entities or persons other than those 
        listed in this paragraph without complying with 
        applicable law, including section 8 of the Commodity 
        Exchange Act (7 U.S.C. 12).
  [(f) Privilege Maintained.--The Board of Governors, the 
Council, the appropriate financial regulator, and any 
Supervisory Agency providing reports or data under this section 
shall not be deemed to have waived any privilege applicable to 
those reports or data, or any portion thereof, by providing the 
reports or data to the other party or by permitting the reports 
or data, or any copies thereof, to be used by the other party.
  [(g) Disclosure Exemption.--Information obtained by the Board 
of Governors, the Supervisory Agencies, or the Council under 
this section and any materials prepared by the Board of 
Governors, the Supervisory Agencies, or the Council regarding 
their assessment of the systemic importance of financial market 
utilities or any payment, clearing, or settlement activities 
engaged in by financial institutions, and in connection with 
their supervision of designated financial market utilities and 
designated activities, shall be confidential supervisory 
information exempt from disclosure under section 552 of title 
5, United States Code. For purposes of such section 552, this 
subsection shall be considered a statute described in 
subsection (b)(3) of such section 552.

[SEC. 810. RULEMAKING.

  [The Board of Governors, the Supervisory Agencies, and the 
Council are authorized to prescribe such rules and issue such 
orders as may be necessary to administer and carry out their 
respective authorities and duties granted under this title and 
prevent evasions thereof.

[SEC. 811. OTHER AUTHORITY.

  [Unless otherwise provided by its terms, this title does not 
divest any appropriate financial regulator, any Supervisory 
Agency, or any other Federal or State agency, of any authority 
derived from any other applicable law, except that any 
standards prescribed by the Board of Governors under section 
805 shall supersede any less stringent requirements established 
under other authority to the extent of any conflict.

[SEC. 812. CONSULTATION.

  [(a) CFTC.--The Commodity Futures Trading Commission shall 
consult with the Board of Governors--
          [(1) prior to exercising its authorities under 
        sections 2(h)(2)(C), 2(h)(3)(A), 2(h)(3)(C), 
        2(h)(4)(A), and 2(h)(4)(B) of the Commodity Exchange 
        Act, as amended by the Wall Street Transparency and 
        Accountability Act of 2010;
          [(2) with respect to any rule or rule amendment of a 
        derivatives clearing organization for which a stay of 
        certification has been issued under section 745(b)(3) 
        of the Wall Street Transparency and Accountability Act 
        of 2010; and
          [(3) prior to exercising its rulemaking authorities 
        under section 728 of the Wall Street Transparency and 
        Accountability Act of 2010.
  [(b) SEC.--The Commission shall consult with the Board of 
Governors--
          [(1) prior to exercising its authorities under 
        sections 3C(a)(2)(C), 3C(a)(3)(A), 3C(a)(3)(C), 
        3C(a)(4)(A), and 3C(a)(4)(B) of the Securities Exchange 
        Act of 1934, as amended by the Wall Street Transparency 
        and Accountability Act of 2010;
          [(2) with respect to any proposed rule change of a 
        clearing agency for which an extension of the time for 
        review has been designated under section 19(b)(2) of 
        the Securities Exchange Act of 1934; and
          [(3) prior to exercising its rulemaking authorities 
        under section 13(n) of the Securities Exchange Act of 
        1934, as added by section 763(i) of the Wall Street 
        Transparency and Accountability Act of 2010.

[SEC. 813. COMMON FRAMEWORK FOR DESIGNATED CLEARING ENTITY RISK 
                    MANAGEMENT.

  [The Commodity Futures Trading Commission and the Commission 
shall coordinate with the Board of Governors to jointly develop 
risk management supervision programs for designated clearing 
entities. Not later than 1 year after the date of enactment of 
this Act, the Commodity Futures Trading Commission, the 
Commission, and the Board of Governors shall submit a joint 
report to the Committee on Banking, Housing, and Urban Affairs 
and the Committee on Agriculture, Nutrition, and Forestry of 
the Senate, and the Committee on Financial Services and the 
Committee on Agriculture of the House of Representatives 
recommendations for--
          [(1) improving consistency in the designated clearing 
        entity oversight programs of the Commission and the 
        Commodity Futures Trading Commission;
          [(2) promoting robust risk management by designated 
        clearing entities;
          [(3) promoting robust risk management oversight by 
        regulators of designated clearing entities; and
          [(4) improving regulators' ability to monitor the 
        potential effects of designated clearing entity risk 
        management on the stability of the financial system of 
        the United States.

[SEC. 814. EFFECTIVE DATE.

  [This title is effective as of the date of enactment of this 
Act.]

 TITLE IX--INVESTOR PROTECTIONS AND IMPROVEMENTS TO THE REGULATION OF 
                               SECURITIES

SEC. 901. SHORT TITLE.

  This title may be cited as the ``Investor Protection and 
Securities Reform Act of 2010''.

           *       *       *       *       *       *       *


[SEC. 912. CLARIFICATION OF AUTHORITY OF THE COMMISSION TO ENGAGE IN 
                    INVESTOR TESTING

  [Section 19 of the Securities Act of 1933 (15 U.S.C. 77s) is 
amended by adding at the end the following:
  [``(e) Evaluation of Rules or Programs.--For the purpose of 
evaluating any rule or program of the Commission issued or 
carried out under any provision of the securities laws, as 
defined in section 3 of the Securities Exchange Act of 1934 (15 
U.S.C. 78c), and the purposes of considering, proposing, 
adopting, or engaging in any such rule or program or developing 
new rules or programs, the Commission may--
          [``(1) gather information from and communicate with 
        investors or other members of the public;
          [``(2) engage in such temporary investor testing 
        programs as the Commission determines are in the public 
        interest or would protect investors; and
          [``(3) consult with academics and consultants, as 
        necessary to carry out this subsection.
  [``(f) Rule of construction.--For purposes of the Paperwork 
Reduction Act (44 U.S.C. 3501 et seq.), any action taken under 
subsection (e) shall not be construed to be a collection of 
information.''.

[SEC. 914. STUDY ON ENHANCING INVESTMENT ADVISER EXAMINATIONS

  [(a) Study Required.--
          [(1) In general.--The Commission shall review and 
        analyze the need for enhanced examination and 
        enforcement resources for investment advisers.
          [(2) Areas of consideration.--The study required by 
        this subsection shall examine--
                  [(A) the number and frequency of examinations 
                of investment advisers by the Commission over 
                the 5 years preceding the date of the enactment 
                of this subtitle;
                  [(B) the extent to which having Congress 
                authorize the Commission to designate one or 
                more self-regulatory organizations to augment 
                the Commission's efforts in overseeing 
                investment advisers would improve the frequency 
                of examinations of investment advisers; and
                  [(C) current and potential approaches to 
                examining the investment advisory activities of 
                dually registered broker-dealers and investment 
                advisers or affiliated broker-dealers and 
                investment advisers.
  [(b) Report Required.--The Commission shall report its 
findings to the Committee on Financial Services of the House of 
Representatives and the Committee on Banking, Housing, and 
Urban Affairs of the Senate, not later than 180 days after the 
date of enactment of this subtitle, and shall use such findings 
to revise its rules and regulations, as necessary. The report 
shall include a discussion of regulatory or legislative steps 
that are recommended or that may be necessary to address 
concerns identified in the study.]

           *       *       *       *       *       *       *


[SEC. 917. STUDY REGARDING FINANCIAL LITERACY AMONG INVESTORS

  [(a) In general.--The Commission shall conduct a study to 
identify--
          [(1) the existing level of financial literacy among 
        retail investors, including subgroups of investors 
        identified by the Commission;
          [(2) methods to improve the timing, content, and 
        format of disclosures to investors with respect to 
        financial intermediaries, investment products, and 
        investment services;
          [(3) the most useful and understandable relevant 
        information that retail investors need to make informed 
        financial decisions before engaging a financial 
        intermediary or purchasing an investment product or 
        service that is typically sold to retail investors, 
        including shares of open-end companies, as that term is 
        defined in section 5 of the Investment Company Act of 
        1940 (15 U.S.C. 80a-5) that are registered under 
        section 8 of that Act;
          [(4) methods to increase the transparency of expenses 
        and conflicts of interests in transactions involving 
        investment services and products, including shares of 
        open-end companies described in paragraph (3);
          [(5) the most effective existing private and public 
        efforts to educate investors; and
          [(6) in consultation with the Financial Literacy and 
        Education Commission, a strategy (including, to the 
        extent practicable, measurable goals and objectives) to 
        increase the financial literacy of investors in order 
        to bring about a positive change in investor behavior.
  [(b) Report.--Not later than 2 years after the date of 
enactment of this Act, the Commission shall submit a report on 
the study required under subsection (a) to--
          [(1) the Committee on Banking, Housing, and Urban 
        Affairs of the Senate; and
          [(2) the Committee on Financial Services of the House 
        of Representatives.

[SEC. 918. STUDY REGARDING MUTUAL FUND ADVERTISING

  [(a) In general.--The Comptroller General of the United 
States shall conduct a study on mutual fund advertising to 
identify--
          [(1) existing and proposed regulatory requirements 
        for open-end investment company advertisements;
          [(2) current marketing practices for the sale of 
        open-end investment company shares, including the use 
        of past performance data, funds that have merged, and 
        incubator funds;
          [(3) the impact of such advertising on consumers; and
          [(4) recommendations to improve investor protections 
        in mutual fund advertising and additional information 
        necessary to ensure that investors can make informed 
        financial decisions when purchasing shares.
  [(b) Report.--Not later than 18 months after the date of 
enactment of this Act, the Comptroller General of the United 
States shall submit a report on the results of the study 
conducted under subsection (a) to--
          [(1) the Committee on Banking, Housing, and Urban 
        Affairs of the United States Senate; and
          [(2) the Committee on Financial Services of the House 
        of Representatives.]

           *       *       *       *       *       *       *


[SEC. 919A. STUDY ON CONFLICTS OF INTEREST

  [(a) In general.--The Comptroller General of the United 
States shall conduct a study--
          [(1) to identify and examine potential conflicts of 
        interest that exist between the staffs of the 
        investment banking and equity and fixed income 
        securities analyst functions within the same firm; and
          [(2) to make recommendations to Congress designed to 
        protect investors in light of such conflicts.
  [(b) Considerations.--In conducting the study under 
subsection (a), the Comptroller General shall--
          [(1) consider--
                  [(A) the potential for investor harm 
                resulting from conflicts, including 
                consideration of the forms of misconduct 
                engaged in by the several securities firms and 
                individuals that entered into the Global 
                Analyst Research Settlements in 2003 (also 
                known as the ``Global Settlement'');
                  [(B) the nature and benefits of the 
                undertakings to which those firms agreed in 
                enforcement proceedings, including firewalls 
                between research and investment banking, 
                separate reporting lines, dedicated legal and 
                compliance staffs, allocation of budget, 
                physical separation, compensation, employee 
                performance evaluations, coverage decisions, 
                limitations on soliciting investment banking 
                business, disclosures, transparency, and other 
                measures;
                  [(C) whether any such undertakings should be 
                codified and applied permanently to securities 
                firms, or whether the Commission should adopt 
                rules applying any such undertakings to 
                securities firms; and
                  [(D) whether to recommend regulatory or 
                legislative measures designed to mitigate 
                possible adverse consequences to investors 
                arising from the conflicts of interest or to 
                enhance investor protection or confidence in 
                the integrity of the securities markets; and
          [(2) consult with State attorneys general, State 
        securities officials, the Commission, the Financial 
        Industry Regulatory Authority (``FINRA''), NYSE 
        Regulation, investor advocates, brokers, dealers, 
        retail investors, institutional investors, and 
        academics.
  [(c) Report.--The Comptroller General shall submit a report 
on the results of the study required by this section to the 
Committee on Banking, Housing, and Urban Affairs of the Senate 
and the Committee on Financial Services of the House of 
Representatives, not later than 18 months after the date of 
enactment of this Act.

[SEC. 919B. STUDY ON IMPROVED INVESTOR ACCESS TO INFORMATION ON 
                    INVESTMENT ADVISERS AND BROKER-DEALERS

  [(a) Study.--
          [(1) In general.--Not later than 6 months after the 
        date of enactment of this Act, the Commission shall 
        complete a study, including recommendations, of ways to 
        improve the access of investors to registration 
        information (including disciplinary actions, 
        regulatory, judicial, and arbitration proceedings, and 
        other information) about registered and previously 
        registered investment advisers, associated persons of 
        investment advisers, brokers and dealers and their 
        associated persons on the existing Central Registration 
        Depository and Investment Adviser Registration 
        Depository systems, as well as identify additional 
        information that should be made publicly available.
          [(2) Contents.--The study required by subsection (a) 
        shall include an analysis of the advantages and 
        disadvantages of further centralizing access to the 
        information contained in the 2 systems, including--
                  [(A) identification of those data pertinent 
                to investors; and
                  [(B) the identification of the method and 
                format for displaying and publishing such data 
                to enhance accessibility by and utility to 
                investors.
  [(b) Implementation.--Not later than 18 months after the date 
of completion of the study required by subsection (a), the 
Commission shall implement any recommendations of the study.

[SEC. 919C. STUDY ON FINANCIAL PLANNERS AND THE USE OF FINANCIAL 
                    DESIGNATIONS

  [(a) In general.--The Comptroller General of the United 
States shall conduct a study to evaluate--
          [(1) the effectiveness of State and Federal 
        regulations to protect investors and other consumers 
        from individuals who hold themselves out as financial 
        planners through the use of misleading titles, 
        designations, or marketing materials;
          [(2) current State and Federal oversight structure 
        and regulations for financial planners; and
          [(3) legal or regulatory gaps in the regulation of 
        financial planners and other individuals who provide or 
        offer to provide financial planning services to 
        consumers.
  [(b) Considerations.--In conducting the study required under 
subsection (a), the Comptroller General shall consider--
          [(1) the role of financial planners in providing 
        advice regarding the management of financial resources, 
        including investment planning, income tax planning, 
        education planning, retirement planning, estate 
        planning, and risk management;
          [(2) whether current regulations at the State and 
        Federal level provide adequate ethical and professional 
        standards for financial planners;
          [(3) the possible risk posed to investors and other 
        consumers by individuals who hold themselves out as 
        financial planners or as otherwise providing financial 
        planning services in connection with the sale of 
        financial products, including insurance and securities;
          [(4) the possible risk posed to investors and other 
        consumers by individuals who otherwise use titles, 
        designations, or marketing materials in a misleading 
        way in connection with the delivery of financial 
        advice;
          [(6) the ability of investors and other consumers to 
        understand licensing requirements and standards of care 
        that apply to individuals who hold themselves out as 
        financial planners or as otherwise providing financial 
        planning services;
          [(7) the possible benefits to investors and other 
        consumers of regulation and professional oversight of 
        financial planners; and
          [(8) any other consideration that the Comptroller 
        General deems necessary or appropriate to effectively 
        execute the study required under subsection (a).
  [(c) Recommendations.--In providing recommendations for the 
appropriate regulation of financial planners and other 
individuals who provide or offer to provide financial planning 
services, in order to protect investors and other consumers of 
financial planning services, the Comptroller General shall 
consider--
          [(1) the appropriate structure for regulation of 
        financial planners and individuals providing financial 
        planning services; and
          [(2) the appropriate scope of the regulations needed 
        to protect investors and other consumers, including but 
        not limited to the need to establish competency 
        standards, practice standards, ethical guidelines, 
        disciplinary authority, and transparency to investors 
        and other consumers.
  [(d) Report.--
          [(1) In general.--Not later than 180 days after the 
        date of enactment of this Act, the Comptroller General 
        shall submit a report on the study required under 
        subsection (a) to--
                  [(A) the Committee on Banking, Housing, and 
                Urban Affairs of the Senate;
                  [(B) the Special Committee on Aging of the 
                Senate; and
                  [(C) the Committee on Financial Services of 
                the House of Representatives.
          [(2) Content requirements.--The report required under 
        paragraph (1) shall describe the findings and 
        determinations made by the Comptroller General in 
        carrying out the study required under subsection (a), 
        including a description of the considerations, 
        analysis, and government, public, industry, nonprofit 
        and consumer input that the Comptroller General 
        considered to make such findings, conclusions, and 
        legislative, regulatory, or other recommendations.]

           *       *       *       *       *       *       *


[SEC. 921. AUTHORITY TO RESTRICT MANDATORY PRE-DISPUTE ARBITRATION

  [(a) Amendment to Securities Exchange Act of 1934.--Section 
15 of the Securities Exchange Act of 1934 (15 U.S.C. 78o), as 
amended by this title, is further amended by adding at the end 
the following new subsection:
  [``(o) Authority to Restrict Mandatory Pre-dispute 
Arbitration.--The Commission, by rule, may prohibit, or impose 
conditions or limitations on the use of, agreements that 
require customers or clients of any broker, dealer, or 
municipal securities dealer to arbitrate any future dispute 
between them arising under the Federal securities laws, the 
rules and regulations thereunder, or the rules of a self-
regulatory organization if it finds that such prohibition, 
imposition of conditions, or limitations are in the public 
interest and for the protection of investors.''.
  [(b) Amendment to Investment Advisers Act of 1940.--Section 
205 of the Investment Advisers Act of 1940 (15 U.S.C. 80b-5) is 
amended by adding at the end the following new subsection:
  [``(f) Authority to Restrict Mandatory Pre-dispute 
Arbitration.--The Commission, by rule, may prohibit, or impose 
conditions or limitations on the use of, agreements that 
require customers or clients of any investment adviser to 
arbitrate any future dispute between them arising under the 
Federal securities laws, the rules and regulations thereunder, 
or the rules of a self-regulatory organization if it finds that 
such prohibition, imposition of conditions, or limitations are 
in the public interest and for the protection of investors.''.]

           *       *       *       *       *       *       *


[SEC. 929T. EQUAL TREATMENT OF SELF-REGULATORY ORGANIZATION RULES

  [Section 29(a) of the Securities Exchange Act of 1934 (15 
U.S.C. 78cc(a)) is amended by striking ``an exchange required 
thereby'' and inserting ``a self-regulatory organization,''.]

           *       *       *       *       *       *       *


[SEC. 929X. SHORT SALE REFORMS

  [(a) Short Sale Disclosure.--Section 13(f) of the Securities 
Exchange Act of 1934 (15 U.S.C. 78m(f)) is amended by 
redesignating paragraphs (2), (3), (4), and (5) as paragraphs 
(3), (4), (5), and (6), respectively, and inserting after 
paragraph (1) the following:
          [``(2) The Commission shall prescribe rules providing 
        for the public disclosure of the name of the issuer and 
        the title, class, CUSIP number, aggregate amount of the 
        number of short sales of each security, and any 
        additional information determined by the Commission 
        following the end of the reporting period. At a 
        minimum, such public disclosure shall occur every 
        month.''.
  [(b) Short Selling Enforcement.--Section 9 of the Securities 
Exchange Act of 1934 (15 U.S.C. 78i) is amended--
          [(1) by redesignating subsections (d), (e), (f), (g), 
        (h), and (i) as subsections (e), (f), (g), (h), (i), 
        and (j), respectively; and
          [(2) inserting after subsection (c), the following 
        new subsection:
  [``(d) Transactions Relating to Short Sales of Securities.--
It shall be unlawful for any person, directly or indirectly, by 
the use of the mails or any means or instrumentality of 
interstate commerce, or of any facility of any national 
securities exchange, or for any member of a national securities 
exchange to effect, alone or with one or more other persons, a 
manipulative short sale of any security. The Commission shall 
issue such other rules as are necessary or appropriate to 
ensure that the appropriate enforcement options and remedies 
are available for violations of this subsection in the public 
interest or for the protection of investors.''.
  [(c) Investor Notification.--Section 15 of the Securities 
Exchange Act of 1934 (15 U.S.C. 78o) is amended--
          [(1) by redesignating subsections (e), (f), (g), (h), 
        and (i) as subsections (f), (g), (h), (i), and (j), 
        respectively; and
          [(2) inserting after subsection (d) the following new 
        subsection:
  [``(e) Notices to Customers Regarding Securities Lending.--
Every registered broker or dealer shall provide notice to its 
customers that they may elect not to allow their fully paid 
securities to be used in connection with short sales. If a 
broker or dealer uses a customer's securities in connection 
with short sales, the broker or dealer shall provide notice to 
its customer that the broker or dealer may receive compensation 
in connection with lending the customer's securities. The 
Commission, by rule, as it deems necessary or appropriate in 
the public interest and for the protection of investors, may 
prescribe the form, content, time, and manner of delivery of 
any notice required under this paragraph.''.

[SEC. 929Y. STUDY ON EXTRATERRITORIAL PRIVATE RIGHTS OF ACTION

  [(a) In general.--The Securities and Exchange Commission of 
the United States shall solicit public comment and thereafter 
conduct a study to determine the extent to which private rights 
of action under the antifraud provisions of the Securities and 
Exchange Act of 1934 (15 U.S.C. 78u-4) should be extended to 
cover--
          [(1) conduct within the United States that 
        constitutes a significant step in the furtherance of 
        the violation, even if the securities transaction 
        occurs outside the United States and involves only 
        foreign investors; and
          [(2) conduct occurring outside the United States that 
        has a foreseeable substantial effect within the United 
        States.
  [(b) Contents.--The study shall consider and analyze, among 
other things--
          [(1) the scope of such a private right of action, 
        including whether it should extend to all private 
        actors or whether it should be more limited to extend 
        just to institutional investors or otherwise;
          [(2) what implications such a private right of action 
        would have on international comity;
          [(3) the economic costs and benefits of extending a 
        private right of action for transnational securities 
        frauds; and
          [(4) whether a narrower extraterritorial standard 
        should be adopted.
  [(c) Report.--A report of the study shall be submitted and 
recommendations made to the Committee on Banking, Housing, and 
Urban Affairs of the Senate and the Committee on Financial 
Services of the House not later than 18 months after the date 
of enactment of this Act.

[SEC. 929Z. GAO STUDY ON SECURITIES LITIGATION

  [(a) Study.--The Comptroller General of the United States 
shall conduct a study on the impact of authorizing a private 
right of action against any person who aids or abets another 
person in violation of the securities laws. To the extent 
feasible, this study shall include--
          [(1) a review of the role of secondary actors in 
        companies issuance of securities;
          [(2) the courts interpretation of the scope of 
        liability for secondary actors under Federal securities 
        laws after January 14, 2008; and
          [(3) the types of lawsuits decided under the Private 
        Securities Litigation Act of 1995.
  [(b) Report.--Not later than 1 year after the date of 
enactment of this Act, the Comptroller General shall submit a 
report to Congress on the findings of the study required under 
subsection (a).]

  Subtitle C--Improvements to the Regulation of Credit Rating Agencies

[SEC. 931. FINDINGS

  [Congress finds the following:
          [(1) Because of the systemic importance of credit 
        ratings and the reliance placed on credit ratings by 
        individual and institutional investors and financial 
        regulators, the activities and performances of credit 
        rating agencies, including nationally recognized 
        statistical rating organizations, are matters of 
        national public interest, as credit rating agencies are 
        central to capital formation, investor confidence, and 
        the efficient performance of the United States economy.
          [(2) Credit rating agencies, including nationally 
        recognized statistical rating organizations, play a 
        critical ``gatekeeper'' role in the debt market that is 
        functionally similar to that of securities analysts, 
        who evaluate the quality of securities in the equity 
        market, and auditors, who review the financial 
        statements of firms. Such role justifies a similar 
        level of public oversight and accountability.
          [(3) Because credit rating agencies perform 
        evaluative and analytical services on behalf of 
        clients, much as other financial ``gatekeepers'' do, 
        the activities of credit rating agencies are 
        fundamentally commercial in character and should be 
        subject to the same standards of liability and 
        oversight as apply to auditors, securities analysts, 
        and investment bankers.
          [(4) In certain activities, particularly in advising 
        arrangers of structured financial products on potential 
        ratings of such products, credit rating agencies face 
        conflicts of interest that need to be carefully 
        monitored and that therefore should be addressed 
        explicitly in legislation in order to give clearer 
        authority to the Securities and Exchange Commission.
          [(5) In the recent financial crisis, the ratings on 
        structured financial products have proven to be 
        inaccurate. This inaccuracy contributed significantly 
        to the mismanagement of risks by financial institutions 
        and investors, which in turn adversely impacted the 
        health of the economy in the United States and around 
        the world. Such inaccuracy necessitates increased 
        accountability on the part of credit rating agencies.]

           *       *       *       *       *       *       *


[SEC. 933. STATE OF MIND IN PRIVATE ACTIONS

  [(a) Accountability.--Section 15E(m) of the Securities 
Exchange Act of 1934 (15 U.S.C. 78o-7(m)) is amended to read as 
follows:
  [``(m) Accountability.--
          [``(1) In general.--The enforcement and penalty 
        provisions of this title shall apply to statements made 
        by a credit rating agency in the same manner and to the 
        same extent as such provisions apply to statements made 
        by a registered public accounting firm or a securities 
        analyst under the securities laws, and such statements 
        shall not be deemed forward-looking statements for the 
        purposes of section 21E.
          [``(2) Rulemaking.--The Commission shall issue such 
        rules as may be necessary to carry out this 
        subsection.''.
  [(b) State of Mind.--Section 21D(b)(2) of the Securities 
Exchange Act of 1934 (15 U.S.C. 78u-4(b)(2)) is amended--
          [(1) by striking ``In any'' and inserting the 
        following:
                  [``(A) In general.--Except as provided in 
                subparagraph (B), in any''; and
          [(2) by adding at the end the following:
                  [``(B) Exception.--In the case of an action 
                for money damages brought against a credit 
                rating agency or a controlling person under 
                this title, it shall be sufficient, for 
                purposes of pleading any required state of mind 
                in relation to such action, that the complaint 
                state with particularity facts giving rise to a 
                strong inference that the credit rating agency 
                knowingly or recklessly failed--
                          [``(i) to conduct a reasonable 
                        investigation of the rated security 
                        with respect to the factual elements 
                        relied upon by its own methodology for 
                        evaluating credit risk; or
                          [``(ii) to obtain reasonable 
                        verification of such factual elements 
                        (which verification may be based on a 
                        sampling technique that does not amount 
                        to an audit) from other sources that 
                        the credit rating agency considered to 
                        be competent and that were independent 
                        of the issuer and underwriter.''.]

           *       *       *       *       *       *       *


[SEC. 937. TIMING OF REGULATIONS

  [Unless otherwise specifically provided in this subtitle, the 
Commission shall issue final regulations, as required by this 
subtitle and the amendments made by this subtitle, not later 
than 1 year after the date of enactment of this Act.]

           *       *       *       *       *       *       *


SEC. 939. REMOVAL OF STATUTORY REFERENCES TO CREDIT RATINGS.

  (a) Federal deposit insurance act.--The Federal Deposit 
Insurance Act (12 U.S.C. 1811 et seq.) is amended--
          (1) in section 7(b)(1)(E)(i), by striking ``credit 
        rating entities, and other private economic'' and 
        insert ``private economic, credit,'';
          (2) in section 28(d)--
                  (A) in the subsection heading, by striking 
                ``Not of Investment Grade'';
                  (B) in paragraph (1), by striking ``not of 
                investment grade'' and inserting ``that does 
                not meet standards of credit-worthiness as 
                established by the Corporation'';
                  (C) in paragraph (2), by striking ``not of 
                investment grade'';
                  (D) by striking paragraph (3);
                  (E) by redesignating paragraph (4) as 
                paragraph (3); and
                  (F) in paragraph (3), as so redesignated--
                          (i) by striking subparagraph (A);
                          (ii) by redesignating subparagraphs 
                        (B) and (C) as subparagraphs (A) and 
                        (B), respectively; and
                          (iii) in subparagraph (B), as so 
                        redesignated, by striking ``not of 
                        investment grade'' and inserting ``that 
                        does not meet standards of credit-
                        worthiness as established by the 
                        Corporation''; and
          (3) in section 28(e)--
                  (A) in the subsection heading, by striking 
                ``Not of Investment Grade'';
                  (B) in paragraph (1), by striking ``not of 
                investment grade'' and inserting ``that does 
                not meet standards of credit-worthiness as 
                established by the Corporation''; and
                  (C) in paragraphs (2) and (3), by striking 
                ``not of investment grade'' each place that it 
                appears and inserting ``that does not meet 
                standards of credit-worthiness established by 
                the Corporation''.
  (b) Federal Housing Enterprises Financial Safety and 
Soundness Act of 1992.--Section 1319 of the Federal Housing 
Enterprises Financial Safety and Soundness Act of 1992 (12 
U.S.C. 4519) is amended by striking ``that is a nationally 
recognized statistical rating organization, as such term is 
defined in section 3(a) of the Securities Exchange Act of 
1934,''.
  (c) Investment Company Act of 1940.--Section 
6(a)(5)(A)(iv)(I) Investment Company Act of 1940 (15 U.S.C. 
80a-6(a)(5)(A)(iv)(I)) is amended by striking ``is rated 
investment grade by not less than 1 nationally recognized 
statistical rating organization'' and inserting ``meets such 
standards of credit-worthiness as the Commission shall adopt''.
  (d) Revised Statutes.--Section 5136A of title LXII of the 
Revised Statutes of the United States (12 U.S.C. 24a) is 
amended--
          (1) in subsection (a)(2)(E), by striking ``any 
        applicable rating'' and inserting ``standards of 
        credit-worthiness established by the Comptroller of the 
        Currency'';
          (2) in the heading for subsection (a)(3) by striking 
        ``Rating or Comparable Requirement'' and inserting 
        ``Requirement'';
          (3) subsection (a)(3), by amending subparagraph (A) 
        to read as follows:
                  ``(A) In general.--A national bank meets the 
                requirements of this paragraph if the bank is 
                one of the 100 largest insured banks and has 
                not fewer than 1 issue of outstanding debt that 
                meets standards of credit-worthiness or other 
                criteria as the Secretary of the Treasury and 
                the Board of Governors of the Federal Reserve 
                System may jointly establish.''.
          (4) in the heading for subsection (f), by striking 
        ``Maintain Public Rating or'' and inserting ``Meet 
        Standards of Credit-worthiness''; and
          (5) in subsection (f)(1), by striking ``any 
        applicable rating'' and inserting ``standards of 
        credit-worthiness established by the Comptroller of the 
        Currency''.
  (e) Securities Exchange Act of 1934.--Section 3(a) Securities 
Exchange Act of 1934 (15 U.S.C. 78a(3)(a)) is amended--
          (1) in paragraph (41), by striking ``is rated in one 
        of the two highest rating categories by at least one 
        nationally recognized statistical rating organization'' 
        and inserting ``meets standards of credit-worthiness as 
        established by the Commission''; and
          (2) in paragraph (53)(A), by striking ``is rated in 1 
        of the 4 highest rating categories by at least 1 
        nationally recognized statistical rating organization'' 
        and inserting ``meets standards of credit-worthiness as 
        established by the Commission''.
  (f) World Bank Discussions.--Section 3(a)(6) of the amendment 
in the nature of a substitute to the text of H.R. 4645, as 
ordered reported from the Committee on Banking, Finance and 
Urban Affairs on September 22, 1988, as enacted into law by 
section 555 of Public Law 100-461, (22 U.S.C. 286hh(a)(6)), is 
amended by striking ``credit rating'' and inserting ``credit-
worthiness''.
  (g) Effective Date.--The amendments made by this section 
shall take effect 2 years after the date of enactment of this 
Act.
  (h) Study and Report.--
          (1) In general.--The Commission shall undertake a 
        study on the [feasability] feasibility and desirability 
        of--
                  (A) standardizing credit ratings terminology, 
                so that all credit rating agencies issue credit 
                ratings using identical terms;
                  (B) standardizing the market stress 
                conditions under which ratings are evaluated;
                  (C) requiring a quantitative correspondence 
                between credit ratings and a range of default 
                probabilities and loss expectations under 
                standardized conditions of economic stress; and
                  (D) standardizing credit rating terminology 
                across asset classes, so that named ratings 
                correspond to a standard range of default 
                probabilities and expected losses independent 
                of asset class and issuing entity.
          (2) Report.--Not later than 1 year after the date of 
        enactment of this Act, the Commission shall submit to 
        Congress a report containing the findings of the study 
        under paragraph (1) and the recommendations, if any, of 
        the Commission with respect to the study.

[SEC. 939B. ELIMINATION OF EXEMPTION FROM FAIR DISCLOSURE RULE.

  [Not later than 90 days after the date of enactment of this 
subtitle, the Securities Exchange Commission shall revise 
Regulation FD (17 C.F.R. 243.100) to remove from such 
regulation the exemption for entities whose primary business is 
the issuance of credit ratings (17 C.F.R. 243.100(b)(2)(iii)).

[SEC. 939C. SECURITIES AND EXCHANGE COMMISSION STUDY ON STRENGTHENING 
                    CREDIT RATING AGENCY INDEPENDENCE

  [(a) Study.--The Commission shall conduct a study of--
          [(1) the independence of nationally recognized 
        statistical rating organizations; and
          [(2) how the independence of nationally recognized 
        statistical rating organizations affects the ratings 
        issued by the nationally recognized statistical rating 
        organizations.
  [(b) Subjects for Evaluation.--In conducting the study under 
subsection (a), the Commission shall evaluate--
          [(1) the management of conflicts of interest raised 
        by a nationally recognized statistical rating 
        organization providing other services, including risk 
        management advisory services, ancillary assistance, or 
        consulting services;
          [(2) the potential impact of rules prohibiting a 
        nationally recognized statistical rating organization 
        that provides a rating to an issuer from providing 
        other services to the issuer; and
          [(3) any other issue relating to nationally 
        recognized statistical rating organizations, as the 
        Chairman of the Commission determines is appropriate.
  [(c) Report.--Not later than 3 years after the date of 
enactment of this Act, the Chairman of the Commission shall 
submit to the Committee on Banking, Housing, and Urban Affairs 
of the Senate and the Committee on Financial Services of the 
House of Representatives a report on the results of the study 
conducted under subsection (a), including recommendations, if 
any, for improving the integrity of ratings issued by 
nationally recognized statistical rating organizations.

[SEC. 939D. GOVERNMENT ACCOUNTABILITY OFFICE STUDY ON ALTERNATIVE 
                    BUSINESS MODELS

  [(a) Study.--The Comptroller General of the United States 
shall conduct a study on alternative means for compensating 
nationally recognized statistical rating organizations in order 
to create incentives for nationally recognized statistical 
rating organizations to provide more accurate credit ratings, 
including any statutory changes that would be required to 
facilitate the use of an alternative means of compensation.
  [(b) Report.--Not later than 18 months after the date of 
enactment of this Act, the Comptroller General shall submit to 
the Committee on Banking, Housing, and Urban Affairs of the 
Senate and the Committee on Financial Services of the House of 
Representatives a report on the results of the study conducted 
under subsection (a), including recommendations, if any, for 
providing incentives to credit rating agencies to improve the 
credit rating process.

[SEC. 939E. GOVERNMENT ACCOUNTABILITY OFFICE STUDY ON THE CREATION OF 
                    AN INDEPENDENT PROFESSIONAL ANALYST ORGANIZATION

  [(a) Study.--The Comptroller General of the United States 
shall conduct a study on the feasibility and merits of creating 
an independent professional organization for rating analysts 
employed by nationally recognized statistical rating 
organizations that would be responsible for--
          [(1) establishing independent standards for governing 
        the profession of rating analysts;
          [(2) establishing a code of ethical conduct; and
          [(3) overseeing the profession of rating analysts.
  [(b) Report.--Not later than 1 year after the date of 
publication of the rules issued by the Commission pursuant to 
section 936, the Comptroller General shall submit to the 
Committee on Banking, Housing, and Urban Affairs of the Senate 
and the Committee on Financial Services of the House of 
Representatives a report on the results of the study conducted 
under subsection (a).

[SEC. 939F. STUDY AND RULEMAKING ON ASSIGNED CREDIT RATINGS.

  [(a) Definition.--In this section, the term ``structured 
finance product'' means an asset-backed security, as defined in 
section 3(a)(77) of the Securities Exchange Act of 1934, as 
added by section 941, and any structured product based on an 
asset-backed security, as determined by the Commission, by 
rule.
  [(b) Study.--The Commission shall carry out a study of--
          [(1) the credit rating process for structured finance 
        products and the conflicts of interest associated with 
        the issuer-pay and the subscriber-pay models;
          [(2) the feasibility of establishing a system in 
        which a public or private utility or a self-regulatory 
        organization assigns nationally recognized statistical 
        rating organizations to determine the credit ratings of 
        structured finance products, including--
                  [(A) an assessment of potential mechanisms 
                for determining fees for the nationally 
                recognized statistical rating organizations;
                  [(B) appropriate methods for paying fees to 
                the nationally recognized statistical rating 
                organizations;
                  [(C) the extent to which the creation of such 
                a system would be viewed as the creation of 
                moral hazard by the Federal Government; and
                  [(D) any constitutional or other issues 
                concerning the establishment of such a system;
          [(3) the range of metrics that could be used to 
        determine the accuracy of credit ratings; and
          [(4) alternative means for compensating nationally 
        recognized statistical rating organizations that would 
        create incentives for accurate credit ratings.
  [(c) Report and Recommendation.--Not later than 24 months 
after the date of enactment of this Act, the Commission shall 
submit to the Committee on Banking, Housing, and Urban Affairs 
of the Senate and the Committee on Financial Services of the 
House of Representatives a report that contains--
          [(1) the findings of the study required under 
        subsection (b); and
          [(2) any recommendations for regulatory or statutory 
        changes that the Commission determines should be made 
        to implement the findings of the study required under 
        subsection (b).
  [(d) Rulemaking.--
          [(1) Rulemaking.--After submission of the report 
        under subsection (c), the Commission shall, by rule, as 
        the Commission determines is necessary or appropriate 
        in the public interest or for the protection of 
        investors, establish a system for the assignment of 
        nationally recognized statistical rating organizations 
        to determine the initial credit ratings of structured 
        finance products, in a manner that prevents the issuer, 
        sponsor, or underwriter of the structured finance 
        product from selecting the nationally recognized 
        statistical rating organization that will determine the 
        initial credit ratings and monitor such credit ratings. 
        In issuing any rule under this paragraph, the 
        Commission shall give thorough consideration to the 
        provisions of section 15E(w) of the Securities Exchange 
        Act of 1934, as that provision would have been added by 
        section 939D of H.R. 4173 (111th Congress), as passed 
        by the Senate on May 20, 2010, and shall implement the 
        system described in such section 939D unless the 
        Commission determines that an alternative system would 
        better serve the public interest and the protection of 
        investors.
          [(2) Rule of construction.--Nothing in this 
        subsection may be construed to limit or suspend any 
        other rulemaking authority of the Commission.

[SEC. 939G. EFFECT OF RULE 436(G).

  [Rule 436(g), promulgated by the Securities and Exchange 
Commission under the Securities Act of 1933, shall have no 
force or effect.

[SEC. 939H. SENSE OF CONGRESS.

  [It is the sense of Congress that the Securities and Exchange 
Commission should exercise the rulemaking authority of the 
Commission under section 15E(h)(2)(B) of the Securities 
Exchange Act of 1934 (15 U.S.C. 78o-7(h)(2)(B)) to prevent 
improper conflicts of interest arising from employees of 
nationally recognized statistical rating organizations 
providing services to issuers of securities that are unrelated 
to the issuance of credit ratings, including consulting, 
advisory, and other services. ]

  Subtitle D--Improvements to the Asset-Backed Securitization Process

SEC. 941. REGULATION OF CREDIT RISK RETENTION

  (a) Definition of Asset-backed Security.--Section 3(a) of the 
Securities Exchange Act of 1934 (15 U.S.C. 78c(a)) is amended 
by adding at the end the following:
          ``(77) Asset-backed security.--The term `asset-backed 
        security'--
                  ``(A) means a fixed-income or other security 
                collateralized by any type of self-liquidating 
                financial asset (including a loan, a lease, a 
                mortgage, or a secured or unsecured receivable) 
                that allows the holder of the security to 
                receive payments that depend primarily on cash 
                flow from the asset, including--
                          ``(i) a collateralized mortgage 
                        obligation;
                          ``(ii) a collateralized debt 
                        obligation;
                          ``(iii) a collateralized bond 
                        obligation;
                          ``(iv) a collateralized debt 
                        obligation of asset-backed securities;
                          ``(v) a collateralized debt 
                        obligation of collateralized debt 
                        obligations; and
                          ``(vi) a security that the 
                        Commission, by rule, determines to be 
                        an asset-backed security for purposes 
                        of this section; and
                  ``(B) does not include a security issued by a 
                finance subsidiary held by the parent company 
                or a company controlled by the parent company, 
                if none of the securities issued by the finance 
                subsidiary are held by an entity that is not 
                controlled by the parent company.''.
  (b) Credit Risk Retention.--The Securities Exchange Act of 
1934 (15 U.S.C. 78a et seq.) is amended by inserting after 
section 15F, as added by this Act, the following:

``SEC. 15G. CREDIT RISK RETENTION

  ``(a) Definitions.--In this section--
          ``(1) the term `Federal banking agencies' means the 
        Office of the Comptroller of the Currency, the Board of 
        Governors of the Federal Reserve System, and the 
        Federal Deposit Insurance Corporation;
          ``(2) the term `insured depository institution' has 
        the same meaning as in section 3(c) of the Federal 
        Deposit Insurance Act (12 U.S.C. 1813(c));
          ``(3) the term `securitizer' means--
                  ``(A) an issuer of an asset-backed security; 
                or
                  ``(B) a person who organizes and initiates an 
                asset-backed securities transaction by selling 
                or transferring assets, either directly or 
                indirectly, including through an affiliate, to 
                the issuer; and
          ``(4) the term `originator' means a person who--
                  ``(A) through the extension of credit or 
                otherwise, creates a financial asset that 
                collateralizes an asset-backed security; and
                  ``(B) sells an asset directly or indirectly 
                to a securitizer.
  ``(b) Regulations required.--
          ``(1) In general.--Not later than 270 days after the 
        date of enactment of this section, the Federal banking 
        agencies and the Commission shall jointly prescribe 
        regulations to require any securitizer to retain an 
        economic interest in a portion of the credit risk for 
        any asset that the securitizer, through the issuance of 
        an asset-backed security, transfers, sells, or conveys 
        to a third party.
          ``(2) Residential mortgages.--Not later than 270 days 
        after the date of the enactment of this section, the 
        Federal banking agencies, the Commission, the Secretary 
        of Housing and Urban Development, and the Federal 
        Housing Finance Agency, shall jointly prescribe 
        regulations to require any securitizer to retain an 
        economic interest in a portion of the credit risk for 
        any residential mortgage asset that the securitizer, 
        through the issuance of an asset-backed security, 
        transfers, sells, or conveys to a third party.
  ``(c) Standards for Regulations.--
          ``(1) Standards.--The regulations prescribed under 
        subsection (b) shall--
                  ``(A) prohibit a securitizer from directly or 
                indirectly hedging or otherwise transferring 
                the credit risk that the securitizer is 
                required to retain with respect to an asset;
                  ``(B) require a securitizer to retain--
                          ``(i) not less than 5 percent of the 
                        credit risk for any asset--
                                  ``(I) that is not a qualified 
                                residential mortgage that is 
                                transferred, sold, or conveyed 
                                through the issuance of an 
                                asset-backed security by the 
                                securitizer; or
                                  ``(II) that is a qualified 
                                residential mortgage that is 
                                transferred, sold, or conveyed 
                                through the issuance of an 
                                asset-backed security by the 
                                securitizer, if 1 or more of 
                                the assets that collateralize 
                                the asset-backed security are 
                                not qualified residential 
                                mortgages; or
                          ``(ii) less than 5 percent of the 
                        credit risk for an asset that is not a 
                        qualified residential mortgage that is 
                        transferred, sold, or conveyed through 
                        the issuance of an asset-backed 
                        security by the securitizer, if the 
                        originator of the asset meets the 
                        underwriting standards prescribed under 
                        paragraph (2)(B);
                  ``(C) specify--
                          ``(i) the permissible forms of risk 
                        retention for purposes of this section;
                          ``(ii) the minimum duration of the 
                        risk retention required under this 
                        section; and
                          ``(iii) that a securitizer is not 
                        required to retain any part of the 
                        credit risk for an asset that is 
                        transferred, sold or conveyed through 
                        the issuance of an asset-backed 
                        security by the securitizer, if all of 
                        the assets that collateralize the 
                        asset-backed security are qualified 
                        residential mortgages;
                  ``(D) apply, regardless of whether the 
                securitizer is an insured depository 
                institution;
                  ``(E) with respect to a commercial mortgage, 
                specify the permissible types, forms, and 
                amounts of risk retention that would meet the 
                requirements of subparagraph (B), which in the 
                determination of the Federal banking agencies 
                and the Commission may include--
                          ``(i) retention of a specified amount 
                        or percentage of the total credit risk 
                        of the asset;
                          ``(ii) retention of the first-loss 
                        position by a third-party purchaser 
                        that specifically negotiates for the 
                        purchase of such first loss position, 
                        holds adequate financial resources to 
                        back losses, provides due diligence on 
                        all individual assets in the pool 
                        before the issuance of the asset-backed 
                        securities, and meets the same 
                        standards for risk retention as the 
                        Federal banking agencies and the 
                        Commission require of the securitizer;
                          ``(iii) a determination by the 
                        Federal banking agencies and the 
                        Commission that the underwriting 
                        standards and controls for the asset 
                        are adequate; and
                          ``(iv) provision of adequate 
                        representations and warranties and 
                        related enforcement mechanisms; and
                  ``(F) establish appropriate standards for 
                retention of an economic interest with respect 
                to collateralized debt obligations, securities 
                collateralized by collateralized debt 
                obligations, and similar instruments 
                collateralized by other asset-backed 
                securities; and
                  ``(G) provide for--
                          ``(i) a total or partial exemption of 
                        any securitization, as may be 
                        appropriate in the public interest and 
                        for the protection of investors;
                          ``(ii) a total or partial exemption 
                        for the securitization of an asset 
                        issued or guaranteed by the United 
                        States, or an agency of the United 
                        States, as the Federal banking agencies 
                        and the Commission jointly determine 
                        appropriate in the public interest and 
                        for the protection of investors, except 
                        that, for purposes of this clause, the 
                        Federal National Mortgage Association 
                        and the Federal Home Loan Mortgage 
                        Corporation are not agencies of the 
                        United States;
                          ``(iii) a total or partial exemption 
                        for any asset-backed security that is a 
                        security issued or guaranteed by any 
                        State of the United States, or by any 
                        political subdivision of a State or 
                        territory, or by any public 
                        instrumentality of a State or territory 
                        that is exempt from the registration 
                        requirements of the Securities Act of 
                        1933 by reason of section 3(a)(2) of 
                        that Act (15 U.S.C. 77c(a)(2)), or a 
                        security defined as a qualified 
                        scholarship funding bond in section 
                        150(d)(2) of the Internal Revenue Code 
                        of 1986, as may be appropriate in the 
                        public interest and for the protection 
                        of investors; and
                          ``(iv) the allocation of risk 
                        retention obligations between a 
                        securitizer and an originator in the 
                        case of a securitizer that purchases 
                        assets from an originator, as the 
                        Federal banking agencies and the 
                        Commission jointly determine 
                        appropriate.
          ``(2) Asset classes.--
                  ``(A) Asset classes.--The regulations 
                prescribed under subsection (b) shall establish 
                asset classes with separate rules for 
                securitizers of different classes of assets, 
                including residential mortgages, commercial 
                mortgages, commercial loans, auto loans, and 
                any other class of assets that the Federal 
                banking agencies and the Commission deem 
                appropriate.
                  ``(B) Contents.--For each asset class 
                established under subparagraph (A), the 
                regulations prescribed under subsection (b) 
                shall include underwriting standards 
                established by the Federal banking agencies 
                that specify the terms, conditions, and 
                characteristics of a loan within the asset 
                class that indicate a low credit risk with 
                respect to the loan.
  ``(d) Originators.--In determining how to allocate risk 
retention obligations between a securitizer and an originator 
under subsection (c)(1)(E)(iv), the Federal banking agencies 
and the Commission shall--
          ``(1) reduce the percentage of risk retention 
        obligations required of the securitizer by the 
        percentage of risk retention obligations required of 
        the originator; and
          ``(2) consider--
                  ``(A) whether the assets sold to the 
                securitizer have terms, conditions, and 
                characteristics that reflect low credit risk;
                  ``(B) whether the form or volume of 
                transactions in securitization markets creates 
                incentives for imprudent origination of the 
                type of loan or asset to be sold to the 
                securitizer; and
                  ``(C) the potential impact of the risk 
                retention obligations on the access of 
                consumers and businesses to credit on 
                reasonable terms, which may not include the 
                transfer of credit risk to a third party.
  ``(e) Exemptions, Exceptions, and Adjustments.--
          ``(1) In general.--The Federal banking agencies and 
        the Commission may jointly adopt or issue exemptions, 
        exceptions, or adjustments to the rules issued under 
        this section, including exemptions, exceptions, or 
        adjustments for classes of institutions or assets 
        relating to the risk retention requirement and the 
        prohibition on hedging under subsection (c)(1).
          ``(2) Applicable standards.--Any exemption, 
        exception, or adjustment adopted or issued by the 
        Federal banking agencies and the Commission under this 
        paragraph shall--
                  ``(A) help ensure high quality underwriting 
                standards for the securitizers and originators 
                of assets that are securitized or available for 
                securitization; and
                  ``(B) encourage appropriate risk management 
                practices by the securitizers and originators 
                of assets, improve the access of consumers and 
                businesses to credit on reasonable terms, or 
                otherwise be in the public interest and for the 
                protection of investors.
          ``(3) Certain institutions and programs exempt.--
                  ``(A) Farm credit system institutions.--
                Notwithstanding any other provision of this 
                section, the requirements of this section shall 
                not apply to any loan or other financial asset 
                made, insured, guaranteed, or purchased by any 
                institution that is subject to the supervision 
                of the Farm Credit Administration, including 
                the Federal Agricultural Mortgage Corporation.
                  ``(B) Other federal programs.--This section 
                shall not apply to any residential, 
                multifamily, or health care facility mortgage 
                loan asset, or securitization based directly or 
                indirectly on such an asset, which is insured 
                or guaranteed by the United States or an agency 
                of the United States. For purposes of this 
                subsection, the Federal National Mortgage 
                Association, the Federal Home Loan Mortgage 
                Corporation, and the Federal home loan banks 
                shall not be considered an agency of the United 
                States.
          ``(4) Exemption for qualified residential 
        mortgages.--
                  ``(A) In general.--The Federal banking 
                agencies, the Commission, the Secretary of 
                Housing and Urban Development, and the Director 
                of the Federal Housing Finance Agency shall 
                jointly issue regulations to exempt qualified 
                residential mortgages from the risk retention 
                requirements of this subsection.
                  ``(B) Qualified residential mortgage.--The 
                Federal banking agencies, the Commission, the 
                Secretary of Housing and Urban Development, and 
                the Director of the Federal Housing Finance 
                Agency shall jointly define the term `qualified 
                residential mortgage' for purposes of this 
                subsection, taking into consideration 
                underwriting and product features that 
                historical loan performance data indicate 
                result in a lower risk of default, such as--
                          ``(i) documentation and verification 
                        of the financial resources relied upon 
                        to qualify the mortgagor;
                          ``(ii) standards with respect to--
                                  ``(I) the residual income of 
                                the mortgagor after all monthly 
                                obligations;
                                  ``(II) the ratio of the 
                                housing payments of the 
                                mortgagor to the monthly income 
                                of the mortgagor;
                                  ``(III) the ratio of total 
                                monthly installment payments of 
                                the mortgagor to the income of 
                                the mortgagor;
                          ``(iii) mitigating the potential for 
                        payment shock on adjustable rate 
                        mortgages through product features and 
                        underwriting standards;
                          ``(iv) mortgage guarantee insurance 
                        or other types of insurance or credit 
                        enhancement obtained at the time of 
                        origination, to the extent such 
                        insurance or credit enhancement reduces 
                        the risk of default; and
                          ``(v) prohibiting or restricting the 
                        use of balloon payments, negative 
                        amortization, prepayment penalties, 
                        interest-only payments, and other 
                        features that have been demonstrated to 
                        exhibit a higher risk of borrower 
                        default.
                  ``(C) Limitation on definition.--The Federal 
                banking agencies, the Commission, the Secretary 
                of Housing and Urban Development, and the 
                Director of the Federal Housing Finance Agency 
                in defining the term `qualified residential 
                mortgage', as required by subparagraph (B), 
                shall define that term to be no broader than 
                the definition `qualified mortgage' as the term 
                is defined under section 129C(c)(2) of the 
                Truth in Lending Act, as amended by the 
                Consumer Financial Protection Act of 2010, and 
                regulations adopted thereunder.
          ``(5) Condition for qualified residential mortgage 
        exemption.--The regulations issued under paragraph (4) 
        shall provide that an asset-backed security that is 
        collateralized by tranches of other asset-backed 
        securities shall not be exempt from the risk retention 
        requirements of this subsection.
          ``(6) Certification.--The Commission shall require an 
        issuer to certify, for each issuance of an asset-backed 
        security collateralized exclusively by qualified 
        residential mortgages, that the issuer has evaluated 
        the effectiveness of the internal supervisory controls 
        of the issuer with respect to the process for ensuring 
        that all assets that collateralize the asset-backed 
        security are qualified residential mortgages.
  ``(f) Enforcement.--The regulations issued under this section 
shall be enforced by--
          ``(1) the appropriate Federal banking agency, with 
        respect to any securitizer that is an insured 
        depository institution; and
          ``(2) the Commission, with respect to any securitizer 
        that is not an insured depository institution.
  ``(g) Authority of commission.--The authority of the 
Commission under this section shall be in addition to the 
authority of the Commission to otherwise enforce the securities 
laws.
  ``(h) Authority to Coordinate on Rulemaking.--The Chairperson 
of the Financial Stability Oversight Council shall coordinate 
all joint rulemaking required under this section.
  ``(i) Effective Date of Regulations.--The regulations issued 
under this section shall become effective--
          ``(1) with respect to securitizers and originators of 
        asset-backed securities backed by residential 
        mortgages, 1 year after the date on which final rules 
        under this section are published in the Federal 
        Register; and
          ``(2) with respect to securitizers and originators of 
        all other classes of asset-backed securities, 2 years 
        after the date on which final rules under this section 
        are published in the Federal Register.''.
  [(c) Study on Risk Retention.--
          [(1) Study.--The Board of Governors of the Federal 
        Reserve System, in coordination and consultation with 
        the Comptroller of the Currency, the Director of the 
        Office of Thrift Supervision, the Chairperson of the 
        Federal Deposit Insurance Corporation, and the 
        Securities and Exchange Commission shall conduct a 
        study of the combined impact on each individual class 
        of asset-backed security established under section 
        15G(c)(2) of the Securities Exchange Act of 1934, as 
        added by subsection (b), of--
                  [(A) the new credit risk retention 
                requirements contained in the amendment made by 
                subsection (b), including the effect credit 
                risk retention requirements have on increasing 
                the market for Federally subsidized loans; and
                  [(B) the Financial Accounting Statements 166 
                and 167 issued by the Financial Accounting 
                Standards Board.
          [(2) Report.--Not later than 90 days after the date 
        of enactment of this Act, the Board of Governors of the 
        Federal Reserve System shall submit to Congress a 
        report on the study conducted under paragraph (1). Such 
        report shall include statutory and regulatory 
        recommendations for eliminating any negative impacts on 
        the continued viability of the asset-backed 
        securitization markets and on the availability of 
        credit for new lending identified by the study 
        conducted under paragraph (1).]

           *       *       *       *       *       *       *


[SEC. 946. STUDY ON THE MACROECONOMIC EFFECTS OF RISK RETENTION 
                    REQUIREMENTS

  [(a) Study Required.--The Chairman of the Financial Services 
Oversight Council shall carry out a study on the macroeconomic 
effects of the risk retention requirements under this subtitle, 
and the amendments made by this subtitle, with emphasis placed 
on potential beneficial effects with respect to stabilizing the 
real estate market. Such study shall include--
          [(1) an analysis of the effects of risk retention on 
        real estate asset price bubbles, including a 
        retrospective estimate of what fraction of real estate 
        losses may have been averted had such requirements been 
        in force in recent years;
          [(2) an analysis of the feasibility of minimizing 
        real estate price bubbles by proactively adjusting the 
        percentage of risk retention that must be borne by 
        creditors and securitizers of real estate debt, as a 
        function of regional or national market conditions;
          [(3) a comparable analysis for proactively adjusting 
        mortgage origination requirements;
          [(4) an assessment of whether such proactive 
        adjustments should be made by an independent regulator, 
        or in a formulaic and transparent manner;
          [(5) an assessment of whether such adjustments should 
        take place independently or in concert with monetary 
        policy; and
          [(6) recommendations for implementation and enabling 
        legislation.
  [(b) Report.--Not later than the end of the 180-day period 
beginning on the date of the enactment of this title, the 
Chairman of the Financial Services Oversight Council shall 
issue a report to the Congress containing any findings and 
determinations made in carrying out the study required under 
subsection (a).]

           *       *       *       *       *       *       *


Subtitle E--Accountability and Executive Compensation

           *       *       *       *       *       *       *


SEC. 953. EXECUTIVE COMPENSATION DISCLOSURES.

  [(a) Disclosure of Pay Versus Performance.--] Section 14 of 
the Securities Exchange Act of 1934 (15 U.S.C. 78n), as amended 
by this title, is amended by adding at the end the following:
  ``(i) Disclosure of Pay Versus Performance.--The Commission 
shall, by rule, require each issuer to disclose in any proxy or 
consent solicitation material for an annual meeting of the 
shareholders of the issuer a clear description of any 
compensation required to be disclosed by the issuer under 
section 229.402 of title 17, Code of Federal Regulations (or 
any successor thereto), including information that shows the 
relationship between executive compensation actually paid and 
the financial performance of the issuer, taking into account 
any change in the value of the shares of stock and dividends of 
the issuer and any distributions. The disclosure under this 
subsection may include a graphic representation of the 
information required to be disclosed.''.
  [(b) Additional Disclosure Requirements.--
          [(1) In general.--The Commission shall amend section 
        229.402 of title 17, Code of Federal Regulations, to 
        require each issuer, other than an emerging growth 
        company, as that term is defined in section 3(a) of the 
        Securities Exchange Act of 1934, to disclose in any 
        filing of the issuer described in section 229.10(a) of 
        title 17, Code of Federal Regulations (or any successor 
        thereto)--
                  [(A) the median of the annual total 
                compensation of all employees of the issuer, 
                except the chief executive officer (or any 
                equivalent position) of the issuer;
                  [(B) the annual total compensation of the 
                chief executive officer (or any equivalent 
                position) of the issuer; and
                  [(C) the ratio of the amount described in 
                subparagraph (A) to the amount described in 
                subparagraph (B).
          [(2) Total compensation.--For purposes of this 
        subsection, the total compensation of an employee of an 
        issuer shall be determined in accordance with section 
        229.402(c)(2)(x) of title 17, Code of Federal 
        Regulations, as in effect on the day before the date of 
        enactment of this Act.]

           *       *       *       *       *       *       *


[SEC. 955. DISCLOSURE REGARDING EMPLOYEE AND DIRECTOR HEDGING

  [Section 14 of the Securities Exchange Act of 1934 (15 U.S.C. 
78n), as amended by this title, is amended by adding at the end 
the following:
  [``(j) Disclosure of Hedging by Employees and Directors.--The 
Commission shall, by rule, require each issuer to disclose in 
any proxy or consent solicitation material for an annual 
meeting of the shareholders of the issuer whether any employee 
or member of the board of directors of the issuer, or any 
designee of such employee or member, is permitted to purchase 
financial instruments (including prepaid variable forward 
contracts, equity swaps, collars, and exchange funds) that are 
designed to hedge or offset any decrease in the market value of 
equity securities--
          [``(1) granted to the employee or member of the board 
        of directors by the issuer as part of the compensation 
        of the employee or member of the board of directors; or
          [``(2) held, directly or indirectly, by the employee 
        or member of the board of directors.''.

[SEC. 956. ENHANCED COMPENSATION STRUCTURE REPORTING.

  [(a) Enhanced Disclosure and Reporting of Compensation 
Arrangements.--
          [(1) In general.--Not later than 9 months after the 
        date of enactment of this title, the appropriate 
        Federal regulators jointly shall prescribe regulations 
        or guidelines to require each covered financial 
        institution to disclose to the appropriate Federal 
        regulator the structures of all incentive-based 
        compensation arrangements offered by such covered 
        financial institutions sufficient to determine whether 
        the compensation structure--
                  [(A) provides an executive officer, employee, 
                director, or principal shareholder of the 
                covered financial institution with excessive 
                compensation, fees, or benefits; or
                  [(B) could lead to material financial loss to 
                the covered financial institution.
          [(2) Rules of construction.--Nothing in this section 
        shall be construed as requiring the reporting of the 
        actual compensation of particular individuals. Nothing 
        in this section shall be construed to require a covered 
        financial institution that does not have an incentive-
        based payment arrangement to make the disclosures 
        required under this subsection.
  [(b) Prohibition on Certain Compensation Arrangements.--Not 
later than 9 months after the date of enactment of this title, 
the appropriate Federal regulators shall jointly prescribe 
regulations or guidelines that prohibit any types of incentive-
based payment arrangement, or any feature of any such 
arrangement, that the regulators determine encourages 
inappropriate risks by covered financial institutions--
          [(1) by providing an executive officer, employee, 
        director, or principal shareholder of the covered 
        financial institution with excessive compensation, 
        fees, or benefits; or
          [(2) that could lead to material financial loss to 
        the covered financial institution.
  [(c) Standards.--The appropriate Federal regulators shall--
          [(1) ensure that any standards for compensation 
        established under subsections (a) or (b) are comparable 
        to the standards established under section of the 
        Federal Deposit Insurance Act (12 U.S.C. 2 1831p-1) for 
        insured depository institutions; and
          [(2) in establishing such standards under such 
        subsections, take into consideration the compensation 
        standards described in section 39(c) of the Federal 
        Deposit Insurance Act (12 U.S.C. 1831p- 9 1(c)).
  [(d) Enforcement.--The provisions of this section and the 
regulations issued under this section shall be enforced under 
section 505 of the Gramm-Leach-Bliley Act and, for purposes of 
such section, a violation of this section or such regulations 
shall be treated as a violation of subtitle A of title V of 
such Act.
  [(e) Definitions.--As used in this section--
          [(1) the term ``appropriate Federal regulator'' means 
        the Board of Governors of the Federal Reserve System, 
        the Office of the Comptroller of the Currency, the 
        Board of Directors of the Federal Deposit Insurance 
        Corporation, the Director of the Office of Thrift 
        Supervision, the National Credit Union Administration 
        Board, the Securities and Exchange Commission, the 
        Federal Housing Finance Agency; and
          [(2) the term ``covered financial institution'' 
        means--
                  [(A) a depository institution or depository 
                institution holding company, as such terms are 
                defined in section 3 of the Federal Deposit 
                Insurance Act (12 U.S.C. 1813);
                  [(B) a broker-dealer registered under section 
                15 of the Securities Exchange Act of 1934 (15 
                U.S.C. 78o);
                  [(C) a credit union, as described in section 
                19(b)(1)(A)(iv) of the Federal Reserve Act;
                  [(D) an investment advisor, as such term is 
                defined in section 202(a)(11) of the Investment 
                Advisers Act of 1940 (15 U.S.C. 80b-2(a)(11));
                  [(E) the Federal National Mortgage 
                Association;
                  [(F) the Federal Home Loan Mortgage 
                Corporation; and
                  [(G) any other financial institution that the 
                appropriate Federal regulators, jointly, by 
                rule, determine should be treated as a covered 
                financial institution for purposes of this 
                section.
  [(f) Exemption for Certain Financial Institutions.--The 
requirements of this section shall not apply to covered 
financial institutions with assets of less than $1,000,000,000.

[SEC. 956. ENHANCED COMPENSATION STRUCTURE REPORTING

  [(a) Enhanced Disclosure and Reporting of Compensation 
Arrangements.--
          [(1) In general.--Not later than 9 months after the 
        date of enactment of this title, the appropriate 
        Federal regulators jointly shall prescribe regulations 
        or guidelines to require each covered financial 
        institution to disclose to the appropriate Federal 
        regulator the structures of all incentive-based 
        compensation arrangements offered by such covered 
        financial institutions sufficient to determine whether 
        the compensation structure--
                  [(A) provides an executive officer, employee, 
                director, or principal shareholder of the 
                covered financial institution with excessive 
                compensation, fees, or benefits; or
                  [(B) could lead to material financial loss to 
                the covered financial institution.
          [(2) Rules of construction.--Nothing in this section 
        shall be construed as requiring the reporting of the 
        actual compensation of particular individuals. Nothing 
        in this section shall be construed to require a covered 
        financial institution that does not have an incentive-
        based payment arrangement to make the disclosures 
        required under this subsection.
  [(b) Prohibition on Certain Compensation Arrangements.--Not 
later than 9 months after the date of enactment of this title, 
the appropriate Federal regulators shall jointly prescribe 
regulations or guidelines that prohibit any types of incentive-
based payment arrangement, or any feature of any such 
arrangement, that the regulators determine encourages 
inappropriate risks by covered financial institutions--
          [(1) by providing an executive officer, employee, 
        director, or principal shareholder of the covered 
        financial institution with excessive compensation, 
        fees, or benefits; or
          [(2) that could lead to material financial loss to 
        the covered financial institution.
  [(c) Standards.--The appropriate Federal regulators shall--
          [(1) ensure that any standards for compensation 
        established under subsections (a) or (b) are comparable 
        to the standards established under section of the 
        Federal Deposit Insurance Act (12 U.S.C. 2 1831p-1) for 
        insured depository institutions; and
          [(2) in establishing such standards under such 
        subsections, take into consideration the compensation 
        standards described in section 39(c) of the Federal 
        Deposit Insurance Act (12 U.S.C. 1831p- 9 1(c)).
  [(d) Enforcement.--The provisions of this section and the 
regulations issued under this section shall be enforced under 
section 505 of the Gramm-Leach-Bliley Act and, for purposes of 
such section, a violation of this section or such regulations 
shall be treated as a violation of subtitle A of title V of 
such Act.
  [(e) Definitions.--As used in this section--
          [(1) the term ``appropriate Federal regulator'' means 
        the Board of Governors of the Federal Reserve System, 
        the Office of the Comptroller of the Currency, the 
        Board of Directors of the Federal Deposit Insurance 
        Corporation, the Director of the Office of Thrift 
        Supervision, the National Credit Union Administration 
        Board, the Securities and Exchange Commission, the 
        Federal Housing Finance Agency; and
          [(2) the term ``covered financial institution'' 
        means--
                  [(A) a depository institution or depository 
                institution holding company, as such terms are 
                defined in section 3 of the Federal Deposit 
                Insurance Act (12 U.S.C. 1813);
                  [(B) a broker-dealer registered under section 
                15 of the Securities Exchange Act of 1934 (15 
                U.S.C. 78o);
                  [(C) a credit union, as described in section 
                19(b)(1)(A)(iv) of the Federal Reserve Act;
                  [(D) an investment advisor, as such term is 
                defined in section 202(a)(11) of the Investment 
                Advisers Act of 1940 (15 U.S.C. 80b-2(a)(11));
                  [(E) the Federal National Mortgage 
                Association;
                  [(F) the Federal Home Loan Mortgage 
                Corporation; and
                  [(G) any other financial institution that the 
                appropriate Federal regulators, jointly, by 
                rule, determine should be treated as a covered 
                financial institution for purposes of this 
                section.
  [(f) Exemption for Certain Financial Institutions.--The 
requirements of this section shall not apply to covered 
financial institutions with assets of less than 
$1,000,000,000.]

           *       *       *       *       *       *       *


   Subtitle F--Improvements to the Management of the Securities and 
                          Exchange Commission

[SEC. 964. REPORT ON OVERSIGHT OF NATIONAL SECURITIES ASSOCIATIONS.

  [(a) Report Required.--Not later than 2 years after the date 
of enactment of this Act, and every 3 years thereafter, the 
Comptroller General of the United States shall submit to the 
Committee on Banking, Housing, and Urban Affairs of the Senate 
and the Committee on Financial Services of the House of 
Representatives a report that includes an evaluation of the 
oversight by the Commission of national securities associations 
registered under section 15A of the Securities Exchange Act of 
1934 (15 U.S.C. 78o-3) with respect to--
          [(1) the governance of such national securities 
        associations, including the identification and 
        management of conflicts of interest by such national 
        securities associations, together with an analysis of 
        the impact of any conflicts of interest on the 
        regulatory enforcement or rulemaking by such national 
        securities associations;
          [(2) the examinations carried out by the national 
        securities associations, including the expertise of the 
        examiners;
          [(3) the executive compensation practices of such 
        national securities associations;
          [(4) the arbitration services provided by the 
        national securities associations;
          [(5) the review performed by national securities 
        associations of advertising by the members of the 
        national securities associations;
          [(6) the cooperation with and assistance to State 
        securities administrators by the national securities 
        associations to promote investor protection;
          [(7) how the funding of national securities 
        associations is used to support the mission of the 
        national securities associations, including--
                  [(A) the methods of funding;
                  [(B) the sufficiency of funds;
                  [(C) how funds are invested by the national 
                securities association pending use; and
                  [(D) the impact of the methods, sufficiency, 
                and investment of funds on regulatory 
                enforcement by the national securities 
                associations;
          [(8) the policies regarding the employment of former 
        employees of national securities associations by 
        regulated entities;
          [(9) the ongoing effectiveness of the rules of the 
        national securities associations in achieving the goals 
        of the rules;
          [(10) the transparency of governance and activities 
        of the national securities associations; and
          [(11) any other issue that has an impact, as 
        determined by the Comptroller General, on the 
        effectiveness of such national securities associations 
        in performing their mission and in dealing fairly with 
        investors and members;
  [(b) Reimbursements for Cost of Reports.--
          [(1) Reimbursements required.--The Commission shall 
        reimburse the Government Accountability Office for the 
        full cost of making the reports under subsection (a), 
        as billed therefor by the Comptroller General.
          [(2) Crediting and use of reimbursements.--Such 
        reimbursements shall--
                  [(A) be credited to the appropriation account 
                ``Salaries and Expenses, Government 
                Accountability Office'' current when the 
                payment is received; and
                  [(B) remain available until expended.

[SEC. 965. COMPLIANCE EXAMINERS

  [Section 4 of the Securities Exchange Act of 1934 (15 U.S.C. 
78d) is amended by adding at the end the following:
  [``(h) Examiners.--
          [``(1) Division of trading and markets.--The Division 
        of Trading and Markets of the Commission, or any 
        successor organizational unit, shall have a staff of 
        examiners who shall--
                  [``(A) perform compliance inspections and 
                examinations of entities under the jurisdiction 
                of that Division; and
                  [``(B) report to the Director of that 
                Division.
          [``(2) Division of investment management.--The 
        Division of Investment Management of the Commission, or 
        any successor organizational unit, shall have a staff 
        of examiners who shall--
                  [``(A) perform compliance inspections and 
                examinations of entities under the jurisdiction 
                of that Division; and
                  [``(B) report to the Director of that 
                Division.''.]

           *       *       *       *       *       *       *


SEC. 967. COMMISSION ORGANIZATIONAL STUDY AND REFORM

  (a) Study Required.--
          (1) In general.--Not later than the end of the 90-day 
        period beginning on the date of the enactment of this 
        subtitle, the Securities and Exchange Commission 
        (hereinafter in this section referred to as the 
        ``SEC'') shall hire an independent consultant of high 
        caliber and with expertise in organizational 
        restructuring and the operations of capital markets to 
        examine the internal operations, structure, funding, 
        and the need for comprehensive reform of the SEC, as 
        well as the SEC's relationship with and the reliance on 
        self-regulatory organizations and other entities 
        relevant to the regulation of securities and the 
        protection of securities investors that are under the 
        SEC's oversight.
          (2) Specific areas for study.--The study required 
        under paragraph (1) shall, at a minimum, include the 
        study of--
                  (A) the possible elimination of unnecessary 
                or redundant units at the SEC;
                  (B) improving communications between SEC 
                offices and divisions;
                  (C) the need to put in place a clear chain-
                of-command structure, particularly for 
                enforcement examinations and compliance 
                inspections;
                  (D) the effect of high-frequency trading and 
                other technological advances on the market and 
                what the SEC requires to monitor the effect of 
                such trading and advances on the market;
                  (E) the SEC's hiring authorities, workplace 
                policies, and personal practices, including--
                          (i) whether there is a need to 
                        further streamline hiring authorities 
                        for those who are not lawyers, 
                        accountants, compliance examiners, or 
                        economists;
                          (ii) whether there is a need for 
                        further pay reforms;
                          (iii) the diversity of skill sets of 
                        SEC employees and whether the present 
                        skill set diversity efficiently and 
                        effectively fosters the SEC's mission 
                        of investor protection; and
                          (iv) the application of civil service 
                        laws by the SEC;
                  (F) whether the SEC's oversight and reliance 
                on self-regulatory organizations promotes 
                efficient and effective governance for the 
                securities markets; and
                  (G) whether adjusting the SEC's reliance on 
                self-regulatory organizations is necessary to 
                promote more efficient and effective governance 
                for the securities markets.
  (b) Consultant Report.--Not later than the end of the 150-day 
period after being retained, the independent consultant hired 
pursuant to subsection (a)(1) shall issue a report to the SEC 
and the Congress containing--
          (1) a detailed description of any findings and 
        conclusions made while carrying out the study required 
        under subsection (a)(1); and
          (2) recommendations for legislative, regulatory, or 
        administrative action that the consultant determines 
        appropriate to enable the SEC and other entities on 
        which the consultant reports to perform their 
        statutorily or otherwise mandated missions.
  (c) SEC Report.--Not later than the end of the 6-month period 
beginning on the date the consultant issues the report under 
subsection (b), and every 6-months thereafter during the 2-year 
period following the date on which the consultant issues such 
report, the SEC shall issue a report to the Committee on 
Financial Services of the House of Representatives and the 
Committee on Banking, Housing, and Urban Affairs of the Senate 
describing the SEC's implementation of the regulatory and 
administrative recommendations contained in the consultant's 
report.
  (d) Implementation of Recommendations.--Not later than 6 
months after the date of enactment of this subsection, the 
Securities and Exchange Commission shall complete an 
implementation of the recommendations contained in the report 
of the independent consultant issued under subsection (b) on 
March 10, 2011. To the extent that implementation of certain 
recommendations requires legislation, the Commission shall 
submit a report to Congress containing a request for 
legislation granting the Commission such authority it needs to 
fully implement such recommendations.

[SEC. 968. STUDY ON SEC REVOLVING DOOR

  [(a) Government Accountability Office Study.--The Comptroller 
General of the United States shall conduct a study that will--
          [(1) review the number of employees who leave the 
        Securities and Exchange Commission to work for 
        financial institutions regulated by such Commission;
          [(2) determine how many employees who leave the 
        Securities and Exchange Commission worked on cases that 
        involved financial institutions regulated by such 
        Commission;
          [(3) review the length of time employees work for the 
        Securities and Exchange Commission before leaving to be 
        employed by financial institutions regulated by such 
        Commission;
          [(4) review existing internal controls and make 
        recommendations on strengthening such controls to 
        ensure that employees of the Securities and Exchange 
        Commission who are later employed by financial 
        institutions did not assist such institutions in 
        violating any rules or regulations of the Commission 
        during the course of their employment with such 
        Commission;
          [(5) determine if greater post-employment 
        restrictions are necessary to prevent employees of the 
        Securities and Exchange Commission from being employed 
        by financial institutions after employment with such 
        Commission;
          [(6) determine if the volume of employees of the 
        Securities and Exchange Commission who are later 
        employed by financial institutions has led to 
        inefficiencies in enforcement;
          [(7) determine if employees of the Securities and 
        Exchange Commission who are later employed by financial 
        institutions assisted such institutions in 
        circumventing Federal rules and regulations while 
        employed by such Commission;
          [(8) review any information that may address the 
        volume of employees of the Securities and Exchange 
        Commission who are later employed by financial 
        institutions, and make recommendations to Congress; and
          [(9) review other additional issues as may be raised 
        during the course of the study conducted under this 
        subsection.
  [(b) Report.--Not later than 1 year after the date of the 
enactment of this subtitle, the Comptroller General of the 
United States shall submit to the Committee on Financial 
Services of the House of Representatives and the Committee on 
Banking, Housing, and Urban Affairs of the Senate a report on 
the results of the study required by subsection (a).]

Subtitle H--Municipal Securities

           *       *       *       *       *       *       *


[SEC. 971. PROXY ACCESS

  [(a) Proxy Access.--Section 14(a) of the Securities Exchange 
Act of 1934 (15 U.S.C. 78n(a)) is amended--
          [(1) by inserting ``(1)'' after ``(a)''; and
          [(2) by adding at the end the following:
  [``(2) The rules and regulations prescribed by the Commission 
under paragraph (1) may include--
          [``(A) a requirement that a solicitation of proxy, 
        consent, or authorization by (or on behalf of) an 
        issuer include a nominee submitted by a shareholder to 
        serve on the board of directors of the issuer; and
          [``(B) a requirement that an issuer follow a certain 
        procedure in relation to a solicitation described in 
        subparagraph (A).''.
  [(b) Regulations.--The Commission may issue rules permitting 
the use by a shareholder of proxy solicitation materials 
supplied by an issuer of securities for the purpose of 
nominating individuals to membership on the board of directors 
of the issuer, under such terms and conditions as the 
Commission determines are in the interests of shareholders and 
for the protection of investors.
  [(c) Exemptions.--The Commission may, by rule or order, 
exempt an issuer or class of issuers from the requirement made 
by this section or an amendment made by this section. In 
determining whether to make an exemption under this subsection, 
the Commission shall take into account, among other 
considerations, whether the requirement in the amendment made 
by subsection (a) disproportionately burdens small issuers.

[SEC. 972. DISCLOSURES REGARDING CHAIRMAN AND CEO STRUCTURES

  [The Securities Exchange Act of 1934 (15 U.S. C. 78a et seq.) 
is amended by inserting after section 14A, as added by this 
title, the following:

[``SEC. 14B. CORPORATE GOVERNANCE

  [``Not later than 180 days after the date of enactment of 
this subsection, the Commission shall issue rules that require 
an issuer to disclose in the annual proxy sent to investors the 
reasons why the issuer has chosen--
          [``(1) the same person to serve as chairman of the 
        board of directors and chief executive officer (or in 
        equivalent positions); or
          [``(2) different individuals to serve as chairman of 
        the board of directors and chief executive officer (or 
        in equivalent positions of the issuer).''.]

           *       *       *       *       *       *       *


[SEC. 976. GOVERNMENT ACCOUNTABILITY OFFICE STUDY OF INCREASED 
                    DISCLOSURE TO INVESTORS

  [(a) Study.--The Comptroller General of the United States 
shall conduct a study and review of the disclosure required to 
be made by issuers of municipal securities.
  [(b) Subjects for Evaluation.--In conducting the study under 
subsection (a), the Comptroller General of the United States 
shall--
          [(1) broadly describe--
                  [(A) the size of the municipal securities 
                markets and the issuers and investors; and
                  [(B) the disclosures provided by issuers to 
                investors;
          [(2) compare the amount, frequency, and quality of 
        disclosures that issuers of municipal securities are 
        required by law to provide for the benefit of municipal 
        securities holders, including the amount of and 
        frequency of disclosures actually provided by issuers 
        of municipal securities, with the amount of and 
        frequency of disclosures that issuers of corporate 
        securities provide for the benefit of corporate 
        securities holders, taking into account the differences 
        between issuers of municipal securities and issuers of 
        corporate securities;
          [(3) evaluate the costs and benefits to various types 
        of issuers of municipal securities of requiring issuers 
        of municipal bonds to provide additional financial 
        disclosures for the benefit of investors;
          [(4) evaluate the potential benefit to investors from 
        additional financial disclosures by issuers of 
        municipal bonds; and
          [(5) make recommendations relating to disclosure 
        requirements for municipal issuers, including the 
        advisability of the repeal or retention of section 
        15B(d) of the Securities Exchange Act of 1934 (15 
        U.S.C. 78o-4(d)) (commonly known as the ``Tower 
        Amendment'').
  [(c) Report.--Not later than 24 months after the date of 
enactment of this Act, the Comptroller General of the United 
States shall submit a report to Congress on the results of the 
study conducted under subsection (a), including recommendations 
for how to improve disclosure by issuers of municipal 
securities.

[SEC. 977. GOVERNMENT ACCOUNTABILITY OFFICE STUDY ON THE MUNICIPAL 
                    SECURITIES MARKETS

  [(a) Study.--The Comptroller General of the United States 
shall conduct a study of the municipal securities markets.
  [(b) Report.--Not later than 18 months after the date of 
enactment of this Act, the Comptroller General of the United 
States shall submit a report to the Committee on Banking, 
Housing, and Urban Affairs of the Senate, and the Committee on 
Financial Services of the House of Representatives, with copies 
to the Special Committee on Aging of the Senate and the 
Commission, on the results of the study conducted under 
subsection (a), including--
          [(1) an analysis of the mechanisms for trading, 
        quality of trade executions, market transparency, trade 
        reporting, price discovery, settlement clearing, and 
        credit enhancements;
          [(2) the needs of the markets and investors and the 
        impact of recent innovations;
          [(3) recommendations for how to improve the 
        transparency, efficiency, fairness, and liquidity of 
        trading in the municipal securities markets, including 
        with reference to items listed in paragraph (1); and
          [(4) potential uses of derivatives in the municipal 
        securities markets.
  [(c) Responses.--Not later than 180 days after receipt of the 
report required under subsection (b), the Commission shall 
submit a response to the Committee on Banking, Housing, and 
Urban Affairs of the Senate, and the Committee on Financial 
Services of the House of Representatives, with a copy to the 
Special Committee on Aging of the Senate, stating the actions 
the Commission has taken in response to the recommendations 
contained in such report.

[SEC. 978. FUNDING FOR GOVERNMENTAL ACCOUNTING STANDARDS BOARD

  [(a) Amendment to the Securities Act of 1933.--Section 19 of 
the Securities Act of 1933 (15 U.S.C. 77s), as amended by 
section 912, is further amended by adding at the end the 
following:
  [``(g) Funding for the GASB.--
          [``(1) In general.--The Commission may, subject to 
        the limitations imposed by section 15B of the 
        Securities Exchange Act of 1934 (15 U.S.C. 78o-4), 
        require a national securities association registered 
        under the Securities Exchange Act of 1934 to 
        establish--
                  [``(A) a reasonable annual accounting support 
                fee to adequately fund the annual budget of the 
                Governmental Accounting Standards Board 
                (referred to in this subsection as the `GASB'); 
                and
                  [``(B) rules and procedures, in consultation 
                with the principal organizations representing 
                State governors, legislators, local elected 
                officials, and State and local finance 
                officers, to provide for the equitable 
                allocation, assessment, and collection of the 
                accounting support fee established under 
                subparagraph (A) from the members of the 
                association, and the remittance of all such 
                accounting support fees to the Financial 
                Accounting Foundation.
          [``(2) Annual budget.--For purposes of this 
        subsection, the annual budget of the GASB is the annual 
        budget reviewed and approved according to the internal 
        procedures of the Financial Accounting Foundation.
          [``(3) Use of funds.--Any fees or funds collected 
        under this subsection shall be used to support the 
        efforts of the GASB to establish standards of financial 
        accounting and reporting recognized as generally 
        accepted accounting principles applicable to State and 
        local governments of the United States.
          [``(4) Limitation on fee.--The annual accounting 
        support fees collected under this subsection for a 
        fiscal year shall not exceed the recoverable annual 
        budgeted expenses of the GASB (which may include 
        operating expenses, capital, and accrued items).
          [``(5) Rules of construction.--
                  [``(A) Fees not public monies.--Accounting 
                support fees collected under this subsection 
                and other receipts of the GASB shall not be 
                considered public monies of the United States.
                  [``(B) Limitation on authority of the 
                commission.--Nothing in this subsection shall 
                be construed to--
                          [``(i) provide the Commission or any 
                        national securities association direct 
                        or indirect oversight of the budget or 
                        technical agenda of the GASB; or
                          [``(ii) affect the setting of 
                        generally accepted accounting 
                        principles by the GASB.
                  [``(C) Noninterference with states.--Nothing 
                in this subsection shall be construed to impair 
                or limit the authority of a State or local 
                government to establish accounting and 
                financial reporting standards.''.
  [(b) Study of Funding for Governmental Accounting Standards 
Board.--
          [(1) Study.--The Comptroller General of the United 
        States shall conduct a study that evaluates--
                  [(A) the role and importance of the 
                Governmental Accounting Standards Board in the 
                municipal securities markets; and
                  [(B) the manner and the level at which the 
                Governmental Accounting Standards Board has 
                been funded.
          [(2) Consultation.--In conducting the study required 
        under paragraph (1), the Comptroller General shall 
        consult with the principal organizations representing 
        State governors, legislators, local elected officials, 
        and State and local finance officers.
          [(3) Report.--Not later than 180 days after the date 
        of enactment of this Act, the Comptroller General shall 
        submit to the Committee on Banking, Housing, and Urban 
        Affairs of the Senate and the Committee on Financial 
        Services of the House of Representatives a report on 
        the study required under paragraph (1).]

SEC. 979. COMMISSION OFFICE OF MUNICIPAL SECURITIES.

  (a) In General.--There shall be in the Commission, within the 
Division of Trading and Markets, an Office of Municipal 
Securities, which shall--
          (1) administer the rules of the Commission with 
        respect to the practices of municipal securities 
        brokers and dealers, municipal securities advisors, 
        municipal securities investors, and municipal 
        securities issuers; and
          (2) coordinate with the Municipal Securities 
        Rulemaking Board for rulemaking and enforcement actions 
        as required by law.
  (b) Director of the Office.--The head of the Office of 
Municipal Securities shall be the Director, who shall [report 
to the Chairman] report to the head of the Division of Trading 
and Markets.
  (c) Staffing.--
          (1) In general.--The Office of Municipal Securities 
        shall be staffed sufficiently to carry out the 
        requirements of this section.
          (2) Requirement.--The staff of the Office of 
        Municipal Securities shall include individuals with 
        knowledge of and expertise in municipal finance.

           *       *       *       *       *       *       *


   Subtitle I--Public Company Accounting Oversight Board, Portfolio 
Margining, and Other Matters

           *       *       *       *       *       *       *


[SEC. 984. LOAN OR BORROWING OF SECURITIES.

  [(a) Rulemaking Authority.--Section 10 of the Securities 
Exchange Act of 1934 (15 U.S.C. 78j) is amended by adding at 
the end the following:
          [``(c)(1) To effect, accept, or facilitate a 
        transaction involving the loan or borrowing of 
        securities in contravention of such rules and 
        regulations as the Commission may prescribe as 
        necessary or appropriate in the public interest or for 
        the protection of investors.
                  [``(2) Nothing in paragraph (1) may be 
                construed to limit the authority of the 
                appropriate Federal banking agency (as defined 
                in section 3(q) of the Federal Deposit 
                Insurance Act (12 U.S.C. 1813(q))), the 
                National Credit Union Administration, or any 
                other Federal department or agency having a 
                responsibility under Federal law to prescribe 
                rules or regulations restricting transactions 
                involving the loan or borrowing of securities 
                in order to protect the safety and soundness of 
                a financial institution or to protect the 
                financial system from systemic risk.''.
  [(b) Rulemaking required.--Not later than 2 years after the 
date of enactment of this Act, the Commission shall promulgate 
rules that are designed to increase the transparency of 
information available to brokers, dealers, and investors, with 
respect to the loan or borrowing of securities.]

           *       *       *       *       *       *       *


[SEC. 989. GOVERNMENT ACCOUNTABILITY OFFICE STUDY ON PROPRIETARY 
                    TRADING.

  [(a) Definitions.--In this section--
          [(1) the term ``covered entity'' means--
                  [(A) an insured depository institution, an 
                affiliate of an insured depository institution, 
                a bank holding company, a financial holding 
                company, or a subsidiary of a bank holding 
                company or a financial holding company, as 
                those terms are defined in the Bank Holding 
                Company Act of 1956 (12 U.S.C. 1841 et seq.); 
                and
                  [(B) any other entity, as the Comptroller 
                General of the United States may determine; and
          [(2) the term ``proprietary trading'' means the act 
        of a covered entity investing as a principal in 
        securities, commodities, derivatives, hedge funds, 
        private equity firms, or such other financial products 
        or entities as the Comptroller General may determine.
  [(b) Study.--
          [(1) In general.--The Comptroller General of the 
        United States shall conduct a study regarding the risks 
        and conflicts associated with proprietary trading by 
        and within covered entities, including an evaluation 
        of--
                  [(A) whether proprietary trading presents a 
                material systemic risk to the stability of the 
                United States financial system, and if so, the 
                costs and benefits of options for mitigating 
                such systemic risk;
                  [(B) whether proprietary trading presents 
                material risks to the safety and soundness of 
                the covered entities that engage in such 
                activities, and if so, the costs and benefits 
                of options for mitigating such risks;
                  [(C) whether proprietary trading presents 
                material conflicts of interest between covered 
                entities that engage in proprietary trading and 
                the clients of the institutions who use the 
                firm to execute trades or who rely on the firm 
                to manage assets, and if so, the costs and 
                benefits of options for mitigating such 
                conflicts of interest;
                  [(D) whether adequate disclosure regarding 
                the risks and conflicts of proprietary trading 
                is provided to the depositors, trading and 
                asset management clients, and investors of 
                covered entities that engage in proprietary 
                trading, and if not, the costs and benefits of 
                options for the improvement of such disclosure; 
                and
                  [(E) whether the banking, securities, and 
                commodities regulators of institutions that 
                engage in proprietary trading have in place 
                adequate systems and controls to monitor and 
                contain any risks and conflicts of interest 
                related to proprietary trading, and if not, the 
                costs and benefits of options for the 
                improvement of such systems and controls.
          [(2) Considerations.--In carrying out the study 
        required under paragraph (1), the Comptroller General 
        shall consider--
                  [(A) current practice relating to proprietary 
                trading;
                  [(B) the advisability of a complete ban on 
                proprietary trading;
                  [(C) limitations on the scope of activities 
                that covered entities may engage in with 
                respect to proprietary trading;
                  [(D) the advisability of additional capital 
                requirements for covered entities that engage 
                in proprietary trading;
                  [(E) enhanced restrictions on transactions 
                between affiliates related to proprietary 
                trading;
                  [(F) enhanced accounting disclosures relating 
                to proprietary trading;
                  [(G) enhanced public disclosure relating to 
                proprietary trading; and
                  [(H) any other options the Comptroller 
                General deems appropriate.
  [(c) Report to Congress.--Not later than 15 months after the 
date of enactment of this Act, the Comptroller General shall 
submit a report to Congress on the results of the study 
conducted under subsection (b).
  [(d) Access by Comptroller General.--For purposes of 
conducting the study required under subsection (b), the 
Comptroller General shall have access, upon request, to any 
information, data, schedules, books, accounts, financial 
records, reports, files, electronic communications, or other 
papers, things, or property belonging to or in use by a covered 
entity that engages in proprietary trading, and to the 
officers, directors, employees, independent public accountants, 
financial advisors, staff, and agents and representatives of a 
covered entity (as related to the activities of the agent or 
representative on behalf of the covered entity), at such 
reasonable times as the Comptroller General may request. The 
Comptroller General may make and retain copies of books, 
records, accounts, and other records, as the Comptroller 
General deems appropriate.
  [(e) Confidentiality of Reports.--
          [(1) In general.--Except as provided in paragraph 
        (2), the Comptroller General may not disclose 
        information regarding--
                  [(A) any proprietary trading activity of a 
                covered entity, unless such information is 
                disclosed at a level of generality that does 
                not reveal the investment or trading position 
                or strategy of the covered entity for any 
                specific security, commodity, derivative, or 
                other investment or financial product; or
                  [(B) any individual interviewed by the 
                Comptroller General for purposes of the study 
                under subsection (b), unless such information 
                is disclosed at a level of generality that does 
                not reveal--
                          [(i) the name of or identifying 
                        details relating to such individual; or
                          [(ii) in the case of an individual 
                        who is an employee of a third party 
                        that provides professional services to 
                        a covered entity believed to be engaged 
                        in proprietary trading, the name of or 
                        any identifying details relating to 
                        such third party.
          [(2) Exceptions.--The Comptroller General may 
        disclose the information described in paragraph (1)--
                  [(A) to a department, agency, or official of 
                the Federal Government, for official use, upon 
                request;
                  [(B) to a committee of Congress, upon 
                request; and
                  [(C) to a court, upon an order of such court.

[SEC. 989A. SENIOR INVESTOR PROTECTIONS.

  [(a) Definitions.--As used in this section--
          [(1) the term ``eligible entity'' means--
                  [(A) a securities commission (or any agency 
                or office performing like functions) of a State 
                that the Office determines has adopted rules on 
                the appropriate use of designations in the 
                offer or sale of securities or the provision of 
                investment advice that meet or exceed the 
                minimum requirements of the NASAA Model Rule on 
                the Use of Senior-Specific Certifications and 
                Professional Designations (or any successor 
                thereto);
                  [(B) the insurance commission (or any agency 
                or office performing like functions) of any 
                State that the Office determines has--
                          [(i) adopted rules on the appropriate 
                        use of designations in the sale of 
                        insurance products that, to the extent 
                        practicable, conform to the minimum 
                        requirements of the National 
                        Association of Insurance Commissioners 
                        Model Regulation on the Use of Senior-
                        Specific Certifications and 
                        Professional Designations in the Sale 
                        of Life Insurance and Annuities (or any 
                        successor thereto); and
                          [(ii) adopted rules with respect to 
                        fiduciary or suitability requirements 
                        in the sale of annuities that meet or 
                        exceed the minimum requirements 
                        established by the Suitability in 
                        Annuity Transactions Model Regulation 
                        of the National Association of 
                        Insurance Commissioners (or any 
                        successor thereto); or
                  [(C) a consumer protection agency of any 
                State, if--
                          [(i) the securities commission (or 
                        any agency or office performing like 
                        functions) of the State is eligible 
                        under subparagraph (A); or
                          [(ii) the insurance commission (or 
                        any agency or office performing like 
                        functions) of the State is eligible 
                        under subparagraph (B);
          [(2) the term ``financial product'' means a security, 
        an insurance product (including an insurance product 
        that pays a return, whether fixed or variable), a bank 
        product, and a loan product;
          [(3) the term ``misleading designation''--
                  [(A) means a certification, professional 
                designation, or other purported credential that 
                indicates or implies that a salesperson or 
                adviser has special certification or training 
                in advising or servicing seniors; and
                  [(B) does not include a certification, 
                professional designation, license, or other 
                credential that--
                          [(i) was issued by or obtained from 
                        an academic institution having regional 
                        accreditation;
                          [(ii) meets the standards for 
                        certifications and professional 
                        designations outlined by the NASAA 
                        Model Rule on the Use of Senior-
                        Specific Certifications and 
                        Professional Designations (or any 
                        successor thereto) or by the Model 
                        Regulations on the Use of Senior-
                        Specific Certifications and 
                        Professional Designations in the Sale 
                        of Life Insurance and Annuities, 
                        adopted by the National Association of 
                        Insurance Commissioners (or any 
                        successor thereto); or
                          [(iii) was issued by or obtained from 
                        a State;
          [(4) the term ``misleading or fraudulent marketing'' 
        means the use of a misleading designation by a person 
        that sells to or advises a senior in connection with 
        the sale of a financial product;
          [(5) the term ``NASAA'' means the North American 
        Securities Administrators Association;
          [(6) the term ``Office'' means the Office of 
        Financial Literacy of the Bureau;
          [(7) the term ``senior'' means any individual who has 
        attained the age of 62 years or older; and
          [(8) the term ``State'' has the same meaning as in 
        section 3 of the Securities Exchange Act of 1934 (15 
        U.S.C. 78c(a)).
  [(b) Grants to States for Enhanced Protection of Seniors From 
Being Misled by False Designations.--The Office shall establish 
a program under which the Office may make grants to States or 
eligible entities--
          [(1) to hire staff to identify, investigate, and 
        prosecute (through civil, administrative, or criminal 
        enforcement actions) cases involving misleading or 
        fraudulent marketing;
          [(2) to fund technology, equipment, and training for 
        regulators, prosecutors, and law enforcement officers, 
        in order to identify salespersons and advisers who 
        target seniors through the use of misleading 
        designations;
          [(3) to fund technology, equipment, and training for 
        prosecutors to increase the successful prosecution of 
        salespersons and advisers who target seniors with the 
        use of misleading designations;
          [(4) to provide educational materials and training to 
        regulators on the appropriateness of the use of 
        designations by salespersons and advisers in connection 
        with the sale and marketing of financial products;
          [(5) to provide educational materials and training to 
        seniors to increase awareness and understanding of 
        misleading or fraudulent marketing;
          [(6) to develop comprehensive plans to combat 
        misleading or fraudulent marketing of financial 
        products to seniors; and
          [(7) to enhance provisions of State law to provide 
        protection for seniors against misleading or fraudulent 
        marketing.
  [(c) Applications.--A State or eligible entity desiring a 
grant under this section shall submit an application to the 
Office, in such form and in such a manner as the Office may 
determine, that includes--
          [(1) a proposal for activities to protect seniors 
        from misleading or fraudulent marketing that are 
        proposed to be funded using a grant under this section, 
        including--
                  [(A) an identification of the scope of the 
                problem of misleading or fraudulent marketing 
                in the State;
                  [(B) a description of how the proposed 
                activities would--
                          [(i) protect seniors from misleading 
                        or fraudulent marketing in the sale of 
                        financial products, including by 
                        proactively identifying victims of 
                        misleading and fraudulent marketing who 
                        are seniors;
                          [(ii) assist in the investigation and 
                        prosecution of those using misleading 
                        or fraudulent marketing; and
                          [(iii) discourage and reduce cases of 
                        misleading or fraudulent marketing; and
                  [(C) a description of how the proposed 
                activities would be coordinated with other 
                State efforts; and
          [(2) any other information, as the Office determines 
        is appropriate.
  [(d) Performance Objectives and Reporting Requirements.--The 
Office may establish such performance objectives and reporting 
requirements for States and eligible entities receiving a grant 
under this section as the Office determines are necessary to 
carry out and assess the effectiveness of the program under 
this section.
  [(e) Maximum Amount.--The amount of a grant under this 
section may not exceed--
          [(1) $500,000 for each of 3 consecutive fiscal years, 
        if the recipient is a State, or an eligible entity of a 
        State, that has adopted rules--
                  [(A) on the appropriate use of designations 
                in the offer or sale of securities or 
                investment advice that meet or exceed the 
                minimum requirements of the NASAA Model Rule on 
                the Use of Senior-Specific Certifications and 
                Professional Designations (or any successor 
                thereto);
                  [(B) on the appropriate use of designations 
                in the sale of insurance products that, to the 
                extent practicable, conform to the minimum 
                requirements of the National Association of 
                Insurance Commissioners Model Regulation on the 
                Use of Senior-Specific Certifications and 
                Professional Designations in the Sale of Life 
                Insurance and Annuities (or any successor 
                thereto); and
                  [(C) with respect to fiduciary or suitability 
                requirements in the sale of annuities that meet 
                or exceed the minimum requirements established 
                by the Suitability in Annuity Transactions 
                Model Regulation of the National Association of 
                Insurance Commissioners (or any successor 
                thereto); and
          [(2) $100,000 for each of 3 consecutive fiscal years, 
        if the recipient is a State, or an eligible entity of a 
        State, that has adopted--
                  [(A) rules on the appropriate use of 
                designations in the offer or sale of securities 
                or investment advice that meet or exceed the 
                minimum requirements of the NASAA Model Rule on 
                the Use of Senior-Specific Certifications and 
                Professional Designations (or any successor 
                thereto); or
                  [(B) rules--
                          [(i) on the appropriate use of 
                        designations in the sale of insurance 
                        products that, to the extent 
                        practicable, conform to the minimum 
                        requirements of the National 
                        Association of Insurance Commissioners 
                        Model Regulation on the Use of Senior-
                        Specific Certifications and 
                        Professional Designations in the Sale 
                        of Life Insurance and Annuities (or any 
                        successor thereto); and
                          [(ii) with respect to fiduciary or 
                        suitability requirements in the sale of 
                        annuities that meet or exceed the 
                        minimum requirements established by the 
                        Suitability in Annuity Transactions 
                        Model Regulation of the National 
                        Association of Insurance Commissioners 
                        (or any successor thereto).
  [(f) Subgrants.--A State or eligible entity that receives a 
grant under this section may make a subgrant, as the State or 
eligible entity determines is necessary to carry out the 
activities funded using a grant under this section.
  [(g) Reapplication.--A State or eligible entity that receives 
a grant under this section may reapply for a grant under this 
section, notwithstanding the limitations on grant amounts under 
subsection (e).
  [(h) Authorization of Appropriations.--There are authorized 
to be appropriated to carry out this section, $8,000,000 for 
each of fiscal years 2011 through 2015.]

           *       *       *       *       *       *       *


SEC. 989E. ADDITIONAL OVERSIGHT OF FINANCIAL REGULATORY SYSTEM.

  (a) Council of Inspectors General on Financial Oversight.--
          (1) Establishment and membership.--There is 
        established a Council of Inspectors General on 
        Financial Oversight (in this section referred to as the 
        ``Council of Inspectors General'') chaired by the 
        Inspector General of the Department of the Treasury and 
        composed of the inspectors general of the following:
                  (A) The Board of Governors of the Federal 
                Reserve System.
                  (B) The Commodity Futures Trading Commission.
                  (C) The Department of Housing and Urban 
                Development.
                  (D) The Department of the Treasury.
                  (E) The Federal Deposit Insurance 
                Corporation.
                  (F) The Federal Housing Finance Agency.
                  (G) The National Credit Union Administration.
                  (H) The Securities and Exchange Commission.
                  (I) The Troubled Asset Relief Program (until 
                the termination of the authority of the Special 
                Inspector General for such program under 
                section 121(k) of the Emergency Economic 
                Stabilization Act of 2008 (12 U.S.C. 5231(k))).
                  (J) The Consumer Law Enforcement Agency.
          (2) Duties.--
                  (A) Meetings.--The Council of Inspectors 
                General shall meet not less than once each 
                quarter, or more frequently if the chair 
                considers it appropriate, to facilitate the 
                sharing of information among inspectors general 
                and to discuss the ongoing work of each 
                inspector general who is a member of the 
                Council of Inspectors General, with a focus on 
                concerns that may apply to the broader 
                financial sector and ways to improve financial 
                oversight.
                  (B) Annual report.--Each year the Council of 
                Inspectors General shall submit to the Council 
                and to Congress a report including--
                          (i) for each inspector general who is 
                        a member of the Council of Inspectors 
                        General, a section within the exclusive 
                        editorial control of such inspector 
                        general that highlights the concerns 
                        and recommendations of such inspector 
                        general in such inspector general's 
                        ongoing and completed work, with a 
                        focus on issues that may apply to the 
                        broader financial sector; and
                          (ii) a summary of the general 
                        observations of the Council of 
                        Inspectors General based on the views 
                        expressed by each inspector general as 
                        required by clause (i), with a focus on 
                        measures that should be taken to 
                        improve financial oversight.
          (3) Working groups to evaluate council.--
                  (A) Convening a working group.--The Council 
                of Inspectors General may, by majority vote, 
                convene a Council of Inspectors General Working 
                Group to evaluate the effectiveness and 
                internal operations of the Council.
                  (B) Personnel and resources.--The inspectors 
                general who are members of the Council of 
                Inspectors General may detail staff and 
                resources to a Council of Inspectors General 
                Working Group established under this paragraph 
                to enable it to carry out its duties.
                  (C) Reports.--A Council of Inspectors General 
                Working Group established under this paragraph 
                shall submit regular reports to the Council and 
                to Congress on its evaluations pursuant to this 
                paragraph.
  (b) Response to Report by Council.--The Council shall respond 
to the concerns raised in the report of the Council of 
Inspectors General under subsection (a)(2)(B) for such year.

[SEC. 989F. GAO STUDY OF PERSON TO PERSON LENDING

  [(a) Study.--
          [(1) In general.--The Comptroller General of the 
        United States shall conduct a study of person to person 
        lending to determine the optimal Federal regulatory 
        structure.
          [(2) Consultation.--In conducting the study required 
        under paragraph (1), the Comptroller General shall 
        consult with Federal banking agencies, the Commission, 
        consumer groups, outside experts, and the person to 
        person lending industry.
          [(3) Content of study.--The study required under 
        paragraph (1) shall include an examination of--
                  [(A) the regulatory structure as it exists on 
                the date of enactment of this Act, as 
                determined by the Commission, with particular 
                attention to--
                          [(i) the application of the 
                        Securities Act of 1933 to person to 
                        person lending platforms;
                          [(ii) the posting of consumer loan 
                        information on the EDGAR database of 
                        the Commission; and
                          [(iii) the treatment of privately 
                        held person to person lending platforms 
                        as public companies;
                  [(B) the State and other Federal regulators 
                responsible for the oversight and regulation of 
                person to person lending markets;
                  [(C) any Federal, State, or local government 
                or private studies of person to person lending 
                completed or in progress on the date of 
                enactment of this Act;
                  [(D) consumer privacy and data protections, 
                minimum credit standards, anti-money laundering 
                and risk management in the regulatory structure 
                as it exists on the date of enactment of this 
                Act, and whether additional or alternative 
                safeguards are needed; and
                  [(E) the uses of person to person lending.
  [(b) Report.--
          [(1) In general.--Not later than 1 year after the 
        date of enactment of this Act, the Comptroller General 
        shall submit a report on the study required under 
        subsection (a) to the Committee on Banking, Housing, 
        and Urban Affairs of the Senate and the Committee on 
        Financial Services of the House of Representatives.
          [(2) Content of report.--The report required under 
        paragraph (1) shall include alternative regulatory 
        options, including--
                  [(A) the involvement of other Federal 
                agencies; and
                  [(B) alternative approaches by the Commission 
                and recommendations on whether the alternative 
                approaches are effective.]

SEC. 989G. EXEMPTION FOR NONACCELERATED FILERS

  [(a) Exemption.--]Section 404 of the Sarbanes-Oxley Act of 
2002 is amended by adding at the end the following:
  ``(c) Exemption for Smaller Issuers.--Subsection (b) shall 
not apply with respect to any audit report prepared for an 
issuer that is neither a `large accelerated filer' nor an 
`accelerated filer' as those terms are defined in Rule 12b-2 of 
the Commission (17 C.F.R. 240.12b-2).''.
  [(b) Study.--The Securities and Exchange Commission shall 
conduct a study to determine how the Commission could reduce 
the burden of complying with section 404(b) of the Sarbanes-
Oxley Act of 2002 for companies whose market capitalization is 
between $75,000,000 and $250,000,000 for the relevant reporting 
period while maintaining investor protections for such 
companies. The study shall also consider whether any such 
methods of reducing the compliance burden or a complete 
exemption for such companies from compliance with such section 
would encourage companies to list on exchanges in the United 
States in their initial public offerings. Not later than 9 
months after the date of the enactment of this subtitle, the 
Commission shall transmit a report of such study to Congress.]

           *       *       *       *       *       *       *


[SEC. 989I. GAO STUDY REGARDING EXEMPTION FOR SMALLER ISSUERS

  [(a) Study Regarding Exemption for Smaller Issuers.--The 
Comptroller General of the United States shall carry out a 
study on the impact of the amendments made by this Act to 
section 404(b) of the Sarbanes-Oxley Act of 2002 (15 U.S.C. 
7262(b)), which shall include an analysis of--
          [(1) whether issuers that are exempt from such 
        section 404(b) have fewer or more restatements of 
        published accounting statements than issuers that are 
        required to comply with such section 404(b);
          [(2) the cost of capital for issuers that are exempt 
        from such section 404(b) compared to the cost of 
        capital for issuers that are required to comply with 
        such section 404(b);
          [(3) whether there is any difference in the 
        confidence of investors in the integrity of financial 
        statements of issuers that comply with such section 
        404(b) and issuers that are exempt from compliance with 
        such section 404(b);
          [(4) whether issuers that do not receive the 
        attestation for internal controls required under such 
        section 404(b) should be required to disclose the lack 
        of such attestation to investors; and
          [(5) the costs and benefits to issuers that are 
        exempt from such section 404(b) that voluntarily have 
        obtained the attestation of an independent auditor.
  [(b) Report.--Not later than 3 years after the date of 
enactment of this Act, the Comptroller General shall submit to 
the Committee on Banking, Housing, and Urban Affairs of the 
Senate and the Committee on Financial Services of the House of 
Representatives a report on the results of the study required 
under subsection (a).]

           *       *       *       *       *       *       *


            TITLE X--BUREAU OF CONSUMER FINANCIAL PROTECTION

SEC. 1001. SHORT TITLE.

  This title may be cited as the ``Consumer Financial 
Protection Act of 2010''.

SEC. 1002. DEFINITIONS.

  Except as otherwise provided in this title, for purposes of 
this title, the following definitions shall apply:
          (1) Affiliate.--The term ``affiliate'' means any 
        person that controls, is controlled by, or is under 
        common control with another person.
          (2) Bureau.--The term ``Bureau'' means the Bureau of 
        Consumer Financial Protection.
          (3) Business of insurance.--The term ``business of 
        insurance'' means the writing of insurance or the 
        reinsuring of risks by an insurer, including all acts 
        necessary to such writing or reinsuring and the 
        activities relating to the writing of insurance or the 
        reinsuring of risks conducted by persons who act as, or 
        are, officers, directors, agents, or employees of 
        insurers or who are other persons authorized to act on 
        behalf of such persons.
          (4) Consumer.--The term ``consumer'' means an 
        individual or an agent, trustee, or representative 
        acting on behalf of an individual.
          (5) Consumer financial product or service.--The term 
        ``consumer financial product or service'' means any 
        financial product or service that is described in one 
        or more categories under--
                  (A) paragraph (15) and is offered or provided 
                for use by consumers primarily for personal, 
                family, or household purposes; or
                  (B) clause (i), (iii), (ix), or (x) of 
                paragraph (15)(A), and is delivered, offered, 
                or provided in connection with a consumer 
                financial product or service referred to in 
                subparagraph (A).
          (6) Covered person.--The term ``covered person'' 
        means--
                  (A) any person that engages in offering or 
                providing a consumer financial product or 
                service; and
                  (B) any affiliate of a person described in 
                subparagraph (A) if such affiliate acts as a 
                service provider to such person.
          (7) Credit.--The term ``credit'' means the right 
        granted by a person to a consumer to defer payment of a 
        debt, incur debt and defer its payment, or purchase 
        property or services and defer payment for such 
        purchase.
          (8) Deposit-taking activity.--The term ``deposit-
        taking activity'' means--
                  (A) the acceptance of deposits, maintenance 
                of deposit accounts, or the provision of 
                services related to the acceptance of deposits 
                or the maintenance of deposit accounts;
                  (B) the acceptance of funds, the provision of 
                other services related to the acceptance of 
                funds, or the maintenance of member share 
                accounts by a credit union; or
                  (C) the receipt of funds or the equivalent 
                thereof, as the Bureau may determine by rule or 
                order, received or held by a covered person (or 
                an agent for a covered person) for the purpose 
                of facilitating a payment or transferring funds 
                or value of funds between a consumer and a 
                third party.
          (9) Designated transfer date.--The term ``designated 
        transfer date'' means the date established under 
        section 1062.
          (10) Director.--The term ``Director'' means the 
        Director of the Bureau.
          (11) Electronic conduit services.--The term 
        ``electronic conduit services''--
                  (A) means the provision, by a person, of 
                electronic data transmission, routing, 
                intermediate or transient storage, or 
                connections to a telecommunications system or 
                network; and
                  (B) does not include a person that provides 
                electronic conduit services if, when providing 
                such services, the person--
                          (i) selects or modifies the content 
                        of the electronic data;
                          (ii) transmits, routes, stores, or 
                        provides connections for electronic 
                        data, including financial data, in a 
                        manner that such financial data is 
                        differentiated from other types of data 
                        of the same form that such person 
                        transmits, routes, or stores, or with 
                        respect to which, provides connections; 
                        or
                          (iii) is a payee, payor, 
                        correspondent, or similar party to a 
                        payment transaction with a consumer.
          (12) Enumerated consumer laws.--Except as otherwise 
        specifically provided in section 1029, subtitle G or 
        subtitle H, the term ``enumerated consumer laws'' 
        means--
                  (A) the Alternative Mortgage Transaction 
                Parity Act of 1982 (12 U.S.C. 3801 et seq.);
                  (B) the Consumer Leasing Act of 1976 (15 
                U.S.C. 1667 et seq.);
                  (C) the Electronic Fund Transfer Act (15 
                U.S.C. 1693 et seq.), except with respect to 
                section 920 of that Act;
                  (D) the Equal Credit Opportunity Act (15 
                U.S.C. 1691 et seq.);
                  (E) the Fair Credit Billing Act (15 U.S.C. 
                1666 et seq.);
                  (F) the Fair Credit Reporting Act (15 U.S.C. 
                1681 et seq.), except with respect to sections 
                615(e) and 628 of that Act (15 U.S.C. 1681m(e), 
                1681w);
                  (G) the [Home Owners] Homeowners Protection 
                Act of 1998 (12 U.S.C. 4901 et seq.);
                  (H) the Fair Debt Collection Practices Act 
                (15 U.S.C. 1692 et seq.);
                  (I) subsections (b) through (f) of section 43 
                of the Federal Deposit Insurance Act (12 U.S.C. 
                1831t(c)-(f));
                  (J) sections 502 through 509 of the Gramm-
                Leach-Bliley Act (15 U.S.C. 6802-6809) except 
                for section 505 as it applies to section 
                501(b);
                  (K) the Home Mortgage Disclosure Act of 1975 
                (12 U.S.C. 2801 et seq.);
                  (L) the Home Ownership and Equity Protection 
                Act of 1994 (15 U.S.C. 1601 note);
                  (M) the Real Estate Settlement Procedures Act 
                of 1974 (12 U.S.C. 2601 et seq.);
                  (N) the S.A.F.E. Mortgage Licensing Act of 
                2008 (12 U.S.C. 5101 et seq.);
                  (O) the Truth in Lending Act (15 U.S.C. 1601 
                et seq.);
                  (P) the Truth in Savings Act (12 U.S.C. 4301 
                et seq.);
                  (Q) section 626 of the Omnibus Appropriations 
                Act, 2009 (Public Law 111-8); and
                  (R) the Interstate Land Sales Full Disclosure 
                Act (15 U.S.C. 1701).
          (13) Fair lending.--The term ``fair lending'' means 
        fair, equitable, and nondiscriminatory access to credit 
        for consumers.
          (14) Federal consumer financial law.--The term 
        ``Federal consumer financial law'' means the provisions 
        of this title, the enumerated consumer laws, the laws 
        for which authorities are transferred under subtitles F 
        and H, and any rule or order prescribed by the Bureau 
        under this title, an enumerated consumer law, or 
        pursuant to the authorities transferred under subtitles 
        F and H. The term does not include the Federal Trade 
        Commission Act.
          (15) Financial product or service.--
                  (A) In general.--The term ``financial product 
                or service'' means--
                          (i) extending credit and servicing 
                        loans, including acquiring, purchasing, 
                        selling, brokering, or other extensions 
                        of credit (other than solely extending 
                        commercial credit to a person who 
                        originates consumer credit 
                        transactions);
                          (ii) extending or brokering leases of 
                        personal or real property that are the 
                        functional equivalent of purchase 
                        finance arrangements, if--
                                  (I) the lease is on a non-
                                operating basis;
                                  (II) the initial term of the 
                                lease is at least 90 days; and
                                  (III) in the case of a lease 
                                involving real property, at the 
                                inception of the initial lease, 
                                the transaction is intended to 
                                result in ownership of the 
                                leased property to be 
                                transferred to the lessee, 
                                subject to standards prescribed 
                                by the Bureau;
                          (iii) providing real estate 
                        settlement services, except such 
                        services excluded under subparagraph 
                        (C), or performing appraisals of real 
                        estate or personal property;
                          (iv) engaging in deposit-taking 
                        activities, transmitting or exchanging 
                        funds, or otherwise acting as a 
                        custodian of funds or any financial 
                        instrument for use by or on behalf of a 
                        consumer;
                          (v) selling, providing, or issuing 
                        stored value or payment instruments, 
                        except that, in the case of a sale of, 
                        or transaction to reload, stored value, 
                        only if the seller exercises 
                        substantial control over the terms or 
                        conditions of the stored value provided 
                        to the consumer where, for purposes of 
                        this clause--
                                  (I) a seller shall not be 
                                found to exercise substantial 
                                control over the terms or 
                                conditions of the stored value 
                                if the seller is not a party to 
                                the contract with the consumer 
                                for the stored value product, 
                                and another person is 
                                principally responsible for 
                                establishing the terms or 
                                conditions of the stored value; 
                                and
                                  (II) advertising the 
                                nonfinancial goods or services 
                                of the seller on the stored 
                                value card or device is not in 
                                itself an exercise of 
                                substantial control over the 
                                terms or conditions;
                          (vi) providing check cashing, check 
                        collection, or check guaranty services;
                          (vii) providing payments or other 
                        financial data processing products or 
                        services to a consumer by any 
                        technological means, including 
                        processing or storing financial or 
                        banking data for any payment 
                        instrument, or through any payments 
                        systems or network used for processing 
                        payments data, including payments made 
                        through an online banking system or 
                        mobile telecommunications network, 
                        except that a person shall not be 
                        deemed to be a covered person with 
                        respect to financial data processing 
                        solely because the person--
                                  (I) is a merchant, retailer, 
                                or seller of any nonfinancial 
                                good or service who engages in 
                                financial data processing by 
                                transmitting or storing 
                                payments data about a consumer 
                                exclusively for purpose of 
                                initiating payments 
                                instructions by the consumer to 
                                pay such person for the 
                                purchase of, or to complete a 
                                commercial transaction for, 
                                such nonfinancial good or 
                                service sold directly by such 
                                person to the consumer; or
                                  (II) provides access to a 
                                host server to a person for 
                                purposes of enabling that 
                                person to establish and 
                                maintain a website;
                          (viii) providing financial advisory 
                        services (other than services relating 
                        to securities provided by a person 
                        regulated by the Commission or a person 
                        regulated by a State securities 
                        Commission, but only to the extent that 
                        such person acts in a regulated 
                        capacity) to consumers on individual 
                        financial matters or relating to 
                        proprietary financial products or 
                        services (other than by publishing any 
                        bona fide newspaper, news magazine, or 
                        business or financial publication of 
                        general and regular circulation, 
                        including publishing market data, news, 
                        or data analytics or investment 
                        information or recommendations that are 
                        not tailored to the individual needs of 
                        a particular consumer), including--
                                  (I) providing credit 
                                counseling to any consumer; and
                                  (II) providing services to 
                                assist a consumer with debt 
                                management or debt settlement, 
                                modifying the terms of any 
                                extension of credit, or 
                                avoiding foreclosure;
                          (ix) collecting, analyzing, 
                        maintaining, or providing consumer 
                        report information or other account 
                        information, including information 
                        relating to the credit history of 
                        consumers, used or expected to be used 
                        in connection with any decision 
                        regarding the offering or provision of 
                        a consumer financial product or 
                        service, except to the extent that--
                                  (I) a person--
                                          (aa) collects, 
                                        analyzes, or maintains 
                                        information that 
                                        relates solely to the 
                                        transactions between a 
                                        consumer and such 
                                        person;
                                          (bb) provides the 
                                        information described 
                                        in item (aa) to an 
                                        affiliate of such 
                                        person; or
                                          (cc) provides 
                                        information that is 
                                        used or expected to be 
                                        used solely in any 
                                        decision regarding the 
                                        offering or provision 
                                        of a product or service 
                                        that is not a consumer 
                                        financial product or 
                                        service, including a 
                                        decision for 
                                        employment, government 
                                        licensing, or a 
                                        residential lease or 
                                        tenancy involving a 
                                        consumer; and
                                  (II) the information 
                                described in subclause (I)(aa) 
                                is not used by such person or 
                                affiliate in connection with 
                                any decision regarding the 
                                offering or provision of a 
                                consumer financial product or 
                                service to the consumer, other 
                                than credit described in 
                                section 1027(a)(2)(A);
                          (x) collecting debt related to any 
                        consumer financial product or service; 
                        and
                          (xi) such other financial product or 
                        service as may be defined by the 
                        Bureau, by regulation, for purposes of 
                        this title, if the Bureau finds that 
                        such financial product or service is--
                                  (I) entered into or conducted 
                                as a subterfuge or with a 
                                purpose to evade any Federal 
                                consumer financial law; or
                                  (II) permissible for a bank 
                                or for a financial holding 
                                company to offer or to provide 
                                under any provision of a 
                                Federal law or regulation 
                                applicable to a bank or a 
                                financial holding company, and 
                                has, or likely will have, a 
                                material impact on consumers.
                  (B) Rule of construction.--
                          (i) In general.--For purposes of 
                        subparagraph (A)(xi)(II), and subject 
                        to clause (ii) of this subparagraph, 
                        the following activities provided to a 
                        covered person shall not, for purposes 
                        of this title, be considered incidental 
                        or complementary to a financial 
                        activity permissible for a financial 
                        holding company to engage in under any 
                        provision of a Federal law or 
                        regulation applicable to a financial 
                        holding company:
                                  (I) Providing information 
                                products or services to a 
                                covered person for identity 
                                authentication.
                                  (II) Providing information 
                                products or services for fraud 
                                or identify theft detection, 
                                prevention, or investigation.
                                  (III) Providing document 
                                retrieval or delivery services.
                                  (IV) Providing public records 
                                information retrieval.
                                  (V) Providing information 
                                products or services for anti-
                                money laundering activities.
                          (ii) Limitation.--Nothing in clause 
                        (i) may be construed as modifying or 
                        limiting the authority of the Bureau to 
                        exercise any--
                                  (I) [examination or] 
                                enforcement powers authority 
                                under this title with respect 
                                to a covered person or service 
                                provider engaging in an 
                                activity described in 
                                subparagraph (A)(ix); or
                                  (II) powers authorized by 
                                this title to prescribe rules, 
                                issue orders, or take other 
                                actions under any enumerated 
                                consumer law or law for which 
                                the authorities are transferred 
                                under subtitle F or H.
                  (C) Exclusions.--The term ``financial product 
                or service'' does not include--
                          (i) the business of insurance; or
                          (ii) electronic conduit services.
          (16) Foreign exchange.--The term ``foreign exchange'' 
        means the exchange, for compensation, of currency of 
        the United States or of a foreign government for 
        currency of another government.
          (17) Insured credit union.--The term ``insured credit 
        union'' has the same meaning as in section 101 of the 
        Federal Credit Union Act (12 U.S.C. 1752).
          (18) Payment instrument.--The term ``payment 
        instrument'' means a check, draft, warrant, money 
        order, traveler's check, electronic instrument, or 
        other instrument, payment of funds, or monetary value 
        (other than currency).
          (19) Person.--The term ``person'' means an 
        individual, partnership, company, corporation, 
        association (incorporated or unincorporated), trust, 
        estate, cooperative organization, or other entity.
          (20) Person regulated by the commodity futures 
        trading commission.--The term ``person regulated by the 
        Commodity Futures Trading Commission'' means any person 
        that is registered, or required by statute or 
        regulation to be registered, with the Commodity Futures 
        Trading Commission, but only to the extent that the 
        activities of such person are subject to the 
        jurisdiction of the Commodity Futures Trading 
        Commission under the Commodity Exchange Act.
          (21) Person regulated by the commission.--The term 
        ``person regulated by the Commission'' means a person 
        who is--
                  (A) a broker or dealer that is required to be 
                registered under the Securities Exchange Act of 
                1934;
                  (B) an investment adviser that is registered 
                under the Investment Advisers Act of 1940;
                  (C) an investment company that is required to 
                be registered under the Investment Company Act 
                of 1940, and any company that has elected to be 
                regulated as a business development company 
                under that Act;
                  (D) a national securities exchange that is 
                required to be registered under the Securities 
                Exchange Act of 1934;
                  (E) a transfer agent that is required to be 
                registered under the Securities Exchange Act of 
                1934;
                  (F) a clearing corporation that is required 
                to be registered under the Securities Exchange 
                Act of 1934;
                  (G) any self-regulatory organization that is 
                required to be registered with the Commission;
                  (H) any nationally recognized statistical 
                rating organization that is required to be 
                registered with the Commission;
                  (I) any securities information processor that 
                is required to be registered with the 
                Commission;
                  (J) any municipal securities dealer that is 
                required to be registered with the Commission;
                  (K) any other person that is required to be 
                registered with the Commission under the 
                Securities Exchange Act of 1934; and
                  (L) any employee, agent, or contractor acting 
                on behalf of, registered with, or providing 
                services to, any person described in any of 
                subparagraphs (A) through (K), but only to the 
                extent that any person described in any of 
                subparagraphs (A) through (K), or the employee, 
                agent, or contractor of such person, acts in a 
                regulated capacity.
          (22) Person regulated by a state insurance 
        regulator.--The term ``person regulated by a State 
        insurance regulator'' means any person that is engaged 
        in the business of insurance and subject to regulation 
        by any State insurance regulator, but only to the 
        extent that such person acts in such capacity.
          (23) Person that performs income tax preparation 
        activities for consumers.--The term ``person that 
        performs income tax preparation activities for 
        consumers'' means--
                  (A) any tax return preparer (as defined in 
                section 7701(a)(36) of the Internal Revenue 
                Code of 1986), regardless of whether 
                compensated, but only to the extent that the 
                person acts in such capacity;
                  (B) any person regulated by the Secretary 
                under section 330 of title 31, United States 
                Code, but only to the extent that the person 
                acts in such capacity; and
                  (C) any authorized IRS e-file Providers (as 
                defined for purposes of section 7216 of the 
                Internal Revenue Code of 1986), but only to the 
                extent that the person acts in such capacity.
          (24) Prudential regulator.--The term ``prudential 
        regulator'' means--
                  (A) in the case of an insured depository 
                institution or depository institution holding 
                company (as defined in section 3 of the Federal 
                Deposit Insurance Act), or subsidiary of such 
                institution or company, the appropriate Federal 
                banking agency, as that term is defined in 
                section 3 of the Federal Deposit Insurance Act; 
                and
                  (B) in the case of an insured credit union, 
                the National Credit Union Administration.
          (25) Related person.--The term ``related person''--
                  (A) shall apply only with respect to a 
                covered person that is not a bank holding 
                company (as that term is defined in section 2 
                of the Bank Holding Company Act of 1956), 
                credit union, or depository institution;
                  (B) shall be deemed to mean a covered person 
                for all purposes of any provision of Federal 
                consumer financial law; and
                  (C) means--
                          (i) any director, officer, or 
                        employee charged with managerial 
                        responsibility for, or controlling 
                        shareholder of, or agent for, such 
                        covered person;
                          (ii) any shareholder, consultant, 
                        joint venture partner, or other person, 
                        as determined by the Bureau (by rule or 
                        on a case-by-case basis) who materially 
                        participates in the conduct of the 
                        affairs of such covered person; and
                          (iii) any independent contractor 
                        (including any attorney, appraiser, or 
                        accountant) who knowingly or recklessly 
                        participates in any--
                                  (I) violation of any 
                                provision of law or regulation; 
                                or
                                  (II) breach of a fiduciary 
                                duty.
          (26) Service provider.--
                  (A) In general.--The term ``service 
                provider'' means any person that provides a 
                material service to a covered person in 
                connection with the offering or provision by 
                such covered person of a consumer financial 
                product or service, including a person that--
                          (i) participates in designing, 
                        operating, or maintaining the consumer 
                        financial product or service; or
                          (ii) processes transactions relating 
                        to the consumer financial product or 
                        service (other than unknowingly or 
                        incidentally transmitting or processing 
                        financial data in a manner that such 
                        data is undifferentiated from other 
                        types of data of the same form as the 
                        person transmits or processes).
                  (B) Exceptions.--The term ``service 
                provider'' does not include a person solely by 
                virtue of such person offering or providing to 
                a covered person--
                          (i) a support service of a type 
                        provided to businesses generally or a 
                        similar ministerial service; or
                          (ii) time or space for an 
                        advertisement for a consumer financial 
                        product or service through print, 
                        newspaper, or electronic media.
                  (C) Rule of construction.--A person that is a 
                service provider shall be deemed to be a 
                covered person to the extent that such person 
                engages in the offering or provision of its own 
                consumer financial product or service.
          (27) State.--The term ``State'' means any State, 
        territory, or possession of the United States, the 
        District of Columbia, the Commonwealth of Puerto Rico, 
        the Commonwealth of the Northern Mariana Islands, Guam, 
        American Samoa, or the United States Virgin Islands or 
        any federally recognized Indian tribe, as defined by 
        the Secretary of the Interior under section 104(a) of 
        the Federally Recognized Indian Tribe List Act of 1994 
        (25 U.S.C. 479a-1(a)).
          (28) Stored value.--
                  (A) In general.--The term ``stored value'' 
                means funds or monetary value represented in 
                any electronic format, whether or not specially 
                encrypted, and stored or capable of storage on 
                electronic media in such a way as to be 
                retrievable and transferred electronically, and 
                includes a prepaid debit card or product, or 
                any other similar product, regardless of 
                whether the amount of the funds or monetary 
                value may be increased or reloaded.
                  (B) Exclusion.--Notwithstanding subparagraph 
                (A), the term ``stored value'' does not include 
                a special purpose card or certificate, which 
                shall be defined for purposes of this paragraph 
                as funds or monetary value represented in any 
                electronic format, whether or not specially 
                encrypted, that is--
                          (i) issued by a merchant, retailer, 
                        or other seller of nonfinancial goods 
                        or services;
                          (ii) redeemable only for transactions 
                        with the merchant, retailer, or seller 
                        of nonfinancial goods or services or 
                        with an affiliate of such person, which 
                        affiliate itself is a merchant, 
                        retailer, or seller of nonfinancial 
                        goods or services;
                          (iii) issued in a specified amount 
                        that, except in the case of a card or 
                        product used solely for telephone 
                        services, may not be increased or 
                        reloaded;
                          (iv) purchased on a prepaid basis in 
                        exchange for payment; and
                          (v) honored upon presentation to such 
                        merchant, retailer, or seller of 
                        nonfinancial goods or services or an 
                        affiliate of such person, which 
                        affiliate itself is a merchant, 
                        retailer, or seller of nonfinancial 
                        goods or services, only for any 
                        nonfinancial goods or services.
          (29) Transmitting or exchanging funds.--The term 
        ``transmitting or exchanging funds'' means receiving 
        currency, monetary value, or payment instruments from a 
        consumer for the purpose of exchanging or transmitting 
        the same by any means, including transmission by wire, 
        facsimile, electronic transfer, courier, the Internet, 
        or through bill payment services or through other 
        businesses that facilitate third-party transfers within 
        the United States or to or from the United States.

          Subtitle A--Bureau of Consumer Financial Protection

SEC. 1011. ESTABLISHMENT OF THE [BUREAU OF CONSUMER FINANCIAL 
                    PROTECTION]  CONSUMER LAW ENFORCEMENT AGENCY.

  (a) [Bureau] Agency Established.--There is established [in 
the Federal Reserve System,] an [independent bureau] 
independent agency to be known as the ``[Bureau of Consumer 
Financial Protection] Consumer Law Enforcement Agency 
(hereinafter in this section referred to as the ``Agency'')'', 
which shall regulate the offering and provision of consumer 
financial products or services under the Federal consumer 
financial laws. The [Bureau] Agency shall be considered an 
Executive agency, as defined in section 105 of title 5, United 
States Code. Except as otherwise provided expressly by law, all 
Federal laws dealing with public or Federal contracts, 
property, works, officers, employees, budgets, or funds, 
including the provisions of chapters 5 and 7 of title 5, shall 
apply to the exercise of the powers of the [Bureau] Agency.
  (b) Director and Deputy Director.--
          (1) In general.--There is established the position of 
        the Director, who shall serve as the head of the 
        [Bureau] Agency.
          (2) Appointment.--Subject to paragraph (3), the 
        Director shall be appointed by the President, by and 
        with the advice and consent of the Senate.
          (3) Qualification.--The President shall nominate the 
        Director from among individuals who are citizens of the 
        United States.
          (4) Compensation.--The Director shall be compensated 
        at the rate prescribed for level II of the Executive 
        Schedule under section 5313 of title 5, United States 
        Code.
          (5) Deputy director.--There is established the 
        position of Deputy Director, who shall--
                  [(A) be appointed by the Director; and]
                  (A) shall be appointed by the President; and
                  (B) serve as acting Director in the absence 
                or unavailability of the Director.
  (c) Term.--
          (1) In general.--The Director shall serve for a term 
        of 5 years.
          (2) Expiration of term.--An individual may serve as 
        Director after the expiration of the term for which 
        appointed, until a successor has been appointed and 
        qualified.
          [(3) Removal for cause.--The President may remove the 
        Director for inefficiency, neglect of duty, or 
        malfeasance in office.]
  (d) Service Restriction.--No Director or Deputy Director may 
hold any office, position, or employment in any Federal reserve 
bank, Federal home loan bank, covered person, or service 
provider during the period of service of such person as 
Director or Deputy Director.
  (e) Offices.--The principal office of the [Bureau] Agency 
shall be in the District of Columbia. The Director may 
establish regional offices of the [Bureau] Agency [, including 
in cities in which the Federal reserve banks, or branches of 
such banks, are located,] in order to carry out the 
responsibilities assigned to the [Bureau] Agency under the 
Federal consumer financial laws.
  (i) Inspector General.--There is established the position of 
the Inspector General of the Agency.

SEC. 1012. EXECUTIVE AND ADMINISTRATIVE POWERS.

  (a) Powers of the Bureau.--The Bureau is authorized to 
establish the general policies of the Bureau with respect to 
all executive and administrative functions, including--
          (1) the establishment of rules for conducting the 
        general business of the Bureau, in a manner not 
        inconsistent with this title;
          (2) to bind the Bureau and enter into contracts;
          (3) directing the establishment and maintenance of 
        divisions or other offices within the Bureau, in order 
        to carry out the responsibilities under the Federal 
        consumer financial laws, and to satisfy the 
        requirements of other applicable law;
          (4) to coordinate and oversee the operation of all 
        administrative, enforcement, and research activities of 
        the Bureau;
          (5) to adopt and use a seal;
          (6) to determine the character of and the necessity 
        for the obligations and expenditures of the Bureau;
          (7) the appointment and supervision of personnel 
        employed by the Bureau;
          (8) the distribution of business among personnel 
        appointed and supervised by the Director and among 
        administrative units of the Bureau;
          (9) the use and expenditure of funds;
          (10) implementing the Federal consumer financial laws 
        through rules, orders, guidance, interpretations, 
        statements of policy, [examinations,] and enforcement 
        actions; and
          (11) performing such other functions as may be 
        authorized or required by law.
  (b) Delegation of Authority.--The Director of the Bureau may 
delegate to any duly authorized employee, representative, or 
agent any power vested in the Bureau by law.
  [(c) Autonomy of the Bureau.--
          [(1) Coordination with the board of governors.--
        Notwithstanding any other provision of law applicable 
        to the supervision or examination of persons with 
        respect to Federal consumer financial laws, the Board 
        of Governors may delegate to the Bureau the authorities 
        to examine persons subject to the jurisdiction of the 
        Board of Governors for compliance with the Federal 
        consumer financial laws.
          [(2) Autonomy.--Notwithstanding the authorities 
        granted to the Board of Governors under the Federal 
        Reserve Act, the Board of Governors may not--
                  [(A) intervene in any matter or proceeding 
                before the Director, including examinations or 
                enforcement actions, unless otherwise 
                specifically provided by law;
                  [(B) appoint, direct, or remove any officer 
                or employee of the Bureau; or
                  [(C) merge or consolidate the Bureau, or any 
                of the functions or responsibilities of the 
                Bureau, with any division or office of the 
                Board of Governors or the Federal reserve 
                banks.
          [(3) Rules and orders.--No rule or order of the 
        Bureau shall be subject to approval or review by the 
        Board of Governors. The Board of Governors may not 
        delay or prevent the issuance of any rule or order of 
        the Bureau.
          [(4) Recommendations and testimony.--No officer or 
        agency of the United States shall have any authority to 
        require the Director or any other officer of the Bureau 
        to submit legislative recommendations, or testimony or 
        comments on legislation, to any officer or agency of 
        the United States for approval, comments, or review 
        prior to the submission of such recommendations, 
        testimony, or comments to the Congress, if such 
        recommendations, testimony, or comments to the Congress 
        include a statement indicating that the views expressed 
        therein are those of the Director or such officer, and 
        do not necessarily reflect the views of the Board of 
        Governors or the President.
          [(5) Clarification of autonomy of the bureau in legal 
        proceedings.--The Bureau shall not be liable under any 
        provision of law for any action or inaction of the 
        Board of Governors, and the Board of Governors shall 
        not be liable under any provision of law for any action 
        or inaction of the Bureau.]

SEC. 1013. ADMINISTRATION.

  (a) Personnel.--
          (1) Appointment.--
                  (A) In general.--The Director may fix the 
                number of, and appoint and direct, all 
                employees of the Bureau, in accordance with the 
                applicable provisions of title 5, United States 
                Code.
                  (B) Employees of the bureau.--The Director is 
                authorized to employ attorneys, [compliance 
                examiners, compliance supervision analysts,] 
                economists, statisticians, and other employees 
                as may be deemed necessary to conduct the 
                business of the Bureau. Unless otherwise 
                provided expressly by law, any individual 
                appointed under this section shall be an 
                employee as defined in section 2105 of title 5, 
                United States Code, and subject to the 
                provisions of such title and other laws 
                generally applicable to the employees of an 
                Executive agency.
                  (C) Waiver authority.--
                          (i) In general.--In making any 
                        appointment under subparagraph (A), the 
                        Director may waive the requirements of 
                        chapter 33 of title 5, United States 
                        Code, and the regulations implementing 
                        such chapter, to the extent necessary 
                        to appoint employees on terms and 
                        conditions that are consistent with 
                        those set forth in [section 11(1)] 
                        subsection (l) of section 11 of the 
                        Federal Reserve Act (12 U.S.C. 248(1)), 
                        while providing for--
                                  (I) fair, credible, and 
                                transparent methods of 
                                establishing qualification 
                                requirements for, recruitment 
                                for, and appointments to 
                                positions;
                                  (II) fair and open 
                                competition and equitable 
                                treatment in the consideration 
                                and selection of individuals to 
                                positions;
                                  (III) fair, credible, and 
                                transparent methods of 
                                assigning, reassigning, 
                                detailing, transferring, and 
                                promoting employees.
                          (ii) Veterans preferences.--In 
                        implementing this subparagraph, the 
                        Director shall comply with the 
                        provisions of section 2302(b)(11), 
                        regarding veterans' preference 
                        requirements, in a manner consistent 
                        with that in which such provisions are 
                        applied under chapter 33 of title 5, 
                        United States Code. The authority under 
                        this subparagraph to waive the 
                        requirements of that chapter 33 shall 
                        expire 5 years after the date of 
                        enactment of this Act.
          [(2) Compensation.--Notwithstanding any otherwise 
        applicable provision of title 5, United States Code, 
        concerning compensation, including the provisions of 
        chapter 51 and chapter 53, the following provisions 
        shall apply with respect to employees of the Bureau:
                  [(A) The rates of basic pay for all employees 
                of the Bureau may be set and adjusted by the 
                Director.
                  [(B) The Director shall at all times provide 
                compensation (including benefits) to each class 
                of employees that, at a minimum, are comparable 
                to the compensation and benefits then being 
                provided by the Board of Governors for the 
                corresponding class of employees.
                  [(C) All such employees shall be compensated 
                (including benefits) on terms and conditions 
                that are consistent with the terms and 
                conditions set forth in section 11(l) of the 
                Federal Reserve Act (12 U.S.C. 248(l)).]
          (2) Compensation.--The rates of basic pay for all 
        employees of the Agency shall be set and adjusted by 
        the Director in accordance with the General Schedule 
        set forth in section 5332 of title 5, United States 
        Code.
          (3) Bureau participation in federal reserve system 
        retirement plan and federal reserve system thrift 
        plan.--
                  (A) Employee election.--Employees appointed 
                to the Bureau may elect to participate in 
                either--
                          (i) both the Federal Reserve System 
                        Retirement Plan and the Federal Reserve 
                        System Thrift Plan, under the same 
                        terms on which such participation is 
                        offered to employees of the Board of 
                        Governors who participate in such plans 
                        and under the terms and conditions 
                        specified under section 1064(i)(1)(C); 
                        or
                          (ii) the Civil Service Retirement 
                        System under chapter 83 of title 5, 
                        United States Code, or the Federal 
                        Employees Retirement System under 
                        chapter 84 of title 5, United States 
                        Code, if previously covered under one 
                        of those Federal employee retirement 
                        systems.
                  (B) Election period.--Bureau employees shall 
                make an election under this paragraph not later 
                than 1 year after the date of appointment by, 
                or transfer under subtitle F to, the Bureau. 
                Participation in, and benefit accruals under, 
                any other retirement plan established or 
                maintained by the Federal Government shall end 
                not later than the date on which participation 
                in, and benefit accruals under, the Federal 
                Reserve System Retirement Plan and Federal 
                Reserve System Thrift Plan begin.
                  (C) Employer contribution.--The Bureau shall 
                pay an employer contribution to the Federal 
                Reserve System Retirement Plan, in the amount 
                established as an employer contribution under 
                the Federal Employees Retirement System, as 
                established under chapter 84 of title 5, United 
                States Code, for each Bureau employee who 
                elects to participate in the Federal Reserve 
                System Retirement Plan. The Bureau shall pay an 
                employer contribution to the Federal Reserve 
                System Thrift Plan for each Bureau employee who 
                elects to participate in such plan, as required 
                under the terms of such plan.
                  (D) Controlled group status.--The Bureau is 
                the same employer as the Federal Reserve System 
                (as comprised of the Board of Governors and 
                each of the 12 Federal reserve banks prior to 
                the date of enactment of this Act) for purposes 
                of subsections (b), (c), (m), and (o) of 
                section 414 of the Internal Revenue Code of 
                1986, (26 U.S.C. 414).
          (4) Labor-management relations.--Chapter 71 of title 
        5, United States Code, shall apply to the Bureau and 
        the employees of the Bureau.
          (5) Agency ombudsman.--
                  (A) Establishment required.--Not later than 
                180 days after the designated transfer date, 
                the Bureau shall appoint an ombudsman.
                  (B) Duties of ombudsman.--The ombudsman 
                appointed in accordance with subparagraph (A) 
                shall--
                          (i) act as a liaison between the 
                        Bureau and any affected person with 
                        respect to any problem that such party 
                        may have in dealing with the Bureau, 
                        resulting from the regulatory 
                        activities of the Bureau; and
                          (ii) assure that safeguards exist to 
                        encourage complainants to come forward 
                        and preserve confidentiality.
  (b) Specific Functional Units.--
          (1) Research.--The Director [shall establish] may 
        establish a unit whose functions shall include 
        researching, analyzing, and reporting on--
                  (A) developments in markets for consumer 
                financial products or services, including 
                market areas of alternative consumer financial 
                products or services with high growth rates and 
                areas of risk to consumers;
                  (B) access to fair and affordable credit for 
                traditionally underserved communities;
                  (C) consumer awareness, understanding, and 
                use of disclosures and communications regarding 
                consumer financial products or services;
                  (D) consumer awareness and understanding of 
                costs, risks, and benefits of consumer 
                financial products or services;
                  (E) consumer behavior with respect to 
                consumer financial products or services, 
                including performance on mortgage loans; and
                  (F) experiences of traditionally underserved 
                consumers, including un-banked and under-banked 
                consumers.
          (2) Community affairs.--The Director [shall 
        establish] may establish a unit whose functions shall 
        include providing information, guidance, and technical 
        assistance regarding the offering and provision of 
        consumer financial products or services to 
        traditionally underserved consumers and communities.
          (3) Collecting and tracking complaints.--
                  (A) In general.--The Director shall establish 
                a unit whose functions shall include 
                establishing a single, toll-free telephone 
                number, a website, and a database or utilizing 
                an existing database to facilitate the 
                centralized collection of, monitoring of, and 
                response to consumer complaints regarding 
                consumer financial products or services. The 
                Director shall coordinate with the Federal 
                Trade Commission or other Federal agencies to 
                route complaints to such agencies, where 
                appropriate.
                  (B) Routing calls to states.--To the extent 
                practicable, State agencies may receive 
                appropriate complaints from the systems 
                established under subparagraph (A), if--
                          (i) the State agency system has the 
                        functional capacity to receive calls or 
                        electronic reports routed by the Bureau 
                        systems;
                          (ii) the State agency has satisfied 
                        any conditions of participation in the 
                        system that the Bureau may establish, 
                        including treatment of personally 
                        identifiable information and sharing of 
                        information on complaint resolution or 
                        related compliance procedures and 
                        resources; and
                          (iii) participation by the State 
                        agency includes measures necessary to 
                        provide for protection of personally 
                        identifiable information that conform 
                        to the standards for protection of the 
                        confidentiality of personally 
                        identifiable information and for data 
                        integrity and security that apply to 
                        the Federal agencies described in 
                        subparagraph (D).
                  (C) Reports to the congress.--The Director 
                shall present an annual report to Congress not 
                later than March 31 of each year on the 
                complaints received by the Bureau in the prior 
                year regarding consumer financial products and 
                services. Such report shall include information 
                and analysis about complaint numbers, complaint 
                types, and, where applicable, information about 
                resolution of complaints.
                  (D) Data sharing required.--[To facilitate 
                preparation of the reports required under 
                subparagraph (C), supervision and enforcement 
                activities, and monitoring of the market for 
                consumer financial products and services, the] 
                The Bureau shall share consumer complaint 
                information with prudential regulators, the 
                Federal Trade Commission, other Federal 
                agencies, and State agencies, subject to the 
                standards applicable to Federal agencies for 
                protection of the confidentiality of personally 
                identifiable information and for data security 
                and integrity. The prudential regulators, the 
                Federal Trade Commission, and other Federal 
                agencies shall share data relating to consumer 
                complaints regarding consumer financial 
                products and services with the Bureau, subject 
                to the standards applicable to Federal agencies 
                for protection of confidentiality of personally 
                identifiable information and for data security 
                and integrity. Information collected under this 
                paragraph may not be made publicly available.
  (c) Office of Fair Lending and Equal Opportunity.--
          (1) Establishment.--The Director [shall establish] 
        may establish within the Bureau the Office of Fair 
        Lending and Equal Opportunity.
          (2) Functions.--The Office of Fair Lending and Equal 
        Opportunity shall have such powers and duties as the 
        Director may delegate to the Office, including--
                  (A) providing oversight and enforcement of 
                Federal laws intended to ensure the fair, 
                equitable, and nondiscriminatory access to 
                credit for both individuals and communities 
                that are enforced by the Bureau, including the 
                Equal Credit Opportunity Act and the Home 
                Mortgage Disclosure Act;
                  (B) coordinating fair lending efforts of the 
                Bureau with other Federal agencies and State 
                regulators, as appropriate, to promote 
                consistent, efficient, and effective 
                enforcement of Federal fair lending laws;
                  (C) working with private industry, fair 
                lending, civil rights, consumer and community 
                advocates on the promotion of fair lending 
                compliance and education; and
                  (D) providing annual reports to Congress on 
                the efforts of the Bureau to fulfill its fair 
                lending mandate.
          (3) Administration of office.--[There is established 
        the] At any time when the Office of Fair Lending and 
        Equal Opportunity exists within the Agency, there shall 
        be a position of Assistant Director of the Bureau for 
        Fair Lending and Equal Opportunity, who--
                  (A) shall be appointed by the Director; and
                  (B) shall carry out such duties as the 
                Director may delegate to such Assistant 
                Director.
  (d) Office of Financial Education.--
          (1) Establishment.--The Director [shall establish] 
        may establish an Office of Financial Education, which 
        shall be responsible for developing and implementing 
        initiatives intended to educate and empower consumers 
        to make better informed financial decisions.
          (2) Other duties.--The Office of Financial Education 
        shall develop and implement a strategy to improve the 
        financial literacy of consumers that includes 
        measurable goals and objectives, in consultation with 
        the Financial Literacy and Education Commission, 
        consistent with the National Strategy for Financial 
        Literacy, through activities including providing 
        opportunities for consumers to access--
                  (A) financial counseling, including 
                community-based financial counseling, where 
                practicable;
                  (B) information to assist with the evaluation 
                of credit products and the understanding of 
                credit histories and scores;
                  (C) savings, borrowing, and other services 
                found at mainstream financial institutions;
                  (D) activities intended to--
                          (i) prepare the consumer for 
                        educational expenses and the submission 
                        of financial aid applications, and 
                        other major purchases;
                          (ii) reduce debt; and
                          (iii) improve the financial situation 
                        of the consumer;
                  (E) assistance in developing long-term 
                savings strategies; and
                  (F) wealth building and financial services 
                during the preparation process to claim earned 
                income tax credits and Federal benefits.
          (3) Coordination.--The Office of Financial Education 
        shall coordinate with other units within the Bureau in 
        carrying out its functions, including--
                  (A) working with the Community Affairs 
                Office, if such Office exists within the 
                Agency, to implement the strategy to improve 
                financial literacy of consumers; and
                  (B) working with the research unit 
                [established by the Director], if established 
                by the Director, to conduct research related to 
                consumer financial education and counseling.
          (4) Report.--[Not later than 24 months after the 
        designated transfer date, and annually thereafter,] 
        Annually, at any time when the Office of Financial 
        Education exists within the Agency, the Director shall 
        submit a report on its financial literacy activities 
        and strategy to improve financial literacy of consumers 
        to--
                  (A) the Committee on Banking, Housing, and 
                Urban Affairs of the Senate; and
                  (B) the Committee on Financial Services of 
                the House of Representatives.
          (5) Membership in financial literacy and education 
        commission.--Section 513(c)(1) of the Financial 
        Literacy and Education Improvement Act (20 U.S.C. 
        9702(c)(1)) is amended--
                  (A) in subparagraph (B), by striking ``and'' 
                at the end;
                  (B) by redesignating subparagraph (C) as 
                subparagraph (D); and
                  (C) by inserting after subparagraph (B) the 
                following new subparagraph:
                  ``(C) the Director of the Bureau of Consumer 
                Financial Protection; and''.
          (6) Conforming amendment.--Section 513(d) of the 
        Financial Literacy and Education Improvement Act (20 
        U.S.C. 9702(d)) is amended by adding at the end the 
        following: ``The Director of the Bureau of Consumer 
        Financial Protection shall serve as the Vice 
        Chairman.''.
          (7) Study and report on financial literacy program.--
                  (A) In general.--The Comptroller General of 
                the United States shall conduct a study to 
                identify--
                          (i) the feasibility of certification 
                        of persons providing the programs or 
                        performing the activities described in 
                        paragraph (2), including recognizing 
                        outstanding programs, and developing 
                        guidelines and resources for community-
                        based practitioners, including--
                                  (I) a potential certification 
                                process and standards for 
                                certification;
                                  (II) appropriate certifying 
                                entities;
                                  (III) resources required for 
                                funding such a process; and
                                  (IV) a cost-benefit analysis 
                                of such certification;
                          (ii) technological resources intended 
                        to collect, analyze, evaluate, or 
                        promote financial literacy and 
                        counseling programs;
                          (iii) effective methods, tools, and 
                        strategies intended to educate and 
                        empower consumers about personal 
                        finance management; and
                          (iv) recommendations intended to 
                        encourage the development of programs 
                        that effectively improve financial 
                        education outcomes and empower 
                        consumers to make better informed 
                        financial decisions based on findings.
                  (B) Report.--Not later than 1 year after the 
                date of enactment of this Act, the Comptroller 
                General of the United States shall submit a 
                report on the results of the study conducted 
                under this paragraph to the Committee on 
                Banking, Housing, and Urban Affairs of the 
                Senate and the Committee on Financial Services 
                of the House of Representatives.
  (e) Office of Service Member Affairs.--
          (1) In general.--The Director [shall] may establish 
        an Office of Service Member Affairs, which shall be 
        responsible for developing and implementing initiatives 
        for service members and their families intended to--
                  (A) educate and empower service members and 
                their families to make better informed 
                decisions regarding consumer financial products 
                and services;
                  (B) coordinate with the unit of the Bureau 
                established under subsection (b)(3), in order 
                to monitor complaints by service members and 
                their families and responses to those 
                complaints by the Bureau or other appropriate 
                Federal or State agency; and
                  (C) coordinate efforts among Federal and 
                State agencies, as appropriate, regarding 
                consumer protection measures relating to 
                consumer financial products and services 
                offered to, or used by, service members and 
                their families.
          (2) Coordination.--
                  (A) Regional services.--The Director is 
                authorized to assign employees of the Bureau as 
                may be deemed necessary to conduct the business 
                of the Office of Service Member Affairs, 
                including by establishing and maintaining the 
                functions of the Office in regional offices of 
                the Bureau located near military bases, 
                military treatment facilities, or other similar 
                military facilities.
                  (B) Agreements.--The Director is authorized 
                to enter into memoranda of understanding and 
                similar agreements with the Department of 
                Defense, including any branch or agency as 
                authorized by the department, in order to carry 
                out the business of the Office of Service 
                Member Affairs.
          (3) Definition.--As used in this subsection, the term 
        ``service member'' means any member of the United 
        States Armed Forces and any member of the National 
        Guard or Reserves.
  [(f) Timing.--The Office of Fair Lending and Equal 
Opportunity, the Office of Financial Education, and the Office 
of Service Member Affairs shall each be established not later 
than 1 year after the designated transfer date.]
  [(g)] (f) Office of Financial Protection for Older 
Americans.--
          (1) Establishment.--[Before the end of the 180-day 
        period beginning on the designated transfer date, the 
        Director shall] The Director may establish the Office 
        of Financial Protection for Older Americans, the 
        functions of which shall include activities designed to 
        facilitate the financial literacy of individuals who 
        have attained the age of 62 years or more (in this 
        subsection, referred to as ``seniors'') [on protection 
        from unfair, deceptive, and abusive practices and] on 
        current and future financial choices, including through 
        the dissemination of materials to seniors on such 
        topics.
          (2) Assistant director.--[The Office] At any time 
        when the Office of Financial Protection for Older 
        Americans exists within the Agency, the Office of 
        Financial Protection for Older Americans (in this 
        subsection referred to as the ``Office'') shall be 
        headed by an assistant director.
          (3) Duties.--The Office shall--
                  (A) develop goals for programs that provide 
                seniors financial literacy and counseling, 
                including programs that--
                          [(i) help seniors recognize warning 
                        signs of unfair, deceptive, or abusive 
                        practices, protect themselves from such 
                        practices;]
                          [(ii)] (i) provide one-on-one 
                        financial counseling on issues 
                        including long-term savings and later-
                        life economic security; and
                          [(iii)] (ii) provide personal 
                        consumer credit advocacy [to respond to 
                        consumer problems caused by unfair, 
                        deceptive, or abusive practices];
                  (B) monitor certifications or designations of 
                financial advisors who advise seniors [and 
                alert the Commission and State regulators of 
                certifications or designations that are 
                identified as unfair, deceptive, or abusive];
                  (C) not later than 18 months after the date 
                of the establishment of the Office, submit to 
                Congress and the Commission any legislative and 
                regulatory recommendations on the best 
                practices for--
                          (i) disseminating information 
                        regarding the legitimacy of 
                        certifications of financial advisers 
                        who advise seniors;
                          (ii) methods in which a senior can 
                        identify the financial advisor most 
                        appropriate for the senior's needs; and
                          (iii) methods in which a senior can 
                        verify a financial advisor's 
                        credentials;
                  (D) conduct research to identify best 
                practices and effective methods, tools, 
                technology and strategies to educate and 
                counsel seniors about personal finance 
                management with a focus on--
                          [(i) protecting themselves from 
                        unfair, deceptive, and abusive 
                        practices;]
                          [(ii)] (i) long-term savings; and
                          [(iii)] (ii) planning for retirement 
                        and long-term care;
                  (E) coordinate consumer protection efforts of 
                seniors with other Federal agencies and State 
                regulators, as appropriate, to promote 
                consistent, effective, and efficient 
                enforcement; and
                  (F) work with community organizations, non-
                profit organizations, and other entities that 
                are involved with educating or assisting 
                seniors (including the National Education and 
                Resource Center on Women and Retirement 
                Planning).
  [(h)] (g) Application of FACA.--Notwithstanding any provision 
of the Federal Advisory Committee Act (5 U.S.C. App.), such Act 
shall apply to each advisory committee of the Bureau and each 
subcommittee of such an advisory committee.
  (h) Office of Economic Analysis.--
          (1) Establishment.--The Director shall, not later 
        than the end of the 60-day period beginning on the date 
        of the enactment of this subsection, establish an 
        Office of Economic Analysis.
          (2) Direct reporting.--The head of the Office of 
        Economic Analysis shall report directly to the 
        Director.
          (3) Review and assessment of proposed rules and 
        regulations.--The Office of Economic Analysis shall--
                  (A) review all proposed rules and regulations 
                of the Agency;
                  (B) assess the impact of such rules and 
                regulations on consumer choice, price, and 
                access to credit products; and
                  (C) publish a report on such reviews and 
                assessments in the Federal Register.
          (4) Measuring existing rules and regulations.--The 
        Office of Economic Analysis shall--
                  (A) review each rule and regulation issued by 
                the Commission after 1, 2, 6, and 11 years;
                  (B) measure the rule or regulation's success 
                in solving the problem that the rule or 
                regulation was intended to solve when issued; 
                and
                  (C) publish a report on such review and 
                measurement in the Federal Register.
          (5) Cost-benefit analysis related to administrative 
        enforcement and civil actions.--The Office of Economic 
        Analysis shall--
                  (A) carry out a cost-benefit analysis of any 
                proposed administrative enforcement action, 
                civil lawsuit, or consent order of the Agency; 
                and
                  (B) assess the impact of such complaint, 
                lawsuit, or order on consumer choice, price, 
                and access to credit products.

[SEC. 1014. CONSUMER ADVISORY BOARD.

  [(a) Establishment Required.--The Director shall establish a 
Consumer Advisory Board to advise and consult with the Bureau 
in the exercise of its functions under the Federal consumer 
financial laws, and to provide information on emerging 
practices in the consumer financial products or services 
industry, including regional trends, concerns, and other 
relevant information.
  [(b) Membership.--In appointing the members of the Consumer 
Advisory Board, the Director shall seek to assemble experts in 
consumer protection, financial services, community development, 
fair lending and civil rights, and consumer financial products 
or services and representatives of depository institutions that 
primarily serve underserved communities, and representatives of 
communities that have been significantly impacted by higher-
priced mortgage loans, and seek representation of the interests 
of covered persons and consumers, without regard to party 
affiliation. Not fewer than 6 members shall be appointed upon 
the recommendation of the regional Federal Reserve Bank 
Presidents, on a rotating basis.
  [(c) Meetings.--The Consumer Advisory Board shall meet from 
time to time at the call of the Director, but, at a minimum, 
shall meet at least twice in each year.
  [(d) Compensation and Travel Expenses.--Members of the 
Consumer Advisory Board who are not full-time employees of the 
United States shall--
          [(1) be entitled to receive compensation at a rate 
        fixed by the Director while attending meetings of the 
        Consumer Advisory Board, including travel time; and
          [(2) be allowed travel expenses, including 
        transportation and subsistence, while away from their 
        homes or regular places of business.]

           *       *       *       *       *       *       *


SEC. 1016. APPEARANCES BEFORE AND REPORTS TO CONGRESS.

  (a) Appearances Before Congress.--The Director of the Bureau 
shall appear before the Committee on Banking, Housing, and 
Urban Affairs of the Senate and the Committee on Financial 
Services and the Committee on Energy and Commerce of the House 
of Representatives at semi-annual hearings regarding the 
reports required under subsection (b).
  (b) Reports Required.--The Bureau shall, concurrent with each 
semi-annual hearing referred to in subsection (a), prepare and 
submit to the President and to the Committee on Banking, 
Housing, and Urban Affairs of the Senate and the Committee on 
Financial Services and the Committee on Energy and Commerce of 
the House of Representatives, a report, beginning with the 
session following the designated transfer date. The Bureau may 
also submit such report to the Committee on Commerce, Science, 
and Transportation of the Senate.
  (c) Contents.--The reports required by subsection (b) shall 
include--
          (1) a discussion of the significant problems faced by 
        consumers in shopping for or obtaining consumer 
        financial products or services;
          (2) a justification of the budget request of the 
        previous year;
          (3) a list of the significant rules and orders 
        adopted by the Bureau, as well as other significant 
        initiatives conducted by the Bureau, during the 
        preceding year and the plan of the Bureau for rules, 
        orders, or other initiatives to be undertaken during 
        the upcoming period;
          (4) an analysis of complaints about consumer 
        financial products or services that the Bureau has 
        received and collected in its central database on 
        complaints during the preceding year;
          (5) a list, with a brief statement of the issues, of 
        the public [supervisory and] enforcement actions to 
        which the Bureau was a party during the preceding year;
          (6) the actions taken regarding rules, [orders, and 
        supervisory actions] and orders with respect to covered 
        persons which are not credit unions or depository 
        institutions;
          (7) an assessment of significant actions by State 
        attorneys general or State regulators relating to 
        Federal consumer financial law;
          (8) an analysis of the efforts of the Bureau to 
        fulfill the fair lending mission of the Bureau; and
          (9) an analysis of the efforts of the Bureau to 
        increase workforce and contracting diversity consistent 
        with the procedures established by the Office of 
        Minority and Women Inclusion.
  (d) Additional Requirement for Inspector General.--On a 
separate occasion from that described in subsection (a), the 
Inspector General of the Agency shall appear, upon invitation, 
before the Committee on Banking, Housing, and Urban Affairs of 
the Senate and the Committee on Financial Services of the House 
of Representatives at semi-annual hearings regarding the 
reports required under subsection (b) and the reports required 
under section 5 of the Inspector General Act of 1978 (5 U.S.C. 
App.).

SEC. 1017. FUNDING; PENALTIES AND FINES.

  (a) [Transfer of Funds From Board Of Governors.--] Budget, 
Financial Management, and Audit._
          [(1) In general.--Each year (or quarter of such 
        year), beginning on the designated transfer date, and 
        each quarter thereafter, the Board of Governors shall 
        transfer to the Bureau from the combined earnings of 
        the Federal Reserve System, the amount determined by 
        the Director to be reasonably necessary to carry out 
        the authorities of the Bureau under Federal consumer 
        financial law, taking into account such other sums made 
        available to the Bureau from the preceding year (or 
        quarter of such year).
          [(2) Funding cap.--
                  [(A) In general.--Notwithstanding paragraph 
                (1), and in accordance with this paragraph, the 
                amount that shall be transferred to the Bureau 
                in each fiscal year shall not exceed a fixed 
                percentage of the total operating expenses of 
                the Federal Reserve System, as reported in the 
                Annual Report, 2009, of the Board of Governors, 
                equal to--
                          [(i) 10 percent of such expenses in 
                        fiscal year 2011;
                          [(ii) 11 percent of such expenses in 
                        fiscal year 2012; and
                          [(iii) 12 percent of such expenses in 
                        fiscal year 2013, and in each year 
                        thereafter.
                  [(B) Adjustment of amount.--The dollar amount 
                referred to in subparagraph (A)(iii) shall be 
                adjusted annually, using the percent increase, 
                if any, in the employment cost index for total 
                compensation for State and local government 
                workers published by the Federal Government, or 
                the successor index thereto, for the 12-month 
                period ending on September 30 of the year 
                preceding the transfer.
                  [(C) Reviewability.--Notwithstanding any 
                other provision in this title, the funds 
                derived from the Federal Reserve System 
                pursuant to this subsection shall not be 
                subject to review by the Committees on 
                Appropriations of the House of Representatives 
                and the Senate.
          [(3) Transition period.--Beginning on the date of 
        enactment of this Act and until the designated transfer 
        date, the Board of Governors shall transfer to the 
        Bureau the amount estimated by the Secretary needed to 
        carry out the authorities granted to the Bureau under 
        Federal consumer financial law, from the date of 
        enactment of this Act until the designated transfer 
        date.]
          [(4)] (1) Budget and financial management.--
                  (A) Financial operating plans and 
                forecasts.--The Director shall provide to the 
                Director of the Office of Management and Budget 
                copies of the financial operating plans and 
                forecasts of the Director, as prepared by the 
                Director in the ordinary course of the 
                operations of the Bureau, and copies of the 
                quarterly reports of the financial condition 
                and results of operations of the Bureau, as 
                prepared by the Director in the ordinary course 
                of the operations of the Bureau.
                  (B) Financial statements.--The Bureau shall 
                prepare annually a statement of--
                          (i) assets and liabilities and 
                        surplus or deficit;
                          (ii) income and expenses; and
                          (iii) sources and application of 
                        funds.
                  (C) Financial management systems.--The Bureau 
                shall implement and maintain financial 
                management systems that comply substantially 
                with Federal financial management systems 
                requirements and applicable Federal accounting 
                standards.
                  (D) Assertion of internal controls.--The 
                Director shall provide to the Comptroller 
                General of the United States an assertion as to 
                the effectiveness of the internal controls that 
                apply to financial reporting by the Bureau, 
                using the standards established in section 
                3512(c) of title 31, United States Code.
                  [(E) Rule of construction.--This subsection 
                may not be construed as implying any obligation 
                on the part of the Director to consult with or 
                obtain the consent or approval of the Director 
                of the Office of Management and Budget with 
                respect to any report, plan, forecast, or other 
                information referred to in subparagraph (A) or 
                any jurisdiction or oversight over the affairs 
                or operations of the Bureau.
                  [(F) Financial statements.--The financial 
                statements of the Bureau shall not be 
                consolidated with the financial statements of 
                either the Board of Governors or the Federal 
                Reserve System.]
          [(5)] (2) Audit of the bureau.--
                  (A) In general.--The Comptroller General 
                shall annually audit the financial transactions 
                of the Bureau in accordance with the United 
                States generally accepted government auditing 
                standards, as may be prescribed by the 
                Comptroller General of the United States. The 
                audit shall be conducted at the place or places 
                where accounts of the Bureau are normally kept. 
                The representatives of the Government 
                Accountability Office shall have access to the 
                personnel and to all books, accounts, 
                documents, papers, records (including 
                electronic records), reports, files, and all 
                other papers, automated data, things, or 
                property belonging to or under the control of 
                or used or employed by the Bureau pertaining to 
                its financial transactions and necessary to 
                facilitate the audit, and such representatives 
                shall be afforded full facilities for verifying 
                transactions with the balances or securities 
                held by depositories, fiscal agents, and 
                custodians. All such books, accounts, 
                documents, records, reports, files, papers, and 
                property of the Bureau shall remain in 
                possession and custody of the Bureau. The 
                Comptroller General may obtain and duplicate 
                any such books, accounts, documents, records, 
                working papers, automated data and files, or 
                other information relevant to such audit 
                without cost to the Comptroller General, and 
                the right of access of the Comptroller General 
                to such information shall be enforceable 
                pursuant to section [716(c)] 716 of title 31, 
                United States Code.
                  (B) Report.--The Comptroller General shall 
                submit to the Congress a report of each annual 
                audit conducted under this subsection. The 
                report to the Congress shall set forth the 
                scope of the audit and shall include the 
                statement of assets and liabilities and surplus 
                or deficit, the statement of income and 
                expenses, the statement of sources and 
                application of funds, and such comments and 
                information as may be deemed necessary to 
                inform Congress of the financial operations and 
                condition of the Bureau, together with such 
                recommendations with respect thereto as the 
                Comptroller General may deem advisable. A copy 
                of each report shall be furnished to the 
                President and to the Bureau at the time 
                submitted to the Congress.
                  (C) Assistance and costs.--For the purpose of 
                conducting an audit under this subsection, the 
                Comptroller General may, in the discretion of 
                the Comptroller General, employ by contract, 
                without regard to [section 3709 of the Revised 
                Statutes of the United States (41 U.S.C. 5)] 
                section 6101 of title 41, United States Code, 
                professional services of firms and 
                organizations of certified public accountants 
                for temporary periods or for special purposes. 
                Upon the request of the Comptroller General, 
                the Director of the Bureau shall transfer to 
                the Government Accountability Office from funds 
                available, the amount requested by the 
                Comptroller General to cover the full costs of 
                any audit and report conducted by the 
                Comptroller General. The Comptroller General 
                shall credit funds transferred to the account 
                established for salaries and expenses of the 
                Government Accountability Office, and such 
                amount shall be available upon receipt and 
                without fiscal year limitation to cover the 
                full costs of the audit and report.
  [(b) Consumer Financial Protection Fund.--
          [(1) Separate fund in federal reserve established.--
        There is established in the Federal Reserve a separate 
        fund, to be known as the ``Bureau of Consumer Financial 
        Protection Fund'' (referred to in this section as the 
        ``Bureau Fund''). The Bureau Fund shall be maintained 
        and established at a Federal reserve bank, in 
        accordance with such requirements as the Board of 
        Governors may impose.
          [(2) Fund receipts.--All amounts transferred to the 
        Bureau under subsection (a) shall be deposited into the 
        Bureau Fund.
          [(3) Investment authority.--
                  [(A) Amounts in bureau fund may be 
                invested.--The Bureau may request the Board of 
                Governors to direct the investment of the 
                portion of the Bureau Fund that is not, in the 
                judgment of the Bureau, required to meet the 
                current needs of the Bureau.
                  [(B) Eligible investments.--Investments 
                authorized by this paragraph shall be made in 
                obligations of the United States or obligations 
                that are guaranteed as to principal and 
                interest by the United States, with maturities 
                suitable to the needs of the Bureau Fund, as 
                determined by the Bureau.
                  [(C) Interest and proceeds credited.--The 
                interest on, and the proceeds from the sale or 
                redemption of, any obligations held in the 
                Bureau Fund shall be credited to the Bureau 
                Fund.
  [(c) Use of Funds.--
          [(1) In general.--Funds obtained by, transferred to, 
        or credited to the Bureau Fund shall be immediately 
        available to the Bureau and under the control of the 
        Director, and shall remain available until expended, to 
        pay the expenses of the Bureau in carrying out its 
        duties and responsibilities. The compensation of the 
        Director and other employees of the Bureau and all 
        other expenses thereof may be paid from, obtained by, 
        transferred to, or credited to the Bureau Fund under 
        this section.
          [(2) Funds that are not government funds.--Funds 
        obtained by or transferred to the Bureau Fund shall not 
        be construed to be Government funds or appropriated 
        monies.
          [(3) Amounts not subject to apportionment.--
        Notwithstanding any other provision of law, amounts in 
        the Bureau Fund and in the Civil Penalty Fund 
        established under subsection (d) shall not be subject 
        to apportionment for purposes of chapter 15 of title 
        31, United States Code, or under any other authority.]
  [(d)] (b) Penalties and Fines.--
          (1) Establishment of victims relief fund.--There is 
        established in the Federal Reserve a separate fund, to 
        be known as the ``Consumer Financial Civil Penalty 
        Fund'' (referred to in this section as the ``Civil 
        Penalty Fund''). The Civil Penalty Fund shall be 
        maintained and established at a Federal reserve bank, 
        in accordance with such requirements as the Board of 
        Governors may impose. If the Bureau obtains a civil 
        penalty against any person in any judicial or 
        administrative action under Federal consumer financial 
        laws, the Bureau shall deposit into the Civil Penalty 
        Fund, the amount of the penalty collected.
          (2) Segregated accounts in civil penalty fund.--
                  (A) In general.--The Agency shall establish 
                and maintain a segregated account in the Civil 
                Penalty Fund each time the Agency obtains a 
                civil penalty against any person in any 
                judicial or administrative action under Federal 
                consumer financial laws.
                  (B) Deposits in segregated accounts.--The 
                Agency shall deposit each civil penalty 
                collected into the segregated account 
                established for such penalty under subparagraph 
                (A).
          [(2) Payment to victims.--Amounts in the Civil 
        Penalty Fund shall be available to the Bureau, without 
        fiscal year limitation, for payments to the victims of 
        activities for which civil penalties have been imposed 
        under the Federal consumer financial laws. To the 
        extent that such victims cannot be located or such 
        payments are otherwise not practicable, the Bureau may 
        use such funds for the purpose of consumer education 
        and financial literacy programs.]
          (3) Payment to victims.--
                  (A) In general.--
                          (i) Identification of class.--Not 
                        later than 60 days after the date of 
                        deposit of amounts in a segregated 
                        account in the Civil Penalty Fund, the 
                        Agency shall identify the class of 
                        victims of the violation of Federal 
                        consumer financial laws for which such 
                        amounts were collected and deposited 
                        under paragraph (2).
                          (ii) Payments.--The Agency, within 2 
                        years after the date on which such 
                        class of victims is identified, shall 
                        locate and make payments from such 
                        amounts to each victim.
                  (B) Funds deposited in treasury.--
                          (i) In general.--The Agency shall 
                        deposit into the general fund of the 
                        Treasury any amounts remaining in a 
                        segregated account in the Civil Penalty 
                        Fund at the end of the 2-year period 
                        for payments to victims under 
                        subparagraph (A).
                          (ii) Impossible or impractical 
                        payments.--If the Agency determines 
                        before the end of the 2-year period for 
                        payments to victims under subparagraph 
                        (A) that such victims cannot be located 
                        or payments to such victims are 
                        otherwise not practicable, the Agency 
                        shall deposit into the general fund of 
                        the Treasury the amounts in the 
                        segregated account in the Civil Penalty 
                        Fund.
  [(e)] (c) Authorization of Appropriations; Annual Report.--
          [(1) Determination regarding need for appropriated 
        funds.--
                  [(A) In general.--The Director is authorized 
                to determine that sums available to the Bureau 
                under this section will not be sufficient to 
                carry out the authorities of the Bureau under 
                Federal consumer financial law for the upcoming 
                year.
                  [(B) Report required.--When making a 
                determination under subparagraph (A), the 
                Director shall prepare a report regarding the 
                funding of the Bureau, including the assets and 
                liabilities of the Bureau, and the extent to 
                which the funding needs of the Bureau are 
                anticipated to exceed the level of the amount 
                set forth in subsection (a)(2). The Director 
                shall submit the report to the President and to 
                the Committee on Appropriations of the Senate 
                and the Committee on Appropriations of the 
                House of Representatives.
          [(2) Authorization of appropriations.--If the 
        Director makes the determination and submits the report 
        pursuant to paragraph (1), there are hereby authorized 
        to be appropriated to the Bureau, for the purposes of 
        carrying out the authorities granted in Federal 
        consumer financial law, $200,000,000 for each of fiscal 
        years 2010, 2011, 2012, 2013, and 2014.
          [(3) Apportionment.--Notwithstanding any other 
        provision of law, the amounts in paragraph (2) shall be 
        subject to apportionment under section 1517 of title 
        31, United States Code, and restrictions that generally 
        apply to the use of appropriated funds in title 31, 
        United States Code, and other laws.]
          (1) Authorization of appropriations.--There is 
        authorized to be appropriated to the Agency for each of 
        fiscal years 2017 and 2018 an amount equal to the 
        aggregate amount of funds transferred by the Board of 
        Governors to the Bureau of Consumer Financial 
        Protection during fiscal year 2015.
          [(4)] (2) Annual report.--The Director shall prepare 
        and submit a report, on an annual basis, to the 
        Committee on Appropriations of the Senate and the 
        Committee on Appropriations of the House of 
        Representatives regarding the financial operating plans 
        and forecasts of the Director, the financial condition 
        and results of operations of the Bureau, and the 
        sources and application of funds of the Bureau, 
        including any funds appropriated in accordance with 
        this subsection.

           *       *       *       *       *       *       *


                Subtitle B--General Powers of the Bureau

SEC. 1021. PURPOSE, OBJECTIVES, AND FUNCTIONS.

  (a) Purpose.--The Bureau shall seek to implement and, where 
applicable, enforce Federal consumer financial law consistently 
for the purpose of ensuring that all consumers have access to 
markets for consumer financial products and services and that 
markets for consumer financial products and services are fair, 
transparent, and competitive. In addition, the Director shall 
seek to implement and, where applicable, enforce Federal 
consumer financial law consistently for the purpose of 
strengthening participation in markets by covered persons, 
without Government interference or subsidies, to increase 
competition and enhance consumer choice.
  (b) Objectives.--The Bureau is authorized to exercise its 
authorities under Federal consumer financial law for the 
purposes of ensuring that, with respect to consumer financial 
products and services--
          (1) consumers are provided with timely and 
        understandable information to make responsible 
        decisions about financial transactions;
          (2) consumers are protected from [unfair, deceptive, 
        or abusive acts and practices and] from discrimination;
          (3) outdated, unnecessary, or unduly burdensome 
        regulations are regularly identified and addressed in 
        order to reduce unwarranted regulatory burdens;
          (4) Federal consumer financial law is enforced 
        consistently, without regard to the status of a person 
        as a depository institution, in order to promote fair 
        competition; and
          (5) markets for consumer financial products and 
        services operate transparently and efficiently to 
        facilitate access and innovation.
  (c) Functions.--The primary functions of the Bureau are--
          (1) conducting financial education programs;
          (2) collecting, investigating, and responding to 
        consumer complaints;
          [(3) collecting, researching, monitoring, and 
        publishing information relevant to the functioning of 
        markets for consumer financial products and services to 
        identify risks to consumers and the proper functioning 
        of such markets;]
          [(4)] (3) subject to sections 1024 through 1026, 
        supervising covered persons for compliance with Federal 
        consumer financial law, and taking appropriate 
        enforcement action to address violations of Federal 
        consumer financial law;
          [(5)] (4) issuing rules, orders, and guidance 
        implementing Federal consumer financial law; and
          [(6)] (5) performing such support activities as may 
        be necessary or useful to facilitate the other 
        functions of the Bureau.

SEC. 1022. RULEMAKING AUTHORITY.

  (a) In General.--The Bureau is authorized to exercise its 
authorities under Federal consumer financial law to administer, 
enforce, and otherwise implement the provisions of Federal 
consumer financial law.
  (b) Rulemaking, Orders, and Guidance.--
          (1) General authority.--The Director may prescribe 
        rules and issue orders and guidance, as may be 
        necessary or appropriate to enable the Bureau to 
        administer and carry out the purposes and objectives of 
        the Federal consumer financial laws, and to prevent 
        evasions thereof.
          (2) Standards for rulemaking.--In prescribing a rule 
        under the Federal consumer financial laws--
                  (A) the Bureau shall consider--
                          (i) the potential benefits and costs 
                        to consumers and covered persons, 
                        including the potential reduction of 
                        access by consumers to consumer 
                        financial products or services 
                        resulting from such rule; [and]
                          (ii) the impact of proposed rules on 
                        covered persons, as described in 
                        section 1026, and the impact on 
                        consumers in rural areas; and
                          (iii) the impact of such rule on the 
                        financial safety or soundness of an 
                        insured depository institution;
                  (B) the Bureau shall consult with the 
                appropriate prudential regulators or other 
                Federal agencies prior to proposing a rule and 
                during the comment process regarding 
                consistency with prudential, market, or 
                systemic objectives administered by such 
                agencies; and
                  (C) if, during the consultation process 
                described in subparagraph (B), a prudential 
                regulator provides the Bureau with a written 
                objection to the proposed rule of the Bureau or 
                a portion thereof, the Bureau shall include in 
                the adopting release a description of the 
                objection and the basis for the Bureau 
                decision, if any, regarding such objection[, 
                except that nothing in this clause shall be 
                construed as altering or limiting the 
                procedures under section 1023 that may apply to 
                any rule prescribed by the Bureau].
          (3) Exemptions.--
                  (A) In general.--The Bureau, by rule, may 
                conditionally or unconditionally exempt any 
                class of covered persons, service providers, or 
                consumer financial products or services, from 
                any provision of this title, or from any rule 
                issued under this title, as the Bureau 
                determines necessary or appropriate to carry 
                out the purposes and objectives of this title, 
                taking into consideration the factors in 
                subparagraph (B).
                  (B) Factors.--In issuing an exemption, as 
                permitted under subparagraph (A), the Bureau 
                shall, as appropriate, take into 
                consideration--
                          (i) the total assets of the class of 
                        covered persons;
                          (ii) the volume of transactions 
                        involving consumer financial products 
                        or services in which the class of 
                        covered persons engages; and
                          (iii) existing provisions of law 
                        which are applicable to the consumer 
                        financial product or service and the 
                        extent to which such provisions provide 
                        consumers with adequate protections.
          (4) Exclusive rulemaking authority.--
                  [(A) In general.--] Notwithstanding any other 
                provisions of Federal law and except as 
                provided in section 1061(b)(5), to the extent 
                that a provision of Federal consumer financial 
                law authorizes the Bureau and another Federal 
                agency to issue regulations under that 
                provision of law for purposes of assuring 
                compliance with Federal consumer financial law 
                and any regulations thereunder, the Bureau 
                shall have the exclusive authority to prescribe 
                rules subject to those provisions of law.
                  [(B) Deference.--Notwithstanding any power 
                granted to any Federal agency or to the Council 
                under this title, and subject to section 
                1061(b)(5)(E), the deference that a court 
                affords to the Bureau with respect to a 
                determination by the Bureau regarding the 
                meaning or interpretation of any provision of a 
                Federal consumer financial law shall be applied 
                as if the Bureau were the only agency 
                authorized to apply, enforce, interpret, or 
                administer the provisions of such Federal 
                consumer financial law.]
          (5) Consideration of review and assessment by the 
        office of economic analysis.--Before issuing any rule 
        or regulation, the Director shall consider the review 
        and assessment of such rule or regulation carried out 
        by the Office of Economic Analysis.
          (6) Identification of problems and metrics for 
        judging success.--
                  (A) In general.--The Director shall, in each 
                proposed rulemaking of the Agency--
                          (i) identify the problem that the 
                        particular rule or regulations is 
                        seeking to solve; and
                          (ii) specify the metrics by which the 
                        Agency will measure the success of the 
                        rule or regulation in solving such 
                        problem.
                  (B) Required metrics.--The metrics specified 
                under subparagraph (A)(ii) shall include a 
                measurement of changes to consumer access to, 
                and cost of, consumer financial products and 
                services.
          (7) Advisory opinions.--
                  (A) Establishing procedures.--
                          (i) In general.--The Director shall 
                        establish a procedure and, as 
                        necessary, promulgate rules to provide 
                        written opinions in response to 
                        inquiries concerning the conformance of 
                        specific conduct with Federal consumer 
                        financial law. In establishing the 
                        procedure, the Director shall consult 
                        with the prudential regulators and such 
                        other Federal departments and agencies 
                        as the Director determines appropriate, 
                        and obtain the views of all interested 
                        persons through a public notice and 
                        comment period.
                          (ii) Scope of request.--A request for 
                        an opinion under this paragraph must 
                        relate to specific proposed or 
                        prospective conduct by a covered person 
                        contemplating the proposed or 
                        prospective conduct.
                          (iii) Submission.--A request for an 
                        opinion under this paragraph may be 
                        submitted to the Director either by or 
                        on behalf of a covered person.
                          (iv) Right to withdraw inquiry.--Any 
                        inquiry under this paragraph may be 
                        withdrawn at any time prior to the 
                        Director issuing an opinion in response 
                        to such inquiry, and any opinion based 
                        on an inquiry that has been withdrawn 
                        shall have no force or effect.
                  (B) Issuance of opinions.--
                          (i) In general.--The Director shall, 
                        within 90 days of receiving the request 
                        for an opinion under this paragraph, 
                        either--
                                  (I) issue an opinion stating 
                                whether the described conduct 
                                would violate Federal consumer 
                                financial law;
                                  (II) if permissible under 
                                clause (iii), deny the request; 
                                or
                                  (III) explain why it is not 
                                feasible to issue an opinion.
                          (ii) Extension.--Notwithstanding 
                        clause (i), if the Director determines 
                        that the Agency requires additional 
                        time to issue an opinion, the Director 
                        may make a single extension of the 
                        deadline of 90 days or less.
                          (iii) Denial of requests.--The 
                        Director shall not issue an opinion, 
                        and shall so inform the requestor, if 
                        the request for an opinion--
                                  (I) asks a general question 
                                of interpretation;
                                  (II) asks about a 
                                hypothetical situation;
                                  (III) asks about the conduct 
                                of someone other than the 
                                covered person on whose behalf 
                                the request is made;
                                  (IV) asks about past conduct 
                                that the covered person on 
                                whose behalf the request is 
                                made does not plan to continue 
                                in the future; or
                                  (V) fails to provide 
                                necessary supporting 
                                information requested by the 
                                Agency within a reasonable time 
                                established by the Agency.
                          (iv) Amendment and revocation.--An 
                        advisory opinion issued under this 
                        paragraph may be amended or revoked at 
                        any time.
                          (v) Public disclosure.--An opinion 
                        rendered pursuant to this paragraph 
                        shall be placed in the Agency's public 
                        record 90 days after the requesting 
                        party has received the advice, subject 
                        to any limitations on public disclosure 
                        arising from statutory restrictions, 
                        Agency regulations, or the public 
                        interest. The Agency shall redact any 
                        personal, confidential, or identifying 
                        information about the covered person or 
                        any other persons mentioned in the 
                        advisory opinion, unless the covered 
                        person consents to such disclosure.
                          (vi) Report to congress.--The Agency 
                        shall, concurrent with the semi-annual 
                        report required under section 1016(b), 
                        submit information regarding the number 
                        of requests for an advisory opinion 
                        received, the subject of each request, 
                        the number of requests denied pursuant 
                        to clause (iii), and the time needed to 
                        respond to each request.
                  (C) Reliance on opinion.--Any person may rely 
                on an opinion issued by the Director pursuant 
                to this paragraph that has not been amended or 
                withdrawn. No liability under Federal consumer 
                financial law shall attach to conduct 
                consistent with an advisory opinion that had 
                not been amended or withdrawn at the time the 
                conduct was undertaken.
                  (D) Confidentiality.--Any document or other 
                material that is received by the Agency or any 
                other Federal department or agency in 
                connection with an inquiry under this paragraph 
                shall be exempt from disclosure under section 
                552 of title 5, United States Code (commonly 
                referred to as the ``Freedom of Information 
                Act'') and may not, except with the consent of 
                the covered person making such inquiry, be made 
                publicly available, regardless of whether the 
                Director responds to such inquiry or the 
                covered person withdraws such inquiry before 
                receiving an opinion.
                  (E) Assistance for small businesses.--
                          (i) In general.--The Agency shall 
                        assist, to the maximum extent 
                        practicable, small businesses in 
                        preparing inquiries under this 
                        paragraph.
                          (ii) Small business defined.--For 
                        purposes of this subparagraph, the term 
                        ``small business'' has the meaning 
                        given the term ``small business 
                        concern'' under section 3 of the Small 
                        Business Act (15 U.S.C. 632).
                  (F) Inquiry fee.--
                          (i) In general.--The Director shall 
                        develop a system to charge a fee for 
                        each inquiry made under this paragraph 
                        in an amount sufficient, in the 
                        aggregate, to pay for the cost of 
                        carrying out this paragraph.
                          (ii) Notice and comment.--Not later 
                        than 45 days after the date of the 
                        enactment of this paragraph, the 
                        Director shall publish a description of 
                        the fee system described in clause (i) 
                        in the Federal Register and shall 
                        solicit comments from the public for a 
                        period of 60 days after publication.
                          (iii) Finalization.--The Director 
                        shall publish a final description of 
                        the fee system and implement such fee 
                        system not later than 30 days after the 
                        end of the public comment period 
                        described in clause (ii).
          (8) Guidance on indirect auto financing.--In 
        proposing and issuing guidance primarily related to 
        indirect auto financing, the Agency shall--
                  (A) provide for a public notice and comment 
                period before issuing the guidance in final 
                form;
                  (B) make available to the public, including 
                on the website of the Agency, all studies, 
                data, methodologies, analyses, and other 
                information relied on by the Agency in 
                preparing such guidance;
                  (C) redact any information that is exempt 
                from disclosure under paragraph (3), (4), (6), 
                (7), or (8) of section 552(b) of title 5, 
                United States Code;
                  (D) consult with the Board of Governors of 
                the Federal Reserve System, the Federal Trade 
                Commission, and the Department of Justice; and
                  (E) conduct a study on the costs and impacts 
                of such guidance to consumers and women-owned, 
                minority-owned, veteran-owned, and small 
                businesses, including consumers and small 
                businesses in rural areas.
  [(c) Monitoring.--
          [(1) In general.--In order to support its rulemaking 
        and other functions, the Bureau shall monitor for risks 
        to consumers in the offering or provision of consumer 
        financial products or services, including developments 
        in markets for such products or services.
          [(2) Considerations.--In allocating its resources to 
        perform the monitoring required by this section, the 
        Bureau may consider, among other factors--
                  [(A) likely risks and costs to consumers 
                associated with buying or using a type of 
                consumer financial product or service;
                  [(B) understanding by consumers of the risks 
                of a type of consumer financial product or 
                service;
                  [(C) the legal protections applicable to the 
                offering or provision of a consumer financial 
                product or service, including the extent to 
                which the law is likely to adequately protect 
                consumers;
                  [(D) rates of growth in the offering or 
                provision of a consumer financial product or 
                service;
                  [(E) the extent, if any, to which the risks 
                of a consumer financial product or service may 
                disproportionately affect traditionally 
                underserved consumers; or
                  [(F) the types, number, and other pertinent 
                characteristics of covered persons that offer 
                or provide the consumer financial product or 
                service.
          [(3) Significant findings.--
                  [(A) In general.--The Bureau shall publish 
                not fewer than 1 report of significant findings 
                of its monitoring required by this subsection 
                in each calendar year, beginning with the first 
                calendar year that begins at least 1 year after 
                the designated transfer date.
                  [(B) Confidential information.--The Bureau 
                may make public such information obtained by 
                the Bureau under this section as is in the 
                public interest, through aggregated reports or 
                other appropriate formats designed to protect 
                confidential information in accordance with 
                paragraphs (4), (6), (8), and (9).
          [(4) Collection of information.--
                  [(A) In general.--In conducting any 
                monitoring or assessment required by this 
                section, the Bureau shall have the authority to 
                gather information from time to time regarding 
                the organization, business conduct, markets, 
                and activities of covered persons and service 
                providers.
                  [(B) Methodology.--In order to gather 
                information described in subparagraph (A), the 
                Bureau may--
                          [(i) gather and compile information 
                        from a variety of sources, including 
                        examination reports concerning covered 
                        persons or service providers, consumer 
                        complaints, voluntary surveys and 
                        voluntary interviews of consumers, 
                        surveys and interviews with covered 
                        persons and service providers, and 
                        review of available databases; and
                          [(ii) require covered persons and 
                        service providers participating in 
                        consumer financial services markets to 
                        file with the Bureau, under oath or 
                        otherwise, in such form and within such 
                        reasonable period of time as the Bureau 
                        may prescribe by rule or order, annual 
                        or special reports, or answers in 
                        writing to specific questions, 
                        furnishing information described in 
                        paragraph (4), as necessary for the 
                        Bureau to fulfill the monitoring, 
                        assessment, and reporting 
                        responsibilities imposed by Congress.
                  [(C) Limitation.--The Bureau may not use its 
                authorities under this paragraph to obtain 
                records from covered persons and service 
                providers participating in consumer financial 
                services markets for purposes of gathering or 
                analyzing the personally identifiable financial 
                information of consumers.
          [(5) Limited information gathering.--In order to 
        assess whether a nondepository is a covered person, as 
        defined in section 1002, the Bureau may require such 
        nondepository to file with the Bureau, under oath or 
        otherwise, in such form and within such reasonable 
        period of time as the Bureau may prescribe by rule or 
        order, annual or special reports, or answers in writing 
        to specific questions.
          [(6) Confidentiality rules.--
                  [(A) Rulemaking.--The Bureau shall prescribe 
                rules regarding the confidential treatment of 
                information obtained from persons in connection 
                with the exercise of its authorities under 
                Federal consumer financial law.
                  [(B) Access by the bureau to reports of other 
                regulators.--
                          [(i) Examination and financial 
                        condition reports.--Upon providing 
                        reasonable assurances of 
                        confidentiality, the Bureau shall have 
                        access to any report of examination or 
                        financial condition made by a 
                        prudential regulator or other Federal 
                        agency having jurisdiction over a 
                        covered person or service provider, and 
                        to all revisions made to any such 
                        report.
                          [(ii) Provision of other reports to 
                        the bureau.--In addition to the reports 
                        described in clause (i), a prudential 
                        regulator or other Federal agency 
                        having jurisdiction over a covered 
                        person or service provider may, in its 
                        discretion, furnish to the Bureau any 
                        other report or other confidential 
                        supervisory information concerning any 
                        insured depository institution, credit 
                        union, or other entity examined by such 
                        agency under authority of any provision 
                        of Federal law.
                  [(C) Access by other regulators to reports of 
                the bureau.--
                          [(i) Examination reports.--Upon 
                        providing reasonable assurances of 
                        confidentiality, a prudential 
                        regulator, a State regulator, or any 
                        other Federal agency having 
                        jurisdiction over a covered person or 
                        service provider shall have access to 
                        any report of examination made by the 
                        Bureau with respect to such person, and 
                        to all revisions made to any such 
                        report.
                          [(ii) Provision of other reports to 
                        other regulators.--In addition to the 
                        reports described in clause (i), the 
                        Bureau may, in its discretion, furnish 
                        to a prudential regulator or other 
                        agency having jurisdiction over a 
                        covered person or service provider any 
                        other report or other confidential 
                        supervisory information concerning such 
                        person examined by the Bureau under the 
                        authority of any other provision of 
                        Federal law.
          [(7) Registration.--
                  [(A) In general.--The Bureau may prescribe 
                rules regarding registration requirements 
                applicable to a covered person, other than an 
                insured depository institution, insured credit 
                union, or related person.
                  [(B) Registration information.--Subject to 
                rules prescribed by the Bureau, the Bureau may 
                publicly disclose registration information to 
                facilitate the ability of consumers to identify 
                covered persons that are registered with the 
                Bureau.
                  [(C) Consultation with state agencies.--In 
                developing and implementing registration 
                requirements under this paragraph, the Bureau 
                shall consult with State agencies regarding 
                requirements or systems (including coordinated 
                or combined systems for registration), where 
                appropriate.
          [(8) Privacy considerations.--In collecting 
        information from any person, publicly releasing 
        information held by the Bureau, or requiring covered 
        persons to publicly report information, the Bureau 
        shall take steps to ensure that proprietary, personal, 
        or confidential consumer information that is protected 
        from public disclosure under section 552(b) or 552a of 
        title 5, United States Code, or any other provision of 
        law, is not made public under this title.
          [(9) Consumer privacy.--
                  [(A) In general.--The Bureau may not obtain 
                from a covered person or service provider any 
                personally identifiable financial information 
                about a consumer from the financial records of 
                the covered person or service provider, 
                except--
                          [(i) if the financial records are 
                        reasonably described in a request by 
                        the Bureau and the consumer provides 
                        written permission for the disclosure 
                        of such information by the covered 
                        person or service provider to the 
                        Bureau; or
                          [(ii) as may be specifically 
                        permitted or required under other 
                        applicable provisions of law and in 
                        accordance with the Right to Financial 
                        Privacy Act of 1978 (12 U.S.C. 3401 et 
                        seq.).
                  [(B) Treatment of covered person or service 
                provider.--With respect to the application of 
                any provision of the Right to Financial Privacy 
                Act of 1978, to a disclosure by a covered 
                person or service provider subject to this 
                subsection, the covered person or service 
                provider shall be treated as if it were a 
                ``financial institution'', as defined in 
                section 1101 of that Act (12 U.S.C. 3401).]
  (c) Consumer Privacy.--
          (1) In general.--The Agency may not request, obtain, 
        access, collect, use, retain, or disclose any nonpublic 
        personal information about a consumer unless--
                  (A) the Agency clearly and conspicuously 
                discloses to the consumer, in writing or in an 
                electronic form, what information will be 
                requested, obtained, accessed, collected, used, 
                retained, or disclosed; and
                  (B) before such information is requested, 
                obtained, accessed, collected, used, retained, 
                or disclosed, the consumer informs the Agency 
                that such information may be requested, 
                obtained, accessed, collected, used, retained, 
                or disclosed.
          (2) Application of requirement to contractors of the 
        agency.--Paragraph (1) shall apply to any person 
        directed or engaged by the Agency to collect 
        information to the extent such information is being 
        collected on behalf of the Agency.
          (3) Definition of nonpublic personal information.--In 
        this subsection, the term ``nonpublic personal 
        information'' has the meaning given the term in section 
        509 of the Gramm-Leach-Bliley Act (15 U.S.C. 6809).
  (d) Assessment of Significant Rules.--
          (1) In general.--The Bureau shall conduct an 
        assessment of each significant rule or order adopted by 
        the Bureau under Federal consumer financial law. The 
        assessment shall address, among other relevant factors, 
        the effectiveness of the rule or order in meeting the 
        purposes and objectives of this title and the specific 
        goals stated by the Bureau. The assessment shall 
        reflect available evidence and any data that the Bureau 
        reasonably may collect.
          (2) Reports.--The Bureau shall publish a report of 
        its assessment under this subsection not later than 5 
        years after the effective date of the subject rule or 
        order.
          (3) Public comment required.--Before publishing a 
        report of its assessment, the Bureau shall invite 
        public comment on recommendations for modifying, 
        expanding, or eliminating the newly adopted significant 
        rule or order.
  (e) Authority of the Office of Information and Regulatory 
Affairs.--The Office of Information and Regulatory Affairs 
shall have the same duties and authorities with respect to the 
Consumer Law Enforcement Agency as the Office of Information 
and Regulatory Affairs has with respect to any other agency 
that is not an independent regulatory agency (as such terms are 
defined, respectively, under section 3502 of title 44, United 
States Code).

[SEC. 1023. REVIEW OF BUREAU REGULATIONS.

  [(a) Review of Bureau Regulations.--On the petition of a 
member agency of the Council, the Council may set aside a final 
regulation prescribed by the Bureau, or any provision thereof, 
if the Council decides, in accordance with subsection (c), that 
the regulation or provision would put the safety and soundness 
of the United States banking system or the stability of the 
financial system of the United States at risk.
  [(b) Petition.--
          [(1) Procedure.--An agency represented by a member of 
        the Council may petition the Council, in writing, and 
        in accordance with rules prescribed pursuant to 
        subsection (f), to stay the effectiveness of, or set 
        aside, a regulation if the member agency filing the 
        petition--
                  [(A) has in good faith attempted to work with 
                the Bureau to resolve concerns regarding the 
                effect of the rule on the safety and soundness 
                of the United States banking system or the 
                stability of the financial system of the United 
                States; and
                  [(B) files the petition with the Council not 
                later than 10 days after the date on which the 
                regulation has been published in the Federal 
                Register.
          [(2) Publication.--Any petition filed with the 
        Council under this section shall be published in the 
        Federal Register and transmitted contemporaneously with 
        filing to the Committee on Banking, Housing, and Urban 
        Affairs of the Senate and the Committee on Financial 
        Services of the House of Representatives.
  [(c) Stays and Set Asides.--
          [(1) Stay.--
                  [(A) In general.--Upon the request of any 
                member agency, the Chairperson of the Council 
                may stay the effectiveness of a regulation for 
                the purpose of allowing appropriate 
                consideration of the petition by the Council.
                  [(B) Expiration.--A stay issued under this 
                paragraph shall expire on the earlier of--
                          [(i) 90 days after the date of filing 
                        of the petition under subsection (b); 
                        or
                          [(ii) the date on which the Council 
                        makes a decision under paragraph (3).
          [(2) No adverse inference.--After the expiration of 
        any stay imposed under this section, no inference shall 
        be drawn regarding the validity or enforceability of a 
        regulation which was the subject of the petition.
          [(3) Vote.--
                  [(A) In general.--The decision to issue a 
                stay of, or set aside, any regulation under 
                this section shall be made only with the 
                affirmative vote in accordance with 
                subparagraph (B) of \2/3\ of the members of the 
                Council then serving.
                  [(B) Authorization to vote.--A member of the 
                Council may vote to stay the effectiveness of, 
                or set aside, a final regulation prescribed by 
                the Bureau only if the agency or department 
                represented by that member has--
                          [(i) considered any relevant 
                        information provided by the agency 
                        submitting the petition and by the 
                        Bureau; and
                          [(ii) made an official determination, 
                        at a public meeting where applicable, 
                        that the regulation which is the 
                        subject of the petition would put the 
                        safety and soundness of the United 
                        States banking system or the stability 
                        of the financial system of the United 
                        States at risk.
          [(4) Decisions to set aside.--
                  [(A) Effect of decision.--A decision by the 
                Council to set aside a regulation prescribed by 
                the Bureau, or provision thereof, shall render 
                such regulation, or provision thereof, 
                unenforceable.
                  [(B) Timely action required.--The Council may 
                not issue a decision to set aside a regulation, 
                or provision thereof, which is the subject of a 
                petition under this section after the 
                expiration of the later of--
                          [(i) 45 days following the date of 
                        filing of the petition, unless a stay 
                        is issued under paragraph (1); or
                          [(ii) the expiration of a stay issued 
                        by the Council under this section.
                  [(C) Separate authority.--The issuance of a 
                stay under this section does not affect the 
                authority of the Council to set aside a 
                regulation.
          [(5) Dismissal due to inaction.--A petition under 
        this section shall be deemed dismissed if the Council 
        has not issued a decision to set aside a regulation, or 
        provision thereof, within the period for timely action 
        under paragraph (4)(B).
          [(6) Publication of decision.--Any decision under 
        this subsection to issue a stay of, or set aside, a 
        regulation or provision thereof shall be published by 
        the Council in the Federal Register as soon as 
        practicable after the decision is made, with an 
        explanation of the reasons for the decision.
          [(7) Rulemaking procedures inapplicable.--The notice 
        and comment procedures under section 553 of title 5, 
        United States Code, shall not apply to any decision 
        under this section of the Council to issue a stay of, 
        or set aside, a regulation.
          [(8) Judicial review of decisions by the council.--A 
        decision by the Council to set aside a regulation 
        prescribed by the Bureau, or provision thereof, shall 
        be subject to review under chapter 7 of title 5, United 
        States Code.
  [(d) Application of Other Law.--Nothing in this section shall 
be construed as altering, limiting, or restricting the 
application of any other provision of law, except as otherwise 
specifically provided in this section, including chapter 5 and 
chapter 7 of title 5, United States Code, to a regulation which 
is the subject of a petition filed under this section.
  [(e) Savings Clause.--Nothing in this section shall be 
construed as limiting or restricting the Bureau from engaging 
in a rulemaking in accordance with applicable law.
  [(f) Implementing Rules.--The Council shall prescribe 
procedural rules to implement this section.]

SEC. 1024. [SUPERVISION OF]  AUTHORITY WITH RESPECT TO CERTAIN 
                    NONDEPOSITORY COVERED PERSONS.

  (a) Scope of Coverage.--
          (1) Applicability.--Notwithstanding any other 
        provision of this title, and except as provided in 
        paragraph (3), this section shall apply to any covered 
        person who--
                  (A) offers or provides origination, 
                brokerage, or servicing of loans secured by 
                real estate for use by consumers primarily for 
                personal, family, or household purposes, or 
                loan modification or foreclosure relief 
                services in connection with such loans;
                  (B) is a larger participant of a market for 
                other consumer financial products or services, 
                [as defined by rule in accordance with 
                paragraph (2)] as of the date of the enactment 
                of the Financial CHOICE Act of 2017;
                  (C) the Bureau has reasonable cause to 
                determine, by order, after notice to the 
                covered person and a reasonable opportunity for 
                such covered person to respond, based on 
                complaints collected through the system under 
                section 1013(b)(3) or information from other 
                sources, that such covered person is engaging, 
                or has engaged, in conduct that poses risks to 
                consumers with regard to the offering or 
                provision of consumer financial products or 
                services; or
                  (D) offers or provides to a consumer any 
                private education loan, as defined in section 
                140 of the Truth in Lending Act (15 U.S.C. 
                1650), notwithstanding section 1027(a)(2)(A) 
                and subject to section 1027(a)(2)(C)[; or].
                  [(E) offers or provides to a consumer a 
                payday loan.]
          [(2) Rulemaking to define covered persons subject to 
        this section.--The Bureau shall consult with the 
        Federal Trade Commission prior to issuing a rule, in 
        accordance with paragraph (1)(B), to define covered 
        persons subject to this section. The Bureau shall issue 
        its initial rule not later than 1 year after the 
        designated transfer date.]
          [(3)] (2) Rules of construction.--
                  (A) Certain persons excluded.--This section 
                shall not apply to persons described in section 
                [1025(a) or] 1026(a).
                  (B) Activity levels.--For purposes of 
                computing activity levels under paragraph (1) 
                or rules issued thereunder, activities of 
                affiliated companies (other than insured 
                depository institutions or insured credit 
                unions) shall be aggregated.
  [(b) Supervision.--
          [(1) In general.--The Bureau shall require reports 
        and conduct examinations on a periodic basis of persons 
        described in subsection (a)(1) for purposes of--
                  [(A) assessing compliance with the 
                requirements of Federal consumer financial law;
                  [(B) obtaining information about the 
                activities and compliance systems or procedures 
                of such person; and
                  [(C) detecting and assessing risks to 
                consumers and to markets for consumer financial 
                products and services.
          [(2) Risk-based supervision program.--The Bureau 
        shall exercise its authority under paragraph (1) in a 
        manner designed to ensure that such exercise, with 
        respect to persons described in subsection (a)(1), is 
        based on the assessment by the Bureau of the risks 
        posed to consumers in the relevant product markets and 
        geographic markets, and taking into consideration, as 
        applicable--
                  [(A) the asset size of the covered person;
                  [(B) the volume of transactions involving 
                consumer financial products or services in 
                which the covered person engages;
                  [(C) the risks to consumers created by the 
                provision of such consumer financial products 
                or services;
                  [(D) the extent to which such institutions 
                are subject to oversight by State authorities 
                for consumer protection; and
                  [(E) any other factors that the Bureau 
                determines to be relevant to a class of covered 
                persons.
          [(3) Coordination.--To minimize regulatory burden, 
        the Bureau shall coordinate its supervisory activities 
        with the supervisory activities conducted by prudential 
        regulators, the State bank regulatory authorities, and 
        the State agencies that licence, supervise, or examine 
        the offering of consumer financial products or 
        services, including establishing their respective 
        schedules for examining persons described in subsection 
        (a)(1) and requirements regarding reports to be 
        submitted by such persons. The sharing of information 
        with such regulators, authorities, and agencies shall 
        not be construed as waiving, destroying, or otherwise 
        affecting any privilege or confidentiality such person 
        may claim with respect to such information under 
        Federal or State law as to any person or entity other 
        than such Bureau, agency, supervisor, or authority.
          [(4) Use of existing reports.--The Bureau shall, to 
        the fullest extent possible, use--
                  [(A) reports pertaining to persons described 
                in subsection (a)(1) that have been provided or 
                required to have been provided to a Federal or 
                State agency; and
                  [(B) information that has been reported 
                publicly.
          [(5) Preservation of authority.--Nothing in this 
        title may be construed as limiting the authority of the 
        Director to require reports from persons described in 
        subsection (a)(1), as permitted under paragraph (1), 
        regarding information owned or under the control of 
        such person, regardless of whether such information is 
        maintained, stored, or processed by another person.
          [(6) Reports of tax law noncompliance.--The Bureau 
        shall provide the Commissioner of Internal Revenue with 
        any report of examination or related information 
        identifying possible tax law noncompliance.
          [(7) Registration, recordkeeping and other 
        requirements for certain persons.--
                  [(A) In general.--The Bureau shall prescribe 
                rules to facilitate supervision of persons 
                described in subsection (a)(1) and assessment 
                and detection of risks to consumers.
                  [(B) Recordkeeping.--The Bureau may require a 
                person described in subsection (a)(1), to 
                generate, provide, or retain records for the 
                purposes of facilitating supervision of such 
                persons and assessing and detecting risks to 
                consumers.
                  [(C) Requirements concerning obligations.--
                The Bureau may prescribe rules regarding a 
                person described in subsection (a)(1), to 
                ensure that such persons are legitimate 
                entities and are able to perform their 
                obligations to consumers. Such requirements may 
                include background checks for principals, 
                officers, directors, or key personnel and 
                bonding or other appropriate financial 
                requirements.
                  [(D) Consultation with state agencies.--In 
                developing and implementing requirements under 
                this paragraph, the Bureau shall consult with 
                State agencies regarding requirements or 
                systems (including coordinated or combined 
                systems for registration), where appropriate.]
  [(c)] (b) Enforcement Authority.--
          (1) The bureau to have enforcement authority.--Except 
        as provided in paragraph (3) and section 1061, with 
        respect to any person described in subsection (a)(1), 
        to the extent that Federal law authorizes the Bureau 
        and another Federal agency to enforce Federal consumer 
        financial law, the Bureau shall have exclusive 
        authority to enforce that Federal consumer financial 
        law.
          (2) Referral.--Any Federal agency authorized to 
        enforce a Federal consumer financial law described in 
        paragraph (1) may recommend in writing to the Bureau 
        that the Bureau initiate an enforcement proceeding, as 
        the Bureau is authorized by that Federal law or by this 
        title.
          (3) Coordination with the federal trade commission.--
                  (A) In general.--The Bureau and the Federal 
                Trade Commission shall negotiate an agreement 
                for coordinating with respect to enforcement 
                actions by each agency regarding the offering 
                or provision of consumer financial products or 
                services by any covered person that is 
                described in subsection (a)(1), or service 
                providers thereto. The agreement shall include 
                procedures for notice to the other agency, 
                where feasible, prior to initiating a civil 
                action to enforce any Federal law regarding the 
                offering or provision of consumer financial 
                products or services.
                  (B) Civil actions.--Whenever a civil action 
                has been filed by, or on behalf of, the Bureau 
                or the Federal Trade Commission for any 
                violation of any provision of Federal law 
                described in subparagraph (A), or any 
                regulation prescribed under such provision of 
                law--
                          (i) the other agency may not, during 
                        the pendency of that action, institute 
                        a civil action under such provision of 
                        law against any defendant named in the 
                        complaint in such pending action for 
                        any violation alleged in the complaint; 
                        and
                          (ii) the Bureau or the Federal Trade 
                        Commission may intervene as a party in 
                        any such action brought by the other 
                        agency, and, upon intervening--
                                  (I) be heard on all matters 
                                arising in such enforcement 
                                action; and
                                  (II) file petitions for 
                                appeal in such actions.
                  (C) Agreement terms.--The terms of any 
                agreement negotiated under subparagraph (A) may 
                modify or supersede the provisions of 
                subparagraph (B).
                  (D) Deadline.--The agencies shall reach the 
                agreement required under subparagraph (A) not 
                later than 6 months after the designated 
                transfer date.
  [(d)] (c) Exclusive Rulemaking [and Examination Authority].--
Notwithstanding any other provision of Federal law and except 
as provided in section 1061, to the extent that Federal law 
authorizes the Bureau and another Federal agency to issue 
regulations or guidance[, conduct examinations,] or require 
reports from a person described in subsection (a)(1) under such 
law for purposes of assuring compliance with Federal consumer 
financial law and any regulations thereunder, the Bureau shall 
have the exclusive authority to prescribe rules, issue 
guidance[, conduct examinations,] require reports, or issue 
exemptions with regard to a person described in subsection 
(a)(1), subject to those provisions of law.
  [(e)] (d) Service Providers.--A service provider to a person 
described in subsection (a)(1) shall be subject to the 
rulemaking and enforcement, but not supervisory, authority of 
the Bureau under this section, to the same extent as if such 
service provider were engaged in a service relationship with a 
bank, and the Bureau were an appropriate Federal banking agency 
under section 7(c) of the Bank Service Company Act (12 U.S.C. 
1867(c)). In [conducting any examination or requiring any 
report from a service provider subject to this subsection] 
carrying out any authority pursuant to this subsection with 
respect to a service provider, the Bureau shall coordinate with 
the appropriate prudential regulator, as applicable.
  [(f)] (e) Preservation of Farm Credit Administration 
Authority.--No provision of this title may be construed as 
modifying, limiting, or otherwise affecting the authority of 
the Farm Credit Administration.

[SEC. 1025. SUPERVISION OF VERY LARGE BANKS, SAVINGS ASSOCIATIONS, AND 
                    CREDIT UNIONS.

  [(a) Scope of Coverage.--This section shall apply to any 
covered person that is--
          [(1) an insured depository institution with total 
        assets of more than $10,000,000,000 and any affiliate 
        thereof; or
          [(2) an insured credit union with total assets of 
        more than $10,000,000,000 and any affiliate thereof.
  [(b) Supervision.--
          [(1) In general.--The Bureau shall have exclusive 
        authority to require reports and conduct examinations 
        on a periodic basis of persons described in subsection 
        (a) for purposes of--
                  [(A) assessing compliance with the 
                requirements of Federal consumer financial 
                laws;
                  [(B) obtaining information about the 
                activities subject to such laws and the 
                associated compliance systems or procedures of 
                such persons; and
                  [(C) detecting and assessing associated risks 
                to consumers and to markets for consumer 
                financial products and services.
          [(2) Coordination.--To minimize regulatory burden, 
        the Bureau shall coordinate its supervisory activities 
        with the supervisory activities conducted by prudential 
        regulators and the State bank regulatory authorities, 
        including consultation regarding their respective 
        schedules for examining such persons described in 
        subsection (a) and requirements regarding reports to be 
        submitted by such persons.
          [(3) Use of existing reports.--The Bureau shall, to 
        the fullest extent possible, use--
                  [(A) reports pertaining to a person described 
                in subsection (a) that have been provided or 
                required to have been provided to a Federal or 
                State agency; and
                  [(B) information that has been reported 
                publicly.
          [(4) Preservation of authority.--Nothing in this 
        title may be construed as limiting the authority of the 
        Director to require reports from a person described in 
        subsection (a), as permitted under paragraph (1), 
        regarding information owned or under the control of 
        such person, regardless of whether such information is 
        maintained, stored, or processed by another person.
          [(5) Reports of tax law noncompliance.--The Bureau 
        shall provide the Commissioner of Internal Revenue with 
        any report of examination or related information 
        identifying possible tax law noncompliance.
  [(c) Primary Enforcement Authority.--
          [(1) The bureau to have primary enforcement 
        authority.--To the extent that the Bureau and another 
        Federal agency are authorized to enforce a Federal 
        consumer financial law, the Bureau shall have primary 
        authority to enforce that Federal consumer financial 
        law with respect to any person described in subsection 
        (a).
          [(2) Referral.--Any Federal agency, other than the 
        Federal Trade Commission, that is authorized to enforce 
        a Federal consumer financial law may recommend, in 
        writing, to the Bureau that the Bureau initiate an 
        enforcement proceeding with respect to a person 
        described in subsection (a), as the Bureau is 
        authorized to do by that Federal consumer financial 
        law.
          [(3) Backup enforcement authority of other federal 
        agency.--If the Bureau does not, before the end of the 
        120-day period beginning on the date on which the 
        Bureau receives a recommendation under paragraph (2), 
        initiate an enforcement proceeding, the other agency 
        referred to in paragraph (2) may initiate an 
        enforcement proceeding, including performing follow up 
        supervisory and support functions incidental thereto, 
        to assure compliance with such proceeding.
  [(d) Service Providers.--A service provider to a person 
described in subsection (a) shall be subject to the authority 
of the Bureau under this section, to the same extent as if the 
Bureau were an appropriate Federal banking agency under section 
7(c) of the Bank Service Company Act 12 U.S.C. 1867(c). In 
conducting any examination or requiring any report from a 
service provider subject to this subsection, the Bureau shall 
coordinate with the appropriate prudential regulator.
  [(e) Simultaneous and Coordinated Supervisory Action.--
          [(1) Examinations.--A prudential regulator and the 
        Bureau shall, with respect to each insured depository 
        institution, insured credit union, or other covered 
        person described in subsection (a) that is supervised 
        by the prudential regulator and the Bureau, 
        respectively--
                  [(A) coordinate the scheduling of 
                examinations of the insured depository 
                institution, insured credit union, or other 
                covered person described in subsection (a);
                  [(B) conduct simultaneous examinations of 
                each insured depository institution or insured 
                credit union, unless such institution requests 
                examinations to be conducted separately;
                  [(C) share each draft report of examination 
                with the other agency and permit the receiving 
                agency a reasonable opportunity (which shall 
                not be less than a period of 30 days after the 
                date of receipt) to comment on the draft report 
                before such report is made final; and
                  [(D) prior to issuing a final report of 
                examination or taking supervisory action, take 
                into consideration concerns, if any, raised in 
                the comments made by the other agency.
          [(2) Coordination with state bank supervisors.--The 
        Bureau shall pursue arrangements and agreements with 
        State bank supervisors to coordinate examinations, 
        consistent with paragraph (1).
          [(3) Avoidance of conflict in supervision.--
                  [(A) Request.--If the proposed supervisory 
                determinations of the Bureau and a prudential 
                regulator (in this section referred to 
                collectively as the ``agencies'') are 
                conflicting, an insured depository institution, 
                insured credit union, or other covered person 
                described in subsection (a) may request the 
                agencies to coordinate and present a joint 
                statement of coordinated supervisory action.
                  [(B) Joint statement.--The agencies shall 
                provide a joint statement under subparagraph 
                (A), not later than 30 days after the date of 
                receipt of the request of the insured 
                depository institution, credit union, or 
                covered person described in subsection (a).
          [(4) Appeals to governing panel.--
                  [(A) In general.--If the agencies do not 
                resolve the conflict or issue a joint statement 
                required by subparagraph (B), or if either of 
                the agencies takes or attempts to take any 
                supervisory action relating to the request for 
                the joint statement without the consent of the 
                other agency, an insured depository 
                institution, insured credit union, or other 
                covered person described in subsection (a) may 
                institute an appeal to a governing panel, as 
                provided in this subsection, not later than 30 
                days after the expiration of the period during 
                which a joint statement is required to be filed 
                under paragraph (3)(B).
                  [(B) Composition of governing panel.--The 
                governing panel for an appeal under this 
                paragraph shall be composed of--
                          [(i) a representative from the Bureau 
                        and a representative of the prudential 
                        regulator, both of whom--
                                  [(I) have not participated in 
                                the material supervisory 
                                determinations under appeal; 
                                and
                                  [(II) do not directly or 
                                indirectly report to the person 
                                who participated materially in 
                                the supervisory determinations 
                                under appeal; and
                          [(ii) one individual representative, 
                        to be determined on a rotating basis, 
                        from among the Board of Governors, the 
                        Corporation, the National Credit Union 
                        Administration, and the Office of the 
                        Comptroller of the Currency, other than 
                        any agency involved in the subject 
                        dispute.
                  [(C) Conduct of appeal.--In an appeal under 
                this paragraph--
                          [(i) the insured depository 
                        institution, insured credit union, or 
                        other covered person described in 
                        subsection (a)--
                                  [(I) shall include in its 
                                appeal all the facts and legal 
                                arguments pertaining to the 
                                matter; and
                                  [(II) may, through counsel, 
                                employees, or representatives, 
                                appear before the governing 
                                panel in person or by 
                                telephone; and
                          [(ii) the governing panel--
                                  [(I) may request the insured 
                                depository institution, insured 
                                credit union, or other covered 
                                person described in subsection 
                                (a), the Bureau, or the 
                                prudential regulator to produce 
                                additional information relevant 
                                to the appeal; and
                                  [(II) by a majority vote of 
                                its members, shall provide a 
                                final determination, in 
                                writing, not later than 30 days 
                                after the date of filing of an 
                                informationally complete 
                                appeal, or such longer period 
                                as the panel and the insured 
                                depository institution, insured 
                                credit union, or other covered 
                                person described in subsection 
                                (a) may jointly agree.
                  [(D) Public availability of determinations.--
                A governing panel shall publish all information 
                contained in a determination by the governing 
                panel, with appropriate redactions of 
                information that would be subject to an 
                exemption from disclosure under section 552 of 
                title 5, United States Code.
                  [(E) Prohibition against retaliation.--The 
                Bureau and the prudential regulators shall 
                prescribe rules to provide safeguards from 
                retaliation against the insured depository 
                institution, insured credit union, or other 
                covered person described in subsection (a) 
                instituting an appeal under this paragraph, as 
                well as their officers and employees.
                  [(F) Limitation.--The process provided in 
                this paragraph shall not apply to a 
                determination by a prudential regulator to 
                appoint a conservator or receiver for an 
                insured depository institution or a liquidating 
                agent for an insured credit union, as the case 
                may be, or a decision to take action pursuant 
                to section 38 of the Federal Deposit Insurance 
                Act (12 U.S.C. 1831o) or section 212 of the 
                Federal Credit Union Act (112 U.S.C. 1790a), as 
                applicable.
                  [(G) Effect on other authority.--Nothing in 
                this section shall modify or limit the 
                authority of the Bureau to interpret, or take 
                enforcement action under, any Federal consumer 
                financial law, or the authority of a prudential 
                regulator to interpret or take enforcement 
                action under any other provision of Federal law 
                for safety and soundness purposes.]

SEC. 1026. OTHER BANKS, SAVINGS ASSOCIATIONS, AND CREDIT UNIONS.

  [(a) Scope of Coverage.--This section shall apply to any 
covered person that is--
          [(1) an insured depository institution with total 
        assets of $10,000,000,000 or less; or
          [(2) an insured credit union with total assets of 
        $10,000,000,000 or less.]
  (a) Scope of Coverage.--This section shall apply to any 
covered person that is an insured depository institution or an 
insured credit union.
  (b) Reports.--The Director may require reports from a person 
described in subsection (a), as necessary to support the role 
of the Bureau in implementing Federal consumer financial law, 
to support its examination activities under subsection (c)[, 
and to assess and detect risks to consumers and consumer 
financial markets].
          (1) Use of existing reports.--The Bureau shall, to 
        the fullest extent possible, use--
                  (A) reports pertaining to a person described 
                in subsection (a) that have been provided or 
                required to have been provided to a Federal or 
                State agency; and
                  (B) information that has been reported 
                publicly.
          (2) Preservation of authority.--Nothing in this 
        subsection may be construed as limiting the authority 
        of the Director from requiring from a person described 
        in subsection (a), as permitted under paragraph (1), 
        information owned or under the control of such person, 
        regardless of whether such information is maintained, 
        stored, or processed by another person.
          (3) Reports of tax law noncompliance.--The Bureau 
        shall provide the Commissioner of Internal Revenue with 
        any [report of examination or related] information 
        identifying possible tax law noncompliance.
  [(c) Examinations.--
          [(1) In general.--The Bureau may, at its discretion, 
        include examiners on a sampling basis of the 
        examinations performed by the prudential regulator to 
        assess compliance with the requirements of Federal 
        consumer financial law of persons described in 
        subsection (a).
          [(2) Agency coordination.--The prudential regulator 
        shall--
                  [(A) provide all reports, records, and 
                documentation related to the examination 
                process for any institution included in the 
                sample referred to in paragraph (1) to the 
                Bureau on a timely and continual basis;
                  [(B) involve such Bureau examiner in the 
                entire examination process for such person; and
                  [(C) consider input of the Bureau concerning 
                the scope of an examination, conduct of the 
                examination, the contents of the examination 
                report, the designation of matters requiring 
                attention, and examination ratings.]
  [(d)] (c) Enforcement.--
          (1) In general.--Except for requiring reports under 
        subsection (b), the prudential regulator is authorized 
        to enforce the requirements of Federal consumer 
        financial laws and, with respect to a covered person 
        described in subsection (a), shall have exclusive 
        authority (relative to the Bureau) to enforce such 
        laws.
          (2) Coordination with prudential regulator.--
                  (A) Referral.--When the Bureau has reason to 
                believe that a person described in subsection 
                (a) has engaged in a material violation of a 
                Federal consumer financial law, the Bureau 
                shall notify the prudential regulator in 
                writing and recommend appropriate action to 
                respond.
                  (B) Response.--Upon receiving a 
                recommendation under subparagraph (A), the 
                prudential regulator shall provide a written 
                response to the Bureau not later than 60 days 
                thereafter.
  [(e)] (d) Service Providers.--A service provider to a 
substantial number of persons described in subsection (a) shall 
be subject to the authority of the Bureau under [section 1025] 
this section to the same extent as if the Bureau were an 
appropriate Federal bank agency under section 7(c) of the Bank 
Service Company Act (12 U.S.C. 1867(c)). [When conducting any 
examination or requiring any report from a service provider 
subject to this subsection] In carrying out any authority 
pursuant to this subsection with respect to a service provider, 
the Bureau shall coordinate with the appropriate prudential 
regulator.

SEC. 1027. LIMITATIONS ON AUTHORITIES OF THE BUREAU; PRESERVATION OF 
                    AUTHORITIES.

  (a) Exclusion for Merchants, Retailers, and Other Sellers of 
Nonfinancial Goods or Services.--
          (1) Sale or brokerage of nonfinancial good or 
        service.--The Bureau may not exercise any rulemaking, 
        [supervisory,] enforcement or other authority under 
        this title with respect to a person who is a merchant, 
        retailer, or seller of any nonfinancial good or service 
        and is engaged in the sale or brokerage of such 
        nonfinancial good or service, except to the extent that 
        such person is engaged in offering or providing any 
        consumer financial product or service, or is otherwise 
        subject to any enumerated consumer law or any law for 
        which authorities are transferred under subtitle F or 
        H.
          (2) Offering or provision of certain consumer 
        financial products or services in connection with the 
        sale or brokerage of nonfinancial good or service.--
                  (A) In general.--Except as provided in 
                subparagraph (B), and subject to subparagraph 
                (C), the Bureau may not exercise any 
                rulemaking, [supervisory,] enforcement, or 
                other authority under this title with respect 
                to a merchant, retailer, or seller of 
                nonfinancial goods or services, but only to the 
                extent that such person--
                          (i) extends credit directly to a 
                        consumer, in a case in which the good 
                        or service being provided is not itself 
                        a consumer financial product or service 
                        (other than credit described in this 
                        subparagraph), exclusively for the 
                        purpose of enabling that consumer to 
                        purchase such nonfinancial good or 
                        service directly from the merchant, 
                        retailer, or seller;
                          (ii) directly, or through an 
                        agreement with another person, collects 
                        debt arising from credit extended as 
                        described in clause (i); or
                          (iii) sells or conveys debt described 
                        in clause (i) that is delinquent or 
                        otherwise in default.
                  (B) Applicability.--Subparagraph (A) does not 
                apply to any credit transaction or collection 
                of debt, other than as described in 
                subparagraph (C)(i), arising from a transaction 
                described in subparagraph (A)--
                          (i) in which the merchant, retailer, 
                        or seller of nonfinancial goods or 
                        services assigns, sells or otherwise 
                        conveys to another person such debt 
                        owed by the consumer (except for a sale 
                        of debt that is delinquent or otherwise 
                        in default, as described in 
                        subparagraph (A)(iii));
                          (ii) in which the credit extended 
                        significantly exceeds the market value 
                        of the nonfinancial good or service 
                        provided, or the Bureau otherwise finds 
                        that the sale of the nonfinancial good 
                        or service is done as a subterfuge, so 
                        as to evade or circumvent the 
                        provisions of this title; or
                          (iii) in which the merchant, 
                        retailer, or seller of nonfinancial 
                        goods or services regularly extends 
                        credit and the credit is subject to a 
                        finance charge.
                  (C) Limitations.--
                          (i) In general.--Notwithstanding 
                        subparagraph (B), subparagraph (A) 
                        shall apply with respect to a merchant, 
                        retailer, or seller of nonfinancial 
                        goods or services that is not engaged 
                        significantly in offering or providing 
                        consumer financial products or 
                        services.
                          (ii) Exception.--Subparagraph (A) and 
                        clause (i) of this subparagraph do not 
                        apply to any merchant, retailer, or 
                        seller of nonfinancial goods or 
                        services--
                                  (I) if such merchant, 
                                retailer, or seller of 
                                nonfinancial goods or services 
                                is engaged in a transaction 
                                described in subparagraph 
                                (B)(i) or (B)(ii); or
                                  (II) to the extent that such 
                                merchant, retailer, or seller 
                                is subject to any enumerated 
                                consumer law or any law for 
                                which authorities are 
                                transferred under subtitle F or 
                                H, but the Bureau may exercise 
                                such authority only with 
                                respect to that law.
                  (D) Rules.--
                          (i) Authority of other agencies.--No 
                        provision of this title shall be 
                        construed as modifying, limiting, or 
                        superseding the supervisory or 
                        enforcement authority of the Federal 
                        Trade Commission or any other agency 
                        (other than the Bureau) with respect to 
                        credit extended, or the collection of 
                        debt arising from such extension, 
                        directly by a merchant or retailer to a 
                        consumer exclusively for the purpose of 
                        enabling that consumer to purchase 
                        nonfinancial goods or services directly 
                        from the merchant or retailer.
                          (ii) Small businesses.--A merchant, 
                        retailer, or seller of nonfinancial 
                        goods or services that would otherwise 
                        be subject to the authority of the 
                        Bureau solely by virtue of the 
                        application of subparagraph (B)(iii) 
                        shall be deemed not to be engaged 
                        significantly in offering or providing 
                        consumer financial products or services 
                        under subparagraph (C)(i), if such 
                        person--
                                  (I) only extends credit for 
                                the sale of nonfinancial goods 
                                or services, as described in 
                                subparagraph (A)(i);
                                  (II) retains such credit on 
                                its own accounts (except to 
                                sell or convey such debt that 
                                is delinquent or otherwise in 
                                default); and
                                  (III) meets the relevant 
                                industry size threshold to be a 
                                small business concern, based 
                                on annual receipts, pursuant to 
                                section 3 of the Small Business 
                                Act (15 U.S.C. 632) and the 
                                implementing rules thereunder.
                          (iii) Initial year.--A merchant, 
                        retailer, or seller of nonfinancial 
                        goods or services shall be deemed to 
                        meet the relevant industry size 
                        threshold described in clause (ii)(III) 
                        during the first year of operations of 
                        that business concern if, during that 
                        year, the receipts of that business 
                        concern reasonably are expected to meet 
                        that size threshold.
                          (iv) Other standards for small 
                        business.--With respect to a merchant, 
                        retailer, or seller of nonfinancial 
                        goods or services that is a classified 
                        on a basis other than annual receipts 
                        for the purposes of section 3 of the 
                        Small Business Act (15 U.S.C. 632) and 
                        the implementing rules thereunder, such 
                        merchant, retailer, or seller shall be 
                        deemed to meet the relevant industry 
                        size threshold described in clause 
                        (ii)(III) if such merchant, retailer, 
                        or seller meets the relevant industry 
                        size threshold to be a small business 
                        concern based on the number of 
                        employees, or other such applicable 
                        measure, established under that Act.
                  (E) Exception from state enforcement.--To the 
                extent that the Bureau may not exercise 
                authority under this subsection with respect to 
                a merchant, retailer, or seller of nonfinancial 
                goods or services, no action by a State 
                attorney general or State regulator with 
                respect to a claim made under this title may be 
                brought under subsection 1042(a), with respect 
                to an activity described in any of clauses (i) 
                through (iii) of subparagraph (A) by such 
                merchant, retailer, or seller of nonfinancial 
                goods or services.
  (b) Exclusion for Real Estate Brokerage Activities.--
          (1) Real estate brokerage activities excluded.--
        Without limiting subsection (a), and except as 
        permitted in paragraph (2), the Bureau may not exercise 
        any rulemaking, [supervisory,] enforcement, or other 
        authority under this title with respect to a person 
        that is licensed or registered as a real estate broker 
        or real estate agent, in accordance with State law, to 
        the extent that such person--
                  (A) acts as a real estate agent or broker for 
                a buyer, seller, lessor, or lessee of real 
                property;
                  (B) brings together parties interested in the 
                sale, purchase, lease, rental, or exchange of 
                real property;
                  (C) negotiates, on behalf of any party, any 
                portion of a contract relating to the sale, 
                purchase, lease, rental, or exchange of real 
                property (other than in connection with the 
                provision of financing with respect to any such 
                transaction); or
                  (D) offers to engage in any activity, or act 
                in any capacity, described in subparagraph (A), 
                (B), or (C).
          (2) Description of activities.--The Bureau may 
        exercise rulemaking, [supervisory,] enforcement, or 
        other authority under this title with respect to a 
        person described in paragraph (1) when such person is--
                  (A) engaged in an activity of offering or 
                providing any consumer financial product or 
                service, except that the Bureau may exercise 
                such authority only with respect to that 
                activity; or
                  (B) otherwise subject to any enumerated 
                consumer law or any law for which authorities 
                are transferred under subtitle F or H, but the 
                Bureau may exercise such authority only with 
                respect to that law.
  (c) Exclusion for Manufactured Home Retailers and Modular 
Home Retailers.--
          (1) In general.--The Director may not exercise any 
        rulemaking, [supervisory,] enforcement, or other 
        authority over a person to the extent that--
                  (A) such person is not described in paragraph 
                (2); and
                  (B) such person--
                          (i) acts as an agent or broker for a 
                        buyer or seller of a manufactured home 
                        or a modular home;
                          (ii) facilitates the purchase by a 
                        consumer of a manufactured home or 
                        modular home, by negotiating the 
                        purchase price or terms of the sales 
                        contract (other than providing 
                        financing with respect to such 
                        transaction); or
                          (iii) offers to engage in any 
                        activity described in clause (i) or 
                        (ii).
          (2) Description of activities.--A person is described 
        in this paragraph to the extent that such person is 
        engaged in the offering or provision of any consumer 
        financial product or service or is otherwise subject to 
        any enumerated consumer law or any law for which 
        authorities are transferred under subtitle F or H.
          (3) Definitions.--For purposes of this subsection, 
        the following definitions shall apply:
                  (A) Manufactured home.--The term 
                ``manufactured home'' has the same meaning as 
                in section 603 of the National Manufactured 
                Housing Construction and Safety Standards Act 
                of 1974 (42 U.S.C. 5402).
                  (B) Modular home.--The term ``modular home'' 
                means a house built in a factory in 2 or more 
                modules that meet the State or local building 
                codes where the house will be located, and 
                where such modules are transported to the 
                building site, installed on foundations, and 
                completed.
  (d) Exclusion for Accountants and Tax Preparers.--
          (1) In general.--Except as permitted in paragraph 
        (2), the Bureau may not exercise any rulemaking, 
        [supervisory,] enforcement, or other authority over--
                  (A) any person that is a certified public 
                accountant, permitted to practice as a 
                certified public accounting firm, or certified 
                or licensed for such purpose by a State, or any 
                individual who is employed by or holds an 
                ownership interest with respect to a person 
                described in this subparagraph, when such 
                person is performing or offering to perform--
                          (i) customary and usual accounting 
                        activities, including the provision of 
                        accounting, tax, advisory, or other 
                        services that are subject to the 
                        regulatory authority of a State board 
                        of accountancy or a Federal authority; 
                        or
                          (ii) other services that are 
                        incidental to such customary and usual 
                        accounting activities, to the extent 
                        that such incidental services are not 
                        offered or provided--
                                  (I) by the person separate 
                                and apart from such customary 
                                and usual accounting 
                                activities; or
                                  (II) to consumers who are not 
                                receiving such customary and 
                                usual accounting activities; or
                  (B) any person, other than a person described 
                in subparagraph (A), that performs income tax 
                preparation activities for consumers.
          (2) Description of activities.--
                  (A) In general.--Paragraph (1) shall not 
                apply to any person described in paragraph 
                (1)(A) or (1)(B) to the extent that such person 
                is engaged in any activity which is not a 
                customary and usual accounting activity 
                described in paragraph (1)(A) or incidental 
                thereto but which is the offering or provision 
                of any consumer financial product or service, 
                except to the extent that a person described in 
                paragraph (1)(A) is engaged in an activity 
                which is a customary and usual accounting 
                activity described in paragraph (1)(A), or 
                incidental thereto.
                  (B) Not a customary and usual accounting 
                activity.--For purposes of this subsection, 
                extending or brokering credit is not a 
                customary and usual accounting activity, or 
                incidental thereto.
                  (C) Rule of construction.--For purposes of 
                subparagraphs (A) and (B), a person described 
                in paragraph (1)(A) shall not be deemed to be 
                extending credit, if such person is only 
                extending credit directly to a consumer, 
                exclusively for the purpose of enabling such 
                consumer to purchase services described in 
                clause (i) or (ii) of paragraph (1)(A) directly 
                from such person, and such credit is--
                          (i) not subject to a finance charge; 
                        and
                          (ii) not payable by written agreement 
                        in more than 4 installments.
                  (D) Other limitations.--Paragraph (1) does 
                not apply to any person described in paragraph 
                (1)(A) or (1)(B) that is otherwise subject to 
                any enumerated consumer law or any law for 
                which authorities are transferred under 
                subtitle F or H.
  (e) Exclusion for Practice of Law.--
          (1) In general.--Except as provided under paragraph 
        (2), the Bureau may not exercise any [supervisory or] 
        enforcement authority with respect to an activity 
        engaged in by an attorney as part of the practice of 
        law under the laws of a State in which the attorney is 
        licensed to practice law.
          (2) Rule of construction.--Paragraph (1) shall not be 
        construed so as to limit the exercise by the Bureau of 
        any [supervisory,] enforcement, or other authority 
        regarding the offering or provision of a consumer 
        financial product or service described in any 
        subparagraph of section 1002(5)--
                  (A) that is not offered or provided as part 
                of, or incidental to, the practice of law, 
                occurring exclusively within the scope of the 
                attorney-client relationship; or
                  (B) that is otherwise offered or provided by 
                the attorney in question with respect to any 
                consumer who is not receiving legal advice or 
                services from the attorney in connection with 
                such financial product or service.
          (3) Existing authority.--Paragraph (1) shall not be 
        construed so as to limit the authority of the Bureau 
        with respect to any attorney, to the extent that such 
        attorney is otherwise subject to any of the enumerated 
        consumer laws or the authorities transferred under 
        subtitle F or H.
  (f) Exclusion for Persons Regulated by a State Insurance 
Regulator.--
          (1) In general.--No provision of this title shall be 
        construed as altering, amending, or affecting the 
        authority of any State insurance regulator to adopt 
        rules, initiate enforcement proceedings, or take any 
        other action with respect to a person regulated by a 
        State insurance regulator. Except as provided in 
        paragraph (2), the Bureau shall have no authority to 
        exercise any power to enforce this title with respect 
        to a person regulated by a State insurance regulator.
          (2) Description of activities.--Paragraph (1) does 
        not apply to any person described in such paragraph to 
        the extent that such person is engaged in the offering 
        or provision of any consumer financial product or 
        service or is otherwise subject to any enumerated 
        consumer law or any law for which authorities are 
        transferred under subtitle F or H.
          (3) State insurance authority under gramm-leach-
        bliley.--Notwithstanding paragraph (2), the Bureau 
        shall not exercise any authorities that are granted a 
        State insurance authority under section 505(a)(6) of 
        the Gramm-Leach-Bliley Act with respect to a person 
        regulated by a State insurance authority.
  (g) Exclusion for Employee Benefit and Compensation Plans and 
Certain Other Arrangements Under the Internal Revenue Code of 
1986.--
          (1) Preservation of authority of other agencies.--No 
        provision of this title shall be construed as altering, 
        amending, or affecting the authority of the Secretary 
        of the Treasury, the Secretary of Labor, or the 
        Commissioner of Internal Revenue to adopt regulations, 
        initiate enforcement proceedings, or take any actions 
        with respect to any specified plan or arrangement.
          (2) Activities not constituting the offering or 
        provision of any consumer financial product or 
        service.--For purposes of this title, a person shall 
        not be treated as having engaged in the offering or 
        provision of any consumer financial product or service 
        solely because such person is--
                  (A) a specified plan or arrangement;
                  (B) engaged in the activity of establishing 
                or maintaining, for the benefit of employees of 
                such person (or for members of an employee 
                organization), any specified plan or 
                arrangement; or
                  (C) engaged in the activity of establishing 
                or maintaining a qualified tuition program 
                under section 529(b)(1) of the Internal Revenue 
                Code of 1986 offered by a State or other 
                prepaid tuition program offered by a State.
          (3) Limitation on bureau authority.--
                  (A) In general.--Except as provided under 
                subparagraphs (B) and (C), the Bureau [may not 
                exercise any rulemaking or enforcement 
                authority] may not exercise any rulemaking, 
                enforcement, or other authority with respect to 
                products or services that relate to any 
                specified plan or arrangement.
                  (B) Bureau action pursuant to agency 
                request.--
                          (i) Agency request.--The Secretary 
                        and the Secretary of Labor may jointly 
                        issue a written request to the Bureau 
                        regarding implementation of appropriate 
                        consumer protection standards under 
                        this title with respect to the 
                        provision of services relating to any 
                        specified plan or arrangement.
                          (ii) Agency response.--In response to 
                        a request by the Bureau, the Secretary 
                        and the Secretary of Labor shall 
                        jointly issue a written response, not 
                        later than 90 days after receipt of 
                        such request, to grant or deny the 
                        request of the Bureau regarding 
                        implementation of appropriate consumer 
                        protection standards under this title 
                        with respect to the provision of 
                        services relating to any specified plan 
                        or arrangement.
                          (iii) Scope of bureau action.--
                        Subject to a request or response 
                        pursuant to clause (i) or clause (ii) 
                        by the agencies made under this 
                        subparagraph, the Bureau may exercise 
                        rulemaking authority, and may act to 
                        enforce a rule prescribed pursuant to 
                        such request or response, in accordance 
                        with the provisions of this title. A 
                        request or response made by the 
                        Secretary and the Secretary of Labor 
                        under this subparagraph shall describe 
                        the basis for, and scope of, 
                        appropriate consumer protection 
                        standards to be implemented under this 
                        title with respect to the provision of 
                        services relating to any specified plan 
                        or arrangement.
                  (C) Description of products or services.--To 
                the extent that a person engaged in providing 
                products or services relating to any specified 
                plan or arrangement is subject to any 
                enumerated consumer law or any law for which 
                authorities are transferred under subtitle F or 
                H, subparagraph (A) shall not apply with 
                respect to that law.
          (4) Specified plan or arrangement.--For purposes of 
        this subsection, the term ``specified plan or 
        arrangement'' means any plan, account, or arrangement 
        described in section 220, 223, 401(a), 403(a), 403(b), 
        408, 408A, 529, 529A, or 530 of the Internal Revenue 
        Code of 1986, or any employee benefit or compensation 
        plan or arrangement, including a plan that is subject 
        to title I of the Employee Retirement Income Security 
        Act of 1974, or any prepaid tuition program offered by 
        a State.
  (h) Persons Regulated by a State Securities Commission.--
          (1) In general.--No provision of this title shall be 
        construed as altering, amending, or affecting the 
        authority of any securities commission (or any agency 
        or office performing like functions) of any State to 
        adopt rules, initiate enforcement proceedings, or take 
        any other action with respect to a person regulated by 
        any securities commission (or any agency or office 
        performing like functions) of any State. Except as 
        permitted in paragraph (2) and subsection (f), the 
        Bureau shall have no authority to exercise any power to 
        enforce this title with respect to a person regulated 
        by any securities commission (or any agency or office 
        performing like functions) of any State, but only to 
        the extent that the person acts in such regulated 
        capacity.
          (2) Description of activities.--Paragraph (1) shall 
        not apply to any person to the extent such person is 
        engaged in the offering or provision of any consumer 
        financial product or service, or is otherwise subject 
        to any enumerated consumer law or any law for which 
        authorities are transferred under subtitle F or H.
  (i) Exclusion for Persons Regulated by the Commission.--
          (1) In general.--No provision of this title may be 
        construed as altering, amending, or affecting the 
        authority of the Commission to adopt rules, initiate 
        enforcement proceedings, or take any other action with 
        respect to a person regulated by the Commission. The 
        Bureau [shall have no authority to exercise any power 
        to enforce this title] may not exercise any rulemaking, 
        enforcement, or other authority with respect to a 
        person regulated by the Commission.
          (2) Consultation and coordination.--Notwithstanding 
        paragraph (1), the Commission shall consult and 
        coordinate, where feasible, with the Bureau with 
        respect to any rule (including any advance notice of 
        proposed rulemaking) regarding an investment product or 
        service that is the same type of product as, or that 
        competes directly with, a consumer financial product or 
        service that is subject to the jurisdiction of the 
        Bureau under this title or under any other law. In 
        carrying out this paragraph, the agencies shall 
        negotiate an agreement to establish procedures for such 
        coordination, including procedures for providing 
        advance notice to the Bureau when the Commission is 
        initiating a rulemaking.
  (j) Exclusion for Persons Regulated by the Commodity Futures 
Trading Commission.--
          (1) In general.--No provision of this title shall be 
        construed as altering, amending, or affecting the 
        authority of the Commodity Futures Trading Commission 
        to adopt rules, initiate enforcement proceedings, or 
        take any other action with respect to a person 
        regulated by the Commodity Futures Trading Commission. 
        The Bureau [shall have no authority to exercise any 
        power to enforce this title] may not exercise any 
        rulemaking, enforcement, or other authority with 
        respect to a person regulated by the Commodity Futures 
        Trading Commission.
          (2) Consultation and coordination.--Notwithstanding 
        paragraph (1), the Commodity Futures Trading Commission 
        shall consult and coordinate with the Bureau with 
        respect to any rule (including any advance notice of 
        proposed rulemaking) regarding a product or service 
        that is the same type of product as, or that competes 
        directly with, a consumer financial product or service 
        that is subject to the jurisdiction of the Bureau under 
        this title or under any other law.
  (k) Exclusion for Persons Regulated by the Farm Credit 
Administration.--
          (1) In general.--No provision of this title shall be 
        construed as altering, amending, or affecting the 
        authority of the Farm Credit Administration to adopt 
        rules, initiate enforcement proceedings, or take any 
        other action with respect to a person regulated by the 
        Farm Credit Administration. The Bureau shall have no 
        authority to exercise any power to enforce this title 
        with respect to a person regulated by the Farm Credit 
        Administration.
          (2) Definition.--For purposes of this subsection, the 
        term ``person regulated by the Farm Credit 
        Administration'' means any Farm Credit System 
        institution that is chartered and subject to the 
        provisions of the Farm Credit Act of 1971 (12 U.S.C. 
        2001 et seq.).
  (l) Exclusion for Activities Relating to Charitable 
Contributions.--
          (1) In general.--The Director and the Bureau may not 
        exercise any rulemaking, [supervisory,] enforcement, or 
        other authority, including authority to order 
        penalties, over any activities related to the 
        solicitation or making of voluntary contributions to a 
        tax-exempt organization as recognized by the Internal 
        Revenue Service, by any agent, volunteer, or 
        representative of such organizations to the extent the 
        organization, agent, volunteer, or representative 
        thereof is soliciting or providing advice, information, 
        education, or instruction to any donor or potential 
        donor relating to a contribution to the organization.
          (2) Limitation.--The exclusion in paragraph (1) does 
        not apply to other activities not described in 
        paragraph (1) that are the offering or provision of any 
        consumer financial product or service, or are otherwise 
        subject to any enumerated consumer law or any law for 
        which authorities are transferred under subtitle F or 
        H.
  (m) Insurance.--The Bureau may not define as a financial 
product or service, by regulation or otherwise, engaging in the 
business of insurance.
  (n) Limited Authority of the Bureau.--Notwithstanding 
subsections (a) through (h) and (l), a person subject to or 
described in one or more of such provisions--
          (1) may be a service provider; and
          (2) may be subject to requests from, or requirements 
        imposed by, the Bureau regarding information in order 
        to carry out the responsibilities and functions of the 
        Bureau and in accordance with section 1022, 1052, or 
        1053.
  (o) No Authority To Impose Usury Limit.--No provision of this 
title shall be construed as conferring authority on the Bureau 
to establish a usury limit applicable to an extension of credit 
offered or made by a covered person to a consumer, unless 
explicitly authorized by law.
  (p) Attorney General.--No provision of this title, including 
[section 1024(c)(1)] section 1024(b)(1), shall affect the 
authorities of the Attorney General under otherwise applicable 
provisions of law.
  (q) Secretary of the Treasury.--No provision of this title 
shall affect the authorities of the Secretary, including with 
respect to prescribing rules, initiating enforcement 
proceedings, or taking other actions with respect to a person 
that performs income tax preparation activities for consumers.
  (r) Deposit Insurance and Share Insurance.--Nothing in this 
title shall affect the authority of the Corporation under the 
Federal Deposit Insurance Act or the National Credit Union 
Administration Board under the Federal Credit Union Act as to 
matters related to deposit insurance and share insurance, 
respectively.
  (s) Fair Housing Act.--No provision of this title shall be 
construed as affecting any authority arising under the Fair 
Housing Act.
  (t) No Authority to Regulate Small-dollar Credit.--The Agency 
may not exercise any rulemaking, enforcement, or other 
authority with respect to payday loans, vehicle title loans, or 
other similar loans.

[SEC. 1028. AUTHORITY TO RESTRICT MANDATORY PRE-DISPUTE ARBITRATION.

  [(a) Study and Report.--The Bureau shall conduct a study of, 
and shall provide a report to Congress concerning, the use of 
agreements providing for arbitration of any future dispute 
between covered persons and consumers in connection with the 
offering or providing of consumer financial products or 
services.
  [(b) Further Authority.--The Bureau, by regulation, may 
prohibit or impose conditions or limitations on the use of an 
agreement between a covered person and a consumer for a 
consumer financial product or service providing for arbitration 
of any future dispute between the parties, if the Bureau finds 
that such a prohibition or imposition of conditions or 
limitations is in the public interest and for the protection of 
consumers. The findings in such rule shall be consistent with 
the study conducted under subsection (a).
  [(c) Limitation.--The authority described in subsection (b) 
may not be construed to prohibit or restrict a consumer from 
entering into a voluntary arbitration agreement with a covered 
person after a dispute has arisen.
  [(d) Effective Date.--Notwithstanding any other provision of 
law, any regulation prescribed by the Bureau under subsection 
(b) shall apply, consistent with the terms of the regulation, 
to any agreement between a consumer and a covered person 
entered into after the end of the 180-day period beginning on 
the effective date of the regulation, as established by the 
Bureau.]

SEC. 1029. EXCLUSION FOR AUTO DEALERS.

  (a) Sale, Servicing, and Leasing of Motor Vehicles 
Excluded.--Except as permitted in subsection (b), the Bureau 
may not exercise any rulemaking, supervisory, enforcement or 
any other authority, including any authority to order 
assessments, over a motor vehicle dealer that is predominantly 
engaged in the sale and servicing of motor vehicles, the 
leasing and servicing of motor vehicles, or both.
  (b) Certain Functions Excepted.--Subsection (a) shall not 
apply to any person, to the extent that such person--
          (1) provides consumers with any services related to 
        residential or commercial mortgages or self-financing 
        transactions involving real property;
          (2) operates a line of business--
                  (A) that involves the extension of retail 
                credit or retail leases involving motor 
                vehicles; and
                  (B) in which--
                          (i) the extension of retail credit or 
                        retail leases are provided directly to 
                        consumers; and
                          (ii) the contract governing such 
                        extension of retail credit or retail 
                        leases is not routinely assigned to an 
                        unaffiliated third party finance or 
                        leasing source; or
          (3) offers or provides a consumer financial product 
        or service not involving or related to the sale, 
        financing, leasing, rental, repair, refurbishment, 
        maintenance, or other servicing of motor vehicles, 
        motor vehicle parts, or any related or ancillary 
        product or service.
  (c) Preservation of Authorities of Other Agencies.--Except as 
provided in subsections (b) and (d), nothing in this title, 
including subtitle F, shall be construed as modifying, 
limiting, or superseding the operation of any provision of 
Federal law, or otherwise affecting the authority of the Board 
of Governors, the Federal Trade Commission, or any other 
Federal agency, with respect to a person described in 
subsection (a).
  (d) Federal Trade Commission Authority.--Notwithstanding 
section 18 of the Federal Trade Commission Act, the Federal 
Trade Commission is authorized to prescribe rules under 
sections 5 and 18(a)(1)(B) of the Federal Trade Commission 
Act[.] in accordance with section 553 of title 5, United States 
Code, with respect to a person described in subsection (a).
  (e) Coordination With Office Of Service Member Affairs.--The 
Board of Governors and the Federal Trade Commission shall 
coordinate with the Office of Service Member Affairs, if 
established under this title, to ensure that--
          (1) service members and their families are educated 
        and empowered to make better informed decisions 
        regarding consumer financial products and services 
        offered by motor vehicle dealers, with a focus on motor 
        vehicle dealers in the proximity of military 
        installations; and
          (2) complaints by service members and their families 
        concerning such motor vehicle dealers are effectively 
        monitored and responded to, and where appropriate, 
        enforcement action is pursued by the authorized 
        agencies.
  (f) Definitions.--For purposes of this section, the following 
definitions shall apply:
          (1) Motor vehicle.--The term ``motor vehicle'' 
        means--
                  (A) any self-propelled vehicle designed for 
                transporting persons or property on a street, 
                highway, or other road;
                  (B) recreational boats and marine equipment;
                  (C) motorcycles;
                  (D) motor homes, recreational vehicle 
                trailers, and slide-in campers, as those terms 
                are defined in sections 571.3 and 575.103 (d) 
                of title 49, Code of Federal Regulations, or 
                any successor thereto; and
                  (E) other vehicles that are titled and sold 
                through dealers.
          (2) Motor vehicle dealer.--The term ``motor vehicle 
        dealer'' means any person or resident in the United 
        States, or any territory of the United States, who--
                  (A) is licensed by a State, a territory of 
                the United States, or the District of Columbia 
                to engage in the sale of motor vehicles; and
                  (B) takes title to, holds an ownership in, or 
                takes physical custody of motor vehicles.

                Subtitle C--Specific Bureau Authorities

[SEC. 1031. PROHIBITING UNFAIR, DECEPTIVE, OR ABUSIVE ACTS OR 
                    PRACTICES.

  [(a) In General.--The Bureau may take any action authorized 
under subtitle E to prevent a covered person or service 
provider from committing or engaging in an unfair, deceptive, 
or abusive act or practice under Federal law in connection with 
any transaction with a consumer for a consumer financial 
product or service, or the offering of a consumer financial 
product or service.
  [(b) Rulemaking.--The Bureau may prescribe rules applicable 
to a covered person or service provider identifying as unlawful 
unfair, deceptive, or abusive acts or practices in connection 
with any transaction with a consumer for a consumer financial 
product or service, or the offering of a consumer financial 
product or service. Rules under this section may include 
requirements for the purpose of preventing such acts or 
practices.
  [(c) Unfairness.--
          [(1) In general.--The Bureau shall have no authority 
        under this section to declare an act or practice in 
        connection with a transaction with a consumer for a 
        consumer financial product or service, or the offering 
        of a consumer financial product or service, to be 
        unlawful on the grounds that such act or practice is 
        unfair, unless the Bureau has a reasonable basis to 
        conclude that--
                  [(A) the act or practice causes or is likely 
                to cause substantial injury to consumers which 
                is not reasonably avoidable by consumers; and
                  [(B) such substantial injury is not 
                outweighed by countervailing benefits to 
                consumers or to competition.
          [(2) Consideration of public policies.--In 
        determining whether an act or practice is unfair, the 
        Bureau may consider established public policies as 
        evidence to be considered with all other evidence. Such 
        public policy considerations may not serve as a primary 
        basis for such determination.
  [(d) Abusive.--The Bureau shall have no authority under this 
section to declare an act or practice abusive in connection 
with the provision of a consumer financial product or service, 
unless the act or practice--
          [(1) materially interferes with the ability of a 
        consumer to understand a term or condition of a 
        consumer financial product or service; or
          [(2) takes unreasonable advantage of--
                  [(A) a lack of understanding on the part of 
                the consumer of the material risks, costs, or 
                conditions of the product or service;
                  [(B) the inability of the consumer to protect 
                the interests of the consumer in selecting or 
                using a consumer financial product or service; 
                or
                  [(C) the reasonable reliance by the consumer 
                on a covered person to act in the interests of 
                the consumer.
  [(e) Consultation.--In prescribing rules under this section, 
the Bureau shall consult with the Federal banking agencies, or 
other Federal agencies, as appropriate, concerning the 
consistency of the proposed rule with prudential, market, or 
systemic objectives administered by such agencies.
  [(f) Consideration of Seasonal Income.--The rules of the 
Bureau under this section shall provide, with respect to an 
extension of credit secured by residential real estate or a 
dwelling, if documented income of the borrower, including 
income from a small business, is a repayment source for an 
extension of credit secured by residential real estate or a 
dwelling, the creditor may consider the seasonality and 
irregularity of such income in the underwriting of and 
scheduling of payments for such credit.]

           *       *       *       *       *       *       *


SEC. 1034. RESPONSE TO CONSUMER COMPLAINTS AND INQUIRIES.

  (a) Timely Regulator Response to Consumers.--The Bureau shall 
establish, in consultation with the appropriate Federal 
regulatory agencies, reasonable procedures to provide a timely 
response to consumers, in writing where appropriate, to 
complaints against, or inquiries concerning, a covered person, 
including--
          (1) steps that have been taken by the regulator in 
        response to the complaint or inquiry of the consumer;
          (2) any responses received by the regulator from the 
        covered person; and
          (3) any follow-up actions or planned follow-up 
        actions by the regulator in response to the complaint 
        or inquiry of the consumer.
  [(b) Timely Response to Regulator by Covered Person.--A 
covered person subject to supervision and primary enforcement 
by the Bureau pursuant to section 1025 shall provide a timely 
response, in writing where appropriate, to the Bureau, the 
prudential regulators, and any other agency having jurisdiction 
over such covered person concerning a consumer complaint or 
inquiry, including--
          [(1) steps that have been taken by the covered person 
        to respond to the complaint or inquiry of the consumer;
          [(2) responses received by the covered person from 
        the consumer; and
          [(3) follow-up actions or planned follow-up actions 
        by the covered person to respond to the complaint or 
        inquiry of the consumer.
  [(c) Provision of Information to Consumers.--
          [(1) In general.--A covered person subject to 
        supervision and primary enforcement by the Bureau 
        pursuant to section 1025 shall, in a timely manner, 
        comply with a consumer request for information in the 
        control or possession of such covered person concerning 
        the consumer financial product or service that the 
        consumer obtained from such covered person, including 
        supporting written documentation, concerning the 
        account of the consumer.
          [(2) Exceptions.--A covered person subject to 
        supervision and primary enforcement by the Bureau 
        pursuant to section 1025, a prudential regulator, and 
        any other agency having jurisdiction over a covered 
        person subject to supervision and primary enforcement 
        by the Bureau pursuant to section 1025 may not be 
        required by this section to make available to the 
        consumer--
                  [(A) any confidential commercial information, 
                including an algorithm used to derive credit 
                scores or other risk scores or predictors;
                  [(B) any information collected by the covered 
                person for the purpose of preventing fraud or 
                money laundering, or detecting or making any 
                report regarding other unlawful or potentially 
                unlawful conduct;
                  [(C) any information required to be kept 
                confidential by any other provision of law; or
                  [(D) any nonpublic or confidential 
                information, including confidential supervisory 
                information.]
  [(d)] (b) Agreements With Other Agencies.--The Bureau shall 
enter into a memorandum of understanding with any affected 
Federal regulatory agency regarding procedures by which any 
covered person, and the prudential regulators, and any other 
agency having jurisdiction over a covered person, including the 
Secretary of the Department of Housing and Urban Development 
and the Secretary of Education, shall comply with this section.

SEC. 1035. PRIVATE EDUCATION LOAN OMBUDSMAN.

  (a) Establishment.--The Secretary, in consultation with the 
Director, [shall designate] may designate a Private Education 
Loan Ombudsman (in this section referred to as the 
``Ombudsman'') within the Bureau, to provide timely assistance 
to borrowers of private education loans.
  (b) Public Information.--[The Secretary] If the Secretary 
designates the Ombudsman under subsection (a), the Secretary 
and the Director shall disseminate information about the 
availability and functions of the Ombudsman to borrowers and 
potential borrowers, as well as institutions of higher 
education, lenders, guaranty agencies, loan servicers, and 
other participants in private education student loan programs.
  (c) Functions of Ombudsman.--The Ombudsman designated under 
this subsection shall--
          (1) in accordance with regulations of the Director, 
        receive, review, and attempt to resolve informally 
        complaints from borrowers of loans described in 
        subsection (a), including, as appropriate, attempts to 
        resolve such complaints in collaboration with the 
        Department of Education and with institutions of higher 
        education, lenders, guaranty agencies, loan servicers, 
        and other participants in private education loan 
        programs;
          (2) not later than 90 days after the designated 
        transfer date, establish a memorandum of understanding 
        with the student loan ombudsman established under 
        section 141(f) of the Higher Education Act of 1965 (20 
        U.S.C. 1018(f)), to ensure coordination in providing 
        assistance to and serving borrowers seeking to resolve 
        complaints related to their private education or 
        Federal student loans;
          (3) compile and analyze data on borrower complaints 
        regarding private education loans; and
          (4) make appropriate recommendations to the Director, 
        the Secretary, the Secretary of Education, the 
        Committee on Banking, Housing, and Urban Affairs and 
        the Committee on Health, Education, Labor, and Pensions 
        of the Senate and the Committee on Financial Services 
        and the Committee on Education and Labor of the House 
        of Representatives.
  (d) Annual Reports.--
          (1) In general.--The Ombudsman shall prepare an 
        annual report that describes the activities, and 
        evaluates the effectiveness of the Ombudsman during the 
        preceding year.
          (2) Submission.--The report required by paragraph (1) 
        shall be submitted on the same date annually to the 
        Secretary, the Secretary of Education, the Committee on 
        Banking, Housing, and Urban Affairs and the Committee 
        on Health, Education, Labor, and Pensions of the Senate 
        and the Committee on Financial Services and the 
        Committee on Education and Labor of the House of 
        Representatives.
  (e) Definitions.--For purposes of this section, the terms 
``private education loan'' and ``institution of higher 
education'' have the same meanings as in section 140 of the 
Truth in Lending Act (15 U.S.C. 1650).

SEC. 1036. PROHIBITED ACTS.

  (a) In General.--It shall be unlawful for--
          (1) any covered person or service [provider--]
                  [(A)] [to offer] provider to offer or provide 
                to a consumer any financial product or service 
                not in conformity with Federal consumer 
                financial law, or otherwise commit any act or 
                omission in violation of a Federal consumer 
                financial law; or
                  [(B) to engage in any unfair, deceptive, or 
                abusive act or practice;]
          (2) any covered person or service provider to fail or 
        refuse, as required by Federal consumer financial law, 
        or any rule or order issued by the Bureau thereunder--
                  (A) to permit access to or copying of 
                records;
                  (B) to establish or maintain records; or
                  (C) to make reports or provide information to 
                the Bureau[; or].
          [(3) any person to knowingly or recklessly provide 
        substantial assistance to a covered person or service 
        provider in violation of the provisions of section 
        1031, or any rule or order issued thereunder, and 
        notwithstanding any provision of this title, the 
        provider of such substantial assistance shall be deemed 
        to be in violation of that section to the same extent 
        as the person to whom such assistance is provided.]
  (b) Exception.--No person shall be held to have violated 
subsection (a)(1) solely by virtue of providing or selling time 
or space to a covered person or service provider placing an 
advertisement.

           *       *       *       *       *       *       *


Subtitle E--Enforcement Powers

           *       *       *       *       *       *       *


SEC. 1052. INVESTIGATIONS AND ADMINISTRATIVE DISCOVERY.

  (a) Joint Investigations.--
          (1) In general.--The Bureau or, where appropriate, a 
        Bureau investigator, may engage in joint investigations 
        and requests for information, as authorized under this 
        title.
          (2) Fair lending.--The authority under paragraph (1) 
        includes matters relating to fair lending, and where 
        appropriate, joint investigations with, and requests 
        for information from, the Secretary of Housing and 
        Urban Development, the Attorney General of the United 
        States, or both.
  (b) Subpoenas.--
          (1) In general.--The Bureau or a Bureau investigator 
        may issue subpoenas for the attendance and testimony of 
        witnesses and the production of relevant papers, books, 
        documents, or other material in connection with 
        hearings under this title.
          (2) Failure to obey.--In the case of contumacy or 
        refusal to obey a subpoena issued pursuant to this 
        paragraph and served upon any person, the district 
        court of the United States for any district in which 
        such person is found, resides, or transacts business, 
        upon application by the Bureau or a Bureau investigator 
        and after notice to such person, may issue an order 
        requiring such person to appear and give testimony or 
        to appear and produce documents or other material.
          (3) Contempt.--Any failure to obey an order of the 
        court under this subsection may be punished by the 
        court as a contempt thereof.
  (c) Demands.--
          (1) In general.--Whenever the Bureau has reason to 
        believe that any person may be in possession, custody, 
        or control of any documentary material or tangible 
        things, or may have any information, relevant to a 
        violation, the Bureau may, before the institution of 
        any proceedings under the Federal consumer financial 
        law, issue in writing, and cause to be served upon such 
        person, a civil investigative demand requiring such 
        person to--
                  (A) produce such documentary material for 
                inspection and copying or reproduction in the 
                form or medium requested by the Bureau;
                  (B) submit such tangible things;
                  (C) file written reports or answers to 
                questions;
                  (D) give oral testimony concerning 
                documentary material, tangible things, or other 
                information; or
                  (E) furnish any combination of such material, 
                answers, or testimony.
          (2) Requirements.--Each civil investigative demand 
        shall state with specificity the nature of the conduct 
        constituting the alleged violation which is under 
        investigation and the provision of law applicable to 
        such violation.
          (3) Production of documents.--Each civil 
        investigative demand for the production of documentary 
        material shall--
                  (A) describe each class of documentary 
                material to be produced under the demand with 
                such definiteness and certainty as to permit 
                such material to be fairly identified;
                  (B) prescribe a return date or dates which 
                will provide a reasonable period of time within 
                which the material so demanded may be assembled 
                and made available for inspection and copying 
                or reproduction; and
                  (C) identify the custodian to whom such 
                material shall be made available.
          (4) Production of things.--Each civil investigative 
        demand for the submission of tangible things shall--
                  (A) describe each class of tangible things to 
                be submitted under the demand with such 
                definiteness and certainty as to permit such 
                things to be fairly identified;
                  (B) prescribe a return date or dates which 
                will provide a reasonable period of time within 
                which the things so demanded may be assembled 
                and submitted; and
                  (C) identify the custodian to whom such 
                things shall be submitted.
          (5) Demand for written reports or answers.--Each 
        civil investigative demand for written reports or 
        answers to questions shall--
                  (A) propound with definiteness and certainty 
                the reports to be produced or the questions to 
                be answered;
                  (B) prescribe a date or dates at which time 
                written reports or answers to questions shall 
                be submitted; and
                  (C) identify the custodian to whom such 
                reports or answers shall be submitted.
          (6) Oral testimony.--Each civil investigative demand 
        for the giving of oral testimony shall--
                  (A) prescribe a date, time, and place at 
                which oral testimony shall be commenced; and
                  (B) identify a Bureau investigator who shall 
                conduct the investigation and the custodian to 
                whom the transcript of such investigation shall 
                be submitted.
          (7) Service.--Any civil investigative demand issued, 
        and any enforcement petition filed, under this section 
        may be served--
                  (A) by any Bureau investigator at any place 
                within the territorial jurisdiction of any 
                court of the United States; and
                  (B) upon any person who is not found within 
                the territorial jurisdiction of any court of 
                the United States--
                          (i) in such manner as the Federal 
                        Rules of Civil Procedure prescribe for 
                        service in a foreign nation; and
                          (ii) to the extent that the courts of 
                        the United States have authority to 
                        assert jurisdiction over such person, 
                        consistent with due process, the United 
                        States District Court for the District 
                        of Columbia shall have the same 
                        jurisdiction to take any action 
                        respecting compliance with this section 
                        by such person that such district court 
                        would have if such person were 
                        personally within the jurisdiction of 
                        such district court.
          (8) Method of service.--Service of any civil 
        investigative demand or any enforcement petition filed 
        under this section may be made upon a person, including 
        any legal entity, by--
                  (A) delivering a duly executed copy of such 
                demand or petition to the individual or to any 
                partner, executive officer, managing agent, or 
                general agent of such person, or to any agent 
                of such person authorized by appointment or by 
                law to receive service of process on behalf of 
                such person;
                  (B) delivering a duly executed copy of such 
                demand or petition to the principal office or 
                place of business of the person to be served; 
                or
                  (C) depositing a duly executed copy in the 
                United States mails, by registered or certified 
                mail, return receipt requested, duly addressed 
                to such person at the principal office or place 
                of business of such person.
          (9) Proof of service.--
                  (A) In general.--A verified return by the 
                individual serving any civil investigative 
                demand or any enforcement petition filed under 
                this section setting forth the manner of such 
                service shall be proof of such service.
                  (B) Return receipts.--In the case of service 
                by registered or certified mail, such return 
                shall be accompanied by the return post office 
                receipt of delivery of such demand or 
                enforcement petition.
          (10) Production of documentary material.--The 
        production of documentary material in response to a 
        civil investigative demand shall be made under a sworn 
        certificate, in such form as the demand designates, by 
        the person, if a natural person, to whom the demand is 
        directed or, if not a natural person, by any person 
        having knowledge of the facts and circumstances 
        relating to such production, to the effect that all of 
        the documentary material required by the demand and in 
        the possession, custody, or control of the person to 
        whom the demand is directed has been produced and made 
        available to the custodian.
          (11) Submission of tangible things.--The submission 
        of tangible things in response to a civil investigative 
        demand shall be made under a sworn certificate, in such 
        form as the demand designates, by the person to whom 
        the demand is directed or, if not a natural person, by 
        any person having knowledge of the facts and 
        circumstances relating to such production, to the 
        effect that all of the tangible things required by the 
        demand and in the possession, custody, or control of 
        the person to whom the demand is directed have been 
        submitted to the custodian.
          (12) Separate answers.--Each reporting requirement or 
        question in a civil investigative demand shall be 
        answered separately and fully in writing under oath, 
        unless it is objected to, in which event the reasons 
        for the objection shall be stated in lieu of an answer, 
        and it shall be submitted under a sworn certificate, in 
        such form as the demand designates, by the person, if a 
        natural person, to whom the demand is directed or, if 
        not a natural person, by any person responsible for 
        answering each reporting requirement or question, to 
        the effect that all information required by the demand 
        and in the possession, custody, control, or knowledge 
        of the person to whom the demand is directed has been 
        submitted.
          (13) Testimony.--
                  (A) In general.--
                          (i) Oath and recordation.--The 
                        examination of any person pursuant to a 
                        demand for oral testimony served under 
                        this subsection shall be taken before 
                        an officer authorized to administer 
                        oaths and affirmations by the laws of 
                        the United States or of the place at 
                        which the examination is held. The 
                        officer before whom oral testimony is 
                        to be taken shall put the witness on 
                        oath or affirmation and shall 
                        personally, or by any individual acting 
                        under the direction of and in the 
                        presence of the officer, record the 
                        testimony of the witness.
                          (ii) Transcription.--The testimony 
                        shall be taken stenographically and 
                        transcribed.
                          (iii) Transmission to custodian.--
                        After the testimony is fully 
                        transcribed, the officer investigator 
                        before whom the testimony is taken 
                        shall promptly transmit a copy of the 
                        transcript of the testimony to the 
                        custodian.
                  (B) Parties present.--Any Bureau investigator 
                before whom oral testimony is to be taken shall 
                exclude from the place where the testimony is 
                to be taken all other persons, except the 
                person giving the testimony, the attorney for 
                that person, the officer before whom the 
                testimony is to be taken, an investigator or 
                representative of an agency with which the 
                Bureau is engaged in a joint investigation, and 
                any stenographer taking such testimony.
                  (C) Location.--The oral testimony of any 
                person taken pursuant to a civil investigative 
                demand shall be taken in the judicial district 
                of the United States in which such person 
                resides, is found, or transacts business, or in 
                such other place as may be agreed upon by the 
                Bureau investigator before whom the oral 
                testimony of such person is to be taken and 
                such person.
                  (D) Attorney representation.--
                          (i) In general.--Any person compelled 
                        to appear under a civil investigative 
                        demand for oral testimony pursuant to 
                        this section may be accompanied, 
                        represented, and advised by an 
                        attorney.
                          (ii) Authority.--The attorney may 
                        advise a person described in clause 
                        (i), in confidence, either upon the 
                        request of such person or upon the 
                        initiative of the attorney, with 
                        respect to any question asked of such 
                        person.
                          (iii) Objections.--A person described 
                        in clause (i), or the attorney for that 
                        person, may object on the record to any 
                        question, in whole or in part, and such 
                        person shall briefly state for the 
                        record the reason for the objection. An 
                        objection may properly be made, 
                        received, and entered upon the record 
                        when it is claimed that such person is 
                        entitled to refuse to answer the 
                        question on grounds of any 
                        constitutional or other legal right or 
                        privilege, including the privilege 
                        against self-incrimination, but such 
                        person shall not otherwise object to or 
                        refuse to answer any question, and such 
                        person or attorney shall not otherwise 
                        interrupt the oral examination.
                          (iv) Refusal to answer.--If a person 
                        described in clause (i) refuses to 
                        answer any question--
                                  (I) the Bureau may petition 
                                the district court of the 
                                United States pursuant to this 
                                section for an order compelling 
                                such person to answer such 
                                question; and
                                  (II) if the refusal is on 
                                grounds of the privilege 
                                against self-incrimination, the 
                                testimony of such person may be 
                                compelled in accordance with 
                                the provisions of section 6004 
                                of title 18, United States 
                                Code.
                  (E) Transcripts.--For purposes of this 
                subsection--
                          (i) after the testimony of any 
                        witness is fully transcribed, the 
                        Bureau investigator shall afford the 
                        witness (who may be accompanied by an 
                        attorney) a reasonable opportunity to 
                        examine the transcript;
                          (ii) the transcript shall be read to 
                        or by the witness, unless such 
                        examination and reading are waived by 
                        the witness;
                          (iii) any changes in form or 
                        substance which the witness desires to 
                        make shall be entered and identified 
                        upon the transcript by the Bureau 
                        investigator, with a statement of the 
                        reasons given by the witness for making 
                        such changes;
                          (iv) the transcript shall be signed 
                        by the witness, unless the witness in 
                        writing waives the signing, is ill, 
                        cannot be found, or refuses to sign; 
                        and
                          (v) if the transcript is not signed 
                        by the witness during the 30-day period 
                        following the date on which the witness 
                        is first afforded a reasonable 
                        opportunity to examine the transcript, 
                        the Bureau investigator shall sign the 
                        transcript and state on the record the 
                        fact of the waiver, illness, absence of 
                        the witness, or the refusal to sign, 
                        together with any reasons given for the 
                        failure to sign.
                  (F) Certification by investigator.--The 
                Bureau investigator shall certify on the 
                transcript that the witness was duly sworn by 
                him or her and that the transcript is a true 
                record of the testimony given by the witness, 
                and the Bureau investigator shall promptly 
                deliver the transcript or send it by registered 
                or certified mail to the custodian.
                  (G) Copy of transcript.--The Bureau 
                investigator shall furnish a copy of the 
                transcript (upon payment of reasonable charges 
                for the transcript) to the witness only, except 
                that the Bureau may for good cause limit such 
                witness to inspection of the official 
                transcript of his testimony.
                  (H) Witness fees.--Any witness appearing for 
                the taking of oral testimony pursuant to a 
                civil investigative demand shall be entitled to 
                the same fees and mileage which are paid to 
                witnesses in the district courts of the United 
                States.
          (14) Meeting requirement.--The recipient of a civil 
        investigative demand shall meet and confer with an 
        Agency investigator within 30 calendar days after 
        receipt of the demand to discuss and attempt to resolve 
        all issues regarding compliance with the civil 
        investigative demand, unless the Agency grants an 
        extension requested by such recipient.
  (d) Confidential Treatment of Demand Material.--
          (1) In general.--Documentary materials and tangible 
        things received as a result of a civil investigative 
        demand shall be subject to requirements and procedures 
        regarding confidentiality, in accordance with rules 
        established by the Bureau.
          (2) Disclosure to congress.--No rule established by 
        the Bureau regarding the confidentiality of materials 
        submitted to, or otherwise obtained by, the Bureau 
        shall be intended to prevent disclosure to either House 
        of Congress or to an appropriate committee of the 
        Congress, except that the Bureau is permitted to adopt 
        rules allowing prior notice to any party that owns or 
        otherwise provided the material to the Bureau and had 
        designated such material as confidential.
  (e) Petition for Enforcement.--
          (1) In general.--Whenever any person fails to comply 
        with any civil investigative demand duly served upon 
        him under this section, or whenever satisfactory 
        copying or reproduction of material requested pursuant 
        to the demand cannot be accomplished and such person 
        refuses to surrender such material, the Bureau, through 
        such officers or attorneys as it may designate, may 
        file, in the district court of the United States for 
        any judicial district in which such person resides, is 
        found, or transacts business, and serve upon such 
        person, a petition for an order of such court for the 
        enforcement of this section.
          (2) Service of process.--All process of any court to 
        which application may be made as provided in this 
        subsection may be served in any judicial district.
  (f) Petition for Order Modifying or Setting Aside Demand.--
          [(1) In general.--Not later than 20 days after the 
        service of any civil investigative demand upon any 
        person under subsection (b), or at any time before the 
        return date specified in the demand, whichever period 
        is shorter, or within such period exceeding 20 days 
        after service or in excess of such return date as may 
        be prescribed in writing, subsequent to service, by any 
        Bureau investigator named in the demand, such person 
        may file with the Bureau a petition for an order by the 
        Bureau modifying or setting aside the demand.]
          (1) In general.--Not later than 45 days after the 
        service of any civil investigative demand upon any 
        person under subsection (c), or at any time before the 
        return date specified in the demand, whichever period 
        is shorter, or within such period exceeding 45 days 
        after service or in excess of such return date as may 
        be prescribed in writing, subsequent to service, by any 
        Agency investigator named in the demand, such person 
        may file, in the district court of the United States 
        for any judicial district in which such person resides, 
        is found, or transacts business, a petition for an 
        order modifying or setting aside the demand.
          (2) Compliance during pendency.--The time permitted 
        for compliance with the demand in whole or in part, as 
        determined proper and ordered by the Bureau, shall not 
        run during the pendency of a petition under paragraph 
        (1) [at the Bureau], except that such person shall 
        comply with any portions of the demand not sought to be 
        modified or set aside.
          (3) Specific grounds.--A petition under paragraph (1) 
        shall specify each ground upon which the petitioner 
        relies in seeking relief, and may be based upon any 
        failure of the demand to comply with the provisions of 
        this section, or upon any constitutional or other legal 
        right or privilege of such person.
  (g) Custodial Control.--At any time during which any 
custodian is in custody or control of any documentary material, 
tangible things, reports, answers to questions, or transcripts 
of oral testimony given by any person in compliance with any 
civil investigative demand, such person may file, in the 
district court of the United States for the judicial district 
within which the office of such custodian is situated, and 
serve upon such custodian, a petition for an order of such 
court requiring the performance by such custodian of any duty 
imposed upon him by this section or rule promulgated by the 
Bureau.
  (h) Jurisdiction of Court.--
          [(1) In general.--]Whenever any petition is filed in 
        any district court of the United States under this 
        section, such court shall have jurisdiction to hear and 
        determine the matter so presented, and to enter such 
        order or orders as may be required to carry out the 
        provisions of this section.
          [(2) Appeal.--Any final order entered as described in 
        paragraph (1) shall be subject to appeal pursuant to 
        section 1291 of title 28, United States Code.]

SEC. 1053. HEARINGS AND ADJUDICATION PROCEEDINGS.

  (a) In General.--The Bureau is authorized to conduct hearings 
and adjudication proceedings with respect to any person in the 
manner prescribed by chapter 5 of title 5, United States Code 
in order to ensure or enforce compliance with--
          (1) the provisions of this title, including any rules 
        prescribed by the Bureau under this title; and
          (2) any other Federal law that the Bureau is 
        authorized to enforce, including an enumerated consumer 
        law, and any regulations or order prescribed 
        thereunder, unless such Federal law specifically limits 
        the Bureau from conducting a hearing or adjudication 
        proceeding and only to the extent of such limitation.
  (b) Special Rules for Cease-and-desist Proceedings.--
          (1) Orders authorized.--
                  (A) In general.--If, in the opinion of the 
                Bureau, any covered person or service provider 
                is engaging or has engaged in an activity that 
                violates a law, rule, or any condition imposed 
                in writing on the person by the Bureau, the 
                Bureau may, subject to [sections 1024, 1025, 
                and 1026] sections 1024 and 1026, issue and 
                serve upon the covered person or service 
                provider a notice of charges in respect 
                thereof.
                  (B) Content of notice.--The notice under 
                subparagraph (A) shall contain a statement of 
                the facts constituting the alleged violation or 
                violations, and shall fix a time and place at 
                which a hearing will be held to determine 
                whether an order to cease and desist should 
                issue against the covered person or service 
                provider, such hearing to be held not earlier 
                than 30 days nor later than 60 days after the 
                date of service of such notice, unless an 
                earlier or a later date is set by the Bureau, 
                at the request of any party so served.
                  (C) Consent.--Unless the party or parties 
                served under subparagraph (B) appear at the 
                hearing personally or by a duly authorized 
                representative, such person shall be deemed to 
                have consented to the issuance of the cease-
                and-desist order.
                  (D) Procedure.--In the event of consent under 
                subparagraph (C), or if, upon the record, made 
                at any such hearing, the Bureau finds that any 
                violation specified in the notice of charges 
                has been established, the Bureau may issue and 
                serve upon the covered person or service 
                provider an order to cease and desist from the 
                violation or practice. Such order may, by 
                provisions which may be mandatory or otherwise, 
                require the covered person or service provider 
                to cease and desist from the subject activity, 
                and to take affirmative action to correct the 
                conditions resulting from any such violation.
          (2) Effectiveness of order.--A cease-and-desist order 
        shall become effective at the expiration of 30 days 
        after the date of service of an order under paragraph 
        (1) upon the covered person or service provider 
        concerned (except in the case of a cease-and-desist 
        order issued upon consent, which shall become effective 
        at the time specified therein), and shall remain 
        effective and enforceable as provided therein, except 
        to such extent as the order is stayed, modified, 
        terminated, or set aside by action of the Bureau or a 
        reviewing court.
          (3) Decision and appeal.--Any hearing provided for in 
        this subsection shall be held in the Federal judicial 
        district or in the territory in which the residence or 
        principal office or place of business of the person is 
        located unless the person consents to another place, 
        and shall be conducted in accordance with the 
        provisions of chapter 5 of title 5 of the United States 
        Code. After such hearing, and within 90 days after the 
        Bureau has notified the parties that the case has been 
        submitted to the Bureau for final decision, the Bureau 
        shall render its decision (which shall include findings 
        of fact upon which its decision is predicated) and 
        shall issue and serve upon each party to the proceeding 
        an order or orders consistent with the provisions of 
        this section. Judicial review of any such order shall 
        be exclusively as provided in this subsection. Unless a 
        petition for review is timely filed in a court of 
        appeals of the United States, as provided in paragraph 
        (4), and thereafter until the record in the proceeding 
        has been filed as provided in paragraph (4), the Bureau 
        may at any time, upon such notice and in such manner as 
        the Bureau shall determine proper, modify, terminate, 
        or set aside any such order. Upon filing of the record 
        as provided, the Bureau may modify, terminate, or set 
        aside any such order with permission of the court.
          (4) Appeal to court of appeals.--Any party to any 
        proceeding under this subsection may obtain a review of 
        any order served pursuant to this subsection (other 
        than an order issued with the consent of the person 
        concerned) by the filing in the court of appeals of the 
        United States for the circuit in which the principal 
        office of the covered person is located, or in the 
        United States Court of Appeals for the District of 
        Columbia Circuit, within 30 days after the date of 
        service of such order, a written petition praying that 
        the order of the Bureau be modified, terminated, or set 
        aside. A copy of such petition shall be forthwith 
        transmitted by the clerk of the court to the Bureau, 
        and thereupon the Bureau shall file in the court the 
        record in the proceeding, as provided in section 2112 
        of title 28 of the United States Code. Upon the filing 
        of such petition, such court shall have jurisdiction, 
        which upon the filing of the record shall except as 
        provided in the last sentence of paragraph (3) be 
        exclusive, to affirm, modify, terminate, or set aside, 
        in whole or in part, the order of the Bureau. Review of 
        such proceedings shall be had as provided in chapter 7 
        of title 5 of the United States Code. The judgment and 
        decree of the court shall be final, except that the 
        same shall be subject to review by the Supreme Court of 
        the United States, upon certiorari, as provided in 
        section 1254 of title 28 of the United States Code.
          (5) No stay.--The commencement of proceedings for 
        judicial review under paragraph (4) shall not, unless 
        specifically ordered by the court, operate as a stay of 
        any order issued by the Bureau.
  (c) Special Rules for Temporary Cease-and-desist 
Proceedings.--
          (1) In general.--Whenever the Bureau determines that 
        the violation specified in the notice of charges served 
        upon a person, including a service provider, pursuant 
        to subsection (b), or the continuation thereof, is 
        likely to cause the person to be insolvent or otherwise 
        prejudice the interests of consumers before the 
        completion of the proceedings conducted pursuant to 
        subsection (b), the Bureau may issue a temporary order 
        requiring the person to cease and desist from any such 
        violation or practice and to take affirmative action to 
        prevent or remedy such insolvency or other condition 
        pending completion of such proceedings. Such order may 
        include any requirement authorized under this subtitle. 
        Such order shall become effective upon service upon the 
        person and, unless set aside, limited, or suspended by 
        a court in proceedings authorized by paragraph (2), 
        shall remain effective and enforceable pending the 
        completion of the administrative proceedings pursuant 
        to such notice and until such time as the Bureau shall 
        dismiss the charges specified in such notice, or if a 
        cease-and-desist order is issued against the person, 
        until the effective date of such order.
          (2) Appeal.--Not later than 10 days after the covered 
        person or service provider concerned has been served 
        with a temporary cease-and-desist order, the person may 
        apply to the United States district court for the 
        judicial district in which the residence or principal 
        office or place of business of the person is located, 
        or the United States District Court for the District of 
        Columbia, for an injunction setting aside, limiting, or 
        suspending the enforcement, operation, or effectiveness 
        of such order pending the completion of the 
        administrative proceedings pursuant to the notice of 
        charges served upon the person under subsection (b), 
        and such court shall have jurisdiction to issue such 
        injunction.
          (3) Incomplete or inaccurate records.--
                  (A) Temporary order.--If a notice of charges 
                served under subsection (b) specifies, on the 
                basis of particular facts and circumstances, 
                that the books and records of a covered person 
                or service provider are so incomplete or 
                inaccurate that the Bureau is unable to 
                determine the financial condition of that 
                person or the details or purpose of any 
                transaction or transactions that may have a 
                material effect on the financial condition of 
                that person, the Bureau may issue a temporary 
                order requiring--
                          (i) the cessation of any activity or 
                        practice which gave rise, whether in 
                        whole or in part, to the incomplete or 
                        inaccurate state of the books or 
                        records; or
                          (ii) affirmative action to restore 
                        such books or records to a complete and 
                        accurate state, until the completion of 
                        the proceedings under subsection 
                        (b)(1).
                  (B) Effective period.--Any temporary order 
                issued under subparagraph (A)--
                          (i) shall become effective upon 
                        service; and
                          (ii) unless set aside, limited, or 
                        suspended by a court in proceedings 
                        under paragraph (2), shall remain in 
                        effect and enforceable until the 
                        earlier of--
                                  (I) the completion of the 
                                proceeding initiated under 
                                subsection (b) in connection 
                                with the notice of charges; or
                                  (II) the date the Bureau 
                                determines[, by examination or 
                                otherwise,] that the books and 
                                records of the covered person 
                                or service provider are 
                                accurate and reflect the 
                                financial condition thereof.
  (d) Special Rules for Enforcement of Orders.--
          (1) In general.--The Bureau may in its discretion 
        apply to the United States district court within the 
        jurisdiction of which the principal office or place of 
        business of the person is located, for the enforcement 
        of any effective and outstanding notice or order issued 
        under this section, and such court shall have 
        jurisdiction and power to order and require compliance 
        herewith.
          (2) Exception.--Except as otherwise provided in this 
        subsection, no court shall have jurisdiction to affect 
        by injunction or otherwise the issuance or enforcement 
        of any notice or order or to review, modify, suspend, 
        terminate, or set aside any such notice or order.
  (e) Rules.--The Bureau shall prescribe rules establishing 
such procedures as may be necessary to carry out this section.
  (f) Private Parties Authorized to Compel the Agency to Seek 
Sanctions by Filing Civil Actions.--
          (1) Termination of administrative proceeding.--In the 
        case of any person who is a party to a proceeding 
        brought by the Agency under this section, to which 
        chapter 5 of title 5, United States Code, applies, and 
        against whom an order imposing a cease and desist order 
        or a penalty may be issued at the conclusion of the 
        proceeding, that person may, not later than 20 days 
        after receiving notice of such proceeding, and at that 
        person's discretion, require the Agency to terminate 
        the proceeding.
          (2) Civil action authorized.--If a person requires 
        the Agency to terminate a proceeding pursuant to 
        paragraph (1), the Agency may bring a civil action 
        against that person for the same remedy that might be 
        imposed.
  (g) Adjudications Deemed Actions.--Any administrative 
adjudication commenced under this section shall be deemed an 
``action'' for purposes of section 1054(g).

SEC. 1054. LITIGATION AUTHORITY.

  (a) In General.--If any person violates a Federal consumer 
financial law, the Bureau may, subject to [sections 1024, 1025, 
and 1026] sections 1024 and 1026, commence a civil action 
against such person to impose a civil penalty or to seek all 
appropriate legal and equitable relief including a permanent or 
temporary injunction as permitted by law.
  (b) Representation.--The Bureau may act in its own name and 
through its own attorneys in enforcing any provision of this 
title, rules thereunder, or any other law or regulation, or in 
any action, suit, or proceeding to which the Bureau is a party.
  (c) Compromise of Actions.--The Bureau may compromise or 
settle any action if such compromise is approved by the court.
  (d) Notice to the Attorney General.--
          (1) In general.--When commencing a civil action under 
        Federal consumer financial law, or any rule thereunder, 
        the Bureau shall notify the Attorney General and, with 
        respect to a civil action against an insured depository 
        institution or insured credit union, the appropriate 
        prudential regulator.
          (2) Notice and coordination.--
                  (A) Notice of other actions.--In addition to 
                any notice required under paragraph (1), the 
                Bureau shall notify the Attorney General 
                concerning any action, suit, or proceeding to 
                which the Bureau is a party, except an action, 
                suit, or proceeding that involves the offering 
                or provision of consumer financial products or 
                services.
                  (B) Coordination.--In order to avoid 
                conflicts and promote consistency regarding 
                litigation of matters under Federal law, the 
                Attorney General and the Bureau shall consult 
                regarding the coordination of investigations 
                and proceedings, including by negotiating an 
                agreement for coordination by not later than 
                180 days after the designated transfer date. 
                The agreement under this subparagraph shall 
                include provisions to ensure that parallel 
                investigations and proceedings involving the 
                Federal consumer financial laws are conducted 
                in a manner that avoids conflicts and does not 
                impede the ability of the Attorney General to 
                prosecute violations of Federal criminal laws.
                  (C) Rule of construction.--Nothing in this 
                paragraph shall be construed to limit the 
                authority of the Bureau under this title, 
                including the authority to interpret Federal 
                consumer financial law.
  (e) Appearance Before the Supreme Court.--The Bureau may 
represent itself in its own name before the Supreme Court of 
the United States, provided that the Bureau makes a written 
request to the Attorney General within the 10-day period which 
begins on the date of entry of the judgment which would permit 
any party to file a petition for writ of certiorari, and the 
Attorney General concurs with such request or fails to take 
action within 60 days of the request of the Bureau.
  (f) Forum.--Any civil action brought under this title may be 
brought in a United States district court or in any court of 
competent jurisdiction of a state in a district in which the 
defendant is located or resides or is doing business, and such 
court shall have jurisdiction to enjoin such person and to 
require compliance with any Federal consumer financial law.
  (g) Time for Bringing Action.--
          (1) In general.--Except as otherwise permitted by law 
        or equity, no action may be brought under this title 
        more than 3 years after the date of discovery of the 
        violation to which an action relates.
          (2) Limitations under other federal laws.--
                  (A) In general.--An action arising under this 
                title does not include claims arising solely 
                under enumerated consumer laws.
                  (B) Bureau authority.--In any action arising 
                solely under an enumerated consumer law, the 
                Bureau may commence, defend, or intervene in 
                the action in accordance with the requirements 
                of that provision of law, as applicable.
                  (C) Transferred authority.--In any action 
                arising solely under laws for which authorities 
                were transferred under subtitles F and H, the 
                Bureau may commence, defend, or intervene in 
                the action in accordance with the requirements 
                of that provision of law, as applicable.

           *       *       *       *       *       *       *


SEC. 1059. CONSIDERATION OF COST-BENEFIT ANALYSIS RELATED TO 
                    ADMINISTRATIVE ENFORCEMENT AND CIVIL ACTIONS.

  Before initiating any administrative enforcement action or 
civil lawsuit or entering into a consent order, the Director 
shall consider the cost-benefit analysis of such action, 
lawsuit, or order carried out by the Office of Economic 
Analysis.

     Subtitle F--Transfer of Functions and Personnel; Transitional 
                               Provisions

SEC. 1061. TRANSFER OF CONSUMER FINANCIAL PROTECTION FUNCTIONS.

  (a) Defined Terms.--For purposes of this subtitle--
          (1) the term ``consumer financial protection 
        functions'' means--
                  (A) all authority to prescribe rules or issue 
                orders or guidelines pursuant to any Federal 
                consumer financial law, including performing 
                appropriate functions to promulgate and review 
                such rules, orders, and guidelines[; and].
                  [(B) the examination authority described in 
                subsection (c)(1), with respect to a person 
                described in subsection 1025(a); and]
          (2) the terms ``transferor agency'' and ``transferor 
        agencies'' mean, respectively--
                  (A) the Board of Governors (and any Federal 
                reserve bank, as the context requires), the 
                Federal Deposit Insurance Corporation, the 
                Federal Trade Commission, the National Credit 
                Union Administration, the Office of the 
                Comptroller of the Currency, the Office of 
                Thrift Supervision, and the Department of 
                Housing and Urban Development, and the heads of 
                those agencies; and
                  (B) the agencies listed in subparagraph (A), 
                collectively.
  (b) In General.--Except as provided in subsection (c), 
consumer financial protection functions are transferred as 
follows:
          (1) Board of governors.--
                  (A) Transfer of functions.--All consumer 
                financial protection functions of the Board of 
                Governors are transferred to the Bureau.
                  (B) Board of governors authority.--The Bureau 
                shall have all powers and duties that were 
                vested in the Board of Governors, relating to 
                consumer financial protection functions, on the 
                day before the designated transfer date.
          (2) Comptroller of the currency.--
                  (A) Transfer of functions.--All consumer 
                financial protection functions of the 
                Comptroller of the Currency are transferred to 
                the Bureau.
                  (B) Comptroller authority.--The Bureau shall 
                have all powers and duties that were vested in 
                the Comptroller of the Currency, relating to 
                consumer financial protection functions, on the 
                day before the designated transfer date.
          (3) Director of the office of thrift supervision.--
                  (A) Transfer of functions.--All consumer 
                financial protection functions of the Director 
                of the Office of Thrift Supervision are 
                transferred to the Bureau.
                  (B) Director authority.--The Bureau shall 
                have all powers and duties that were vested in 
                the Director of the Office of Thrift 
                Supervision, relating to consumer financial 
                protection functions, on the day before the 
                designated transfer date.
          (4) Federal deposit insurance corporation.--
                  (A) Transfer of functions.--All consumer 
                financial protection functions of the Federal 
                Deposit Insurance Corporation are transferred 
                to the Bureau.
                  (B) Corporation authority.--The Bureau shall 
                have all powers and duties that were vested in 
                the Federal Deposit Insurance Corporation, 
                relating to consumer financial protection 
                functions, on the day before the designated 
                transfer date.
          (5) Federal trade commission.--
                  (A) Transfer of functions.--The authority of 
                the Federal Trade Commission under an 
                enumerated consumer law to prescribe rules, 
                issue guidelines, or conduct a study or issue a 
                report mandated under such law shall be 
                transferred to the Bureau on the designated 
                transfer date. Nothing in this title shall be 
                construed to require a mandatory transfer of 
                any employee of the Federal Trade Commission.
                  (B) Bureau authority.--
                          (i) In general.--The Bureau shall 
                        have all powers and duties under the 
                        enumerated consumer laws to prescribe 
                        rules, issue guidelines, or to conduct 
                        studies or issue reports mandated by 
                        such laws, that were vested in the 
                        Federal Trade Commission on the day 
                        before the designated transfer date.
                          [(ii) Federal trade commission act.--
                        Subject to subtitle B, the Bureau may 
                        enforce a rule prescribed under the 
                        Federal Trade Commission Act by the 
                        Federal Trade Commission with respect 
                        to an unfair or deceptive act or 
                        practice to the extent that such rule 
                        applies to a covered person or service 
                        provider with respect to the offering 
                        or provision of a consumer financial 
                        product or service as if it were a rule 
                        prescribed under section 1031 of this 
                        title.]
                  (C) Authority of the federal trade 
                commission.--
                          (i) In general.--No provision of this 
                        title shall be construed as modifying, 
                        limiting, or otherwise affecting the 
                        authority of the Federal Trade 
                        Commission (including its authority 
                        with respect to affiliates described in 
                        section 1025(a)(1)) under the Federal 
                        Trade Commission Act or any other law, 
                        other than the authority under an 
                        enumerated consumer law to prescribe 
                        rules, issue official guidelines, or 
                        conduct a study or issue a report 
                        mandated under such law.
                          (ii) Commission authority relating to 
                        rules prescribed by the bureau.--
                        Subject to subtitle B, the Federal 
                        Trade Commission shall have authority 
                        to enforce under the Federal Trade 
                        Commission Act (15 U.S.C. 41 et seq.) a 
                        rule prescribed by the Bureau under 
                        this title with respect to a covered 
                        person subject to the jurisdiction of 
                        the Federal Trade Commission under that 
                        Act, and a violation of such a rule by 
                        such a person shall be treated as a 
                        violation of a rule issued under 
                        section 18 of that Act (15 U.S.C. 57a) 
                        with respect to unfair or deceptive 
                        acts or practices.
                  [(D) Coordination.--To avoid duplication of 
                or conflict between rules prescribed by the 
                Bureau under section 1031 of this title and the 
                Federal Trade Commission under section 
                18(a)(1)(B) of the Federal Trade Commission Act 
                that apply to a covered person or service 
                provider with respect to the offering or 
                provision of consumer financial products or 
                services, the agencies shall negotiate an 
                agreement with respect to rulemaking by each 
                agency, including consultation with the other 
                agency prior to proposing a rule and during the 
                comment period.]
                  [(E)] (D) Deference.--No provision of this 
                title shall be construed as altering, limiting, 
                expanding, or otherwise affecting the deference 
                that a court [affords to the--]
                          [(i)] [Federal Trade Commission] 
                        affords to the Federal Trade Commission 
                        in making determinations regarding the 
                        meaning or interpretation of any 
                        provision of the Federal Trade 
                        Commission Act, or of any other Federal 
                        law for which the Commission has 
                        authority to prescribe rules[; or].
                          [(ii) Bureau in making determinations 
                        regarding the meaning or interpretation 
                        of any provision of a Federal consumer 
                        financial law (other than any law 
                        described in clause (i)).]
          (6) National credit union administration.--
                  (A) Transfer of functions.--All consumer 
                financial protection functions of the National 
                Credit Union Administration are transferred to 
                the Bureau.
                  (B) National credit union administration 
                authority.--The Bureau shall have all powers 
                and duties that were vested in the National 
                Credit Union Administration, relating to 
                consumer financial protection functions, on the 
                day before the designated transfer date.
          (7) Department of housing and urban development.--
                  (A) Transfer of functions.--All consumer 
                protection functions of the [Secretary of the 
                Department of Housing and Urban Development] 
                Department of Housing and Urban Development 
                relating to the Real Estate Settlement 
                Procedures Act of 1974 (12 U.S.C. 2601 et 
                seq.), the Secure and Fair Enforcement for 
                Mortgage Licensing Act of 2008 [(12 U.S.C. 5102 
                et seq.)] (12 U.S.C. 5101 et seq.), and the 
                Interstate Land Sales Full Disclosure Act (15 
                U.S.C. 1701 et seq.) are transferred to the 
                Bureau.
                  (B) Authority of the department of housing 
                and urban development.--The Bureau shall have 
                all powers and duties that were vested in the 
                [Secretary of the Department of Housing and 
                Urban Development] Department of Housing and 
                Urban Development relating to the Real Estate 
                Settlement Procedures Act of 1974 (12 U.S.C. 
                2601 et seq.), the Secure and Fair Enforcement 
                for Mortgage Licensing Act of 2008 (12 U.S.C. 
                5101 et seq.), and the Interstate Land Sales 
                Full Disclosure Act (15 U.S.C. 1701 et seq.), 
                on the day before the designated transfer date.
  (c) Authorities of the Prudential Regulators.--
          [(1) Examination.--A transferor agency that is a 
        prudential regulator shall have--
                  [(A) authority to require reports from and 
                conduct examinations for compliance with 
                Federal consumer financial laws with respect to 
                a person described in section 1025(a), that is 
                incidental to the backup and enforcement 
                procedures provided to the regulator under 
                section 1025(c); and
                  [(B) exclusive authority (relative to the 
                Bureau) to require reports from and conduct 
                examinations for compliance with Federal 
                consumer financial laws with respect to a 
                person described in section 1026(a), except as 
                provided to the Bureau under subsections (b) 
                and (c) of section 1026.]
          (1) Examination.--A transferor agency that is a 
        prudential regulator shall have exclusive authority 
        (relative to the Bureau) to require reports from and 
        conduct examinations for compliance with Federal 
        consumer financial laws with respect to a person 
        described in section 1026(a).
          (2) Enforcement.--
                  [(A) Limitation.--The authority of a 
                transferor agency that is a prudential 
                regulator to enforce compliance with Federal 
                consumer financial laws with respect to a 
                person described in section 1025(a), shall be 
                limited to the backup and enforcement 
                procedures in described in section 1025(c).]
                  [(B)] (A) Exclusive authority.--A transferor 
                agency that is a prudential regulator shall 
                have exclusive authority (relative to the 
                Bureau) to enforce compliance with Federal 
                consumer financial laws with respect to a 
                person described in section 1026(a), except as 
                provided to the Bureau under subsections (b) 
                and (c) of section 1026.
                  [(C)] (B) Statutory enforcement.--For 
                purposes of carrying out the authorities under, 
                and subject to the limitations of, subtitle B, 
                each prudential regulator may enforce 
                compliance with the requirements imposed under 
                this title, and any rule or order prescribed by 
                the Bureau under this title, under--
                          (i) the Federal Credit Union Act (12 
                        U.S.C. 1751 et seq.), by the National 
                        Credit Union Administration Board with 
                        respect to any covered person or 
                        service provider that is an insured 
                        credit union, or service provider 
                        thereto, or any affiliate of an insured 
                        credit union, who is subject to the 
                        jurisdiction of the Board under that 
                        Act; and
                          (ii) section 8 of the Federal Deposit 
                        Insurance Act (12 U.S.C. 1818), by the 
                        appropriate Federal banking agency, as 
                        defined in section 3(q) of the Federal 
                        Deposit Insurance Act (12 U.S.C. 
                        1813(q)), with respect to a covered 
                        person or service provider that is a 
                        person described in section 3(q) of 
                        that Act and who is subject to the 
                        jurisdiction of that agency, as set 
                        forth in sections 3(q) and 8 of the 
                        Federal Deposit Insurance Act; or
                          (iii) the Bank Service Company Act 
                        (12 U.S.C. 1861 et seq.).
  (d) Effective Date.--Subsections (b) and (c) shall become 
effective on the designated transfer date.

           *       *       *       *       *       *       *


SEC. 1063. SAVINGS PROVISIONS.

  (a) Board of Governors.--
          (1) Existing rights, duties, and obligations not 
        affected.--Section 1061(b)(1) does not affect the 
        validity of any right, duty, or obligation of the 
        United States, the Board of Governors (or any Federal 
        reserve bank), or any other person that--
                  (A) arises under any provision of law 
                relating to any consumer financial protection 
                function of the Board of Governors transferred 
                to the Bureau by this title; and
                  (B) existed on the day before the designated 
                transfer date.
          (2) Continuation of suits.--No provision of this Act 
        shall abate any proceeding commenced by or against the 
        Board of Governors (or any Federal reserve bank) before 
        the designated transfer date with respect to any 
        consumer financial protection function of the Board of 
        Governors (or any Federal reserve bank) transferred to 
        the Bureau by this title, except that the Bureau, 
        subject to [sections 1024, 1025, and 1026] sections 
        1024 and 1026, shall be substituted for the Board of 
        Governors (or Federal reserve bank) as a party to any 
        such proceeding as of the designated transfer date.
  (b) Federal Deposit Insurance Corporation.--
          (1) Existing rights, duties, and obligations not 
        affected.--Section 1061(b)(4) does not affect the 
        validity of any right, duty, or obligation of the 
        United States, the Federal Deposit Insurance 
        Corporation, the Board of Directors of that 
        Corporation, or any other person, that--
                  (A) arises under any provision of law 
                relating to any consumer financial protection 
                function of the Federal Deposit Insurance 
                Corporation transferred to the Bureau by this 
                title; and
                  (B) existed on the day before the designated 
                transfer date.
          (2) Continuation of suits.--No provision of this Act 
        shall abate any proceeding commenced by or against the 
        Federal Deposit Insurance Corporation (or the Board of 
        Directors of that Corporation) before the designated 
        transfer date with respect to any consumer financial 
        protection function of the Federal Deposit Insurance 
        Corporation transferred to the Bureau by this title, 
        except that the Bureau, subject to [sections 1024, 
        1025, and 1026] sections 1024 and 1026, shall be 
        substituted for the Federal Deposit Insurance 
        Corporation (or Board of Directors) as a party to any 
        such proceeding as of the designated transfer date.
  (c) Federal Trade Commission.--Section 1061(b)(5) does not 
affect the validity of any right, duty, or obligation of the 
United States, the Federal Trade Commission, or any other 
person, that--
          (1) arises under any provision of law relating to any 
        consumer financial protection function of the Federal 
        Trade Commission transferred to the Bureau by this 
        title; and
          (2) existed on the day before the designated transfer 
        date.
  (d) National Credit Union Administration.--
          (1) Existing rights, duties, and obligations not 
        affected.--Section 1061(b)(6) does not affect the 
        validity of any right, duty, or obligation of the 
        United States, the National Credit Union 
        Administration, the National Credit Union 
        Administration Board, or any other person, that--
                  (A) arises under any provision of law 
                relating to any consumer financial protection 
                function of the National Credit Union 
                Administration transferred to the Bureau by 
                this title; and
                  (B) existed on the day before the designated 
                transfer date.
          (2) Continuation of suits.--No provision of this Act 
        shall abate any proceeding commenced by or against the 
        National Credit Union Administration (or the National 
        Credit Union Administration Board) before the 
        designated transfer date with respect to any consumer 
        financial protection function of the National Credit 
        Union Administration transferred to the Bureau by this 
        title, except that the Bureau, subject to [sections 
        1024, 1025, and 1026] sections 1024 and 1026, shall be 
        substituted for the National Credit Union 
        Administration (or National Credit Union Administration 
        Board) as a party to any such proceeding as of the 
        designated transfer date.
  (e) Office of the Comptroller of the Currency.--
          (1) Existing rights, duties, and obligations not 
        affected.--Section 1061(b)(2) does not affect the 
        validity of any right, duty, or obligation of the 
        United States, the Comptroller of the Currency, the 
        Office of the Comptroller of the Currency, or any other 
        person, that--
                  (A) arises under any provision of law 
                relating to any consumer financial protection 
                function of the Comptroller of the Currency 
                transferred to the Bureau by this title; and
                  (B) existed on the day before the designated 
                transfer date.
          (2) Continuation of suits.--No provision of this Act 
        shall abate any proceeding commenced by or against the 
        Comptroller of the Currency (or the Office of the 
        Comptroller of the Currency) with respect to any 
        consumer financial protection function of the 
        Comptroller of the Currency transferred to the Bureau 
        by this title before the designated transfer date, 
        except that the Bureau, subject to [sections 1024, 
        1025, and 1026] sections 1024 and 1026, shall be 
        substituted for the Comptroller of the Currency (or the 
        Office of the Comptroller of the Currency) as a party 
        to any such proceeding as of the designated transfer 
        date.
  (f) Office of Thrift Supervision.--
          (1) Existing rights, duties, and obligations not 
        affected.--Section 1061(b)(3) does not affect the 
        validity of any right, duty, or obligation of the 
        United States, the Director of the Office of Thrift 
        Supervision, the Office of Thrift Supervision, or any 
        other person, that--
                  (A) arises under any provision of law 
                relating to any consumer financial protection 
                function of the Director of the Office of 
                Thrift Supervision transferred to the Bureau by 
                this title; and
                  (B) [that] existed on the day before the 
                designated transfer date.
          (2) Continuation of suits.--No provision of this Act 
        shall abate any proceeding commenced by or against the 
        Director of the Office of Thrift Supervision (or the 
        Office of Thrift Supervision) with respect to any 
        consumer financial protection function of the Director 
        of the Office of Thrift Supervision transferred to the 
        Bureau by this title before the designated transfer 
        date, except that the Bureau, subject to [sections 
        1024, 1025, and 1026] sections 1024 and 1026, shall be 
        substituted for the Director (or the Office of Thrift 
        Supervision) as a party to any such proceeding as of 
        the designated transfer date.
  (g) Department of Housing and Urban Development.--
          (1) Existing rights, duties, and obligations not 
        affected.--Section 1061(b)(7) shall not affect the 
        validity of any right, duty, or obligation of the 
        United States, the Secretary of the Department of 
        Housing and Urban Development (or the Department of 
        Housing and Urban Development), or any other person, 
        that--
                  (A) arises under any provision of law 
                relating to any function of the Secretary of 
                the Department of Housing and Urban Development 
                with respect to the Real Estate Settlement 
                Procedures Act of 1974 (12 U.S.C. 2601 et 
                seq.), the Secure and Fair Enforcement for 
                Mortgage Licensing Act of 2008 [(12 U.S.C. 5102 
                et seq.)] (12 U.S.C. 5101 et seq.), or the 
                Interstate Land Sales Full Disclosure Act (15 
                U.S.C. 1701 et [seq)] seq.) transferred to the 
                Bureau by this title; and
                  (B) existed on the day before the designated 
                transfer date.
          (2) Continuation of suits.--This title shall not 
        abate any proceeding commenced by or against the 
        Secretary of the Department of Housing and Urban 
        Development (or the Department of Housing and Urban 
        Development) with respect to any consumer financial 
        protection function of the Secretary of the Department 
        of Housing and Urban Development transferred to the 
        Bureau by this title before the designated transfer 
        date, except that the Bureau, subject to [sections 
        1024, 1025, and 1026] sections 1024 and 1026, shall be 
        substituted for the Secretary of the Department of 
        Housing and Urban Development (or the Department of 
        Housing and Urban Development) as a party to any such 
        proceeding as of the designated transfer date.
  (h) Continuation of Existing Orders, Rulings, Determinations, 
Agreements, and Resolutions.--
          (1) In general.--Except as provided in paragraph (2) 
        and under subsection (i), all orders, resolutions, 
        determinations, agreements, and rulings that have been 
        issued, made, prescribed, or allowed to become 
        effective by any transferor agency or by a court of 
        competent jurisdiction, in the performance of consumer 
        financial protection functions that are transferred by 
        this title and that are in effect on the day before the 
        designated transfer date, shall continue in effect, and 
        shall continue to be enforceable by the appropriate 
        transferor agency, according to the terms of those 
        orders, resolutions, determinations, agreements, and 
        rulings, and shall not be enforceable by or against the 
        Bureau.
          (2) Exception for orders applicable to persons 
        described in section 1025(a).--All orders, resolutions, 
        determinations, agreements, and rulings that have been 
        issued, made, prescribed, or allowed to become 
        effective by any transferor agency or by a court of 
        competent jurisdiction, in the performance of consumer 
        financial protection functions that are transferred by 
        this title and that are in effect on the day before the 
        designated transfer date with respect to any person 
        described in section 1025(a), shall continue in effect, 
        according to the terms of those orders, resolutions, 
        determinations, agreements, and rulings, and shall be 
        enforceable by or against the Bureau or transferor 
        agency.
  (i) Identification of Rules and Orders Continued.--Not later 
than the designated transfer date, the Bureau--
          (1) shall, after consultation with the head of each 
        transferor agency, identify the rules and orders that 
        will be enforced by the Bureau; and
          (2) shall publish a list of such rules and orders in 
        the Federal Register.
  (j) Status of Rules Proposed or Not Yet Effective.--
          (1) Proposed rules.--Any proposed rule of a 
        transferor agency which that agency, in performing 
        consumer financial protection functions transferred by 
        this title, has proposed before the designated transfer 
        date, but has not been published as a final rule before 
        that date, shall be deemed to be a proposed rule of the 
        Bureau.
          (2) Rules not yet effective.--Any interim or final 
        rule of a transferor agency which that agency, in 
        performing consumer financial protection functions 
        transferred by this title, has published before the 
        designated transfer date, but which has not become 
        effective before that date, shall become effective as a 
        rule of the Bureau according to its terms.

SEC. 1064. TRANSFER OF CERTAIN PERSONNEL.

  (a) In General.--
          (1) Certain federal reserve system employees 
        transferred.--
                  (A) Identifying employees for transfer.--The 
                Bureau and the Board of Governors shall--
                          (i) jointly determine the number of 
                        employees of the Board of Governors 
                        necessary to perform or support the 
                        consumer financial protection functions 
                        of the Board of Governors that are 
                        transferred to the Bureau by this 
                        title; and
                          (ii) consistent with the number 
                        determined under clause (i), jointly 
                        identify employees of the Board of 
                        Governors for transfer to the Bureau, 
                        in a manner that the Bureau and the 
                        Board of Governors, in their sole 
                        discretion, determine equitable.
                  (B) Identified employees transferred.--All 
                employees of the Board of Governors identified 
                under subparagraph (A)(ii) shall be transferred 
                to the Bureau for employment.
                  (C) Federal reserve bank employees.--
                Employees of any Federal reserve bank who are 
                performing consumer financial protection 
                functions on behalf of the Board of Governors 
                shall be treated as employees of the Board of 
                Governors for purposes of subparagraphs (A) and 
                (B).
          (2) Certain fdic employees transferred.--
                  (A) Identifying employees for transfer.--The 
                Bureau and the Board of Directors of the 
                Federal Deposit Insurance Corporation shall--
                          (i) jointly determine the number of 
                        employees of that Corporation necessary 
                        to perform or support the consumer 
                        financial protection functions of the 
                        Corporation that are transferred to the 
                        Bureau by this title; and
                          (ii) consistent with the number 
                        determined under clause (i), jointly 
                        identify employees of the Corporation 
                        for transfer to the Bureau, in a manner 
                        that the Bureau and the Board of 
                        Directors of the Corporation, in their 
                        sole discretion, determine equitable.
                  (B) Identified employees transferred.--All 
                employees of the Corporation identified under 
                subparagraph (A)(ii) shall be transferred to 
                the Bureau for employment.
          (3) Certain ncua employees transferred.--
                  (A) Identifying employees for transfer.--The 
                Bureau and the National Credit Union 
                Administration Board shall--
                          (i) jointly determine the number of 
                        employees of the National Credit Union 
                        Administration necessary to perform or 
                        support the consumer financial 
                        protection functions of the National 
                        Credit Union Administration that are 
                        transferred to the Bureau by this 
                        title; and
                          (ii) consistent with the number 
                        determined under clause (i), jointly 
                        identify employees of the National 
                        Credit Union Administration for 
                        transfer to the Bureau, in a manner 
                        that the Bureau and the National Credit 
                        Union Administration Board, in their 
                        sole discretion, determine equitable.
                  (B) Identified employees transferred.--All 
                employees of the National Credit Union 
                Administration identified under subparagraph 
                (A)(ii) shall be transferred to the Bureau for 
                employment.
          (4) Certain office of the comptroller of the currency 
        employees transferred.--
                  (A) Identifying employees for transfer.--The 
                Bureau and the Comptroller of the Currency 
                shall--
                          (i) jointly determine the number of 
                        employees of the Office of the 
                        Comptroller of the Currency necessary 
                        to perform or support the consumer 
                        financial protection functions of the 
                        Office of the Comptroller of the 
                        Currency that are transferred to the 
                        Bureau by this title; and
                          (ii) consistent with the number 
                        determined under clause (i), jointly 
                        identify employees of the Office of the 
                        Comptroller of the Currency for 
                        transfer to the Bureau, in a manner 
                        that the Bureau and the Office of the 
                        Comptroller of the Currency, in their 
                        sole discretion, determine equitable.
                  (B) Identified employees transferred.--All 
                employees of the Office of the Comptroller of 
                the Currency identified under subparagraph 
                (A)(ii) shall be transferred to the Bureau for 
                employment.
          (5) Certain office of thrift supervision employees 
        transferred.--
                  (A) Identifying employees for transfer.--The 
                Bureau and the Director of the Office of Thrift 
                Supervision shall--
                          (i) jointly determine the number of 
                        employees of the Office of Thrift 
                        Supervision necessary to perform or 
                        support the consumer financial 
                        protection functions of the Office of 
                        Thrift Supervision that are transferred 
                        to the Bureau by this title; and
                          (ii) consistent with the number 
                        determined under clause (i), jointly 
                        identify employees of the Office of 
                        Thrift Supervision for transfer to the 
                        Bureau, in a manner that the Bureau and 
                        the Office of Thrift Supervision, in 
                        their sole discretion, determine 
                        equitable.
                  (B) Identified employees transferred.--All 
                employees of the Office of Thrift Supervision 
                identified under subparagraph (A)(ii) shall be 
                transferred to the Bureau for employment.
          (6) Certain employees of department of housing and 
        urban development transferred.--
                  (A) Identifying employees for transfer.--The 
                Bureau and the Secretary of the Department of 
                Housing and Urban Development shall--
                          (i) jointly determine the number of 
                        employees of the Department of Housing 
                        and Urban Development necessary to 
                        perform or support the consumer 
                        protection functions of the Department 
                        that are transferred to the Bureau by 
                        this title; and
                          (ii) consistent with the number 
                        determined under clause (i), jointly 
                        identify employees of the Department of 
                        Housing and Urban Development for 
                        transfer to the Bureau in a manner that 
                        the Bureau and the Secretary of the 
                        Department of Housing and Urban 
                        Development, in their sole discretion, 
                        deem equitable.
                  (B) Identified employees transferred.--All 
                employees of the Department of Housing and 
                Urban Development identified under subparagraph 
                (A)(ii) shall be transferred to the Bureau for 
                employment.
          (7) Consumer education, financial literacy, consumer 
        complaints, and research functions.--The Bureau and 
        each of the transferor agencies (except the Federal 
        Trade Commission) shall jointly determine the number of 
        employees and the types and grades of employees 
        necessary to perform the functions of the Bureau under 
        subtitle A, including consumer education, financial 
        literacy, policy analysis, responses to consumer 
        complaints and inquiries, research, and similar 
        functions. All employees jointly identified under this 
        paragraph shall be transferred to the Bureau for 
        employment.
          (8) Authority of the president to resolve disputes.--
                  (A) Action authorized.--In the event that the 
                Bureau and a transferor agency are unable to 
                reach an agreement under paragraphs (1) through 
                (7) by the designated transfer date, the 
                President, or the designee thereof, may issue 
                an order or directive to the transferor agency 
                to effect the transfer of personnel and 
                property under this subtitle.
                  (B) Transmittal to congress required.--If an 
                order or directive is issued under subparagraph 
                (A), the President shall transmit a copy of the 
                written determination made with respect to such 
                order or directive, including an explanation 
                for the need for the order or directive, to the 
                Committee on Banking, Housing, and Urban 
                Affairs and the Committee on Appropriations of 
                the Senate and the Committee on Financial 
                Services and the Committee on Appropriations of 
                the House of Representatives.
                  (C) Sunset.--The authority provided in this 
                paragraph shall terminate 3 years after the 
                designated transfer date.
          (9) Appointment authority for excepted service and 
        senior executive service transferred.--
                  (A) In general.--In the case of an employee 
                occupying a position in the excepted service or 
                the Senior Executive Service, any appointment 
                authority established pursuant to law or 
                regulations of the Office of Personnel 
                Management for filling such positions shall be 
                transferred, subject to subparagraph (B).
                  (B) Declining transfers allowed.--An agency 
                or entity may decline to make a transfer of 
                authority under subparagraph (A) (and the 
                employees appointed pursuant thereto) to the 
                extent that such authority relates to positions 
                excepted from the competitive service because 
                of their confidential, policy-making, policy-
                determining, or policy-advocating character, 
                and non-career positions in the Senior 
                Executive Service (within the meaning of 
                section 3132(a)(7) of title 5, United States 
                Code).
  (b) Timing of Transfers and Position Assignments.--Each 
employee to be transferred under this section shall--
          (1) be transferred not later than 90 days after the 
        designated transfer date; and
          (2) receive notice of a position assignment not later 
        than 120 days after the effective date of his or her 
        transfer.
  (c) Transfer of Function.--
          (1) In general.--Notwithstanding any other provision 
        of law, the transfer of employees shall be deemed a 
        transfer of functions for the purpose of section 3503 
        of title 5, United States Code.
          (2) Priority of this title.--If any provisions of 
        this title conflict with any protection provided to 
        transferred employees under section 3503 of title 5, 
        United States Code, the provisions of this title shall 
        control.
  (d) Equal Status and Tenure Positions.--
          (1) Employees transferred from the federal reserve 
        system, fdic, hud, ncua, occ, and ots.--Each employee 
        transferred to the Bureau from the Board of Governors, 
        a Federal reserve bank, the Federal Deposit Insurance 
        Corporation, the Department of Housing and Urban 
        Development, the National Credit Union Administration, 
        the Office of the Comptroller of the Currency, or the 
        Office of Thrift Supervision shall be placed in a 
        position at the Bureau with the same status and tenure 
        as that employee held on the day before the designated 
        transfer date.
          (2) Employees transferred from the federal reserve 
        system.--For purposes of determining the status and 
        position placement of a transferred employee, any 
        period of service with the Board of Governors or a 
        Federal reserve bank shall be credited as a period of 
        service with a Federal agency.
  (e) Additional Certification Requirements Limited.--Examiners 
transferred to the Bureau are not subject to any additional 
certification requirements before being placed in a comparable 
examiner position at the Bureau examining the same types of 
institutions as they examined before they were transferred.
  (f) Personnel Actions Limited.--
          (1) 2-YEAR PROTECTION.--Except as provided in 
        paragraph (2), each transferred employee holding a 
        permanent position on the day before the designated 
        transfer date may not, during the 2-year period 
        beginning on the designated transfer date, be 
        involuntarily separated, or involuntarily reassigned 
        outside his or her locality pay area.
          (2) Exceptions.--Paragraph (1) does not limit the 
        right of the Bureau--
                  (A) to separate an employee for cause or for 
                unacceptable performance;
                  (B) to terminate an appointment to a position 
                excepted from the competitive service because 
                of its confidential policy-making, policy-
                determining, or policy-advocating character; or
                  (C) to reassign a supervisory employee 
                outside of his or her locality pay area when 
                the Bureau determines that the reassignment is 
                necessary for the efficient operation of the 
                Bureau.
  (g) Pay.--
          (1) 2-YEAR PROTECTION.--
                  (A) In general.--Except as provided in 
                paragraph (2), each transferred employee shall, 
                during the 2-year period beginning on the 
                designated transfer date, receive pay at a rate 
                equal to not less than the basic rate of pay 
                (including any geographic differential) that 
                the employee received during the pay period 
                immediately preceding the date of transfer.
                  (B) Limitation.--Notwithstanding subparagraph 
                (A), if the employee was receiving a higher 
                rate of basic pay on a temporary basis (because 
                of a temporary assignment, temporary promotion, 
                or other temporary action) immediately before 
                the date of transfer, the Bureau may reduce the 
                rate of basic pay on the date on which the rate 
                would have been reduced but for the transfer, 
                and the protected rate for the remainder of the 
                2-year period shall be the reduced rate that 
                would have applied, but for the transfer.
          (2) Exceptions.--Paragraph (1) does not limit the 
        right of the Bureau to reduce the rate of basic pay of 
        a transferred employee--
                  (A) for cause;
                  (B) for unacceptable performance; or
                  (C) with the consent of the employee.
          (3) Protection only while employed.--Paragraph (1) 
        applies to a transferred employee only while that 
        employee remains employed by the Bureau.
          (4) Pay increases permitted.--Paragraph (1) does not 
        limit the authority of the Bureau to increase the pay 
        of a transferred employee.
  (h) Reorganization.--
          (1) Between 1st and 3rd year.--
                  (A) In general.--If the Bureau determines, 
                during the 2-year period beginning 1 year after 
                the designated transfer date, that a 
                reorganization of the staff of the Bureau is 
                required--
                          (i) that reorganization shall be 
                        deemed a ``substantial reorganization'' 
                        for purposes of affording affected 
                        employees retirement under section 
                        8336(d)(2) or 8414(b)(1)(B) of title 5, 
                        United States Code;
                          (ii) before the reorganization 
                        occurs, all employees in the same 
                        locality pay area as defined by the 
                        Office of Personnel Management shall be 
                        placed in a uniform position 
                        classification system; and
                          (iii) any resulting reduction in 
                        force shall be governed by the 
                        provisions of chapter 35 of title 5, 
                        United States Code, except that the 
                        Bureau shall--
                                  (I) establish competitive 
                                areas (as that term is defined 
                                in regulations issued by the 
                                Office of Personnel Management) 
                                to include at a minimum all 
                                employees in the same locality 
                                pay area as defined by the 
                                Office of Personnel Management;
                                  (II) establish competitive 
                                levels (as that term is defined 
                                in regulations issued by the 
                                Office of Personnel Management) 
                                without regard to whether the 
                                particular employees have been 
                                appointed to positions in the 
                                competitive service or the 
                                excepted service; and
                                  (III) afford employees 
                                appointed to positions in the 
                                excepted service (other than to 
                                a position excepted from the 
                                competitive service because of 
                                its confidential policy-making, 
                                policy-determining, or policy-
                                advocating character) the same 
                                assignment rights to positions 
                                within the Bureau as employees 
                                appointed to positions in the 
                                competitive service.
                  (B) Service credit for reductions in force.--
                For purposes of this paragraph, periods of 
                service with a Federal home loan bank, a joint 
                office of the Federal home loan banks, the 
                Board of Governors, a Federal reserve bank, the 
                Federal Deposit Insurance Corporation, or the 
                National Credit Union Administration shall be 
                credited as periods of service with a Federal 
                agency.
          (2) After 3rd year.--
                  (A) In general.--If the Bureau determines, at 
                any time after the 3-year period beginning on 
                the designated transfer date, that a 
                reorganization of the staff of the Bureau is 
                required, any resulting reduction in force 
                shall be governed by the provisions of chapter 
                35 of title 5, United States Code, except that 
                the Bureau shall establish competitive levels 
                (as that term is defined in regulations issued 
                by the Office of Personnel Management) without 
                regard to types of appointment held by 
                particular employees transferred under this 
                section.
                  (B) Service credit for reductions in force.--
                For purposes of this paragraph, periods of 
                service with a Federal home loan bank, a joint 
                office of the Federal home loan banks, the 
                Board of Governors, a Federal reserve bank, the 
                Federal Deposit Insurance Corporation, or the 
                National Credit Union Administration shall be 
                credited as periods of service with a Federal 
                agency.
  (i) Benefits.--
          (1) Retirement benefits for transferred employees.--
                  (A) In general.--
                          (i) Continuation of existing 
                        retirement plan.--Unless an election is 
                        made under clause (iii) or subparagraph 
                        (B), each employee transferred pursuant 
                        to this subtitle shall remain enrolled 
                        in the existing retirement plan of that 
                        employee as of the date of transfer, 
                        through any period of continuous 
                        employment with the Bureau.
                          (ii) Employer contribution.--The 
                        Bureau shall pay any employer 
                        contributions to the existing 
                        retirement plan of each transferred 
                        employee, as required under that plan.
                          (iii) Option to elect into the 
                        federal reserve system retirement plan 
                        and federal reserve system thrift 
                        plan.--Any employee transferred 
                        pursuant to this subtitle may, during 
                        the 1-year period beginning 6 months 
                        after the designated transfer date, 
                        elect to end their participation and 
                        benefit accruals under their existing 
                        retirement plan or plans and elect to 
                        participate in both the Federal Reserve 
                        System Retirement Plan and the Federal 
                        Reserve System Thrift Plan, through any 
                        period of continuous employment with 
                        the Bureau, under the same terms as are 
                        applicable to Federal Reserve System 
                        transferred employees, as provided in 
                        subparagraph (C). An election of 
                        coverage by the Federal Reserve System 
                        Retirement Plan and the Federal Reserve 
                        System Thrift Plan shall begin on the 
                        day following the end of the 18- month 
                        period beginning on the designated 
                        transfer date, and benefit accruals 
                        under the existing retirement plan of 
                        the transferred employee shall end on 
                        the last day of the 18-month period 
                        beginning on the designated transfer 
                        date. If an employee elects to 
                        participate in the Federal Reserve 
                        System Retirement Plan and the Federal 
                        Reserve System Thrift Plan, all of the 
                        service of the employee that was 
                        creditable under their existing 
                        retirement plan shall be transferred to 
                        the Federal Reserve System Retirement 
                        Plan on the day following the end of 
                        the 18-month period beginning on the 
                        designated transfer date.
                          (iv) Bureau contribution.--The Bureau 
                        shall pay an employer contribution to 
                        the Federal Reserve System Retirement 
                        Plan, in the amount established as an 
                        employer contribution under the Federal 
                        Employees Retirement System, as 
                        established under chapter 84 of title 
                        5, United States Code, for each Bureau 
                        employee who elects to participate in 
                        the Federal Reserve System Retirement 
                        Plan under this subparagraph. The 
                        Bureau shall pay an employer 
                        contribution to the Federal Reserve 
                        System Thrift Plan for each Bureau 
                        employee who elects to participate in 
                        such plan, as required under the terms 
                        of the Federal Reserve System Thrift 
                        Plan.
                          (v) Additional funding.--The Bureau 
                        shall transfer to the Federal Reserve 
                        System Retirement Plan an amount 
                        determined by the Board of Governors, 
                        in consultation with the Bureau, to be 
                        necessary to reimburse the Federal 
                        Reserve System Retirement Plan for the 
                        costs to such plan of providing 
                        benefits to employees electing coverage 
                        under the Federal Reserve System 
                        Retirement Plan under subparagraph 
                        (iii), and who were transferred to the 
                        Bureau from outside of the Federal 
                        Reserve System.
                          (vi) Option to elect into thrift plan 
                        created by the bureau.--If the Bureau 
                        chooses to establish a thrift plan, the 
                        employees transferred pursuant to this 
                        subtitle shall have the option to 
                        elect, under such terms and conditions 
                        as the Bureau may establish, coverage 
                        under such a thrift plan established by 
                        the Bureau. Transferred employees may 
                        not remain in the thrift plan of the 
                        agency from which the employee 
                        transferred under this subtitle, if the 
                        employee elects to participate in a 
                        thrift plan established by the Bureau.
                  (B) Option for employees transferred from 
                federal reserve system to be subject to the 
                federal employee retirement program.--
                          (i) Election.--Any Federal Reserve 
                        System transferred employee who was 
                        enrolled in the Federal Reserve System 
                        Retirement Plan on the day before the 
                        date of his or her transfer to the 
                        Bureau may, during the 1-year period 
                        beginning 6 months after the designated 
                        transfer date, elect to be subject to 
                        the Federal Employee Retirement 
                        Program.
                          (ii) Effective date of coverage.--An 
                        election of coverage by the Federal 
                        Employee Retirement Program under this 
                        subparagraph shall begin on the day 
                        following the end of the 18-month 
                        period beginning on the designated 
                        transfer date, and benefit accruals 
                        under the existing retirement plan of 
                        the Federal Reserve System transferred 
                        employee shall end on the last day of 
                        the 18-month period beginning on the 
                        designated transfer date.
                  (C) Bureau participation in federal reserve 
                system retirement plan.--
                          (i) Benefits provided.--Federal 
                        Reserve System employees transferred 
                        pursuant to this subtitle shall 
                        continue to be eligible to participate 
                        in the Federal Reserve System 
                        Retirement Plan and Federal Reserve 
                        System Thrift Plan through any period 
                        of continuous employment with the 
                        Bureau, unless the employee makes an 
                        election under subparagraph (A)(vi) or 
                        (B). The retirement benefits, formulas, 
                        and features offered to the Federal 
                        Reserve System transferred employees 
                        shall be the same as those offered to 
                        employees of the Board of Governors who 
                        participate in the Federal Reserve 
                        System Retirement Plan and the Federal 
                        Reserve System Thrift Plan, as amended 
                        from time to time.
                          (ii) Limitation.--The Bureau shall 
                        not have responsibility or authority--
                                  (I) to amend an existing 
                                retirement plan (including the 
                                Federal Reserve System 
                                Retirement Plan or Federal 
                                Reserve System Thrift Plan);
                                  (II) for administering an 
                                existing retirement plan 
                                (including the Federal Reserve 
                                System Retirement Plan or 
                                Federal Reserve System Thrift 
                                Plan); or
                                  (III) for ensuring the plans 
                                comply with applicable laws, 
                                fiduciary rules, and related 
                                responsibilities.
                          (iii) Tax qualified status.--
                        Notwithstanding any other provision of 
                        law, providing benefits to Federal 
                        Reserve System employees transferred to 
                        the Bureau pursuant to this subtitle, 
                        and to employees who elect coverage 
                        pursuant to subparagraph (A)(iii) or 
                        under section 1013(a)(2)(B), shall not 
                        cause any existing retirement plan 
                        (including the Federal Reserve System 
                        Retirement Plan and the Federal Reserve 
                        System Thrift Plan) to lose its tax-
                        qualified status under sections 401(a) 
                        and 501(a) of the Internal Revenue Code 
                        of 1986.
                          (iv) Bureau contribution.--The Bureau 
                        shall pay any employer contributions to 
                        the existing retirement plan (including 
                        the Federal Reserve System Retirement 
                        Plan and the Federal Reserve System 
                        Thrift Plan) for each Federal Reserve 
                        System transferred employee 
                        participating in those plans, as 
                        required under the plan, after the 
                        designated transfer date.
                          (v) Controlled group status.--The 
                        Bureau is the same employer as the 
                        Federal Reserve System (as comprised of 
                        the Board of Governors and each of the 
                        12 Federal reserve banks prior to the 
                        date of enactment of this Act) for 
                        purposes of subsections (b), (c), (m), 
                        and (o) of section 414 of the Internal 
                        Revenue Code of 1986 (26 U.S.C. 414).
                  (D) Definitions.--For purposes of this 
                paragraph--
                          (i) the term ``existing retirement 
                        plan'' means, with respect to an 
                        employee transferred pursuant to this 
                        subtitle, the retirement plan 
                        (including the Financial Institutions 
                        Retirement Fund) and any associated 
                        thrift savings plan, of the agency from 
                        which the employee was transferred 
                        under this subtitle, in which the 
                        employee was enrolled on the day before 
                        the date on which the employee was 
                        transferred;
                          (ii) the term ``Federal Employee 
                        Retirement Program'' means either the 
                        Civil Service Retirement System 
                        established under chapter 83 of title 
                        5, United States Code, or the Federal 
                        Employees Retirement System established 
                        under chapter 84 of title 5, United 
                        States Code, depending upon the service 
                        history of the individual;
                          (iii) the term ``Federal Reserve 
                        System transferred employee'' means a 
                        transferred employee who is an employee 
                        of the Board of Governors or a Federal 
                        reserve bank on the day before the 
                        designated transfer date, and who is 
                        transferred to the Bureau on the 
                        designated transfer date pursuant to 
                        this subtitle;
                          (iv) the term ``Federal Reserve 
                        System Retirement Plan'' means the 
                        Retirement Plan for Employees of the 
                        Federal Reserve System; and
                          (v) the term ``Federal Reserve System 
                        Thrift Plan'' means the Thrift Plan for 
                        Employees of the Federal Reserve 
                        System.
          (2) Benefits other than retirement benefits for 
        transferred employees.--
                  (A) During 1st year.--
                          (i) Existing plans continue.--Each 
                        employee transferred pursuant to this 
                        subtitle may, for 1 year after the 
                        designated transfer date, retain 
                        membership in any other employee 
                        benefit program of the agency or bank 
                        from which the employee transferred, 
                        including a medical, dental, vision, 
                        long term care, or life insurance 
                        program, to which the employee belonged 
                        on the day before the designated 
                        transfer date.
                          (ii) Employer contribution.--The 
                        Bureau shall reimburse the agency or 
                        bank from which an employee was 
                        transferred for any cost incurred by 
                        that agency or bank in continuing to 
                        extend coverage in the benefit program 
                        to the employee, as required under that 
                        program or negotiated agreements.
                  (B) Medical, dental, vision, or life 
                insurance after first year.--If, at the end of 
                the 1-year period beginning on the designated 
                transfer date, the Bureau has not established 
                its own, or arranged for participation in 
                another entity's, medical, dental, vision, or 
                life insurance program, an employee transferred 
                pursuant to this subtitle who was a member of 
                such a program at the agency or Federal reserve 
                bank from which the employee transferred may, 
                before the coverage of that employee ends under 
                subparagraph (A)(i), elect to enroll, without 
                regard to any regularly scheduled open season, 
                in--
                          (i) the enhanced dental benefits 
                        program established under chapter 89A 
                        of title 5, United States Code;
                          (ii) the enhanced vision benefits 
                        established under chapter 89B of title 
                        5, United States Code;
                          (iii) the Federal Employees Group 
                        Life Insurance Program established 
                        under chapter 87 of title 5, United 
                        States Code, without regard to any 
                        requirement of insurability; and
                          (iv) the Federal Employees Health 
                        Benefits Program established under 
                        chapter 89 of title 5, United States 
                        Code.
                  (C) Long term care insurance after 1st 
                year.--If, at the end of the 1-year period 
                beginning on the designated transfer date, the 
                Bureau has not established its own, or arranged 
                for participation in another entity's, long 
                term care insurance program, an employee 
                transferred pursuant to this subtitle who was a 
                member of such a program at the agency or 
                Federal reserve bank from which the employee 
                transferred may, before the coverage of that 
                employee ends under subparagraph (A)(i), elect 
                to apply for coverage under the Federal Long 
                Term Care Insurance Program established under 
                chapter 90 of title 5, United States Code, 
                under the underwriting requirements applicable 
                to a new active workforce member (as defined in 
                part 875 of title 5, Code of Federal 
                Regulations).
                  (D) Employee contribution.--An individual 
                enrolled in the Federal Employees Health 
                Benefits program shall pay any employee 
                contribution required by the plan.
                  (E) Additional funding.--The Bureau shall 
                transfer to the Federal Employees Health 
                Benefits Fund established under section 8909 of 
                title 5, United States Code, an amount 
                determined by the Director of the Office of 
                Personnel Management, after consultation with 
                the Bureau and the Office of Management and 
                Budget, to be necessary to reimburse the Fund 
                for the cost to the Fund of providing benefits 
                under this paragraph.
                  (F) Credit for time enrolled in other 
                plans.--For employees transferred under this 
                title, enrollment in a health benefits plan 
                administered by a transferor agency or a 
                Federal reserve bank, as the case may be, 
                immediately before enrollment in a health 
                benefits plan under chapter 89 of title 5, 
                United States Code, shall be considered as 
                enrollment in a health benefits plan under that 
                chapter for purposes of section 8905(b)(1)(A) 
                of title 5, United States Code.
                  (G) Special provisions to ensure continuation 
                of life insurance benefits.--
                          (i) In general.--An annuitant (as 
                        defined in section 8901(3) of title 5, 
                        United States Code) who is enrolled in 
                        a life insurance plan administered by a 
                        transferor agency on the day before the 
                        designated transfer date shall be 
                        eligible for coverage by a life 
                        insurance plan under sections 8706(b), 
                        8714a, 8714b, and 8714c of title 5, 
                        United States Code, or in a life 
                        insurance plan established by the 
                        Bureau, without regard to any regularly 
                        scheduled open season and requirement 
                        of insurability.
                          (ii) Employee contribution.--An 
                        individual enrolled in a life insurance 
                        plan under this subparagraph shall pay 
                        any employee contribution required by 
                        the plan.
                          (iii) Additional funding.--The Bureau 
                        shall transfer to the Employees' Life 
                        Insurance Fund established under 
                        section 8714 of title 5, United States 
                        Code, an amount determined by the 
                        Director of the Office of Personnel 
                        Management, after consultation with the 
                        Bureau and the Office of Management and 
                        Budget, to be necessary to reimburse 
                        the Fund for the cost to the Fund of 
                        providing benefits under this 
                        subparagraph not otherwise paid for by 
                        the employee under clause (ii).
                          (iv) Credit for time enrolled in 
                        other plans.--For employees transferred 
                        under this title, enrollment in a life 
                        insurance plan administered by a 
                        transferor agency immediately before 
                        enrollment in a life insurance plan 
                        under chapter 87 of title 5, United 
                        States Code, shall be considered as 
                        enrollment in a life insurance plan 
                        under that chapter for purposes of 
                        section 8706(b)(1)(A) of title 5, 
                        United States Code.
          (3) OPM rules.--The Office of Personnel Management 
        shall issue such rules as are necessary to carry out 
        this subsection.
  (j) Implementation of Uniform Pay and Classification 
System.--Not later than 2 years after the designated transfer 
date, the Bureau shall implement a uniform pay and 
classification system for all employees transferred under this 
title.
  (k) Equitable Treatment.--In administering the provisions of 
this section, the Bureau--
          (1) shall take no action that would unfairly 
        disadvantage transferred employees relative to each 
        other based on their prior employment by the Board of 
        Governors, the Federal Deposit Insurance Corporation, 
        the Department of Housing and Urban Development, the 
        National Credit Union Administration, the Office of the 
        Comptroller of the Currency, the Office of Thrift 
        Supervision, a Federal reserve bank, a Federal home 
        loan bank, or a joint office of the Federal home loan 
        banks; and
          (2) may take such action as is appropriate in 
        individual cases so that employees transferred under 
        this section receive equitable treatment, with respect 
        to the status, tenure, pay, benefits (other than 
        benefits under programs administered by the Office of 
        Personnel Management), and accrued leave or vacation 
        time of those employees, for prior periods of service 
        with any Federal agency, including the Board of 
        Governors, the Corporation, the Department of Housing 
        and Urban Development, the National Credit Union 
        Administration, the Office of the Comptroller of the 
        Currency, the Office of Thrift Supervision, a Federal 
        reserve bank, a Federal home loan bank, or a joint 
        office of the Federal home loan banks.
  (l) Implementation.--In implementing the provisions of this 
section, the Bureau shall coordinate with the Office of 
Personnel Management and other entities having expertise in 
matters related to employment to ensure a fair and orderly 
transition for affected employees.

           *       *       *       *       *       *       *


SEC. 1067. TRANSITION OVERSIGHT.

  (a) Purpose.--The purpose of this section is to ensure that 
the Bureau--
          (1) has an orderly and organized startup;
          (2) attracts and retains a qualified workforce; and
          (3) establishes comprehensive employee training and 
        benefits programs.
  (b) Reporting Requirement.--
          (1) In general.--The Bureau shall submit an annual 
        report to the Committee on Banking, Housing, and Urban 
        Affairs of the Senate and the Committee on Financial 
        Services of the House of Representatives that includes 
        the plans described in paragraph (2).
          (2) Plans.--The plans described in this paragraph are 
        as follows:
                  (A) Training and workforce development 
                plan.--The Bureau shall submit a training and 
                workforce development plan that includes, to 
                the extent practicable--
                          (i) identification of skill and 
                        technical expertise needs and actions 
                        taken to meet those requirements;
                          (ii) steps taken to foster innovation 
                        and creativity;
                          (iii) leadership development and 
                        succession planning; and
                          (iv) effective use of technology by 
                        employees.
                  (B) Workplace flexibilities plan.--The Bureau 
                shall submit a workforce flexibility plan that 
                includes, to the extent practicable--
                          (i) telework;
                          (ii) flexible work schedules;
                          (iii) phased retirement;
                          (iv) reemployed annuitants;
                          (v) part-time work;
                          (vi) job sharing;
                          (vii) parental leave benefits and 
                        childcare assistance;
                          (viii) domestic partner benefits;
                          (ix) other workplace flexibilities; 
                        or
                          (x) any combination of the items 
                        described in clauses (i) through (ix).
                  (C) Recruitment and retention plan.--The 
                Bureau shall submit a recruitment and retention 
                plan that includes, to the extent practicable, 
                provisions relating to--
                          (i) the steps necessary to target 
                        highly qualified applicant pools with 
                        diverse backgrounds;
                          (ii) streamlined employment 
                        application processes;
                          (iii) the provision of timely 
                        notification of the status of 
                        employment applications to applicants; 
                        and
                          (iv) the collection of information to 
                        measure indicators of hiring 
                        effectiveness.
  (c) Expiration.--The reporting requirement under subsection 
(b) shall terminate 5 years after the date of enactment of this 
Act.
  (d) Rule of Construction.--Nothing in this section may be 
construed to affect--
          (1) a collective bargaining agreement, as that term 
        is defined in section 7103(a)(8) of title 5, United 
        States Code, that is in effect on the date of enactment 
        of this Act; or
          (2) the rights of employees under chapter 71 of title 
        5, United States Code.
  [(e) Participation in Examinations.--In order to prepare the 
Bureau to conduct examinations under section 1025 upon the 
designated transfer date, the Bureau and the applicable 
prudential regulator may agree to include, on a sampling basis, 
examiners on examinations of the compliance with Federal 
consumer financial law of institutions described in section 
1025(a) conducted by the prudential regulators prior to the 
designated transfer date.]

Subtitle G--Regulatory Improvements

           *       *       *       *       *       *       *


SEC. 1073. REMITTANCE TRANSFERS.

  (a) [Omitted--Amendatory]
  (b) Automated Clearinghouse System.--
          (1) Expansion of system.--The Board of Governors 
        shall work with the Federal reserve banks and the 
        Department of the Treasury to expand the use of the 
        automated clearinghouse system and other payment 
        mechanisms for remittance transfers to foreign 
        countries, with a focus on countries that receive 
        significant remittance transfers from the United 
        States, based on--
                  (A) the number, volume, and size of such 
                transfers;
                  (B) the significance of the volume of such 
                transfers relative to the external financial 
                flows of the receiving country, including--
                          (i) the total amount transferred; and
                          (ii) the total volume of payments 
                        made by United States Government 
                        agencies to beneficiaries and retirees 
                        living abroad;
                  (C) the feasibility of such an expansion; and
                  (D) the ability of the Federal Reserve System 
                to establish payment gateways in different 
                geographic regions and currency zones to 
                receive remittance transfers and route them 
                through the payments systems in the destination 
                countries.
          (2) Report to congress.--Not later than one calendar 
        year after the date of enactment of this Act, and on 
        April 30 biennially thereafter during the 10-year 
        period beginning on that date of enactment, the Board 
        of Governors shall submit a report to the Committee on 
        Banking, Housing, and Urban Affairs of the Senate and 
        the Committee on Financial Services of the House of 
        Representatives on the status of the automated 
        clearinghouse system and its progress in complying with 
        the requirements of this subsection. The report shall 
        include an analysis of adoption rates of International 
        ACH Transactions rules and formats, the efficacy of 
        increasing adoption rates, and potential 
        recommendations to increase adoption.
  (c) Expansion of Financial Institution Provision of 
Remittance Transfers.--
          (1) Provision of guidelines to institutions.--Each of 
        the Federal banking agencies and the National Credit 
        Union Administration shall provide guidelines to 
        financial institutions under the jurisdiction of the 
        agency regarding the offering of low-cost remittance 
        transfers and no-cost or low-cost basic consumer 
        accounts, as well as agency services to remittance 
        transfer providers.
          (2) Assistance to financial literacy and education 
        commission.--As part of [its duties] their duties as 
        members of the Financial Literacy and Education 
        Commission, the Bureau, the Federal banking agencies, 
        and the National Credit Union Administration shall 
        assist the Financial Literacy and Education Commission 
        in executing the Strategy for Assuring Financial 
        Empowerment (or the ``SAFE Strategy''), as it relates 
        to remittances.

           *       *       *       *       *       *       *


[SEC. 1075. REASONABLE FEES AND RULES FOR PAYMENT CARD TRANSACTIONS.

  [(a) In general.--The Electronic Fund Transfer Act (15 U.S.C. 
1693 et seq.) is amended--
          [(1) by redesignating sections 920 and 921 as 
        sections 921 and 922, respectively; and
          [(2) by inserting after section 919 the following:

[``SEC. 920. REASONABLE FEES AND RULES FOR PAYMENT CARD TRANSACTIONS

  [``(a) Reasonable Interchange Transaction Fees for Electronic 
Debit Transactions.--
          [``(1) Regulatory authority over interchange 
        transaction fees.--The Board may prescribe regulations, 
        pursuant to section 553 of title 5, United States Code, 
        regarding any interchange transaction fee that an 
        issuer may receive or charge with respect to an 
        electronic debit transaction, to implement this 
        subsection (including related definitions), and to 
        prevent circumvention or evasion of this subsection.
          [``(2) Reasonable interchange transaction fees.--The 
        amount of any interchange transaction fee that an 
        issuer may receive or charge with respect to an 
        electronic debit transaction shall be reasonable and 
        proportional to the cost incurred by the issuer with 
        respect to the transaction.
          [``(3) Rulemaking required.--
                  [``(A) In general.--The Board shall prescribe 
                regulations in final form not later than 9 
                months after the date of enactment of the 
                Consumer Financial Protection Act of 2010, to 
                establish standards for assessing whether the 
                amount of any interchange transaction fee 
                described in paragraph (2) is reasonable and 
                proportional to the cost incurred by the issuer 
                with respect to the transaction.
                  [``(B) Information collection.--The Board may 
                require any issuer (or agent of an issuer) or 
                payment card network to provide the Board with 
                such information as may be necessary to carry 
                out the provisions of this subsection and the 
                Board, in issuing rules under subparagraph (A) 
                and on at least a bi-annual basis thereafter, 
                shall disclose such aggregate or summary 
                information concerning the costs incurred, and 
                interchange transaction fees charged or 
                received, by issuers or payment card networks 
                in connection with the authorization, clearance 
                or settlement of electronic debit transactions 
                as the Board considers appropriate and in the 
                public interest.
          [``(4) Considerations; consultation.--In prescribing 
        regulations under paragraph (3)(A), the Board shall--
                  [``(A) consider the functional similarity 
                between--
                          [``(i) electronic debit transactions; 
                        and
                          [``(ii) checking transactions that 
                        are required within the Federal Reserve 
                        bank system to clear at par;
                  [``(B) distinguish between--
                          [``(i) the incremental cost incurred 
                        by an issuer for the role of the issuer 
                        in the authorization, clearance, or 
                        settlement of a particular electronic 
                        debit transaction, which cost shall be 
                        considered under paragraph (2); and
                          [``(ii) other costs incurred by an 
                        issuer which are not specific to a 
                        particular electronic debit 
                        transaction, which costs shall not be 
                        considered under paragraph (2); and
                  [``(C) consult, as appropriate, with the 
                Comptroller of the Currency, the Board of 
                Directors of the Federal Deposit Insurance 
                Corporation, the Director of the Office of 
                Thrift Supervision, the National Credit Union 
                Administration Board, the Administrator of the 
                Small Business Administration, and the Director 
                of the Bureau of Consumer Financial Protection.
          [``(5) Adjustments to interchange transaction fees 
        for fraud prevention costs.--
                  [``(A) Adjustments.--The Board may allow for 
                an adjustment to the fee amount received or 
                charged by an issuer under paragraph (2), if--
                          [``(i) such adjustment is reasonably 
                        necessary to make allowance for costs 
                        incurred by the issuer in preventing 
                        fraud in relation to electronic debit 
                        transactions involving that issuer; and
                          [``(ii) the issuer complies with the 
                        fraud-related standards established by 
                        the Board under subparagraph (B), which 
                        standards shall--
                                  [``(I) be designed to ensure 
                                that any fraud-related 
                                adjustment of the issuer is 
                                limited to the amount described 
                                in clause (i) and takes into 
                                account any fraud-related 
                                reimbursements (including 
                                amounts from charge-backs) 
                                received from consumers, 
                                merchants, or payment card 
                                networks in relation to 
                                electronic debit transactions 
                                involving the issuer; and
                                  [``(II) require issuers to 
                                take effective steps to reduce 
                                the occurrence of, and costs 
                                from, fraud in relation to 
                                electronic debit transactions, 
                                including through the 
                                development and implementation 
                                of cost-effective fraud 
                                prevention technology.
                  [``(B) Rulemaking required.--
                          [``(i) In general.--The Board shall 
                        prescribe regulations in final form not 
                        later than 9 months after the date of 
                        enactment of the Consumer Financial 
                        Protection Act of 2010, to establish 
                        standards for making adjustments under 
                        this paragraph.
                          [``(ii) Factors for Consideration.--
                        In issuing the standards and 
                        prescribing regulations under this 
                        paragraph, the Board shall consider--
                                  [``(I) the nature, type, and 
                                occurrence of fraud in 
                                electronic debit transactions;
                                  [``(II) the extent to which 
                                the occurrence of fraud depends 
                                on whether authorization in an 
                                electronic debit transaction is 
                                based on signature, PIN, or 
                                other means;
                                  [``(III) the available and 
                                economical means by which fraud 
                                on electronic debit 
                                transactions may be reduced;
                                  [``(IV) the fraud prevention 
                                and data security costs 
                                expended by each party involved 
                                in electronic debit 
                                transactions (including 
                                consumers, persons who accept 
                                debit cards as a form of 
                                payment, financial 
                                institutions, retailers and 
                                payment card networks);
                                  [``(V) the costs of 
                                fraudulent transactions 
                                absorbed by each party involved 
                                in such transactions (including 
                                consumers, persons who accept 
                                debit cards as a form of 
                                payment, financial 
                                institutions, retailers and 
                                payment card networks);
                                  [``(VI) the extent to which 
                                interchange transaction fees 
                                have in the past reduced or 
                                increased incentives for 
                                parties involved in electronic 
                                debit transactions to reduce 
                                fraud on such transactions; and
                                  [``(VII) such other factors 
                                as the Board considers 
                                appropriate.
          [``(6) Exemption for small issuers.--
                  [``(A) In general.--This subsection shall not 
                apply to any issuer that, together with its 
                affiliates, has assets of less than 
                $10,000,000,000, and the Board shall exempt 
                such issuers from regulations prescribed under 
                paragraph (3)(A).
                  [``(B) Definition.--For purposes of this 
                paragraph, the term `issuer' shall be limited 
                to the person holding the asset account that is 
                debited through an electronic debit 
                transaction.
          [``(7) Exemption for government-administered payment 
        programs and reloadable prepaid cards.--
                  [``(A) In general.--This subsection shall not 
                apply to an interchange transaction fee charged 
                or received with respect to an electronic debit 
                transaction in which a person uses--
                          [``(i) a debit card or general-use 
                        prepaid card that has been provided to 
                        a person pursuant to a Federal, State 
                        or local government-administered 
                        payment program, in which the person 
                        may only use the debit card or general-
                        use prepaid card to transfer or debit 
                        funds, monetary value, or other assets 
                        that have been provided pursuant to 
                        such program; or
                          [``(ii) a plastic card, payment code, 
                        or device that is--
                                  [``(I) linked to funds, 
                                monetary value, or assets which 
                                are purchased or loaded on a 
                                prepaid basis;
                                  [``(II) not issued or 
                                approved for use to access or 
                                debit any account held by or 
                                for the benefit of the card 
                                holder (other than a subaccount 
                                or other method of recording or 
                                tracking funds purchased or 
                                loaded on the card on a prepaid 
                                basis);
                                  [``(III) redeemable at 
                                multiple, unaffiliated 
                                merchants or service providers, 
                                or automated teller machines;
                                  [``(IV) used to transfer or 
                                debit funds, monetary value, or 
                                other assets; and
                                  [``(V) reloadable and not 
                                marketed or labeled as a gift 
                                card or gift certificate.
                  [``(B) Exception.--Notwithstanding 
                subparagraph (A), after the end of the 1-year 
                period beginning on the effective date provided 
                in paragraph (9), this subsection shall apply 
                to an interchange transaction fee charged or 
                received with respect to an electronic debit 
                transaction described in subparagraph (A)(i) in 
                which a person uses a general-use prepaid card, 
                or an electronic debit transaction described in 
                subparagraph (A)(ii), if any of the following 
                fees may be charged to a person with respect to 
                the card:
                          [``(i) A fee for an overdraft, 
                        including a shortage of funds or a 
                        transaction processed for an amount 
                        exceeding the account balance.
                          [``(ii) A fee imposed by the issuer 
                        for the first withdrawal per month from 
                        an automated teller machine that is 
                        part of the issuer's designated 
                        automated teller machine network.
                  [``(C) Definition.--For purposes of 
                subparagraph (B), the term `designated 
                automated teller machine network' means 
                either--
                          [``(i) all automated teller machines 
                        identified in the name of the issuer; 
                        or
                          [``(ii) any network of automated 
                        teller machines identified by the 
                        issuer that provides reasonable and 
                        convenient access to the issuer's 
                        customers.
                  [``(D) Reporting.--Beginning 12 months after 
                the date of enactment of the Consumer Financial 
                Protection Act of 2010, the Board shall 
                annually provide a report to the Congress 
                regarding --
                          [``(i) the prevalence of the use of 
                        general-use prepaid cards in Federal, 
                        State or local government-administered 
                        payment programs; and
                          [``(ii) the interchange transaction 
                        fees and cardholder fees charged with 
                        respect to the use of such general-use 
                        prepaid cards.
          [``(8) Regulatory authority over network fees.--
                  [``(A) In general.--The Board may prescribe 
                regulations, pursuant to section 553 of title 
                5, United States Code, regarding any network 
                fee.
                  [``(B) Limitation.--The authority under 
                subparagraph (A) to prescribe regulations shall 
                be limited to regulations to ensure that--
                          [``(i) a network fee is not used to 
                        directly or indirectly compensate an 
                        issuer with respect to an electronic 
                        debit transaction; and
                          [``(ii) a network fee is not used to 
                        circumvent or evade the restrictions of 
                        this subsection and regulations 
                        prescribed under such subsection.
                  [``(C) Rulemaking required.--The Board shall 
                prescribe regulations in final form before the 
                end of the 9-month period beginning on the date 
                of the enactment of the Consumer Financial 
                Protection Act of 2010, to carry out the 
                authorities provided under subparagraph (A).
          [``(9) Effective Date.--This subsection shall take 
        effect at the end of the 12-month period beginning on 
        the date of the enactment of the Consumer Financial 
        Protection Act of 2010.
  [``(b) Limitation on Payment Card Network Restrictions.--
          [``(1) Prohibitions against exclusivity 
        arrangements.--
                  [``(A) No exclusive network.--The Board 
                shall, before the end of the 1-year period 
                beginning on the date of the enactment of the 
                Consumer Financial Protection Act of 2010, 
                prescribe regulations providing that an issuer 
                or payment card network shall not directly or 
                through any agent, processor, or licensed 
                member of a payment card network, by contract, 
                requirement, condition, penalty, or otherwise, 
                restrict the number of payment card networks on 
                which an electronic debit transaction may be 
                processed to--
                          [``(i) 1 such network; or
                          [``(ii) 2 or more such networks which 
                        are owned, controlled, or otherwise 
                        operated by --
                                  [``(I) affiliated persons; or
                                  [``(II) networks affiliated 
                                with such issuer.
                  [``(B) No routing restrictions.--The Board 
                shall, before the end of the 1-year period 
                beginning on the date of the enactment of the 
                Consumer Financial Protection Act of 2010, 
                prescribe regulations providing that an issuer 
                or payment card network shall not, directly or 
                through any agent, processor, or licensed 
                member of the network, by contract, 
                requirement, condition, penalty, or otherwise, 
                inhibit the ability of any person who accepts 
                debit cards for payments to direct the routing 
                of electronic debit transactions for processing 
                over any payment card network that may process 
                such transactions.
          [``(2) Limitation on restrictions on offering 
        discounts for use of a form of payment.--
                  [``(A) In general.--A payment card network 
                shall not, directly or through any agent, 
                processor, or licensed member of the network, 
                by contract, requirement, condition, penalty, 
                or otherwise, inhibit the ability of any person 
                to provide a discount or in-kind incentive for 
                payment by the use of cash, checks, debit 
                cards, or credit cards to the extent that--
                          [``(i) in the case of a discount or 
                        in-kind incentive for payment by the 
                        use of debit cards, the discount or in-
                        kind incentive does not differentiate 
                        on the basis of the issuer or the 
                        payment card network;
                          [``(ii) in the case of a discount or 
                        in-kind incentive for payment by the 
                        use of credit cards, the discount or 
                        in-kind incentive does not 
                        differentiate on the basis of the 
                        issuer or the payment card network; and
                          [``(iii) to the extent required by 
                        Federal law and applicable State law, 
                        such discount or in-kind incentive is 
                        offered to all prospective buyers and 
                        disclosed clearly and conspicuously.
                  [``(B) Lawful discounts.--For purposes of 
                this paragraph, the network may not penalize 
                any person for the providing of a discount that 
                is in compliance with Federal law and 
                applicable State law.
          [``(3) Limitation on restrictions on setting 
        transaction minimums or maximums.--
                  [``(A) In general.--A payment card network 
                shall not, directly or through any agent, 
                processor, or licensed member of the network, 
                by contract, requirement, condition, penalty, 
                or otherwise, inhibit the ability--
                          [``(i) of any person to set a minimum 
                        dollar value for the acceptance by that 
                        person of credit cards, to the extent 
                        that --
                                  [``(I) such minimum dollar 
                                value does not differentiate 
                                between issuers or between 
                                payment card networks; and
                                  [``(II) such minimum dollar 
                                value does not exceed $10.00; 
                                or
                          [``(ii) of any Federal agency or 
                        institution of higher education to set 
                        a maximum dollar value for the 
                        acceptance by that Federal agency or 
                        institution of higher education of 
                        credit cards, to the extent that such 
                        maximum dollar value does not 
                        differentiate between issuers or 
                        between payment card networks.
                  [``(B) Increase in minimum dollar amount.--
                The Board may, by regulation prescribed 
                pursuant to section 553 of title 5, United 
                States Code, increase the amount of the dollar 
                value listed in subparagraph (A)(i)(II).
          [``(4) Rule of construction:.--No provision of this 
        subsection shall be construed to authorize any person--
                  [``(A) to discriminate between debit cards 
                within a payment card network on the basis of 
                the issuer that issued the debit card; or
                  [``(B) to discriminate between credit cards 
                within a payment card network on the basis of 
                the issuer that issued the credit card.
  [``(c) Definitions.--For purposes of this section, the 
following definitions shall apply:
          [``(1) Affiliate.--The term `affiliate' means any 
        company that controls, is controlled by, or is under 
        common control with another company.
          [``(2) Debit card.--The term `debit card'--
                  [``(A) means any card, or other payment code 
                or device, issued or approved for use through a 
                payment card network to debit an asset account 
                (regardless of the purpose for which the 
                account is established), whether authorization 
                is based on signature, PIN, or other means;
                  [``(B) includes a general-use prepaid card, 
                as that term is defined in section 
                915(a)(2)(A); and
                  [``(C) does not include paper checks.
          [``(3) Credit card.--The term `credit card' has the 
        same meaning as in section 103 of the Truth in Lending 
        Act.
          [``(4) Discount.--The term `discount'--
                  [``(A) means a reduction made from the price 
                that customers are informed is the regular 
                price; and
                  [``(B) does not include any means of 
                increasing the price that customers are 
                informed is the regular price.
          [``(5) Electronic debit transaction.--The term 
        `electronic debit transaction' means a transaction in 
        which a person uses a debit card.
          [``(6) Federal agency.--The term `Federal agency' 
        means--
                  [``(A) an agency (as defined in section 101 
                of title 31, United States Code); and
                  [``(B) a Government corporation (as defined 
                in section 103 of title 5, United States Code).
          [``(7) Institution of higher education.--The term 
        `institution of higher education' has the same meaning 
        as in 101 and 102 of the Higher Education Act of 1965 
        (20 U.S.C. 1001, 1002).
          [``(8) Interchange transaction fee.--The term 
        `interchange transaction fee' means any fee 
        established, charged or received by a payment card 
        network for the purpose of compensating an issuer for 
        its involvement in an electronic debit transaction.
          [``(9) Issuer.--The term `issuer' means any person 
        who issues a debit card, or credit card, or the agent 
        of such person with respect to such card.
          [``(10) Network fee.--The term `network fee' means 
        any fee charged and received by a payment card network 
        with respect to an electronic debit transaction, other 
        than an interchange transaction fee.
          [``(11) Payment card network.--The term `payment card 
        network' means an entity that directly, or through 
        licensed members, processors, or agents, provides the 
        proprietary services, infrastructure, and software that 
        route information and data to conduct debit card or 
        credit card transaction authorization, clearance, and 
        settlement, and that a person uses in order to accept 
        as a form of payment a brand of debit card, credit card 
        or other device that may be used to carry out debit or 
        credit transactions.
  [``(d) Enforcement.--
          [``(1) In general.--Compliance with the requirements 
        imposed under this section shall be enforced under 
        section 918.
          [``(2) Exception.--Sections 916 and 917 shall not 
        apply with respect to this section or the requirements 
        imposed pursuant to this section.''.
  [(b) Amendment to the Food and Nutrition Act of 2008.--
Section 7(h)(10) of the Food and Nutrition Act of 2008 (7 
U.S.C. 2016(h)(10)) is amended to read as follows:
          [``(10) Federal Law Not Applicable.--Section 920 of 
        the Electronic Fund Transfer Act shall not apply to 
        electronic benefit transfer or reimbursement systems 
        under this Act.''.
  [(c) Amendment to the Farm Security and Rural Investment Act 
of 2002.--Section 4402 of the Farm Security and Rural 
Investment Act of 2002 (7 U.S.C. 3007) is amended by adding at 
the end the following new subsection:
  [``(f) Federal Law Not Applicable.--Section 920 of the 
Electronic Fund Transfer Act shall not apply to electronic 
benefit transfer systems established under this section.''.
  [(d) Amendment to the Child Nutrition Act of 1966.--Section 
11 of the Child Nutrition Act of 1966 (42 U.S.C. 1780) is 
amended by adding at the end the following:
  [``(c) Federal Law Not Applicable.--Section 920 of the 
Electronic Fund Transfer Act shall not apply to electronic 
benefit transfer systems established under this Act or the 
Richard B. Russell National School Lunch Act (42 U.S.C. 1751 et 
seq.).''.]

SEC. 1076. REVERSE MORTGAGE STUDY AND REGULATIONS.

  (a) Study.--Not later than 1 year after the designated 
transfer date, the Bureau shall conduct a study on reverse 
mortgage transactions.
  (b) Regulations.--
          (1) In general.--If the Bureau determines through the 
        study required under subsection (a) that conditions or 
        limitations on reverse mortgage transactions are 
        necessary or appropriate for accomplishing the purposes 
        and objectives of this title, including protecting 
        borrowers with respect to the obtaining of reverse 
        mortgage loans for the purpose of funding investments, 
        annuities, and other investment products and the 
        suitability of a borrower in obtaining a reverse 
        mortgage for such purpose, the Agency may, after notice 
        and opportunity for comment, prescribe regulations.
          (2) Identified practices and integrated 
        disclosures.--The regulations prescribed under 
        paragraph (1) may, as the Bureau may so [determine--]
                  [(A) identify any practice as unfair, 
                deceptive, or abusive in connection with a 
                reverse mortgage transaction; and]
                  [(B)] [provide for] determine, provide for an 
                integrated disclosure standard and model 
                disclosures for reverse mortgage transactions, 
                consistent with section 4302(d), that combines 
                the relevant disclosures required under the 
                Truth in Lending Act (15 U.S.C. 1601 et seq.) 
                and the Real Estate Settlement Procedures Act, 
                with the disclosures required to be provided to 
                consumers for Home Equity Conversion Mortgages 
                under section 255 of the National Housing Act.
  (c) Rule of Construction.--This section shall not be 
construed as limiting the authority of the Bureau to issue 
regulations, orders, or guidance that apply to reverse 
mortgages prior to the completion of the study required under 
subsection (a).

           *       *       *       *       *       *       *


SEC. 1077. REPORT ON PRIVATE EDUCATION LOANS AND PRIVATE EDUCATIONAL 
                    LENDERS.

  (a) Report.--Not later than 2 years after the date of 
enactment of this Act, the Director and the Secretary of 
Education, in consultation with the Commissioners of the 
Federal Trade Commission, and the Attorney General of the 
United States, shall submit a report to the Committee on 
Banking, Housing, and Urban Affairs and the Committee on 
Health, Education, Labor, and Pensions of the Senate and the 
Committee on Financial Services and the Committee on Education 
and Labor of the House of Representatives, on private education 
loans (as that term is defined in section 140 of the Truth in 
Lending Act (15 U.S.C. 1650)) and private educational lenders 
(as that term is defined in such section).
  (b) Content.--The report required by this section shall 
examine, at a minimum--
          (1) the growth and changes of the private education 
        loan market in the United States;
          (2) factors influencing such growth and changes;
          (3) the extent to which students and parents of 
        students rely on private education loans to finance 
        postsecondary education and the private education loan 
        indebtedness of borrowers;
          (4) the characteristics of private education loan 
        borrowers, including--
                  (A) the types of institutions of higher 
                education that they attend;
                  (B) socioeconomic characteristics (including 
                income and education levels, racial 
                characteristics, geographical background, age, 
                and gender);
                  (C) what other forms of financing borrowers 
                use to pay for education;
                  (D) whether they exhaust their Federal loan 
                options before taking out a private loan;
                  (E) whether such borrowers are dependent or 
                independent students (as determined under part 
                F of title IV of the Higher Education Act of 
                1965) or parents of such students;
                  (F) whether such borrowers are students 
                enrolled in a program leading to a certificate, 
                license, or credential other than a degree, an 
                [associates] associate's degree, a 
                baccalaureate degree, or a graduate or 
                professional degree; and
                  (G) if practicable, employment and repayment 
                behaviors;
          (5) the characteristics of private educational 
        lenders, including whether such creditors are for-
        profit, non-profit, or institutions of higher 
        education;
          (6) the underwriting criteria used by private 
        educational lenders, including the use of cohort 
        default rate (as such term is defined in section 435(m) 
        of the Higher Education Act of 1965);
          (7) the terms, conditions, and pricing of private 
        education loans;
          (8) the consumer protections available to private 
        education loan borrowers, including the effectiveness 
        of existing disclosures and requirements and borrowers' 
        awareness and understanding about terms and conditions 
        of various financial products;
          (9) whether Federal regulators and the public have 
        access to information sufficient to provide them with 
        assurances that private education loans are provided in 
        accord with the Nation's fair lending laws and that 
        allows public officials to determine lender compliance 
        with fair lending laws; and
          (10) any statutory or legislative recommendations 
        necessary to improve consumer protections for private 
        education loan borrowers and to better enable Federal 
        regulators and the public to ascertain private 
        educational lender compliance with fair lending laws.

           *       *       *       *       *       *       *


SEC. 1084. AMENDMENTS TO THE ELECTRONIC FUND TRANSFER ACT.

  The Electronic Fund Transfer Act (15 U.S.C. 1693 et seq.) is 
amended--
          (1) by striking ``Board'' each place that term 
        appears and inserting ``Bureau'', except in subsections 
        (a) and (e) of section 904 (as amended in paragraph (3) 
        of this section) and in 918 (15 U.S.C. 1693o) (as so 
        designated by the Credit Card Act of 2009), and section 
        920 (as added by section 1076);
          (2) in section 903 (15 U.S.C. 1693a)--
                  (A) by redesignating paragraphs (3) through 
                (11) as paragraphs (4) through (12), 
                respectively; and
                  (B) by inserting after paragraph (3) the 
                following:
          ``(4) the term `Bureau' means the Bureau of Consumer 
        Financial Protection;'';
          (3) in section 904 (15 U.S.C. 1693b)--
                  (A) in subsection (a), by striking ``(a) 
                Prescription by Board.--The Board shall 
                prescribe regulations to carry out the purposes 
                of this title.'' and inserting the following:
  ``(a) Prescription by the Bureau and the Board.--
          ``(1) In general.--Except as provided in paragraph 
        (2), the Bureau shall prescribe rules to carry out the 
        purposes of this title.
          ``(2) Authority of the board.--The Board shall have 
        sole authority to prescribe rules--
                  ``(A) to carry out the purposes of this title 
                with respect to a person described in section 
                1029(a) of the Consumer Financial Protection 
                Act of 2010; and
                  ``(B) to carry out the purposes of section 
                920.''; and
                  (B) by adding at the end the following new 
                subsection:
  ``(e) Deference.--No provision of this title may be construed 
as altering, limiting, or otherwise affecting the deference 
that a court affords to--
          ``(1) the Bureau in making determinations regarding 
        the meaning or interpretation of any provision of this 
        title for which the Bureau has authority to prescribe 
        regulations; or
          ``(2) the Board in making determinations regarding 
        the meaning or interpretation of section 920.''.
          (4) in section 916(d) (15 U.S.C. 1693m) (as so 
        designated by the Credit CARD Act of 2009)--
                  (A) in the subsection heading, by striking 
                ``of Board or Approval of Duly Authorized 
                Official or Employee of Federal Reserve 
                System'';
                  (B) by inserting ``Bureau or the'' before 
                ``Board'' each place that term appears; and
                  (C) by inserting ``Bureau of Consumer 
                Financial Protection or the'' before ``Federal 
                Reserve System''; and
          (5) in section 918 (15 U.S.C. 1693o) (as so 
        designated by the Credit CARD Act of 2009)--
                  (A) in subsection (a)--
                          (i) by striking ``Compliance'' and 
                        inserting ``Subject to subtitle B of 
                        the Consumer Financial Protection Act 
                        of 2010, compliance'';
                          (ii) by striking paragraphs (1) and 
                        (2), and inserting the following:
          ``(1) section 8 of the Federal Deposit Insurance Act, 
        by the appropriate Federal banking agency, as defined 
        in section 3(q) of the Federal Deposit Insurance Act 
        (12 U.S.C. 1813(q)), with respect to--
                  ``(A) national banks, Federal savings 
                associations, and Federal branches and Federal 
                agencies of foreign banks;
                  ``(B) member banks of the Federal Reserve 
                System (other than national banks), branches 
                and agencies of foreign banks (other than 
                Federal branches, Federal agencies, and insured 
                State branches of foreign banks), commercial 
                lending companies owned or controlled by 
                foreign banks, and organizations operating 
                under section 25 or 25A of the Federal Reserve 
                Act; and
                  ``(C) banks and State savings associations 
                insured by the Federal Deposit Insurance 
                Corporation (other than members of the Federal 
                Reserve System), and insured State branches of 
                foreign banks;'';
                          (iii) by redesignating paragraphs (3) 
                        through (5) as paragraphs (2) through 
                        (4), respectively;
                          (iv) in paragraph (2) (as so 
                        redesignated), by striking the period 
                        at the end and inserting a semicolon;
                          (v) in paragraph (3) (as so 
                        redesignated), by striking ``and'' at 
                        the end;
                          (vi) in paragraph (4) (as so 
                        redesignated), by striking the period 
                        at the end and inserting ``and''; and
                          (vii) by adding at the end the 
                        following:
          ``(5) subtitle E of the Consumer Financial Protection 
        Act of 2010, by the Bureau, with respect to any person 
        subject to this title, except that the Bureau shall not 
        have authority to enforce the requirements of section 
        920 or any regulations prescribed by the Board under 
        section 920.'';
                  (B) in subsection (b), by inserting ``any of 
                paragraphs (1) through (4) of'' before 
                ``subsection (a)'' each place that term 
                appears; and
                  (C) by striking subsection (c) and inserting 
                the following:
  ``(c) Overall Enforcement Authority of the Federal Trade 
Commission.--Except to the extent that enforcement of the 
requirements imposed under this title is specifically committed 
to some other Government agency under any of paragraphs (1) 
through (4) of subsection (a), and subject to subtitle B of the 
Consumer Financial Protection Act of 2010, the Federal Trade 
Commission shall be authorized to enforce such requirements. 
For the purpose of the exercise by the Federal Trade Commission 
of its functions and powers under the Federal Trade Commission 
Act, a violation of any requirement imposed under this title 
shall be deemed a violation of a requirement imposed under that 
Act. All of the functions and powers of the Federal Trade 
Commission under the Federal Trade Commission Act are available 
to the Federal Trade Commission to enforce compliance by any 
person subject to the jurisdiction of the Federal Trade 
Commission with the requirements imposed under this title, 
irrespective of whether that person is engaged in commerce or 
meets any other jurisdictional tests under the Federal Trade 
Commission Act.''.

           *       *       *       *       *       *       *


SEC. 1089. AMENDMENTS TO THE FAIR DEBT COLLECTION PRACTICES ACT.

  The Fair Debt Collection Practices Act (15 U.S.C. 1692 et 
seq.) is amended--
          (1) by striking ``Commission'' each place that term 
        appears and inserting ``Bureau'';
          (2) in section 803 (15 U.S.C. 1692a)--
                  (A) by striking paragraph (1) and inserting 
                the following:
          ``(1) The term `Bureau' means the Bureau of Consumer 
        Financial Protection.'';
          (3) in section 814 (15 U.S.C. 1692l)--
                  (A) by striking subsection (a) and inserting 
                the following:
  ``(a) Federal Trade Commission.--The Federal Trade Commission 
shall be authorized to enforce compliance with this title, 
except to the extent that enforcement of the requirements 
imposed under this title is specifically committed to another 
Government agency under any of paragraphs (1) through (5) of 
subsection (b), subject to subtitle B of the Consumer Financial 
Protection Act of 2010. For purpose of the exercise by the 
Federal Trade Commission of its functions and powers under the 
Federal Trade Commission Act (15 U.S.C. 41 et seq.), a 
violation of this title shall be deemed an unfair or deceptive 
act or practice in violation of that Act. All of the functions 
and powers of the Federal Trade Commission under the Federal 
Trade Commission Act are available to the Federal Trade 
Commission to enforce compliance by any person with this title, 
irrespective of whether that person is engaged in commerce or 
meets any other jurisdictional tests under the Federal Trade 
Commission Act, including the power to enforce the provisions 
of this title, in the same manner as if the violation had been 
a violation of a Federal Trade Commission trade regulation 
rule.''; [and]
                  (B) in subsection (b)--
                          (i) by striking ``Compliance'' and 
                        inserting ``Subject to subtitle B of 
                        the Consumer Financial Protection Act 
                        of 2010, compliance'';
                          (ii) by striking paragraphs (1) and 
                        (2) and inserting the following:
          ``(1) section 8 of the Federal Deposit Insurance Act, 
        by the appropriate Federal banking agency, as defined 
        in section 3(q) of the Federal Deposit Insurance Act 
        (12 U.S.C. 1813(q)), with respect to--
                  ``(A) national banks, Federal savings 
                associations, and Federal branches and Federal 
                agencies of foreign banks;
                  ``(B) member banks of the Federal Reserve 
                System (other than national banks), branches 
                and agencies of foreign banks (other than 
                Federal branches, Federal agencies, and insured 
                State branches of foreign banks), commercial 
                lending companies owned or controlled by 
                foreign banks, and organizations operating 
                under section 25 or 25A of the Federal Reserve 
                Act; and
                  ``(C) banks and State savings associations 
                insured by the Federal Deposit Insurance 
                Corporation (other than members of the Federal 
                Reserve System), and insured State branches of 
                foreign banks;'';
                          (iii) by redesignating paragraphs (3) 
                        through (6), as paragraphs (2) through 
                        (5), respectively;
                          (iv) in paragraph (4) (as so 
                        redesignated), by striking ``and'' at 
                        the end;
                          (v) in paragraph (5) (as so 
                        redesignated), by striking the period 
                        at the end and inserting ``; and''; and
                          (vi) by inserting before the 
                        undesignated matter at the end the 
                        following:
          ``(6) subtitle E of the Consumer Financial Protection 
        Act of 2010, by the Bureau, with respect to any person 
        subject to this title.''[.] ; and
                  [(4)] (C) in subsection (d), by striking 
                ``Neither the Commission'' and all that follows 
                through the end of the subsection and inserting 
                the following: ``Except as provided in section 
                1029(a) of the Consumer Financial Protection 
                Act of 2010, the Bureau may prescribe rules 
                with respect to the collection of debts by debt 
                collectors, as defined in this title.''.

           *       *       *       *       *       *       *


SEC. 1098. AMENDMENTS TO THE REAL ESTATE SETTLEMENT PROCEDURES ACT OF 
                    1974.

  The Real Estate Settlement Procedures Act of 1974 (12 U.S.C. 
2601 et seq.) is amended--
          (1) in section 3 (12 U.S.C. 2602)--
                  (A) in paragraph (7), by striking ``and'' at 
                the end;
                  (B) in paragraph (8), by striking the period 
                at the end and inserting ``; and''; and
                  (C) by adding at the end the following:
          ``(9) the term `Bureau' means the Bureau of Consumer 
        Financial Protection.'';
          (2) in section 4 (12 U.S.C. 2603)--
                  (A) in subsection (a), by striking the first 
                sentence and inserting the following: ``The 
                Bureau shall publish a single, integrated 
                disclosure for mortgage loan transactions 
                (including real estate settlement cost 
                statements) which includes the disclosure 
                requirements of this section and section 5, in 
                conjunction with the disclosure requirements of 
                the Truth in Lending Act that, taken together, 
                may apply to a transaction that is subject to 
                both or either provisions of law. The purpose 
                of such model disclosure shall be to facilitate 
                compliance with the disclosure requirements of 
                this title and the Truth in Lending Act, and to 
                aid the borrower or lessee in understanding the 
                transaction by utilizing readily understandable 
                language to simplify the technical nature of 
                the disclosures.'';
                  (B) by striking ``Secretary'' each place that 
                term appears and inserting ``Bureau''; and
                  (C) by striking ``form'' each place that term 
                appears and inserting ``forms'';
          (3) in section 5 (12 U.S.C. 2604)--
                  (A) by striking ``Secretary'' each place that 
                term appears and inserting ``Bureau''; and
                  (B) in subsection (a), by striking the first 
                sentence and inserting the following: ``The 
                Bureau shall prepare and distribute booklets 
                jointly addressing compliance with the 
                requirements of the Truth in Lending Act and 
                the provisions of this title, in order to help 
                persons borrowing money to finance the purchase 
                of residential real estate better to understand 
                the nature and costs of real estate settlement 
                services.'';
          (4) in section 6(j)(3) (12 U.S.C. 2605(j)(3))--
                  (A) by striking ``Secretary'' and inserting 
                ``Bureau''; and
                  (B) by striking ``, by regulations that shall 
                take effect not later than April 20, 1991,'';
          (5) in section 7(b) (12 U.S.C. 2606(b)) by striking 
        ``Secretary'' and inserting ``Bureau'';
          (6) in section 8(c)(5) (12 U.S.C. 2607(c)(5)), by 
        striking ``Secretary'' the first place that term 
        appears and inserting ``Bureau'';
          (7) in section 8(d) (12 U.S.C. 2607(d))--
                  (A) in the subsection heading, by inserting 
                ``Bureau and'' before ``Secretary''; and
                  (B) by striking paragraph (4), and inserting 
                the following:
          ``(4) The Bureau, the Secretary, or the attorney 
        general or the insurance commissioner of any State may 
        bring an action to enjoin violations of this section. 
        Except, to the extent that a person is subject to the 
        jurisdiction of the Bureau, the Secretary, or the 
        attorney general or the insurance commissioner of any 
        State, the Bureau shall have primary authority to 
        enforce or administer this section, subject to subtitle 
        B of the Consumer Financial Protection Act of 2010.'';
          (8) in section 10(c) (12 U.S.C. 2609(c) and (d)), by 
        striking ``Secretary'' and inserting ``Bureau'';
          (9) in section 16 (12 U.S.C. 2614), by inserting 
        ``the Bureau,'' before ``the Secretary'';
          (10) in section 18 (12 U.S.C. 2616), by striking 
        ``Secretary'' each place that term appears and 
        inserting ``Bureau''; and
          (11) in section 19 (12 U.S.C. 2617)--
                  (A) in the section heading by striking 
                ``secretary'' and inserting ``bureau'';
                  (B) in subsection (a), by striking 
                ``Secretary'' each place that term appears and 
                inserting ``Bureau''; and
                  (C) in subsections (b) and (c), by striking 
                ``the Secretary'' each place that term appears 
                and inserting ``the Bureau''.

TITLE XI--FEDERAL RESERVE SYSTEM PROVISIONS

           *       *       *       *       *       *       *


[SEC. 1104. LIQUIDITY EVENT DETERMINATION.

  [(a) Determination and Written Recommendation.--
          [(1) Determination request.--The Secretary may 
        request the Corporation and the Board of Governors to 
        determine whether a liquidity event exists that 
        warrants use of the guarantee program authorized under 
        section 1105.
          [(2) Requirements of determination.--Any 
        determination pursuant to paragraph (1) shall--
                  [(A) be written; and
                  [(B) contain an evaluation of the evidence 
                that--
                          [(i) a liquidity event exists;
                          [(ii) failure to take action would 
                        have serious adverse effects on 
                        financial stability or economic 
                        conditions in the United States; and
                          [(iii) actions authorized under 
                        section 1105 are needed to avoid or 
                        mitigate potential adverse effects on 
                        the United States financial system or 
                        economic conditions.
  [(b) Procedures.--Notwithstanding any other provision of 
Federal or State law, upon the determination of both the 
Corporation (upon a vote of not fewer than \2/3\ of the members 
of the Corporation then serving) and the Board of Governors 
(upon a vote of not fewer than \2/3\ of the members of the 
Board of Governors then serving) under subsection (a) that a 
liquidity event exists that warrants use of the guarantee 
program authorized under section 1105, and with the written 
consent of the Secretary--
          [(1) the Corporation shall take action in accordance 
        with section 1105(a); and
          [(2) the Secretary (in consultation with the 
        President) shall take action in accordance with section 
        1105(c).
  [(c) Documentation and Review.--
          [(1) Documentation.--The Secretary shall--
                  [(A) maintain the written documentation of 
                each determination of the Corporation and the 
                Board of Governors under this section; and
                  [(B) provide the documentation for review 
                under paragraph (2).
          [(2) GAO review.--The Comptroller General of the 
        United States shall review and report to Congress on 
        any determination of the Corporation and the Board of 
        Governors under subsection (a), including--
                  [(A) the basis for the determination; and
                  [(B) the likely effect of the actions taken.
  [(d) Report to Congress.--On the earlier of the date of a 
submission made to Congress under section 1105(c), or within 30 
days of the date of a determination under subsection (a), the 
Secretary shall provide written notice of the determination of 
the Corporation and the Board of Governors to the Committee on 
Banking, Housing, and Urban Affairs of the Senate and the 
Committee on Financial Services of the House of 
Representatives, including a description of the basis for the 
determination.

[SEC. 1105. EMERGENCY FINANCIAL STABILIZATION.

  [(a) In General.--Upon the written determination of the 
Corporation and the Board of Governors under section 1104, the 
Corporation shall create a widely available program to 
guarantee obligations of solvent insured depository 
institutions or solvent depository institution holding 
companies (including any affiliates thereof) during times of 
severe economic distress, except that a guarantee of 
obligations under this section may not include the provision of 
equity in any form.
  [(b) Rulemaking and Terms and Conditions.--
          [(1) Policies and procedures.--As soon as is 
        practicable after the date of enactment of this Act, 
        the Corporation shall establish, by regulation, and in 
        consultation with the Secretary, policies and 
        procedures governing the issuance of guarantees 
        authorized by this section. Such policies and 
        procedures may include a requirement of collateral as a 
        condition of any such guarantee.
          [(2) Terms and conditions.--The terms and conditions 
        of any guarantee program shall be established by the 
        Corporation, with the concurrence of the Secretary.
  [(c) Determination of Guaranteed Amount.--
          [(1) In general.--In connection with any program 
        established pursuant to subsection (a) and subject to 
        paragraph (2) of this subsection, the Secretary (in 
        consultation with the President) shall determine the 
        maximum amount of debt outstanding that the Corporation 
        may guarantee under this section, and the President may 
        transmit to Congress a written report on the plan of 
        the Corporation to exercise the authority under this 
        section to issue guarantees up to that maximum amount 
        and a request for approval of such plan. The 
        Corporation shall exercise the authority under this 
        section to issue guarantees up to that specified 
        maximum amount upon passage of the joint resolution of 
        approval, as provided in subsection (d). Absent such 
        approval, the Corporation shall issue no such 
        guarantees.
          [(2) Additional debt guarantee authority.--If the 
        Secretary (in consultation with the President) 
        determines, after a submission to Congress under 
        paragraph (1), that the maximum guarantee amount should 
        be raised, and the Council concurs with that 
        determination, the President may transmit to Congress a 
        written report on the plan of the Corporation to 
        exercise the authority under this section to issue 
        guarantees up to the increased maximum debt guarantee 
        amount. The Corporation shall exercise the authority 
        under this section to issue guarantees up to that 
        specified maximum amount upon passage of the joint 
        resolution of approval, as provided in subsection (d). 
        Absent such approval, the Corporation shall issue no 
        such guarantees.
  [(d) Resolution of Approval.--
          [(1) Additional debt guarantee authority.--Arequest 
        by the President under this section shall be considered 
        granted by Congress upon adoption of a joint resolution 
        approving such request. Such joint resolution shall be 
        considered in the Senate under expedited procedures.
          [(2) Fast track consideration in senate.--
                  [(A) Reconvening.--Upon receipt of a request 
                under subsection (c), if the Senate has 
                adjourned or recessed for more than 2 days, the 
                majority leader of the Senate, after 
                consultation with the minority leader of the 
                Senate, shall notify the Members of the Senate 
                that, pursuant to this section, the Senate 
                shall convene not later than the second 
                calendar day after receipt of such message.
                  [(B) Placement on calendar.--Upon 
                introduction in the Senate, the joint 
                resolution shall be placed immediately on the 
                calendar.
                  [(C) Floor consideration.--
                          [(i) In general.--Notwithstanding 
                        Rule XXII of the Standing Rules of the 
                        Senate, it is in order at any time 
                        during the period beginning on the 4th 
                        day after the date on which Congress 
                        receives a request under subsection 
                        (c), and ending on the 7th day after 
                        that date (even though a previous 
                        motion to the same effect has been 
                        disagreed to) to move to proceed to the 
                        consideration of the joint resolution, 
                        and all points of order against the 
                        joint resolution (and against 
                        consideration of the joint resolution) 
                        are waived. The motion to proceed is 
                        not debatable. The motion is not 
                        subject to a motion to postpone. A 
                        motion to reconsider the vote by which 
                        the motion is agreed to or disagreed to 
                        shall not be in order. If a motion to 
                        proceed to the consideration of the 
                        resolution is agreed to, the joint 
                        resolution shall remain the unfinished 
                        business until disposed of.
                          [(ii) Debate.--Debate on the joint 
                        resolution, and on all debatable 
                        motions and appeals in connection 
                        therewith, shall be limited to not more 
                        than 10 hours, which shall be divided 
                        equally between the majority and 
                        minority leaders or their designees. A 
                        motion further to limit debate is in 
                        order and not debatable. An amendment 
                        to, or a motion to postpone, or a 
                        motion to proceed to the consideration 
                        of other business, or a motion to 
                        recommit the joint resolution is not in 
                        order.
                          [(iii) Vote on passage.--The vote on 
                        passage shall occur immediately 
                        following the conclusion of the debate 
                        on the joint resolution, and a single 
                        quorum call at the conclusion of the 
                        debate if requested in accordance with 
                        the rules of the Senate.
                          [(iv) Rulings of the chair on 
                        procedure.--Appeals from the decisions 
                        of the Chair relating to the 
                        application of the rules of the Senate, 
                        as the case may be, to the procedure 
                        relating to a joint resolution shall be 
                        decided without debate.
          [(3) Rules.--
                  [(A) Coordination with action by house of 
                representatives.--If, before the passage by the 
                Senate of a joint resolution of the Senate, the 
                Senate receives a joint resolution, from the 
                House of Representatives, then the following 
                procedures shall apply:
                          [(i) The joint resolution of the 
                        House of Representatives shall not be 
                        referred to a committee.
                          [(ii) With respect to a joint 
                        resolution of the Senate--
                                  [(I) the procedure in the 
                                Senate shall be the same as if 
                                no joint resolution had been 
                                received from the other House; 
                                but
                                  [(II) the vote on passage 
                                shall be on the joint 
                                resolution of the House of 
                                Representatives.
                  [(B) Treatment of joint resolution of house 
                of representatives.--If the Senate fails to 
                introduce or consider a joint resolution under 
                this section, the joint resolution of the House 
                of Representatives shall be entitled to 
                expedited floor procedures under this 
                subsection.
                  [(C) Treatment of companion measures.--If, 
                following passage of the joint resolution in 
                the Senate, the Senate then receives the 
                companion measure from the House of 
                Representatives, the companion measure shall 
                not be debatable.
                  [(D) Rules of the senate.--This subsection is 
                enacted by Congress--
                          [(i) as an exercise of the rulemaking 
                        power of the Senate, and as such it is 
                        deemed a part of the rules of the 
                        Senate, but applicable only with 
                        respect to the procedure to be followed 
                        in the Senate in the case of a joint 
                        resolution, and it supersedes other 
                        rules, only to the extent that it is 
                        inconsistent with such rules; and
                          [(ii) with full recognition of the 
                        constitutional right of the Senate to 
                        change the rules (so far as relating to 
                        the procedure of the Senate) at any 
                        time, in the same manner, and to the 
                        same extent as in the case of any other 
                        rule of the Senate.
          [(4) Definition.--As used in this subsection, the 
        term ``joint resolution'' means only a joint 
        resolution--
                  [(A) that is introduced not later than 3 
                calendar days after the date on which the 
                request referred to in subsection (c) is 
                received by Congress;
                  [(B) that does not have a preamble;
                  [(C) the title of which is as follows: 
                ``Joint resolution relating to the approval of 
                a plan to guarantee obligations under section 
                1105 of the Dodd-Frank Wall Street Reform and 
                Consumer Protection Act''; and
                  [(D) the matter after the resolving clause of 
                which is as follows: ``That Congress approves 
                the obligation of any amount described in 
                section 1105(c) of the Dodd-Frank Wall Street 
                Reform and Consumer Protection Act.''.
  [(e) Funding.--
          [(1) Fees and other charges.--The Corporation shall 
        charge fees and other assessments to all participants 
        in the program established pursuant to this section, in 
        such amounts as are necessary to offset projected 
        losses and administrative expenses, including amounts 
        borrowed pursuant to paragraph (3), and such amounts 
        shall be available to the Corporation.
          [(2) Excess funds.--If, at the conclusion of the 
        program established under this section, there are any 
        excess funds collected from the fees associated with 
        such program, the funds shall be deposited in the 
        General Fund of the Treasury.
          [(3) Authority of corporation.--The Corporation--
                  [(A) may borrow funds from the Secretary of 
                the Treasury and issue obligations of the 
                Corporation to the Secretary for amounts 
                borrowed, and the amounts borrowed shall be 
                available to the Corporation for purposes of 
                carrying out a program established pursuant to 
                this section, including the payment of 
                reasonable costs of administering the program, 
                and the obligations issued shall be repaid in 
                full with interest through fees and charges 
                paid by participants in accordance with 
                paragraphs (1) and (4), as applicable; and
                  [(B) may not borrow funds from the Deposit 
                Insurance Fund established pursuant to section 
                11(a)(4) of the Federal Deposit Insurance Act.
          [(4) Backup special assessments.--To the extent that 
        the funds collected pursuant to paragraph (1) are 
        insufficient to cover any losses or expenses, including 
        amounts borrowed pursuant to paragraph (3), arising 
        from a program established pursuant to this section, 
        the Corporation shall impose a special assessment 
        solely on participants in the program, in amounts 
        necessary to address such insufficiency, and which 
        shall be available to the Corporation to cover such 
        losses or expenses.
          [(5) Authority of the secretary.--The Secretary may 
        purchase any obligations issued under paragraph (3)(A). 
        For such purpose, the Secretary may use the proceeds of 
        the sale of any securities issued under chapter 31 of 
        title 31, United States Code, and the purposes for 
        which securities may be issued under that chapter 31 
        are extended to include such purchases, and the amount 
        of any securities issued under that chapter 31 for such 
        purpose shall be treated in the same manner as 
        securities issued under section 208(n)(5)(E).
  [(f) Rule of Construction.--For purposes of this section, a 
guarantee of deposits held by insured depository institutions 
shall not be treated as a debt guarantee program.
  [(g) Definitions.--For purposes of this section, the 
following definitions shall apply:
          [(1) Company.--The term ``company'' means any entity 
        other than a natural person that is incorporated or 
        organized under Federal law or the laws of any State.
          [(2) Depository institution holding company.--The 
        term ``depository institution holding company'' has the 
        same meaning as in section 3 of the Federal Deposit 
        Insurance Act (12 U.S.C. 1813).
          [(3) Liquidity event.--The term ``liquidity event'' 
        means--
                  [(A) an exceptional and broad reduction in 
                the general ability of financial market 
                participants--
                          [(i) to sell financial assets without 
                        an unusual and significant discount; or
                          [(ii) to borrow using financial 
                        assets as collateral without an unusual 
                        and significant increase in margin; or
                  [(B) an unusual and significant reduction in 
                the ability of financial market participants to 
                obtain unsecured credit.
          [(4) Solvent.--The term ``solvent'' means that the 
        value of the assets of an entity exceed its obligations 
        to creditors.

[SEC. 1106. ADDITIONAL RELATED AMENDMENTS.

  [(a) Suspension of Parallel Federal Deposit Insurance Act 
Authority.--Effective upon the date of enactment of this 
section, the Corporation may not exercise its authority under 
section 13(c)(4)(G)(i) of the Federal Deposit Insurance Act (12 
U.S.C. 1823(c)(4)(G)(i)) to establish any widely available debt 
guarantee program for which section 1105 would provide 
authority.
  [(b) Federal Deposit Insurance Act.--Section 13(c)(4)(G) of 
the Federal Deposit Insurance Act (12 U.S.C. 1823(c)(4)(G)) is 
amended--
          [(1) in clause (i)--
                  [(A) in subclause (I), by inserting ``for 
                which the Corporation has been appointed 
                receiver'' before ``would have serious''; and
                  [(B) in the undesignated matter following 
                subclause (II), by inserting ``for the purpose 
                of winding up the insured depository 
                institution for which the Corporation has been 
                appointed receiver'' after ``provide assistance 
                under this section''; and
          [(2) in clause (v)(I), by striking ``The'' and 
        inserting ``Not later than 3 days after making a 
        determination under clause (i), the''.
  [(c) Effect of Default on an FDIC Guarantee.--If an insured 
depository institution or depository institution holding 
company (as those terms are defined in section 3 of the Federal 
Deposit Insurance Act) participating in a program under section 
1105, or any participant in a debt guarantee program 
established pursuant to section 13(c)(4)(G)(i) of the Federal 
Deposit Insurance Act defaults on any obligation guaranteed by 
the Corporation after the date of enactment of this Act, the 
Corporation shall--
          [(1) appoint itself as receiver for the insured 
        depository institution that defaults; and
          [(2) with respect to any other participating company 
        that is not an insured depository institution that 
        defaults--
                  [(A) require--
                          [(i) consideration of whether a 
                        determination shall be made, as 
                        provided in section 203 to resolve the 
                        company under section 202; and
                          [(ii) the company to file a petition 
                        for bankruptcy under section 301 of 
                        title 11, United States Code, if the 
                        Corporation is not appointed receiver 
                        pursuant to section 202 within 30 days 
                        of the date of default; or
                  [(B) file a petition for involuntary 
                bankruptcy on behalf of the company under 
                section 303 of title 11, United States Code.]

           *       *       *       *       *       *       *


TITLE XII--IMPROVING ACCESS TO MAINSTREAM FINANCIAL INSTITUTIONS

           *       *       *       *       *       *       *


SEC. 1208. AUTHORIZATION OF APPROPRIATIONS.

  (a) Authorization to the Secretary.--There are authorized to 
be appropriated to the Secretary, such sums as are necessary to 
both administer and fund the programs and projects authorized 
by this title, to remain available until expended.
  (b) Authorization to the Fund.--There is authorized to be 
appropriated to the Fund, as defined in section 103(10) of the 
Riegle Community Development and Regulatory Improvement Act of 
1994 (12 U.S.C. 4702(10)), for each fiscal year beginning in 
fiscal year 2010, an amount equal to the amount of the 
administrative costs of the Fund for the operation of the grant 
program established under this title.

           *       *       *       *       *       *       *


       TITLE XIV--MORTGAGE REFORM AND ANTI-PREDATORY LENDING ACT

SEC. 1400. SHORT TITLE; DESIGNATION AS ENUMERATED CONSUMER LAW.

  (a) Short Title.--This title may be cited as the ``Mortgage 
Reform and Anti-Predatory Lending Act''.
  (b) Designation as Enumerated Consumer Law Under the Purview 
of the [Bureau of Consumer Financial Protection] Consumer Law 
Enforcement Agency.--Subtitles A, B, C, and E and sections 
1471, 1472, 1475, and 1476, and the amendments made by such 
subtitles and sections, shall be enumerated consumer laws, as 
defined in section 1002, and come under the purview of the 
[Bureau of Consumer Financial Protection] Consumer Law 
Enforcement Agency for purposes of title X, including the 
transfer of functions and personnel under subtitle F of title X 
and the savings provisions of such subtitle.
  (c) Regulations; Effective Date.--
          (1) Regulations.--The regulations required to be 
        prescribed under this title or the amendments made by 
        this title shall--
                  (A) be prescribed in final form before the 
                end of the 18-month period beginning on the 
                designated transfer date; and
                  (B) take effect not later than 12 months 
                after the date of issuance of the regulations 
                in final form.
          (2) Effective date established by rule.--Except as 
        provided in paragraph (3), a section, or provision 
        thereof, of this title shall take effect on the date on 
        which the final regulations implementing such section, 
        or provision, take effect.
          (3) Effective date.--A section of this title for 
        which regulations have not been issued on the date that 
        is 18 months after the designated transfer date shall 
        take effect on such date.

           *       *       *       *       *       *       *


              Subtitle B--Minimum Standards For Mortgages

SEC. 1411. ABILITY TO REPAY.

  (a) In general.--
          (1) Rule of construction.--No regulation, order, or 
        guidance issued by the [Bureau] Agency under this title 
        shall be construed as requiring a depository 
        institution to apply mortgage underwriting standards 
        that do not meet the minimum underwriting standards 
        required by the appropriate prudential regulator of the 
        depository institution.
          (2) Amendment to truth in lending act.--Chapter 2 of 
        the Truth in Lending Act (15 U.S.C. 1631 et seq.) is 
        amended by inserting after section 129B (as added by 
        section 1402(a)) the following new section:

``SEC. 129C. MINIMUM STANDARDS FOR RESIDENTIAL MORTGAGE LOANS

  ``(a) Ability To Repay.--
          ``(1) In general.--In accordance with regulations 
        prescribed by the Board, no creditor may make a 
        residential mortgage loan unless the creditor makes a 
        reasonable and good faith determination based on 
        verified and documented information that, at the time 
        the loan is consummated, the consumer has a reasonable 
        ability to repay the loan, according to its terms, and 
        all applicable taxes, insurance (including mortgage 
        guarantee insurance), and assessments.
          ``(2) Multiple loans.--If the creditor knows, or has 
        reason to know, that 1 or more residential mortgage 
        loans secured by the same dwelling will be made to the 
        same consumer, the creditor shall make a reasonable and 
        good faith determination, based on verified and 
        documented information, that the consumer has a 
        reasonable ability to repay the combined payments of 
        all loans on the same dwelling according to the terms 
        of those loans and all applicable taxes, insurance 
        (including mortgage guarantee insurance), and 
        assessments.
          ``(3) Basis for determination.--A determination under 
        this subsection of a consumer's ability to repay a 
        residential mortgage loan shall include consideration 
        of the consumer's credit history, current income, 
        expected income the consumer is reasonably assured of 
        receiving, current obligations, debt-to-income ratio or 
        the residual income the consumer will have after paying 
        non-mortgage debt and mortgage-related obligations, 
        employment status, and other financial resources other 
        than the consumer's equity in the dwelling or real 
        property that secures repayment of the loan. A creditor 
        shall determine the ability of the consumer to repay 
        using a payment schedule that fully amortizes the loan 
        over the term of the loan.
          ``(4) Income verification.--A creditor making a 
        residential mortgage loan shall verify amounts of 
        income or assets that such creditor relies on to 
        determine repayment ability, including expected income 
        or assets, by reviewing the consumer's Internal Revenue 
        Service Form W-2, tax returns, payroll receipts, 
        financial institution records, or other third-party 
        documents that provide reasonably reliable evidence of 
        the consumer's income or assets. In order to safeguard 
        against fraudulent reporting, any consideration of a 
        consumer's income history in making a determination 
        under this subsection shall include the verification of 
        such income by the use of--
                  ``(A) Internal Revenue Service transcripts of 
                tax returns; or
                  ``(B) a method that quickly and effectively 
                verifies income documentation by a third party 
                subject to rules prescribed by the Board.
          ``(5) Exemption.--With respect to loans made, 
        guaranteed, or insured by Federal departments or 
        agencies identified in subsection (b)(3)(B)(ii), such 
        departments or agencies may exempt refinancings under a 
        streamlined refinancing from this income verification 
        requirement as long as the following conditions are 
        met:
                  ``(A) The consumer is not 30 days or more 
                past due on the prior existing residential 
                mortgage loan.
                  ``(B) The refinancing does not increase the 
                principal balance outstanding on the prior 
                existing residential mortgage loan, except to 
                the extent of fees and charges allowed by the 
                department or agency making, guaranteeing, or 
                insuring the refinancing.
                  ``(C) Total points and fees (as defined in 
                section 103(aa)(4), other than bona fide third 
                party charges not retained by the mortgage 
                originator, creditor, or an affiliate of the 
                creditor or mortgage originator) payable in 
                connection with the refinancing do not exceed 3 
                percent of the total new loan amount.
                  ``(D) The interest rate on the refinanced 
                loan is lower than the interest rate of the 
                original loan, unless the borrower is 
                refinancing from an adjustable rate to a fixed- 
                rate loan, under guidelines that the department 
                or agency shall establish for loans they make, 
                guarantee, or issue.
                  ``(E) The refinancing is subject to a payment 
                schedule that will fully amortize the 
                refinancing in accordance with the regulations 
                prescribed by the department or agency making, 
                guaranteeing, or insuring the refinancing.
                  ``(F) The terms of the refinancing do not 
                result in a balloon payment, as defined in 
                subsection (b)(2)(A)(ii).
                  ``(G) Both the residential mortgage loan 
                being refinanced and the refinancing satisfy 
                all requirements of the department or agency 
                making, guaranteeing, or insuring the 
                refinancing.
          ``(6) Nonstandard loans.--
                  ``(A) Variable rate loans that defer 
                repayment of any principal or interest.--For 
                purposes of determining, under this subsection, 
                a consumer's ability to repay a variable rate 
                residential mortgage loan that allows or 
                requires the consumer to defer the repayment of 
                any principal or interest, the creditor shall 
                use a fully amortizing repayment schedule.
                  ``(B) Interest-only loans.--For purposes of 
                determining, under this subsection, a 
                consumer's ability to repay a residential 
                mortgage loan that permits or requires the 
                payment of interest only, the creditor shall 
                use the payment amount required to amortize the 
                loan by its final maturity.
                  ``(C) Calculation for negative 
                amortization.--In making any determination 
                under this subsection, a creditor shall also 
                take into consideration any balance increase 
                that may accrue from any negative amortization 
                provision.
                  ``(D) Calculation process.--For purposes of 
                making any determination under this subsection, 
                a creditor shall calculate the monthly payment 
                amount for principal and interest on any 
                residential mortgage loan by assuming--
                          ``(i) the loan proceeds are fully 
                        disbursed on the date of the 
                        consummation of the loan;
                          ``(ii) the loan is to be repaid in 
                        substantially equal monthly amortizing 
                        payments for principal and interest 
                        over the entire term of the loan with 
                        no balloon payment, unless the loan 
                        contract requires more rapid repayment 
                        (including balloon payment), in which 
                        case the calculation shall be made (I) 
                        in accordance with regulations 
                        prescribed by the Board, with respect 
                        to any loan which has an annual 
                        percentage rate that does not exceed 
                        the average prime offer rate for a 
                        comparable transaction, as of the date 
                        the interest rate is set, by 1.5 or 
                        more percentage points for a first lien 
                        residential mortgage loan; and by 3.5 
                        or more percentage points for a 
                        subordinate lien residential mortgage 
                        loan; or (II) using the contract's 
                        repayment schedule, with respect to a 
                        loan which has an annual percentage 
                        rate, as of the date the interest rate 
                        is set, that is at least 1.5 percentage 
                        points above the average prime offer 
                        rate for a first lien residential 
                        mortgage loan; and 3.5 percentage 
                        points above the average prime offer 
                        rate for a subordinate lien residential 
                        mortgage loan; and
                          ``(iii) the interest rate over the 
                        entire term of the loan is a fixed rate 
                        equal to the fully indexed rate at the 
                        time of the loan closing, without 
                        considering the introductory rate.
                  ``(E) Refinance of hybrid loans with current 
                lender.--In considering any application for 
                refinancing an existing hybrid loan by the 
                creditor into a standard loan to be made by the 
                same creditor in any case in which there would 
                be a reduction in monthly payment and the 
                mortgagor has not been delinquent on any 
                payment on the existing hybrid loan, the 
                creditor may--
                          ``(i) consider the mortgagor's good 
                        standing on the existing mortgage;
                          ``(ii) consider if the extension of 
                        new credit would prevent a likely 
                        default should the original mortgage 
                        reset and give such concerns a higher 
                        priority as an acceptable underwriting 
                        practice; and
                          ``(iii) offer rate discounts and 
                        other favorable terms to such mortgagor 
                        that would be available to new 
                        customers with high credit ratings 
                        based on such underwriting practice.
          ``(7) Fully-indexed rate defined.--For purposes of 
        this subsection, the term `fully indexed rate' means 
        the index rate prevailing on a residential mortgage 
        loan at the time the loan is made plus the margin that 
        will apply after the expiration of any introductory 
        interest rates.
          ``(8) Reverse mortgages and bridge loans.--This 
        subsection shall not apply with respect to any reverse 
        mortgage or temporary or bridge loan with a term of 12 
        months or less, including to any loan to purchase a new 
        dwelling where the consumer plans to sell a different 
        dwelling within 12 months.
          ``(9) Seasonal income.--If documented income, 
        including income from a small business, is a repayment 
        source for a residential mortgage loan, a creditor may 
        consider the seasonality and irregularity of such 
        income in the underwriting of and scheduling of 
        payments for such credit.''.
  (b) Clerical Amendment.--The table of sections for chapter 2 
of the Truth in Lending Act is amended by inserting after the 
item relating to section 129B (as added by section 1402(b)) the 
following new item:

``129C. Minimum standards for residential mortgage loans.''.

                Subtitle D--Office of Housing Counseling

          * * * * * * *

SEC. 1447. DEFAULT AND FORECLOSURE DATABASE.

  (a) Establishment.--The Secretary of Housing and Urban 
Development and the [Director of the Bureau] Director of the 
Consumer Law Enforcement Agency, in consultation with the 
Federal agencies responsible for regulation of banking and 
financial institutions involved in residential mortgage lending 
and servicing, shall establish and maintain a database of 
information on foreclosures and defaults on mortgage loans for 
one- to four-unit residential properties and shall make such 
information publicly available, subject to subsection (e).
  (b) Census Tract Data.--Information in the database may be 
collected, aggregated, and made available on a census tract 
basis.
  (c) Requirements.--Information collected and made available 
through the database shall include--
          (1) the number and percentage of such mortgage loans 
        that are delinquent by more than 30 days;
          (2) the number and percentage of such mortgage loans 
        that are delinquent by more than 90 days;
          (3) the number and percentage of such properties that 
        are real estate-owned;
          (4) number and percentage of such mortgage loans that 
        are in the foreclosure process;
          (5) the number and percentage of such mortgage loans 
        that have an outstanding principal obligation amount 
        that is greater than the value of the property for 
        which the loan was made; and
          (6) such other information as the Secretary of 
        Housing and Urban Development and the [Director of the 
        Bureau] Director of the Consumer Law Enforcement Agency 
        consider appropriate.
  (d) Rule of Construction.--Nothing in this section shall be 
construed to encourage discriminatory or unsound allocation of 
credit or lending policies or practices.
  (e) Privacy and Confidentiality.--In establishing and 
maintaining the database described in subsection (a), the 
Secretary of Housing and Urban Development and the [Director of 
the Bureau] Director of the Consumer Law Enforcement Agency 
shall--
          (1) be subject to the standards applicable to Federal 
        agencies for the protection of the confidentiality of 
        personally identifiable information and for data 
        security and integrity;
          (2) implement the necessary measures to conform to 
        the standards for data integrity and security described 
        in paragraph (1); and
          (3) collect and make available information under this 
        section, in accordance with paragraphs (5) and (6) of 
        section 1022(c) and the rules prescribed under such 
        paragraphs, in order to protect privacy and 
        confidentiality.
          * * * * * * *

SEC. 1451. HOME INSPECTION COUNSELING.

  (a) Public Outreach.--
          (1) In general.--The Secretary of Housing and Urban 
        Development (in this section referred to as the 
        ``Secretary'') shall take such actions as may be 
        necessary to inform potential homebuyers of the 
        availability and importance of obtaining an independent 
        home inspection. Such actions shall include--
                  (A) publication of the HUD/FHA form HUD 
                92564-CN entitled ``For Your Protection: Get a 
                Home Inspection'', in both English and Spanish 
                languages;
                  (B) publication of the HUD/FHA booklet 
                entitled ``For Your Protection: Get a Home 
                Inspection'', in both English and Spanish 
                languages;
                  (C) development and publication of a HUD 
                booklet entitled ``For Your Protection--Get a 
                Home Inspection'' that does not reference FHA-
                insured homes, in both English and Spanish 
                languages; and
                  (D) publication of the HUD document entitled 
                ``Ten Important Questions To Ask Your Home 
                Inspector'', in both English and Spanish 
                languages.
          (2) Availability.--The Secretary shall make the 
        materials specified in paragraph (1) available for 
        electronic access and, where appropriate, inform 
        potential homebuyers of such availability through home 
        purchase counseling public service announcements and 
        toll-free telephone hotlines of the Department of 
        Housing and Urban Development. The Secretary shall give 
        special emphasis to reaching first-time and low-income 
        homebuyers with these materials and efforts.
          (3) Updating.--The Secretary may periodically update 
        and revise such materials, as the Secretary determines 
        to be appropriate.
  (b) Requirement for FHA-approved Lenders.--Each mortgagee 
approved for participation in the mortgage insurance programs 
under title II of the National Housing Act shall provide 
prospective homebuyers, at first contact, whether upon pre-
qualification, pre-approval, or initial application, the 
materials specified in subparagraphs (A), (B), and (D) of 
subsection (a)(1).
  (c) Requirements for HUD-approved Counseling Agencies.--Each 
counseling agency certified [pursuant] by the Secretary to 
provide housing counseling services shall provide each of their 
clients, as part of the home purchase counseling process, the 
materials specified in subparagraphs (C) and (D) of subsection 
(a)(1).
  (d) Training.--Training provided the Department of Housing 
and Urban Development for housing counseling agencies, whether 
such training is provided directly by the Department or 
otherwise, shall include--
          (1) providing information on counseling potential 
        homebuyers of the availability and importance of 
        getting an independent home inspection;
          (2) providing information about the home inspection 
        process, including the reasons for specific inspections 
        such as radon and lead-based paint testing;
          (3) providing information about advising potential 
        homebuyers on how to locate and select a qualified home 
        inspector; and
          (4) review of home inspection public outreach 
        materials of the Department.
          * * * * * * *

                   TITLE XV--MISCELLANEOUS PROVISIONS

          * * * * * * *

[SEC. 1502. CONFLICT MINERALS.

  [(a) Sense of Congress on Exploitation and Trade of Conflict 
Minerals Originating in the Democratic Republic of the Congo.--
It is the sense of Congress that the exploitation and trade of 
conflict minerals originating in the Democratic Republic of the 
Congo is helping to finance conflict characterized by extreme 
levels of violence in the eastern Democratic Republic of the 
Congo, particularly sexual- and gender-based violence, and 
contributing to an emergency humanitarian situation therein, 
warranting the provisions of section 13(p) of the Securities 
Exchange Act of 1934, as added by subsection (b).
  [(b) Disclosure Relating to Conflict Minerals Originating in 
the Democratic Republic of the Congo.--Section 13 of the 
Securities Exchange Act of 1934 (15 U.S.C. 78m), as amended by 
this Act, is amended by adding at the end the following new 
subsection:
  [``(p) Disclosures Relating to Conflict Minerals Originating 
in the Democratic Republic of the Congo.--
          [``(1) Regulations.--
                  [``(A) In general.--Not later than 270 days 
                after the date of the enactment of this 
                subsection, the Commission shall promulgate 
                regulations requiring any person described in 
                paragraph (2) to disclose annually, beginning 
                with the person's first full fiscal year that 
                begins after the date of promulgation of such 
                regulations, whether conflict minerals that are 
                necessary as described in paragraph (2)(B), in 
                the year for which such reporting is required, 
                did originate in the Democratic Republic of the 
                Congo or an adjoining country and, in cases in 
                which such conflict minerals did originate in 
                any such country, submit to the Commission a 
                report that includes, with respect to the 
                period covered by the report--
                          [``(i) a description of the measures 
                        taken by the person to exercise due 
                        diligence on the source and chain of 
                        custody of such minerals, which 
                        measures shall include an independent 
                        private sector audit of such report 
                        submitted through the Commission that 
                        is conducted in accordance with 
                        standards established by the 
                        Comptroller General of the United 
                        States, in accordance with rules 
                        promulgated by the Commission, in 
                        consultation with the Secretary of 
                        State; and
                          [``(ii) a description of the products 
                        manufactured or contracted to be 
                        manufactured that are not DRC conflict 
                        free (`DRC conflict free' is defined to 
                        mean the products that do not contain 
                        minerals that directly or indirectly 
                        finance or benefit armed groups in the 
                        Democratic Republic of the Congo or an 
                        adjoining country), the entity that 
                        conducted the independent private 
                        sector audit in accordance with clause 
                        (i), the facilities used to process the 
                        conflict minerals, the country of 
                        origin of the conflict minerals, and 
                        the efforts to determine the mine or 
                        location of origin with the greatest 
                        possible specificity.
                  [``(B) Certification.--The person submitting 
                a report under subparagraph (A) shall certify 
                the audit described in clause (i) of such 
                subparagraph that is included in such report. 
                Such a certified audit shall constitute a 
                critical component of due diligence in 
                establishing the source and chain of custody of 
                such minerals.
                  [``(C) Unreliable determination.--If a report 
                required to be submitted by a person under 
                subparagraph (A) relies on a determination of 
                an independent private sector audit, as 
                described under subparagraph (A)(i), or other 
                due diligence processes previously determined 
                by the Commission to be unreliable, the report 
                shall not satisfy the requirements of the 
                regulations promulgated under subparagraph 
                (A)(i).
                  [``(D) DRC conflict free.--For purposes of 
                this paragraph, a product may be labeled as 
                `DRC conflict free' if the product does not 
                contain conflict minerals that directly or 
                indirectly finance or benefit armed groups in 
                the Democratic Republic of the Congo or an 
                adjoining country.
                  [``(E) Information available to the public.--
                Each person described under paragraph (2) shall 
                make available to the public on the Internet 
                website of such person the information 
                disclosed by such person under subparagraph 
                (A).
          [``(2) Person described.--A person is described in 
        this paragraph if--
                  [``(A) the person is required to file reports 
                with the Commission pursuant to paragraph 
                (1)(A); and
                  [``(B) conflict minerals are necessary to the 
                functionality or production of a product 
                manufactured by such person.
          [``(3) Revisions and waivers.--The Commission shall 
        revise or temporarily waive the requirements described 
        in paragraph (1) if the President transmits to the 
        Commission a determination that--
                  [``(A) such revision or waiver is in the 
                national security interest of the United States 
                and the President includes the reasons 
                therefor; and
                  [``(B) establishes a date, not later than 2 
                years after the initial publication of such 
                exemption, on which such exemption shall 
                expire.
          [``(4) Termination of disclosure requirements.--The 
        requirements of paragraph (1) shall terminate on the 
        date on which the President determines and certifies to 
        the appropriate congressional committees, but in no 
        case earlier than the date that is one day after the 
        end of the 5-year period beginning on the date of the 
        enactment of this subsection, that no armed groups 
        continue to be directly involved and benefitting from 
        commercial activity involving conflict minerals.
          [``(5) Definitions.--For purposes of this subsection, 
        the terms `adjoining country', `appropriate 
        congressional committees', `armed group', and `conflict 
        mineral' have the meaning given those terms under 
        section 1502 of the Dodd-Frank Wall Street Reform and 
        Consumer Protection Act.''.
  [(c) Strategy and Map to Address Linkages Between Conflict 
Minerals and Armed Groups.--
          [(1) Strategy.--
                  [(A) In general.--Not later than 180 days 
                after the date of the enactment of this Act, 
                the Secretary of State, in consultation with 
                the Administrator of the United States Agency 
                for International Development, shall submit to 
                the appropriate congressional committees a 
                strategy to address the linkages between human 
                rights abuses, armed groups, mining of conflict 
                minerals, and commercial products.
                  [(B) Contents.--The strategy required by 
                subparagraph (A) shall include the following:
                          [(i) A plan to promote peace and 
                        security in the Democratic Republic of 
                        the Congo by supporting efforts of the 
                        Government of the Democratic Republic 
                        of the Congo, including the Ministry of 
                        Mines and other relevant agencies, 
                        adjoining countries, and the 
                        international community, in particular 
                        the United Nations Group of Experts on 
                        the Democratic Republic of Congo, to--
                                  [(I) monitor and stop 
                                commercial activities involving 
                                the natural resources of the 
                                Democratic Republic of the 
                                Congo that contribute to the 
                                activities of armed groups and 
                                human rights violations in the 
                                Democratic Republic of the 
                                Congo; and
                                  [(II) develop stronger 
                                governance and economic 
                                institutions that can 
                                facilitate and improve 
                                transparency in the cross-
                                border trade involving the 
                                natural resources of the 
                                Democratic Republic of the 
                                Congo to reduce exploitation by 
                                armed groups and promote local 
                                and regional development.
                          [(ii) A plan to provide guidance to 
                        commercial entities seeking to exercise 
                        due diligence on and formalize the 
                        origin and chain of custody of conflict 
                        minerals used in their products and on 
                        their suppliers to ensure that conflict 
                        minerals used in the products of such 
                        suppliers do not directly or indirectly 
                        finance armed conflict or result in 
                        labor or human rights violations.
                          [(iii) A description of punitive 
                        measures that could be taken against 
                        individuals or entities whose 
                        commercial activities are supporting 
                        armed groups and human rights 
                        violations in the Democratic Republic 
                        of the Congo.
          [(2) Map.--
                  [(A) In general.--Not later than 180 days 
                after the date of the enactment of this Act, 
                the Secretary of State shall, in accordance 
                with the recommendation of the United Nations 
                Group of Experts on the Democratic Republic of 
                the Congo in their December 2008 report--
                          [(i) produce a map of mineral-rich 
                        zones, trade routes, and areas under 
                        the control of armed groups in the 
                        Democratic Republic of the Congo and 
                        adjoining countries based on data from 
                        multiple sources, including--
                                  [(I) the United Nations Group 
                                of Experts on the Democratic 
                                Republic of the Congo;
                                  [(II) the Government of the 
                                Democratic Republic of the 
                                Congo, the governments of 
                                adjoining countries, and the 
                                governments of other Member 
                                States of the United Nations; 
                                and
                                  [(III) local and 
                                international nongovernmental 
                                organizations;
                          [(ii) make such map available to the 
                        public; and
                          [(iii) provide to the appropriate 
                        congressional committees an explanatory 
                        note describing the sources of 
                        information from which such map is 
                        based and the identification, where 
                        possible, of the armed groups or other 
                        forces in control of the mines 
                        depicted.
                  [(B) Designation.--The map required under 
                subparagraph (A) shall be known as the 
                ``Conflict Minerals Map'', and mines located in 
                areas under the control of armed groups in the 
                Democratic Republic of the Congo and adjoining 
                countries, as depicted on such Conflict 
                Minerals Map, shall be known as ``Conflict Zone 
                Mines''.
                  [(C) Updates.--The Secretary of State shall 
                update the map required under subparagraph (A) 
                not less frequently than once every 180 days 
                until the date on which the disclosure 
                requirements under paragraph (1) of section 
                13(p) of the Securities Exchange Act of 1934, 
                as added by subsection (b), terminate in 
                accordance with the provisions of paragraph (4) 
                of such section 13(p).
                  [(D) Publication in federal register.--The 
                Secretary of State shall add minerals to the 
                list of minerals in the definition of conflict 
                minerals under section 1502, as appropriate. 
                The Secretary shall publish in the Federal 
                Register notice of intent to declare a mineral 
                as a conflict mineral included in such 
                definition not later than one year before such 
                declaration.
  [(d) Reports.--
          [(1) Baseline report.--Not later than 1 year after 
        the date of the enactment of this Act and annually 
        thereafter through 2020, in 2022, and in 2024, the 
        Comptroller General of the United States shall submit 
        to appropriate congressional committees a report that 
        includes an assessment of the rate of sexual- and 
        gender-based violence in war-torn areas of the 
        Democratic Republic of the Congo and adjoining 
        countries.
          [(2) Regular report on effectiveness.--Not later than 
        2 years after the date of the enactment of this Act and 
        annually thereafter through 2020, in 2022, and in 2024, 
        the Comptroller General of the United States shall 
        submit to the appropriate congressional committees a 
        report that includes the following:
                  [(A) An assessment of the effectiveness of 
                section 13(p) of the Securities Exchange Act of 
                1934, as added by subsection (b), in promoting 
                peace and security in the Democratic Republic 
                of the Congo and adjoining countries.
                  [(B) A description of issues encountered by 
                the Securities and Exchange Commission in 
                carrying out the provisions of such section 
                13(p).
                  [(C)(i) A general review of persons described 
                in clause (ii) and whether information is 
                publicly available about--
                                  [(I) the use of conflict 
                                minerals by such persons; and
                                  [(II) whether such conflict 
                                minerals originate from the 
                                Democratic Republic of the 
                                Congo or an adjoining country.
                          [(ii) A person is described in this 
                        clause if--
                                  [(I) the person is not 
                                required to file reports with 
                                the Securities and Exchange 
                                Commission pursuant to section 
                                13(p)(1)(A) of the Securities 
                                Exchange Act of 1934, as added 
                                by subsection (b); and
                                  [(II) conflict minerals are 
                                necessary to the functionality 
                                or production of a product 
                                manufactured by such person.
          [(3) Report on private sector auditing.--Not later 
        than 30 months after the date of the enactment of this 
        Act, and annually thereafter, the Secretary of Commerce 
        shall submit to the appropriate congressional 
        committees a report that includes the following:
                  [(A) An assessment of the accuracy of the 
                independent private sector audits and other due 
                diligence processes described under section 
                13(p) of the Securities Exchange Act of 1934.
                  [(B) Recommendations for the processes used 
                to carry out such audits, including ways to--
                          [(i) improve the accuracy of such 
                        audits; and
                          [(ii) establish standards of best 
                        practices.
                  [(C) A listing of all known conflict mineral 
                processing facilities worldwide.
  [(e) Definitions.--For purposes of this section:
          [(1) Adjoining country.--The term ``adjoining 
        country'', with respect to the Democratic Republic of 
        the Congo, means a country that shares an 
        internationally recognized border with the Democratic 
        Republic of the Congo.
          [(2) Appropriate congressional committees.--The term 
        ``appropriate congressional committees'' means--
                  [(A) the Committee on Appropriations, the 
                Committee on Foreign Affairs, the Committee on 
                Ways and Means, and the Committee on Financial 
                Services of the House of Representatives; and
                  [(B) the Committee on Appropriations, the 
                Committee on Foreign Relations, the Committee 
                on Finance, and the Committee on Banking, 
                Housing, and Urban Affairs of the Senate.
          [(3) Armed group.--The term ``armed group'' means an 
        armed group that is identified as perpetrators of 
        serious human rights abuses in the annual Country 
        Reports on Human Rights Practices under sections 116(d) 
        and 502B(b) of the Foreign Assistance Act of 1961 (22 
        U.S.C. 2151n(d) and 2304(b)) relating to the Democratic 
        Republic of the Congo or an adjoining country.
          [(4) Conflict mineral.--The term ``conflict mineral'' 
        means--
                  [(A) columbite-tantalite (coltan), 
                cassiterite, gold, wolframite, or their 
                derivatives; or
                  [(B) any other mineral or its derivatives 
                determined by the Secretary of State to be 
                financing conflict in the Democratic Republic 
                of the Congo or an adjoining country.
          [(5) Under the control of armed groups.--The term 
        ``under the control of armed groups'' means areas 
        within the Democratic Republic of the Congo or 
        adjoining countries in which armed groups--
                  [(A) physically control mines or force labor 
                of civilians to mine, transport, or sell 
                conflict minerals;
                  [(B) tax, extort, or control any part of 
                trade routes for conflict minerals, including 
                the entire trade route from a Conflict Zone 
                Mine to the point of export from the Democratic 
                Republic of the Congo or an adjoining country; 
                or
                  [(C) tax, extort, or control trading 
                facilities, in whole or in part, including the 
                point of export from the Democratic Republic of 
                the Congo or an adjoining country.

[SEC. 1503. REPORTING REQUIREMENTS REGARDING COAL OR OTHER MINE SAFETY.

  [(a) Reporting Mine Safety Information.--Each issuer that is 
required to file reports pursuant to section 13(a) or 15(d) of 
the Securities Exchange Act of 1934 (15 U.S.C. 78m, 78o) and 
that is an operator, or that has a subsidiary that is an 
operator, of a coal or other mine shall include, in each 
periodic report filed with the Commission under the securities 
laws on or after the date of enactment of this Act, the 
following information for the time period covered by such 
report:
          [(1) For each coal or other mine of which the issuer 
        or a subsidiary of the issuer is an operator--
                  [(A) the total number of violations of 
                mandatory health or safety standards that could 
                significantly and substantially contribute to 
                the cause and effect of a coal or other mine 
                safety or health hazard under section 104 of 
                the Federal Mine Safety and Health Act of 1977 
                (30 U.S.C. 814) for which the operator received 
                a citation from the Mine Safety and Health 
                Administration;
                  [(B) the total number of orders issued under 
                section 104(b) of such Act (30 U.S.C. 814(b));
                  [(C) the total number of citations and orders 
                for unwarrantable failure of the mine operator 
                to comply with mandatory health or safety 
                standards under section 104(d) of such Act (30 
                U.S.C. 814(d));
                  [(D) the total number of flagrant violations 
                under section 110(b)(2) of such Act (30 U.S.C. 
                820(b)(2));
                  [(E) the total number of imminent danger 
                orders issued under section 107(a) of such Act 
                (30 U.S.C. 817(a));
                  [(F) the total dollar value of proposed 
                assessments from the Mine Safety and Health 
                Administration under such Act (30 U.S.C. 801 et 
                seq.); and
                  [(G) the total number of mining-related 
                fatalities.
          [(2) A list of such coal or other mines, of which the 
        issuer or a subsidiary of the issuer is an operator, 
        that receive written notice from the Mine Safety and 
        Health Administration of--
                  [(A) a pattern of violations of mandatory 
                health or safety standards that are of such 
                nature as could have significantly and 
                substantially contributed to the cause and 
                effect of coal or other mine health or safety 
                hazards under section 104(e) of such Act (30 
                U.S.C. 814(e)); or
                  [(B) the potential to have such a pattern.
          [(3) Any pending legal action before the Federal Mine 
        Safety and Health Review Commission involving such coal 
        or other mine.
  [(b) Reporting Shutdowns and Patterns of Violations.--
Beginning on and after the date of enactment of this Act, each 
issuer that is an operator, or that has a subsidiary that is an 
operator, of a coal or other mine shall file a current report 
with the Commission on Form 8-K (or any successor form) 
disclosing the following regarding each coal or other mine of 
which the issuer or subsidiary is an operator:
          [(1) The receipt of an imminent danger order issued 
        under section 107(a) of the Federal Mine Safety and 
        Health Act of 1977 (30 U.S.C. 817(a)).
          [(2) The receipt of written notice from the Mine 
        Safety and Health Administration that the coal or other 
        mine has--
                  [(A) a pattern of violations of mandatory 
                health or safety standards that are of such 
                nature as could have significantly and 
                substantially contributed to the cause and 
                effect of coal or other mine health or safety 
                hazards under section 104(e) of such Act (30 
                U.S.C. 814(e)); or
                  [(B) the potential to have such a pattern.
  [(c) Rule of Construction.--Nothing in this section shall be 
construed to affect any obligation of a person to make a 
disclosure under any other applicable law in effect before, on, 
or after the date of enactment of this Act.
  [(d) Commission Authority.--
          [(1) Enforcement.--A violation by any person of this 
        section, or any rule or regulation of the Commission 
        issued under this section, shall be treated for all 
        purposes in the same manner as a violation of the 
        Securities Exchange Act of 1934 (15 U.S.C. 78a et seq.) 
        or the rules and regulations issued thereunder, 
        consistent with the provisions of this section, and any 
        such person shall be subject to the same penalties, and 
        to the same extent, as for a violation of such Act or 
        the rules or regulations issued thereunder.
          [(2) Rules and regulations.--The Commission is 
        authorized to issue such rules or regulations as are 
        necessary or appropriate for the protection of 
        investors and to carry out the purposes of this 
        section.
  [(e) Definitions.--In this section--
          [(1) the terms ``issuer'' and ``securities laws'' 
        have the meaning given the terms in section 3 of the 
        Securities Exchange Act of 1934 (15 U.S.C. 78c);
          [(2) the term ``coal or other mine'' means a coal or 
        other mine, as defined in section 3 of the Federal Mine 
        Safety and Health Act of 1977 (30 U.S.C. 802), that is 
        subject to the provisions of such Act (30 U.S.C. 801 et 
        seq.); and
          [(3) the term ``operator'' has the meaning given the 
        term in section 3 of the Federal Mine Safety and Health 
        Act of 1977 (30 U.S.C. 802).
  [(f) Effective Date.--This section shall take effect on the 
day that is 30 days after the date of enactment of this Act.

[SEC. 1504. DISCLOSURE OF PAYMENTS BY RESOURCE EXTRACTION ISSUERS.

  [Section 13 of the Securities Exchange Act of 1934 (15 U.S.C. 
78m), as amended by this Act, is amended by adding at the end 
the following:
  [``(q) Disclosure of Payments by Resource Extraction 
Issuers.--
          [``(1) Definitions.--In this subsection--
                  [``(A) the term `commercial development of 
                oil, natural gas, or minerals' includes 
                exploration, extraction, processing, export, 
                and other significant actions relating to oil, 
                natural gas, or minerals, or the acquisition of 
                a license for any such activity, as determined 
                by the Commission;
                  [``(B) the term `foreign government' means a 
                foreign government, a department, agency, or 
                instrumentality of a foreign government, or a 
                company owned by a foreign government, as 
                determined by the Commission;
                  [``(C) the term `payment'--
                          [``(i) means a payment that is--
                                  [``(I) made to further the 
                                commercial development of oil, 
                                natural gas, or minerals; and
                                  [``(II) not de minimis; and
                          [``(ii) includes taxes, royalties, 
                        fees (including license fees), 
                        production entitlements, bonuses, and 
                        other material benefits, that the 
                        Commission, consistent with the 
                        guidelines of the Extractive Industries 
                        Transparency Initiative (to the extent 
                        practicable), determines are part of 
                        the commonly recognized revenue stream 
                        for the commercial development of oil, 
                        natural gas, or minerals;
                  [``(D) the term `resource extraction issuer' 
                means an issuer that--
                          [``(i) is required to file an annual 
                        report with the Commission; and
                          [``(ii) engages in the commercial 
                        development of oil, natural gas, or 
                        minerals;
                  [``(E) the term `interactive data format' 
                means an electronic data format in which pieces 
                of information are identified using an 
                interactive data standard; and
                  [``(F) the term `interactive data standard' 
                means standardized list of electronic tags that 
                mark information included in the annual report 
                of a resource extraction issuer.
          [``(2) Disclosure.--
                  [``(A) Information required.--Not later than 
                270 days after the date of enactment of the 
                Dodd-Frank Wall Street Reform and Consumer 
                Protection Act, the Commission shall issue 
                final rules that require each resource 
                extraction issuer to include in an annual 
                report of the resource extraction issuer 
                information relating to any payment made by the 
                resource extraction issuer, a subsidiary of the 
                resource extraction issuer, or an entity under 
                the control of the resource extraction issuer 
                to a foreign government or the Federal 
                Government for the purpose of the commercial 
                development of oil, natural gas, or minerals, 
                including--
                          [``(i) the type and total amount of 
                        such payments made for each project of 
                        the resource extraction issuer relating 
                        to the commercial development of oil, 
                        natural gas, or minerals; and
                          [``(ii) the type and total amount of 
                        such payments made to each government.
                  [``(B) Consultation in rulemaking.--In 
                issuing rules under subparagraph (A), the 
                Commission may consult with any agency or 
                entity that the Commission determines is 
                relevant.
                  [``(C) Interactive data format.--The rules 
                issued under subparagraph (A) shall require 
                that the information included in the annual 
                report of a resource extraction issuer be 
                submitted in an interactive data format.
                  [``(D) Interactive data standard.--
                          [``(i) In general.--The rules issued 
                        under subparagraph (A) shall establish 
                        an interactive data standard for the 
                        information included in the annual 
                        report of a resource extraction issuer.
                          [``(ii) Electronic tags.--The 
                        interactive data standard shall include 
                        electronic tags that identify, for any 
                        payments made by a resource extraction 
                        issuer to a foreign government or the 
                        Federal Government--
                                  [``(I) the total amounts of 
                                the payments, by category;
                                  [``(II) the currency used to 
                                make the payments;
                                  [``(III) the financial period 
                                in which the payments were 
                                made;
                                  [``(IV) the business segment 
                                of the resource extraction 
                                issuer that made the payments;
                                  [``(V) the government that 
                                received the payments, and the 
                                country in which the government 
                                is located;
                                  [``(VI) the project of the 
                                resource extraction issuer to 
                                which the payments relate; and
                                  [``(VII) such other 
                                information as the Commission 
                                may determine is necessary or 
                                appropriate in the public 
                                interest or for the protection 
                                of investors.
                  [``(E) International transparency efforts.--
                To the extent practicable, the rules issued 
                under subparagraph (A) shall support the 
                commitment of the Federal Government to 
                international transparency promotion efforts 
                relating to the commercial development of oil, 
                natural gas, or minerals.
                  [``(F) Effective date.--With respect to each 
                resource extraction issuer, the final rules 
                issued under subparagraph (A) shall take effect 
                on the date on which the resource extraction 
                issuer is required to submit an annual report 
                relating to the fiscal year of the resource 
                extraction issuer that ends not earlier than 1 
                year after the date on which the Commission 
                issues final rules under subparagraph (A).
          [``(3) Public availability of information.--
                  [``(A) In general.--To the extent 
                practicable, the Commission shall make 
                available online, to the public, a compilation 
                of the information required to be submitted 
                under the rules issued under paragraph (2)(A).
                  [``(B) Other information.--Nothing in this 
                paragraph shall require the Commission to make 
                available online information other than the 
                information required to be submitted under the 
                rules issued under paragraph (2)(A).
          [``(4) Authorization of appropriations.--There are 
        authorized to be appropriated to the Commission such 
        sums as may be necessary to carry out this 
        subsection.''.

[SEC. 1505. STUDY BY THE COMPTROLLER GENERAL

  [(a) In general.--Not later than 1 year after the date of 
enactment of this Act, the Comptroller General of the United 
States shall issue a report assessing the relative 
independence, effectiveness, and expertise of presidentially 
appointed inspectors general and inspectors general of 
designated Federal entities, as such term is defined under 
section 8G of the Inspector General Act of 1978, and the 
effects on independence of the amendments to the Inspector 
General Act of 1978 made by this Act.
  [(b) Report.--The report required by subsection (a) shall be 
issued to the Committees on Financial Services and Oversight 
and Government Reform of the House of Representatives and the 
Committees on Banking, Housing, and Urban Affairs and Homeland 
Security and Governmental Affairs of the Senate.

[SEC. 1506. STUDY ON CORE DEPOSITS AND BROKERED DEPOSITS

  [(a) Study.--The Corporation shall conduct a study to 
evaluate--
          [(1) the definition of core deposits for the purpose 
        of calculating the insurance premiums of banks;
          [(2) the potential impact on the Deposit Insurance 
        Fund of revising the definitions of brokered deposits 
        and core deposits to better distinguish between them;
          [(3) an assessment of the differences between core 
        deposits and brokered deposits and their role in the 
        economy and banking sector of the United States;
          [(4) the potential stimulative effect on local 
        economies of redefining core deposits; and
          [(5) the competitive parity between large 
        institutions and community banks that could result from 
        redefining core deposits.
  [(b) Report to Congress.--Not later than 1 year after the 
date of enactment of this Act, the Corporation shall submit to 
the Committee on Banking, Housing, and Urban Affairs of the 
Senate and the Committee on Financial Services of the House of 
Representatives a report on the results of the study under 
subsection (a) that includes legislative recommendations, if 
any, to address concerns arising in connection with the 
definitions of core deposits and brokered deposits.]
          * * * * * * *
                              ----------                              


                     FEDERAL DEPOSIT INSURANCE ACT

SECTION 1. FEDERAL DEPOSIT INSURANCE 
                    CORPORATION.

  (a) Establishment of Corporation.--There is hereby 
established a Federal Deposit Insurance Corporation 
(hereinafter referred to as the ``Corporation'') which shall 
insure, as hereinafter provided, the deposits of all banks and 
savings associations which are entitled to the benefits of 
insurance under this Act, and which shall have the powers 
hereinafter granted.
  (b) Asset Disposition Division.--
          (1) Establishment.--The Corporation shall have a 
        separate division of asset disposition.
          (2) Management.--The division of asset disposition 
        shall have an administrator who shall be appointed by 
        the Board of Directors.
          (3) Responsibilities of division.--The division of 
        asset disposition shall carry out all of the 
        responsibilities of the Corporation under this Act 
        relating to the liquidation of insured depository 
        institutions and the disposition of assets of such 
        institutions.

SEC. 2. MANAGEMENT.

  (a) Board of Directors.--
          (1) In general.--The management of the Corporation 
        shall be vested in a Board of Directors consisting of 
        [5 members--]
                  [(A) 1 of whom shall be the Comptroller of 
                the Currency;
                  [(B) 1 of whom shall be the Director of the 
                Consumer Financial Protection Bureau; and]
                  [(C)] [3 of whom] 5 members, who shall be 
                appointed by the President, by and with the 
                advice and consent of the Senate, from among 
                individuals who are citizens of the United 
                States, 1 of whom shall have State bank 
                supervisory experience.
          (2) Political affiliation.--After February 28, 1993, 
        not more than 3 of the members of the Board of 
        Directors may be members of the same political party.
  (b) Chairperson and Vice Chairperson.--
          (1) Chairperson.--1 of the appointed members shall be 
        designated by the President, by and with the advice and 
        consent of the Senate, to serve as Chairperson of the 
        Board of Directors for a term of 5 years.
          (2) Vice chairperson.--1 of the appointed members 
        shall be designated by the President, by and with the 
        advice and consent of the Senate, to serve as Vice 
        Chairperson of the Board of Directors.
          (3) Acting chairperson.--In the event of a vacancy in 
        the position of Chairperson of the Board of Directors 
        or during the absence or disability of the Chairperson, 
        the Vice Chairperson shall act as Chairperson.
  (c) Terms.--
          (1) Appointed members.--Each appointed member shall 
        be appointed for a term of 6 years.
          (2) Interim appointments.--Any member appointed to 
        fill a vacancy occurring before the expiration of the 
        term for which such member's predecessor was appointed 
        shall be appointed only for the remainder of such term.
          (3) Continuation of service.--The Chairperson, Vice 
        Chairperson, and each appointed member may continue to 
        serve after the expiration of the term of office to 
        which such member was appointed until a successor has 
        been appointed and qualified.
  [(d) Vacancy.--
          [(1) In general.--Any vacancy on the Board of 
        Directors shall be filled in the manner in which the 
        original appointment was made.
          [(2) Acting officials may serve.--In the event of a 
        vacancy in the office of the Comptroller of the 
        Currency or the office of Director of the Consumer 
        Financial Protection Bureau and pending the appointment 
        of a successor, or during the absence or disability of 
        the Comptroller of the Currency or the Director of the 
        Consumer Financial Protection Bureau, the acting 
        Comptroller of the Currency or the acting Director of 
        the Consumer Financial Protection Bureau, as the case 
        may be, shall be a member of the Board of Directors in 
        the place of the Comptroller or Director.]
  (d) Vacancy.--Any vacancy on the Board of Directors shall be 
filled in the manner in which the original appointment was 
made.
  (e) Ineligibility for Other Offices.--
          (1) Postservice restriction.--
                  (A) In general.--No member of the Board of 
                Directors may hold any office, position, or 
                employment in any insured depository 
                institution or any depository institution 
                holding company during--
                          (i) the time such member is in 
                        office; and
                          (ii) the 2-year period beginning on 
                        the date such member ceases to serve on 
                        the Board of Directors.
                  (B) Exception for members who serve full 
                term.--The limitation contained in subparagraph 
                (A)(ii) shall not apply to any member who has 
                ceased to serve on the Board of Directors after 
                serving the full term for which such member was 
                appointed.
          (2) Restriction during service.--No member of the 
        Board of Directors may--
                  (A) be an officer or director of any insured 
                depository institution, depository institution 
                holding company, Federal Reserve bank, or 
                Federal home loan bank; or
                  (B) hold stock in any insured depository 
                institution or depository institution holding 
                company.
          (3) Certification.--Upon taking office, each member 
        of the Board of Directors shall certify under oath that 
        such member has complied with this subsection and such 
        certification shall be filed with the secretary of the 
        Board of Directors.
  (f) Status of Employees.--
          (1) In general.--A director, member, officer, or 
        employee of the Corporation has no liability under the 
        Securities Act of 1933 with respect to any claim 
        arising out of or resulting from any act or omission by 
        such person within the scope of such person's 
        employment in connection with any transaction involving 
        the disposition of assets (or any interests in any 
        assets or any obligations backed by any assets) by the 
        Corporation. This subsection shall not be construed to 
        limit personal liability for criminal acts or 
        omissions, willful or malicious misconduct, acts or 
        omissions for private gain, or any other acts or 
        omissions outside the scope of such person's 
        employment.
          [(2) Definition.--For purposes of this subsection, 
        the term ``employee of the Corporation'' includes any 
        employee of the Office of the Comptroller of the 
        Currency or of the Consumer Financial Protection Bureau 
        who serves as a deputy or assistant to a member of the 
        Board of Directors of the Corporation in connection 
        with activities of the Corporation.]
          [(3)] (2) Effect on other law.--This subsection does 
        not affect--
                  (A) any other immunities and protections that 
                may be available to such person under 
                applicable law with respect to such 
                transactions, or
                  (B) any other right or remedy against the 
                Corporation, against the United States under 
                applicable law, or against any person other 
                than a person described in paragraph (1) 
                participating in such transactions.
        This subsection shall not be construed to limit or 
        alter in any way the immunities that are available 
        under applicable law for Federal officials and 
        employees not described in this subsection.
  Sec. 3. As used in this Act--
  (a) Definitions of Bank and Related Terms.--
          (1) Bank.--The term ``bank''--
                  (A) means any national bank and State bank, 
                and any Federal branch and insured branch;
                  (B) includes any former savings association.
          (2) State bank.--The term ``State bank'' means any 
        bank, banking association, trust company, savings bank, 
        industrial bank (or similar depository institution 
        which the Board of Directors finds to be operating 
        substantially in the same manner as an industrial 
        bank), or other banking institution which--
                  (A) is engaged in the business of receiving 
                deposits, other than trust funds (as defined in 
                this section); and
                  (B) is incorporated under the laws of any 
                State or which is operating under the Code of 
                Law for the District of Columbia,
        including any cooperative bank or other unincorporated 
        bank the deposits of which were insured by the 
        Corporation on the day before the date of the enactment 
        of the Financial Institutions Reform, Recovery, and 
        Enforcement Act of 1989.
          (3) State.--The term ``State'' means any State of the 
        United States, the District of Columbia, any territory 
        of the United States, Puerto Rico, Guam, American 
        Samoa, the Trust Territory of the Pacific Islands, the 
        Virgin Islands, and the Northern Mariana Islands.
  (b) Definition of Savings Associations and Related Terms.--
          (1) Savings association.--The term ``savings 
        association'' means--
                  (A) any Federal savings association;
                  (B) any State savings association; and
                  (C) any corporation (other than a bank) that 
                the Board of Directors and the Comptroller of 
                the Currency jointly determine to be operating 
                in substantially the same manner as a savings 
                association.
          (2) Federal savings association.--The term ``Federal 
        savings association'' means any Federal savings 
        association or Federal savings bank which is chartered 
        under section 5 of the Home Owners' Loan Act.
          (3) State savings association.--The term ``State 
        savings association'' means--
                  (A) any building and loan association, 
                savings and loan association, or homestead 
                association; or
                  (B) any cooperative bank (other than a 
                cooperative bank which is a State bank as 
                defined in subsection (a)(2)),
        which is organized and operating according to the laws 
        of the State (as defined in subsection (a)(3)) in which 
        it is chartered or organized.
  (c) Definitions Relating to Depository Institutions.--
          (1) Depository institution.--The term ``depository 
        institution'' means any bank or savings association.
          (2) Insured depository institution.--The term 
        ``insured depository institution'' means any bank or 
        savings association the deposits of which are insured 
        by the Corporation pursuant to this Act.
          (3) Institutions included for certain purposes.--The 
        term ``insured depository institution'' includes any 
        uninsured branch or agency of a foreign bank or a 
        commercial lending company owned or controlled by a 
        foreign bank for purposes of section 8 of this Act.
          (4) Federal depository institution.--The term 
        ``Federal depository institution'' means any national 
        bank, any Federal savings association, and any Federal 
        branch.
          (5) State depository institution.--The term ``State 
        depository institution'' means any State bank, any 
        State savings association, and any insured branch which 
        is not a Federal branch.
  (d) Definitions Relating to Member Banks.--
          (1) National member bank.--The term ``national member 
        bank'' means any national bank which is a member of the 
        Federal Reserve System.
          (2) State member bank.--The term ``State member 
        bank'' means any State bank which is a member of the 
        Federal Reserve System.
  (e) Definitions Relating to Nonmember Banks.--
          (1) National nonmember bank.--The term ``national 
        nonmember bank'' means any national bank which--
                  (A) is located in any territory of the United 
                States, Puerto Rico, Guam, American Samoa, the 
                Virgin Islands, or the Northern Mariana 
                Islands; and
                  (B) is not a member of the Federal Reserve 
                System.
          (2) State nonmember bank.--The term ``State nonmember 
        bank'' means any State bank which is not a member of 
        the Federal Reserve System.
  (f) The term ``mutual savings bank'' means a bank without 
capital stock transacting a savings bank business, the net 
earnings of which inure wholly to the benefit of its depositors 
after payment of obligations for any advances by its 
organizers.
  (g) Savings Bank.--The term ``savings bank'' means a bank 
(including a mutual savings bank) which transacts its ordinary 
banking business strictly as a savings bank under State laws 
imposing special requirements on such banks governing the 
manner of investing their funds and of conducting their 
business.
  (h) The term ``insured bank'' means any bank (including a 
foreign bank having an insured branch) the deposits of which 
are insured in accordance with the provisions of this Act; and 
the term ``noninsured bank'' means any bank the deposits of 
which are not so insured.
  (i) New Depository Institution and Bridge Depository 
Institution Defined.--
          (1) New depository institution.--The term ``new 
        depository institution'' means a new national bank or 
        Federal savings association, other than a bridge 
        depository institution, organized by the Corporation in 
        accordance with section 11(m).
          (2) Bridge depository institution.--The term ``bridge 
        depository institution'' means a new national bank or 
        Federal savings association organized by the 
        Corporation in accordance with section 11(n).
  (j) The term ``receiver'' includes a receiver, liquidating 
agent, conservator, commission, person, or other agency charged 
by law with the duty of winding up the affairs of a bank or 
savings association or of a branch of a foreign bank.
  (k) The term ``Board of Directors'' means the Board of 
Directors of the Corporation.
  (l) The term ``deposit'' means--
          (1) the unpaid balance of money or its equivalent 
        received or held by a bank or savings association in 
        the usual course of business and for which it has given 
        or is obligated to give credit, either conditionally or 
        unconditionally, to a commercial, checking, savings, 
        time, or thrift account, or which is evidenced by its 
        certificate of deposit, thrift certificate, investment 
        certificate, certificate of indebtedness, or other 
        similar name, or a check or draft drawn against a 
        deposit account and certified by the bank or savings 
        association, or a letter of credit or a traveler's 
        check on which the bank or savings association is 
        primarily liable: Provided, That, without limiting the 
        generality of the term ``money or its equivalent'', any 
        such account or instrument must be regarded as 
        evidencing the receipt of the equivalent of money when 
        credited or issued in exchange for checks or drafts or 
        for a promissory note upon which the person obtaining 
        any such credit or instrument is primarily or 
        secondarily liable, or for a charge against a deposit 
        account, or in settlement of checks, drafts, or other 
        instruments forwarded to such bank or savings 
        association for collection,
          (2) trust funds as defined in this Act received or 
        held by such bank or savings association, whether held 
        in the trust department or held or deposited in any 
        other department of such bank or savings association,
          (3) money received or held by a bank or savings 
        association, or the credit given for money or its 
        equivalent received or held by a bank or savings 
        association, in the usual course of business for a 
        special or specific purpose, regardless of the legal 
        relationship thereby established, including without 
        being limited to, escrow funds, funds held as security 
        for an obligation due to the bank or savings 
        association or others (including funds held as dealers 
        reserves) or for securities loaned by the bank or 
        savings association, funds deposited by a debtor to 
        meet maturing obligations, funds deposited as advance 
        payment on subscriptions to United States Government 
        securities, funds held for distribution or purchase of 
        securities, funds held to meet its acceptances or 
        letters of credit, and withheld taxes: Provided, That 
        there shall not be included funds which are received by 
        the bank or savings association for immediate 
        application to the reduction of an indebtedness to the 
        receiving bank or savings association, or under 
        condition that the receipt thereof immediately reduces 
        or extinguishes such an indebtedness,
          (4) outstanding draft (including advice or 
        authorization to charge a bank's or a savings 
        association's balance in another bank or savings 
        association), cashier's check, money order, or other 
        officer's check issued in the usual course of business 
        for any purpose, including without being limited to 
        those issued in payment for services, dividends, or 
        purchases, and
          (5) such other obligations of a bank or savings 
        association as the Board of Directors, after 
        consultation with the Comptroller of the Currency, and 
        the Board of Governors of the Federal Reserve System, 
        shall find and prescribe by regulation to be deposit 
        liabilities by general usage, except that the following 
        shall not be a deposit for any of the purposes of this 
        Act or be included as part of the total deposits or of 
        an insured deposit:
                  (A) any obligation of a depository 
                institution which is carried on the books and 
                records of an office of such bank or savings 
                association located outside of any State, 
                unless--
                          (i) such obligation would be a 
                        deposit if it were carried on the books 
                        and records of the depository 
                        institution, and would be payable at, 
                        an office located in any State; and
                          (ii) the contract evidencing the 
                        obligation provides by express terms, 
                        and not by implication, for payment at 
                        an office of the depository institution 
                        located in any State;
                  (B) any international banking facility 
                deposit, including an international banking 
                facility time deposit, as such term is from 
                time to time defined by the Board of Governors 
                of the Federal Reserve System in regulation D 
                or any successor regulation issued by the Board 
                of Governors of the Federal Reserve System; and
                  (C) any liability of an insured depository 
                institution that arises under an annuity 
                contract, the income of which is tax deferred 
                under section 72 of the Internal Revenue Code 
                of 1986.
  (m) Insured Deposit.--
          (1) In general.--Subject to paragraph (2), the term 
        ``insured deposit'' means the net amount due to any 
        depositor for deposits in an insured depository 
        institution as determined under sections 7(i) and 
        11(a).
  (2) In the case of any deposit in a branch of a foreign bank, 
the term ``insured deposit'' means an insured deposit as 
defined in paragraph (1) of this subsection which--
          (A) is payable in the United States to--
                  (i) an individual who is a citizen or 
                resident of the United States,
                  (ii) a partnership, corporation, trust, or 
                other legally cognizable entity created under 
                the laws of the United States or any State and 
                having its principal place of business within 
                the United States or any State, or
                  (iii) an individual, partnership, 
                corporation, trust, or other legally cognizable 
                entity which is determined by the Board of 
                Directors in accordance with its regulations to 
                have such business or financial relationships 
                in the United States as to make the insurance 
                of such deposit consistent with the purposes of 
                this Act; and
          (B) meets any other criteria prescribed by the Board 
        of Directors by regulation as necessary or appropriate 
        in its judgment to carry out the purposes of this Act 
        or to facilitate the administration thereof.
          (3) Uninsured deposits.--The term ``uninsured 
        deposit'' means the amount of any deposit of any 
        depositor at any insured depository institution in 
        excess of the amount of the insured deposits of such 
        depositor (if any) at such depository institution.
          (4) Preferred deposits.--The term ``preferred 
        deposits'' means deposits of any public unit (as 
        defined in paragraph (1)) at any insured depository 
        institution which are secured or collateralized as 
        required under State law.
  (n) The term ``transferred deposit'' means a deposit in a new 
bank or other insured depository institution made available to 
a depositor by the Corporation as payment of the insured 
deposit of such depositor in a closed bank, and assumed by such 
new bank or other insured depository institution.
  (o) The term ``domestic branch'' includes any branch bank, 
branch office, branch agency, additional office, or any branch 
place of business located in any State of the United States or 
in any Territory of the United States, Puerto Rico, Guam, 
American Samoa, the Trust Territory of the Pacific Islands, or 
the Virgin Islands at which deposits are received or checks 
paid or money lent. The term ``domestic branch'' does not 
include an automated teller machine or a remote service unit. 
The term ``foreign branch'' means any office or place of 
business located outside the United States, its territories, 
Puerto Rico, Guam, American Samoa, the Trust Territory of the 
Pacific Islands, or the Virgin Islands, at which banking 
operations are conducted.
  (p) The term ``trust funds'' means funds held by an insured 
depository institution in a fiduciary capacity and includes, 
without being limited to, funds held as trustee, executor, 
administrator, guardian, or agent.
  (q) Appropriate Federal Banking Agency.--The term 
``appropriate Federal banking agency'' means--
          (1) the Office of the Comptroller of the Currency, in 
        the case of--
                  (A) any national banking association;
                  (B) any Federal branch or agency of a foreign 
                bank; and
                  (C) any Federal savings association;
          (2) the Federal Deposit Insurance Corporation, in the 
        case of--
                  (A) any State nonmember insured bank;
                  (B) any foreign bank having an insured 
                branch; and
                  (C) any State savings association; and
          (3) the Board of Governors of the Federal Reserve 
        System, in the case of--
                  (A) any State member bank;
                  (B) any branch or agency of a foreign bank 
                with respect to any provision of the Federal 
                Reserve Act which is made applicable under the 
                International Banking Act of 1978;
                  (C) any foreign bank which does not operate 
                an insured branch;
                  (D) any agency or commercial lending company 
                other than a Federal agency;
                  (E) supervisory or regulatory proceedings 
                arising from the authority given to the Board 
                of Governors under section 7(c)(1) of the 
                International Banking Act of 1978, including 
                such proceedings under the Financial 
                Institutions Supervisory Act of 1966;
                  (F) any bank holding company and any 
                subsidiary (other than a depository 
                institution) of a bank holding company; and
                  (G) any savings and loan holding company and 
                any subsidiary (other than a depository 
                institution) of a savings and loan holding 
                company.
Under the rule set forth in this subsection, more than one 
agency may be an appropriate Federal banking agency with 
respect to any given institution.
  (r) State Bank Supervisor.--
          (1) In general.--The term ``State bank supervisor'' 
        means any officer, agency, or other entity of any State 
        which has primary regulatory authority over State banks 
        or State savings associations in such State.
          (2) Interstate application.--The State bank 
        supervisors of more than 1 State may be the appropriate 
        State bank supervisor for any insured depository 
        institution.
  (s) Definitions Relating to Foreign Banks and Branches.--
          (1) Foreign bank.--The term ``foreign bank'' has the 
        meaning given to such term by section 1(b)(7) of the 
        International Banking Act of 1978.
          (2) Federal branch.--The term ``Federal branch'' has 
        the meaning given to such term by section 1(b)(6) of 
        the International Banking Act of 1978.
          (3) Insured branch.--The term ``insured branch'' 
        means any branch (as defined in section 1(b)(3) of the 
        International Banking Act of 1978) of a foreign bank 
        any deposits in which are insured pursuant to this Act.
  (t) Includes, Including.--
          (1) In general.--The terms ``includes'' and 
        ``including'' shall not be construed more restrictively 
        than the ordinary usage of such terms so as to exclude 
        any other thing not referred to or described.
          (2) Rule of construction.--Paragraph (1) shall not be 
        construed as creating any inference that the term 
        ``includes'' or ``including'' in any other provision of 
        Federal law may be deemed to exclude any other thing 
        not referred to or described.
  (u) Institution-Affiliated Party.--The term ``institution-
affiliated party'' means--
          (1) any director, officer, employee, or controlling 
        stockholder (other than a bank holding company or 
        savings and loan holding company) of, or agent for, an 
        insured depository institution;
          (2) any other person who has filed or is required to 
        file a change-in-control notice with the appropriate 
        Federal banking agency under section 7(j);
          (3) any shareholder (other than a bank holding 
        company or savings and loan holding company), 
        consultant, joint venture partner, and any other person 
        as determined by the appropriate Federal banking agency 
        (by regulation or case-by-case) who participates in the 
        conduct of the affairs of an insured depository 
        institution; and
          (4) any independent contractor (including any 
        attorney, appraiser, or accountant) who knowingly or 
        recklessly participates in--
                  (A) any violation of any law or regulation;
                  (B) any breach of fiduciary duty; or
                  (C) any unsafe or unsound practice,
        which caused or is likely to cause more than a minimal 
        financial loss to, or a significant adverse effect on, 
        the insured depository institution.
  (v) Violation.--The term ``violation'' includes any action 
(alone or with another or others) for or toward causing, 
bringing about, participating in, counseling, or aiding or 
abetting a violation.
  (w) Definitions Relating to Affiliates of Depository 
Institutions.--
          (1) Depository institution holding company.--The term 
        ``depository institution holding company'' means a bank 
        holding company or a savings and loan holding company.
          (2) Bank holding company.--The term ``bank holding 
        company'' has the meaning given to such term in section 
        2 of the Bank Holding Company Act of 1956.
          (3) Savings and loan holding company.--The term 
        ``savings and loan holding company'' has the meaning 
        given to such term in section 10 of the Home Owners' 
        Loan Act.
          (4) Subsidiary.--The term ``subsidiary''--
                  (A) means any company which is owned or 
                controlled directly or indirectly by another 
                company; and
                  (B) includes any service corporation owned in 
                whole or in part by an insured depository 
                institution or any subsidiary of such a service 
                corporation.
          (5) Control.--The term ``control'' has the meaning 
        given to such term in section 2 of the Bank Holding 
        Company Act of 1956.
          (6) Affiliate.--The term ``affiliate'' has the 
        meaning given to such term in section 2(k) of the Bank 
        Holding Company Act of 1956.
          (7) Company.--The term ``company'' has the same 
        meaning as in section 2(b) of the Bank Holding Company 
        Act of 1956.
  (x) Definitions Relating to Default.--
          (1) Default.--The term ``default'' means, with 
        respect to an insured depository institution, any 
        adjudication or other official determination by any 
        court of competent jurisdiction, the appropriate 
        Federal banking agency, or other public authority 
        pursuant to which a conservator, receiver, or other 
        legal custodian is appointed for an insured depository 
        institution or, in the case of a foreign bank having an 
        insured branch, for such branch.
          (2) In danger of default.--The term ``in danger of 
        default'' means an insured depository institution with 
        respect to which (or in the case of a foreign bank 
        having an insured branch, with respect to such insured 
        branch) the appropriate Federal banking agency or State 
        chartering authority has advised the Corporation (or, 
        if the appropriate Federal banking agency is the 
        Corporation, the Corporation has determined) that--
                  (A) in the opinion of such agency or 
                authority--
                          (i) the depository institution or 
                        insured branch is not likely to be able 
                        to meet the demands of the 
                        institution's or branch's depositors or 
                        pay the institution's or branch's 
                        obligations in the normal course of 
                        business; and
                          (ii) there is no reasonable prospect 
                        that the depository institution or 
                        insured branch will be able to meet 
                        such demands or pay such obligations 
                        without Federal assistance; or
                  (B) in the opinion of such agency or 
                authority--
                          (i) the depository institution or 
                        insured branch has incurred or is 
                        likely to incur losses that will 
                        deplete all or substantially all of its 
                        capital; and
                          (ii) there is no reasonable prospect 
                        that the capital of the depository 
                        institution or insured branch will be 
                        replenished without Federal assistance.
  (y) Definitions Relating to Deposit Insurance Fund.--
          (1) Deposit insurance fund.--The term ``Deposit 
        Insurance Fund'' means the Deposit Insurance Fund 
        established under section 11(a)(4).
          (2) Designated reserve ratio.--The term ``designated 
        reserve ratio'' means the reserve ratio designated by 
        the Board of Directors in accordance with section 
        7(b)(3).
          (3) Reserve ratio.--The term ``reserve ratio'', when 
        used with regard to the Deposit Insurance Fund other 
        than in connection with a reference to the designated 
        reserve ratio, means the ratio of the net worth of the 
        Deposit Insurance Fund to the value of the aggregate 
        estimated insured deposits, or such comparable 
        percentage of the assessment base set forth in section 
        7(b)(2)(C).
  (z) Federal Banking Agency.--The term ``Federal banking 
agency'' means the Comptroller of the Currency, the Board of 
Governors of the Federal Reserve System, or the Federal Deposit 
Insurance Corporation.

           *       *       *       *       *       *       *

  Sec. 7. (a)(1) Each insured State nonmember bank and each 
foreign bank having an insured branch which is not a Federal 
branch shall make to the Corporation reports of condition which 
shall be in such form and shall contain such information as the 
Board of Directors may require. Such reports shall be made to 
the Corporation on the dates selected as provided in paragraph 
(3) of this subsection and the deposit liabilities shall be 
reported therein in accordance with and pursuant to paragraphs 
(4) and (5) of this subsection. The Board of Directors may call 
for additional reports of condition on dates to be fixed by it 
and may call for such other reports as the Board may from time 
to time require. Any such bank which (A) maintains procedures 
reasonably adapted to avoid any inadvertent error and, 
unintentionally and as a result of such an error, fails to make 
or publish any report required under this paragraph, within the 
period of time specified by the Corporation, or submits or 
publishes any false or misleading report or information, or (B) 
inadvertently transmits or publishes any report which is 
minimally late, shall be subject to a penalty of not more than 
$2,000 for each day during which such failure continues or such 
false or misleading information is not corrected. Such bank 
shall have the burden of proving that an error was inadvertent 
and that a report was inadvertently transmitted or published 
late. Any such bank which fails to make or publish any report 
required under this paragraph, within the period of time 
specified by the Corporation, or submits or publishes any false 
or misleading report or information, in a manner not described 
in the 2nd preceding sentence shall be subject to a penalty of 
not more than $20,000 for each day during which such failure 
continues or such false or misleading information is not 
corrected. Notwithstanding the preceding sentence, if any such 
bank knowingly or with reckless disregard for the accuracy of 
any information or report described in such sentence submits or 
publishes any false or misleading report or information, the 
Corporation may assess a penalty of not more than [$1,000,000] 
$1,500,000 or 1 percent of total assets of such bank, whichever 
is less, per day for each day during which such failure 
continues or such false or misleading information is not 
corrected. Any penalty imposed under any of the 4 preceding 
sentences shall be assessed and collected by the Corporation in 
the manner provided in subparagraphs (E), (F), (G), and (I) of 
section 8(i)(2) (for penalties imposed under such section) and 
any such assessment (including the determination of the amount 
of the penalty) shall be subject to the provisions of such 
section. Any such bank against which any penalty is assessed 
under this subsection shall be afforded an agency hearing if 
such bank submits a request for such hearing within 20 days 
after the issuance of the notice of assessment. Section 8(h) 
shall apply to any proceeding under this paragraph.
  (2)(A) The Corporation and, with respect to any State 
depository institution, any appropriate State bank supervisor 
for such institution, shall have access to reports of 
examination made by, and reports of condition made to, the 
Comptroller of the Currency, the Federal Housing Finance 
Agency, any Federal home loan bank, or any Federal Reserve bank 
and to all revisions of reports of condition made to any of 
them, and they shall promptly advise the Corporation of any 
revisons or changes in respect to deposit liabilities made or 
required to be made in any report of condition. The Corporation 
may accept any report made by or to any commission, board, or 
authority having supervision of a depository institution, and 
may furnish to the Comptroller of the Currency, to the Federal 
Housing Finance Agency, to any Federal home loan bank, to any 
Federal Reserve bank, and to any such commission, board, or 
authority, reports of examinations made on behalf of, and 
reports of condition made to, the Corporation.
          (B) Additional reports.--The Board of Directors may 
        from time to time require any insured depository 
        institution to file such additional reports as the 
        Corporation, after consultation with the Comptroller of 
        the Currency and the Board of Governors of the Federal 
        Reserve System, as appropriate, may deem advisable for 
        insurance purposes.
          (C) Data sharing with other agencies and persons.--In 
        addition to reports of examination, reports of 
        condition, and other reports required to be regularly 
        provided to the Corporation (with respect to all 
        insured depository institutions, including a depository 
        institution for which the Corporation has been 
        appointed conservator or receiver) or an appropriate 
        State bank supervisor (with respect to a State 
        depository institution) under subparagraph (A) or (B), 
        a Federal banking agency may, in the discretion of the 
        agency, furnish any report of examination or other 
        confidential supervisory information concerning any 
        depository institution or other entity examined by such 
        agency under authority of any Federal law, to--
                  (i) any other Federal or State agency or 
                authority with supervisory or regulatory 
                authority over the depository institution or 
                other entity;
                  (ii) any officer, director, or receiver of 
                such depository institution or entity; and
                  (iii) any other person that the Federal 
                banking agency determines to be appropriate.
  (3) Each insured depository institution shall make to the 
appropriate Federal banking agency 4 reports of condition 
annually upon dates which shall be selected by the Chairman of 
the Board of Directors, the Comptroller of the Currency, and 
the Chairman of the Board of Governors of the Federal Reserve 
System. The dates selected shall be the same for all insured 
depository institutions, except that when any of said reporting 
dates is a nonbusiness day for any depository institution, the 
preceding business day shall be its reporting date. Such 
reports of condition shall be the basis for the certified 
statements to be filed pursuant to subsection (c). The deposit 
liabilities shall be reported in said reports of condition in 
accordance with and pursuant to paragraphs (4) and (5) of this 
subsection, and such other information shall be reported 
therein as may be required by the respective agencies. Each 
said report of condition shall contain a declaration by the 
president, a vice president, the cashier or the treasurer, or 
by any other officer designated by the board of directors or 
trustees of the reporting depository institution to make such 
declaration, that the report is true and correct to the best of 
his knowledge and belief. The correctness of said report of 
conditions shall be attested by the signatures of at least two 
directors or trustees of the reporting depository institution 
other than the officer making such declaration, with a 
declaration that the report has been examined by them and to 
the best of their knowledge and belief is true and correct. At 
the time of making said reports of condition each insured 
depository institution shall furnish to the Corporation a copy 
thereof containing such signed declaration and attestations. 
Nothing herein shall preclude any of the foregoing agencies 
from requiring the banks or savings associations under its 
jurisdiction to make additional reports of condition at any 
time.
  (4) In the reports of condition required to be made by 
paragraph (3) of this subsection, each insured depository 
institution shall report the total amount of the liability of 
the depository institution for deposits in the main office and 
in any branch located in any State of the United States, the 
District of Columbia, any Territory of the United States, 
Puerto Rico, Guam, American Samoa, the Trust Territory of the 
Pacific Islands, or the Virgin Islands, according to the 
definition of the term ``deposit'' in and pursuant to 
subsection (1) of section 3 of this Act, without any deduction 
for indebtedness of depositors or creditors or any deduction 
for cash items in the process of collection drawn on others 
than the reporting depository institution: Provided, That the 
depository institution in reporting such deposits may (i) 
subtract from the deposit balance due to any depository 
institution the deposit balance due from the same depository 
institution (other than trust funds deposited by either 
depository institution) and any cash items in the process of 
collection due from or due to such depository institutions 
shall be included in determining such net balance, except that 
balances of time deposits of any depository institution and any 
balances standing to the credit of private depository 
institutions, of depository institutions in foreign countries, 
of foreign branches of other American depository institutions, 
and of American branches of foreign banks shall be reported 
gross without any such subtraction, and (ii) exclude any 
deposits received in any office of the depository institution 
for deposit in any other office of the depository institution: 
And provided further, That outstanding drafts (including 
advices and authorizations to charge depository institution's 
balance in another depository institution) drawn in the regular 
course of business by the reporting depository institution on 
depository institutions need not be reported as deposit 
liabilities. The amount of trust funds held in the depository 
institution's own trust department, which the reporting 
depository institution keeps segregated and apart from its 
general assets and does not use in the conduct of its business, 
shall not be included in the total deposits in such reports, 
but shall be separately stated in such reports. Deposits which 
are accumulated for the payment of personal loans and are 
assigned or pledged to assure payment of loans at maturity 
shall not be included in the total deposits in such reports, 
but shall be deducted from the loans for which such deposits 
are assigned or pledged to assure repayment.
  (5) The deposits to be reported on such reports of condition 
shall be segregated between (i) time and savings deposits and 
(ii) demand deposits. For this purpose, the time and savings 
deposits shall consist of time certificates of deposit, time 
deposits-open account and savings deposits; and demand deposits 
shall consist of all deposits other than time and savings 
deposits.
          (6) Lifeline account deposits.--In the reports of 
        condition required to be reported under this 
        subsection, the deposits in lifeline accounts (as 
        defined in section 232(a)(3)(D) of the Bank Enterprise 
        Act of 1991) shall be reported separately.
  (7) The Board of Directors, after consultation with the 
Comptroller of the Currency and the Board of Governors of the 
Federal Reserve System, may by regulation define the terms 
``cash items'' and ``process of collection'', and shall 
classify deposits as ``time,''``savings,'' and ``demand'' 
deposits, for the purposes of this section.
  (8) In respect of any report required or authorized to be 
supplied or published pursuant to this subsection or any other 
provision of law, the Board of Directors or the Comptroller of 
the Currency, as the case may be, may differentiate between 
domestic banks and foreign banks to such extent as, in their 
judgment, may be reasonably required to avoid hardship and can 
be done without substantial compromise of insurance risk or 
supervisory and regulatory effectiveness.
          (9) Data collections.--In addition to or in 
        connection with any other report required under this 
        subsection, the Corporation shall take such action as 
        may be necessary to ensure that--
                  (A) each insured depository institution 
                maintains; and
                  (B) the Corporation receives on a regular 
                basis from such institution,
        information on the total amount of all insured 
        deposits, preferred deposits, and uninsured deposits at 
        the institution. In prescribing reporting and other 
        requirements for the collection of actual and accurate 
        information pursuant to this paragraph, the Corporation 
        shall minimize the regulatory burden imposed upon 
        insured depository institutions that are well 
        capitalized (as defined in section 38) while taking 
        into account the benefit of the information to the 
        Corporation, including the use of the information to 
        enable the Corporation to more accurately determine the 
        total amount of insured deposits in each insured 
        depository institution for purposes of compliance with 
        this Act.
          (10) A Federal banking agency may not, by regulation 
        or otherwise, designate, or require an insured 
        institution or an affiliate to designate, a corporation 
        as highly leveraged or a transaction with a corporation 
        as a highly leveraged transaction solely because such 
        corporation is or has been a debtor or bankrupt under 
        title 11, United States Code, if, after confirmation of 
        a plan of reorganization, such corporation would not 
        otherwise be highly leveraged.
          (11) Streamlining reports of condition.--
                  (A) Review of information and schedules.--
                Before the end of the 1-year period beginning 
                on the date of enactment of the Financial 
                Services Regulatory Relief Act of 2006 and 
                before the end of each 5-year period 
                thereafter, each Federal banking agency shall, 
                in conjunction with the other relevant Federal 
                banking agencies, review the information and 
                schedules that are required to be filed by an 
                insured depository institution in a report of 
                condition required under paragraph (3).
                  (B) Reduction or elimination of information 
                found to be unnecessary.--After completing the 
                review required by subparagraph (A), a Federal 
                banking agency, in conjunction with the other 
                relevant Federal banking agencies, shall reduce 
                or eliminate any requirement to file 
                information or schedules under paragraph (3) 
                (other than information or schedules that are 
                otherwise required by law) if the agency 
                determines that the continued collection of 
                such information or schedules is no longer 
                necessary or appropriate.
          (12) Short form reporting.--
                  (A) In general.--The appropriate Federal 
                banking agencies shall issue regulations 
                allowing for a reduced reporting requirement 
                for covered depository institutions when making 
                the first and third report of condition for a 
                year, as required pursuant to paragraph (3).
                  (B) Covered depository institution defined.--
                For purposes of this paragraph, the term 
                ``covered depository institution'' means an 
                insured depository institution that--
                          (i) is well capitalized (as defined 
                        under section 38(b)); and
                          (ii) satisfies such other criteria as 
                        the appropriate Federal banking 
                        agencies determine appropriate.
  (b) Assessments.--
          (1) Risk-based assessment system.--
                  (A) Risk-based assessment system required.--
                The Board of Directors shall, by regulation, 
                establish a risk-based assessment system for 
                insured depository institutions.
                  (B) Private reinsurance authorized.--In 
                carrying out this paragraph, the Corporation 
                may--
                          (i) obtain private reinsurance 
                        covering not more than 10 percent of 
                        any loss the Corporation incurs with 
                        respect to an insured depository 
                        institution; and
                          (ii) base that institution's 
                        assessment (in whole or in part) on the 
                        cost of the reinsurance.
                  (C) Risk-based assessment system defined.--
                For purposes of this paragraph, the term 
                ``risk-based assessment system'' means a system 
                for calculating a depository institution's 
                assessment based on--
                          (i) the probability that the Deposit 
                        Insurance Fund will incur a loss with 
                        respect to the institution, taking into 
                        consideration the risks attributable 
                        to--
                                  (I) different categories and 
                                concentrations of assets;
                                  (II) different categories and 
                                concentrations of liabilities, 
                                both insured and uninsured, 
                                contingent and noncontingent; 
                                and
                                  (III) any other factors the 
                                Corporation determines are 
                                relevant to assessing such 
                                probability;
                          (ii) the likely amount of any such 
                        loss; and
                          (iii) the revenue needs of the 
                        Deposit Insurance Fund.
                  (D) Separate assessment systems.--The Board 
                of Directors may establish separate risk-based 
                assessment systems for large and small members 
                of the Deposit Insurance Fund.
                  (E) Information concerning risk of loss and 
                economic conditions.--
                          (i) Sources of information.--For 
                        purposes of determining risk of losses 
                        at insured depository institutions and 
                        economic conditions generally affecting 
                        depository institutions, the 
                        Corporation shall collect information, 
                        as appropriate, from all sources the 
                        Board of Directors considers 
                        appropriate, including reports of 
                        condition, inspection reports, and 
                        other information from all Federal 
                        banking agencies, any information 
                        available from State bank supervisors, 
                        State insurance and securities 
                        regulators, the Securities and Exchange 
                        Commission (including information 
                        described in section 35), the Secretary 
                        of the Treasury, the Commodity Futures 
                        Trading Commission, the Farm Credit 
                        Administration, the Federal Trade 
                        Commission, any Federal reserve bank or 
                        Federal home loan bank, and other 
                        regulators of financial institutions, 
                        and any information available from 
                        private economic, credit, or business 
                        analysts.
                          (ii) Consultation with federal 
                        banking agencies.--
                                  (I) In general.--Except as 
                                provided in subclause (II), in 
                                assessing the risk of loss to 
                                the Deposit Insurance Fund with 
                                respect to any insured 
                                depository institution, the 
                                Corporation shall consult with 
                                the appropriate Federal banking 
                                agency of such institution.
                                  (II) Treatment on aggregate 
                                basis.--In the case of insured 
                                depository institutions that 
                                are well capitalized (as 
                                defined in section 38) and, in 
                                the most recent examination, 
                                were found to be well managed, 
                                the consultation under 
                                subclause (I) concerning the 
                                assessment of the risk of loss 
                                posed by such institutions may 
                                be made on an aggregate basis.
                          (iii) Rule of construction.--No 
                        provision of this paragraph shall be 
                        construed as providing any new 
                        authority for the Corporation to 
                        require submission of information by 
                        insured depository institutions to the 
                        Corporation.
                  (F) Modifications to the risk-based 
                assessment system allowed only after notice and 
                comment.--In revising or modifying the risk-
                based assessment system at any time after the 
                date of the enactment of the Federal Deposit 
                Insurance Reform Act of 2005, the Board of 
                Directors may implement such revisions or 
                modification in final form only after notice 
                and opportunity for comment.
          (2) Setting assessments.--
                  (A) In general.--The Board of Directors shall 
                set assessments for insured depository 
                institutions in such amounts as the Board of 
                Directors may determine to be necessary or 
                appropriate, subject to subparagraph [(D)] (C).
                  (B) Factors to be considered.--In setting 
                assessments under subparagraph (A), the Board 
                of Directors shall consider the following 
                factors:
                          (i) The estimated operating expenses 
                        of the Deposit Insurance Fund.
                          (ii) The estimated case resolution 
                        expenses and income of the Deposit 
                        Insurance Fund.
                          (iii) The projected effects of the 
                        payment of assessments on the capital 
                        and earnings of insured depository 
                        institutions.
                          (iv) The risk factors and other 
                        factors taken into account pursuant to 
                        paragraph (1) under the risk-based 
                        assessment system, including the 
                        requirement under such paragraph to 
                        maintain a risk-based system.
                          (v) Any other factors the Board of 
                        Directors may determine to be 
                        appropriate.
                  [(D)] (C) Notice of assessments.--The 
                Corporation shall notify each insured 
                depository institution of that institution's 
                assessment.
                  [(E)] (D) Bank enterprise act requirement.--
                The Corporation shall design the risk-based 
                assessment system so that, insofar as the 
                system bases assessments, directly or 
                indirectly, on deposits, the portion of the 
                deposits of any insured depository institution 
                which are attributable to lifeline accounts 
                established in accordance with the Bank 
                Enterprise Act of 1991 shall be subject to 
                assessment at a rate determined in accordance 
                with such Act.
          (3) Designated reserve ratio.--
                  (A) Establishment.--
                          (i) In general.--Before the beginning 
                        of each calendar year, the Board of 
                        Directors shall designate the reserve 
                        ratio applicable with respect to the 
                        Deposit Insurance Fund and publish the 
                        reserve ratio so designated.
                          (ii) Rulemaking requirement.--Any 
                        change to the designated reserve ratio 
                        shall be made by the Board of Directors 
                        by regulation after notice and 
                        opportunity for comment.
                  (B) Minimum reserve ratio.--The reserve ratio 
                designated by the Board of Directors for any 
                year may not be less than 1.35 percent of 
                estimated insured deposits, or the comparable 
                percentage of the assessment base set forth in 
                paragraph (2)(C).
                  (C) Factors.--In designating a reserve ratio 
                for any year, the Board of Directors shall--
                          (i) take into account the risk of 
                        losses to the Deposit Insurance Fund in 
                        such year and future years, including 
                        historic experience and potential and 
                        estimated losses from insured 
                        depository institutions;
                          (ii) take into account economic 
                        conditions generally affecting insured 
                        depository institutions so as to allow 
                        the designated reserve ratio to 
                        increase during more favorable economic 
                        conditions and to decrease during less 
                        favorable economic conditions, 
                        notwithstanding the increased risks of 
                        loss that may exist during such less 
                        favorable conditions, as determined to 
                        be appropriate by the Board of 
                        Directors;
                          (iii) seek to prevent sharp swings in 
                        the assessment rates for insured 
                        depository institutions; and
                          (iv) take into account such other 
                        factors as the Board of Directors may 
                        determine to be appropriate, consistent 
                        with the requirements of this 
                        subparagraph.
                  (D) Publication of proposed change in 
                ratio.--In soliciting comment on any proposed 
                change in the designated reserve ratio in 
                accordance with subparagraph (A), the Board of 
                Directors shall include in the published 
                proposal a thorough analysis of the data and 
                projections on which the proposal is based.
                  (E) DIF restoration plans.--
                          (i) In general.--Whenever--
                                  (I) the Corporation projects 
                                that the reserve ratio of the 
                                Deposit Insurance Fund will, 
                                within 6 months of such 
                                determination, fall below the 
                                minimum amount specified in 
                                subparagraph (B)(ii) for the 
                                designated reserve ratio; or
                                  (II) the reserve ratio of the 
                                Deposit Insurance Fund actually 
                                falls below the minimum amount 
                                specified in subparagraph 
                                (B)(ii) for the designated 
                                reserve ratio without any 
                                determination under subclause 
                                (I) having been made,
                        the Corporation shall establish and 
                        implement a Deposit Insurance Fund 
                        restoration plan within 90 days that 
                        meets the requirements of clause (ii) 
                        and such other conditions as the 
                        Corporation determines to be 
                        appropriate.
                          (ii) Requirements of restoration 
                        plan.--A Deposit Insurance Fund 
                        restoration plan meets the requirements 
                        of this clause if the plan provides 
                        that the reserve ratio of the Fund will 
                        meet or exceed the minimum amount 
                        specified in subparagraph (B)(ii) for 
                        the designated reserve ratio before the 
                        end of the 8-year period beginning upon 
                        the implementation of the plan (or such 
                        longer period as the Corporation may 
                        determine to be necessary due to 
                        extraordinary circumstances).
                          (iii) Restriction on assessment 
                        credits.--As part of any restoration 
                        plan under this subparagraph, the 
                        Corporation may elect to restrict the 
                        application of assessment credits 
                        provided under subsection (e)(3) for 
                        any period that the plan is in effect.
                          (iv) Limitation on restriction.--
                        Notwithstanding clause (iii), while any 
                        restoration plan under this 
                        subparagraph is in effect, the 
                        Corporation shall apply credits 
                        provided to an insured depository 
                        institution under subsection (e)(3) 
                        against any assessment imposed on the 
                        institution for any assessment period 
                        in an amount equal to the lesser of--
                                  (I) the amount of the 
                                assessment; or
                                  (II) the amount equal to 3 
                                basis points of the 
                                institution's assessment base.
                          (v) Transparency.--Not more than 30 
                        days after the Corporation establishes 
                        and implements a restoration plan under 
                        clause (i), the Corporation shall 
                        publish in the Federal Register a 
                        detailed analysis of the factors 
                        considered and the basis for the 
                        actions taken with regard to the plan.
          (4) Depository institution required to maintain 
        assessment-related records.--Each insured depository 
        institution shall maintain all records that the 
        Corporation may require for verifying the correctness 
        of any assessment on the insured depository institution 
        under this subsection until the later of--
                  (A) the end of the 3-year period beginning on 
                the due date of the assessment; or
                  (B) in the case of a dispute between the 
                insured depository institution and the 
                Corporation with respect to such assessment, 
                the date of a final determination of any such 
                dispute.
          (5) Emergency special assessments.--In addition to 
        the other assessments imposed on insured depository 
        institutions under this subsection, the Corporation may 
        impose 1 or more special assessments on insured 
        depository institutions in an amount determined by the 
        Corporation if the amount of any such assessment is 
        necessary--
                  (A) to provide sufficient assessment income 
                to repay amounts borrowed from the Secretary of 
                the Treasury under section 14(a) in accordance 
                with the repayment schedule in effect under 
                section 14(c) during the period with respect to 
                which such assessment is imposed;
                  (B) to provide sufficient assessment income 
                to repay obligations issued to and other 
                amounts borrowed from insured depository 
                institutions under section 14(d); or
                  (C) for any other purpose that the 
                Corporation may deem necessary.
          (6) Community enterprise credits.--The Corporation 
        shall allow a credit against any semiannual assessment 
        to any insured depository institution which satisfies 
        the requirements of the Community Enterprise Assessment 
        Credit Board under section 233(a)(1) of the Bank 
        Enterprise Act of 1991 in the amount determined by such 
        Board by regulation.
  (c) Certified Statements; Payments.--
          (1) Certified statements required.--
                  (A) In general.--Each insured depository 
                institution shall file with the Corporation a 
                certified statement containing such information 
                as the Corporation may require for determining 
                the institution's assessment.
                  (B) Form of certification.--The certified 
                statement required under subparagraph (A) 
                shall--
                          (i) be in such form and set forth 
                        such supporting information as the 
                        Board of Directors shall prescribe; and
                          (ii) be certified by the president of 
                        the depository institution or any other 
                        officer designated by its board of 
                        directors or trustees that to the best 
                        of his or her knowledge and belief, the 
                        statement is true, correct and 
                        complete, and in accordance with this 
                        Act and regulations issued hereunder.
          (2) Payments required.--
                  (A) In general.--Each insured depository 
                institution shall pay to the Corporation the 
                assessment imposed under subsection (b).
                  (B) Form of payment.--The payments required 
                under subparagraph (A) shall be made in such 
                manner and at such time or times as the Board 
                of Directors shall prescribe by regulation.
          (3) Newly insured institutions.--To facilitate the 
        administration of this section, the Board of Directors 
        may waive the requirements of paragraphs (1) and (2) 
        for the initial assessment period in which a depository 
        institution becomes insured.
          (4) Penalty for failure to make accurate certified 
        statement.--
                  (A) First tier.--Any insured depository 
                institution which--
                          (i) maintains procedures reasonably 
                        adapted to avoid any inadvertent error 
                        and, unintentionally and as a result of 
                        such an error, fails to submit the 
                        certified statement under paragraph (1) 
                        within the period of time required 
                        under paragraph (1) or submits a false 
                        or misleading certified statement; or
                          (ii) submits the statement at a time 
                        which is minimally after the time 
                        required in such paragraph,
                shall be subject to a penalty of not more than 
                $2,000 for each day during which such failure 
                continues or such false and misleading 
                information is not corrected. The institution 
                shall have the burden of proving that an error 
                was inadvertent or that a statement was 
                inadvertently submitted late.
                  (B) Second tier.--Any insured depository 
                institution which fails to submit the certified 
                statement under paragraph (1) within the period 
                of time required under paragraph (1) or submits 
                a false or misleading certified statement in a 
                manner not described in subparagraph (A) shall 
                be subject to a penalty of not more than 
                $20,000 for each day during which such failure 
                continues or such false and misleading 
                information is not corrected.
                  (C) Third tier.--Notwithstanding 
                subparagraphs (A) and (B), if any insured 
                depository institution knowingly or with 
                reckless disregard for the accuracy of any 
                certified statement described in paragraph (1) 
                submits a false or misleading certified 
                statement under paragraph (1), the Corporation 
                may assess a penalty of not more than 
                $1,000,000 or not more than 1 percent of the 
                total assets of the institution, whichever is 
                less, per day for each day during which the 
                failure continues or the false or misleading 
                information in such statement is not corrected.
                  (D) Assessment procedure.--Any penalty 
                imposed under this paragraph shall be assessed 
                and collected by the Corporation in the manner 
                provided in subparagraphs (E), (F), (G), and 
                (I) of section 8(i)(2) (for penalties imposed 
                under such section) and any such assessment 
                (including the determination of the amount of 
                the penalty) shall be subject to the provisions 
                of such section.
                  (E) Hearing.--Any insured depository 
                institution against which any penalty is 
                assessed under this paragraph shall be afforded 
                an agency hearing if the institution submits a 
                request for such hearing within 20 days after 
                the issuance of the notice of the assessment. 
                Section 8(h) shall apply to any proceeding 
                under this subparagraph.
  [(d) Corporation Exempt From Apportionment.--Notwithstanding 
any other provision of law, amounts received pursuant to any 
assessment under this section and any other amounts received by 
the Corporation shall not be subject to apportionment for the 
purposes of chapter 15 of title 31, United States Code, or 
under any other authority.]
  (d) Deposit Insurance Fund Exempt From Apportionment.--
Notwithstanding any other provision of law, amounts received 
pursuant to any assessments or other fees that are deposited 
into the Deposit Insurance Fund shall not be subject to 
apportionment for the purposes of chapter 15 of title 31, 
United States Code, or under any other authority.
  (e) Refunds, Dividends, and Credits.--
          (1) Refunds of overpayments.--In the case of any 
        payment of an assessment by an insured depository 
        institution in excess of the amount due to the 
        Corporation, the Corporation may--
                  (A) refund the amount of the excess payment 
                to the insured depository institution; or
                  (B) credit such excess amount toward the 
                payment of subsequent assessments until such 
                credit is exhausted.
          (2) Dividends from excess amounts in deposit 
        insurance fund.--
                  (A) Reserve ratio in excess of 1.5 percent of 
                estimated insured deposits.--If, at the end of 
                a calendar year, the reserve ratio of the 
                Deposit Insurance Fund exceeds 1.5 percent of 
                estimated insured deposits, the Corporation 
                shall declare the amount in the Fund in excess 
                of the amount required to maintain the reserve 
                ratio at 1.5 percent of estimated insured 
                deposits, as dividends to be paid to insured 
                depository institutions.
                  (B) Limitation.--The Board of Directors may, 
                in its sole discretion, suspend or limit the 
                declaration of payment of dividends under 
                subparagraph (A).
                  (C) Notice and opportunity for comment.--The 
                Corporation shall prescribe, by regulation, 
                after notice and opportunity for comment, the 
                method for the declaration, calculation, 
                distribution, and payment of dividends under 
                this paragraph.
          (3) One-time credit based on total assessment base at 
        year-end 1996.--
                  (A) In general.--Before the end of the 270-
                day period beginning on the date of the 
                enactment of the Federal Deposit Insurance 
                Reform Act of 2005, the Board of Directors 
                shall, by regulation after notice and 
                opportunity for comment, provide for a credit 
                to each eligible insured depository institution 
                (or a successor insured depository 
                institution), based on the assessment base of 
                the institution on December 31, 1996, as 
                compared to the combined aggregate assessment 
                base of all eligible insured depository 
                institutions, taking into account such factors 
                as the Board of Directors may determine to be 
                appropriate.
                  (B) Credit limit.--The aggregate amount of 
                credits available under subparagraph (A) to all 
                eligible insured depository institutions shall 
                equal the amount that the Corporation could 
                collect if the Corporation imposed an 
                assessment of 10.5 basis points on the combined 
                assessment base of the Bank Insurance Fund and 
                the Savings Association Insurance Fund as of 
                December 31, 2001.
                  (C) Eligible insured depository institution 
                defined.--For purposes of this paragraph, the 
                term ``eligible insured depository 
                institution'' means any insured depository 
                institution that--
                          (i) was in existence on December 31, 
                        1996, and paid a deposit insurance 
                        assessment prior to that date; or
                          (ii) is a successor to any insured 
                        depository institution described in 
                        clause (i).
                  (D) Application of credits.--
                          (i) In general.--Subject to clause 
                        (ii), the amount of a credit to any 
                        eligible insured depository institution 
                        under this paragraph shall be applied 
                        by the Corporation, subject to 
                        subsection (b)(3)(E), to the 
                        assessments imposed on such institution 
                        under subsection (b) that become due 
                        for assessment periods beginning after 
                        the effective date of regulations 
                        prescribed under subparagraph (A).
                          (ii) Temporary restriction on use of 
                        credits.--The amount of a credit to any 
                        eligible insured depository institution 
                        under this paragraph may not be applied 
                        to more than 90 percent of the 
                        assessments imposed on such institution 
                        under subsection (b) that become due 
                        for assessment periods beginning in 
                        fiscal years 2008, 2009, and 2010.
                          (iii) Regulations.--The regulations 
                        prescribed under subparagraph (A) shall 
                        establish the qualifications and 
                        procedures governing the application of 
                        assessment credits pursuant to clause 
                        (i).
                  (E) Limitation on amount of credit for 
                certain depository institutions.--In the case 
                of an insured depository institution that 
                exhibits financial, operational, or compliance 
                weaknesses ranging from moderately severe to 
                unsatisfactory, or is not adequately 
                capitalized (as defined in section 38) at the 
                beginning of an assessment period, the amount 
                of any credit allowed under this paragraph 
                against the assessment on that depository 
                institution for such period may not exceed the 
                amount calculated by applying to that 
                depository institution the average assessment 
                rate on all insured depository institutions for 
                such assessment period.
                  (F) Successor defined.--The Corporation shall 
                define the term ``successor'' for purposes of 
                this paragraph, by regulation, and may consider 
                any factors as the Board may deem appropriate.
          (4) Administrative review.--
                  (A) In general.--The regulations prescribed 
                under paragraphs (2) and (3) shall include 
                provisions allowing an insured depository 
                institution a reasonable opportunity to 
                challenge administratively the amount of the 
                credit or dividend determined under paragraph 
                (2) or (3) for such institution.
                  (B) Administrative review.--Any review under 
                subparagraph (A) of any determination of the 
                Corporation under paragraph (2) or (3) shall be 
                final and not subject to judicial review.
  (f) Any insured depository institution which fails to make 
any report of condition under subsection (a) of this section or 
to file any certified statement required to be filed by it in 
connection with determining the amount of any assessment 
payable by the depository institution to the Corporation may be 
compelled to make such report or file such statement by 
mandatory injunction or other appropriate remedy in a suit 
brought for such purpose by the Corporation against the 
depository institution and any officer or officers thereof in 
any court of the United States of competent jurisdiction in the 
District or Territory in which such depository institution is 
located.
  (g) Assessment Actions.--
          (1) In general.--The Corporation, in any court of 
        competent jurisdiction, shall be entitled to recover 
        from any insured depository institution the amount of 
        any unpaid assessment lawfully payable by such insured 
        depository institution.
          (2) Statute of limitations.--The following provisions 
        shall apply to actions relating to assessments, 
        notwithstanding any other provision in Federal law, or 
        the law of any State:
                  (A) Any action by an insured depository 
                institution to recover from the Corporation the 
                overpaid amount of any assessment shall be 
                brought within 3 years after the date the 
                assessment payment was due, subject to the 
                exception in subparagraph (E).
                  (B) Any action by the Corporation to recover 
                from an insured depository institution the 
                underpaid amount of any assessment shall be 
                brought within 3 years after the date the 
                assessment payment was due, subject to the 
                exceptions in subparagraphs (C) and (E).
                  (C) If an insured depository institution has 
                made a false or fraudulent statement with 
                intent to evade any or all of its assessment, 
                the Corporation shall have until 3 years after 
                the date of discovery of the false or 
                fraudulent statement in which to bring an 
                action to recover the underpaid amount.
                  (D) Except as provided in subparagraph (C), 
                assessment deposit information contained in 
                records no longer required to be maintained 
                pursuant to subsection (b)(4) shall be 
                considered conclusive and not subject to 
                change.
                  (E) Any action for the underpaid or overpaid 
                amount of any assessment that became due before 
                the amendment to this subsection under the 
                Federal Deposit Insurance Reform Act of 2005 
                took effect shall be subject to the statute of 
                limitations for assessments in effect at the 
                time the assessment became due.
  (h) Should any national member bank or any insured national 
nonmember bank fail to make any report of condition under 
subsection (a) of this section or to file any certified 
statement required to be filed by such bank under any provision 
of this section, or fail to pay any assessment required to be 
paid by such bank under any provision of this Act, and should 
the bank not correct such failure within thirty days after 
written notice has been given by the Corporation to an officer 
of the bank, citing this subsection, and stating that the bank 
has failed to make any report of condition under subsection (a) 
of this section or to file or pay as required by law, all the 
rights, privileges, and franchises of the bank granted to it 
under the National Bank Act, as amended, the Federal Reserve 
Act, as amended, or this Act, shall be thereby forfeited. 
Whether or not the penalty provided in this subsection has been 
incurred shall be determined and adjudged in the manner 
provided in the sixth paragraph of section 2 of the Federal 
Reserve Act, as amended. The remedies provided in this 
subsection and in the two preceding subsections shall not be 
construed as limiting any other remedies against any insured 
depository institution, but shall be in addition thereto.
  (i) Insurance of Trust Funds.--
          (1) In general.--Trust funds held on deposit by an 
        insured depository institution in a fiduciary capacity 
        as trustee pursuant to any irrevocable trust 
        established pursuant to any statute or written trust 
        agreement shall be insured in an amount not to exceed 
        the standard maximum deposit insurance amount (as 
        determined under section 11(a)(1)) for each trust 
        estate.
          (2) Interbank deposits.--Trust funds described in 
        paragraph (1) which are deposited by the fiduciary 
        depository institution in another insured depository 
        institution shall be similarly insured to the fiduciary 
        depository institution according to the trust estates 
        represented.
          (3) Bank deposit financial assistance program.--
        Notwithstanding paragraph (1), funds deposited by an 
        insured depository institution pursuant to the Bank 
        Deposit Financial Assistance Program of the Department 
        of Energy shall be separately insured in an amount not 
        to exceed the standard maximum deposit insurance amount 
        (as determined under section 11(a)(1)) for each insured 
        depository institution depositing such funds.
          (4) Regulations.--The Board of Directors may 
        prescribe such regulations as may be necessary to 
        clarify the insurance coverage under this subsection 
        and to prescribe the manner of reporting and depositing 
        such trust funds.
  (j)(1) No person, acting directly or indirectly or through or 
in concert with one or more other persons, shall acquire 
control of any insured depository institution through a 
purchase, assignment, transfer, pledge, or other disposition of 
voting stock of such insured depository institution unless the 
appropriate Federal banking agency has been given sixty days' 
prior written notice of such proposed acquisition and within 
that time period the agency has not issued a notice 
disapproving the proposed acquisition or, in the discretion of 
the agency, extending for an additional 30 days the period 
during which such a disapproval may issue.The period for 
disapproval under the preceding sentence may be extended not to 
exceed 2 additional times for not more than 45 days each time 
if--
          (A) the agency determines that any acquiring party 
        has not furnished all the information required under 
        paragraph (6);
          (B) in the agency's judgment, any material 
        information submitted is substantially inaccurate;
          (C) the agency has been unable to complete the 
        investigation of an acquiring party under paragraph 
        (2)(B) because of any delay caused by, or the 
        inadequate cooperation of, such acquiring party; or
          (D) the agency determines that additional time is 
        needed--
                  (i) to investigate and determine that no 
                acquiring party has a record of failing to 
                comply with the requirements of subchapter II 
                of chapter 53 of title 31, United States Code; 
                or
                  (ii) to analyze the safety and soundness of 
                any plans or proposals described in paragraph 
                (6)(E) or the future prospects of the 
                institution.
An acquisition may be made prior to expiration of the 
disapproval period if the agency issues written notice of its 
intent not to disapprove the action.
  (2)(A) Notice to State Agency.--Upon receiving any notice 
under this subsection, the appropriate Federal banking agency 
shall forward a copy thereof to the appropriate State 
depository institution supervisory agency if the depository 
institution the voting shares of which are sought to be 
acquired is a State depository institution, and shall allow 
thirty days within which the views and recommendations of such 
State depository institution supervisory agency may be 
submitted. The appropriate Federal banking agency shall give 
due consideration to the views and recommendations of such 
State agency in determining whether to disapprove any proposed 
acquisition. Notwithstanding the provisions of this paragraph, 
if the appropriate Federal banking agency determines that it 
must act immediately upon any notice of a proposed acquisition 
in order to prevent the probable default of the depository 
institution involved in the proposed acquisition, such Federal 
banking agency may dispense with the requirements of this 
paragraph or, if a copy of the notice is forwarded to the State 
depository institution supervisory agency, such Federal banking 
agency may request that the views and recommendations of such 
State depository institution supervisory agency be submitted 
immediately in any form or by any means acceptable to such 
Federal banking agency.
  (B) Investigation of Principals Required.--Upon receiving any 
notice under this subsection, the appropriate Federal banking 
agency shall--
          (i) conduct an investigation of the competence, 
        experience, integrity, and financial ability of each 
        person named in a notice of a proposed acquisition as a 
        person by whom or for whom such acquisition is to be 
        made; and
          (ii) make an independent determination of the 
        accuracy and completeness of any information described 
        in paragraph (6) with respect to such person.
  (C) Report.--The appropriate Federal banking agency shall 
prepare a written report of any investigation under 
subparagraph (B) which shall contain, at a minimum, a summary 
of the results of such investigation. The agency shall retain 
such written report as a record of the agency.
  (D) Public Comment.--Upon receiving notice of a proposed 
acquisition, the appropriate Federal banking agency shall, 
unless such agency determines that an emergency exists, within 
a reasonable period of time--
          (i) publish the name of the insured depository 
        institution proposed to be acquired and the name of 
        each person identified in such notice as a person by 
        whom or for whom such acquisition is to be made; and
          (ii) solicit public comment on such proposed 
        acquisition, particularly from persons in the 
        geographic area where the bank proposed to be acquired 
        is located, before final consideration of such notice 
        by the agency,
unless the agency determines in writing that such disclosure or 
solicitation would seriously threaten the safety or soundness 
of such bank.
  (3) Within three days after its decision to disapprove any 
proposed acquisition, the appropriate Federal banking agency 
shall notify the acquiring party in writing of the disapproval. 
Such notice shall provide a statement of the basis for the 
disapproval.
  (4) Within ten days of receipt of such notice of disapproval, 
the acquiring party may request an agency hearing on the 
proposed acquisition. In such hearing all issues shall be 
determined on the record pursuant to section 554 of title 5, 
United States Code. The length of the hearing shall be 
determined by the appropriate Federal banking agency. At the 
conclusion thereof, the appropriate Federal banking agency 
shall by order approve or disapprove the proposed acquisition 
on the basis of the record made at such hearing.
  (5) Any person whose proposed acquisition is disapproved 
after agency hearings under this subsection may obtain review 
by the United States court of appeals for the circuit in which 
the home office of the bank to be acquired is located, or the 
United States Court of Appeals for the District of Columbia 
Circuit, by filing a notice of appeal in such court within ten 
days from the date of such order, and simultaneously sending a 
copy of such notice by registered or certified mail to the 
appropriate Federal banking agency. The appropriate Federal 
banking agency shall promptly certify and file in such court 
the record upon which the disapproval was based. The findings 
of the appropriate Federal banking agency shall be set aside if 
found to be arbitrary or capricious or if found to violate 
procedures established by this subsection.
  (6) Except as otherwise provided by regulation of the 
appropriate Federal banking agency, a notice filed pursuant to 
this subsection shall contain the following information:
          (A) The identity, personal history, business 
        background and experience of each person by whom or on 
        whose behalf the acquisition is to be made, including 
        his material business activities and affiliations 
        during the past five years, and a description of any 
        material pending legal or administrative proceedings in 
        which he is a party and any criminal indictment or 
        conviction of such person by a State or Federal court.
          (B) A statement of the assets and liabilities of each 
        person by whom or on whose behalf the acquisition is to 
        be made, as of the end of the fiscal year for each of 
        five fiscal years immediately preceding the date of the 
        notice, together with related statements of income and 
        source and application of funds for each of the fiscal 
        years then concluded, all prepared in accordance with 
        generally accepted accounting principles consistently 
        applied, and an interim statement of the assets and 
        liabilities for each such person, together with related 
        statements of income and source and application of 
        funds, as of a date not more than ninety days prior to 
        the date of the filing of the notice.
          (C) The terms and conditions of the proposed 
        acquisition and the manner in which the acquisition is 
        to be made.
          (D) The identity, source and amount of the funds or 
        other consideration used or to be used in making the 
        acquisition, and if any part of these funds or other 
        consideration has been or is to be borrowed or 
        otherwise obtained for the purpose of making the 
        acquisition, a description of the transaction, the 
        names of the parties, and any arrangements, agreements, 
        or understandings with such persons.
          (E) Any plans or proposals which any acquiring party 
        making the acquisition may have to liquidate the bank, 
        to sell its assets or merge it with any company or to 
        make any other major change in its business or 
        corporate structure or management.
          (F) The identification of any person employed, 
        retained, or to be compensated by the acquiring party, 
        or by any person on his behalf, to make solicitations 
        or recommendations to stockholders for the purpose of 
        assisting in the acquisition, and a brief description 
        of the terms of such employment, retainer, or 
        arrangement for compensation.
          (G) Copies of all invitations or tenders or 
        advertisements making a tender offer to stockholders 
        for purchase of their stock to be used in connection 
        with the proposed acquisition.
          (H) Any additional relevant information in such form 
        as the appropriate Federal banking agency may require 
        by regulation or by specific request in connection with 
        any particular notice.
  (7) The appropriate Federal banking agency may disapprove any 
proposed acquisition if--
          (A) the proposed acquisition of control would result 
        in a monopoly or would be in furtherance of any 
        combination or conspiracy to monopolize or to attempt 
        to monopolize the business of banking in any part of 
        the United States;
          (B) the effect of the proposed acquisition of control 
        in any section of the country may be substantially to 
        lessen competition or to tend to create a monopoly or 
        the proposed acquisition of control would in any other 
        manner be in restraint of trade, and the 
        anticompetitive effects of the proposed acquisition of 
        control are not clearly outweighed in the public 
        interest by the probable effect of the transaction in 
        meeting the convenience and needs of the community to 
        be served;
          (C) either the financial condition of any acquiring 
        person or the future prospects of the institution is 
        such as might jeopardize the financial stability of the 
        bank or prejudice the interests of the depositors of 
        the bank;
          (D) the competence, experience, or integrity of any 
        acquiring person or of any of the proposed management 
        personnel indicates that it would not be in the 
        interest of the depositors of the bank, or in the 
        interest of the public to permit such person to control 
        the bank;
          (E) any acquiring person neglects, fails, or refuses 
        to furnish the appropriate Federal banking agency all 
        the information required by the appropriate Federal 
        banking agency; or
          (F) the appropriate Federal banking agency determines 
        that the proposed transaction would result in an 
        adverse effect on the Deposit Insurance Fund.
  (8) For the purposes of this subsection, the term--
          (A) ``person'' means an individual or a corporation, 
        partnership, trust, association, joint venture, pool, 
        syndicate, sole proprietorship, unincorporated 
        organization, or any other form of entity not 
        specifically listed herein; and
          (B) ``control'' means the power, directly or 
        indirectly, to direct the management or policies of an 
        insured depository institution or to vote 25 per centum 
        or more of any class of voting securities of an insured 
        depository institution.
          (9) Reporting of stock loans.--
                  (A) Report required.--Any foreign bank, or 
                any affiliate thereof, that has credit 
                outstanding to any person or group of persons 
                which is secured, directly or indirectly, by 
                shares of an insured depository institution 
                shall file a consolidated report with the 
                appropriate Federal banking agency for such 
                insured depository institution if the 
                extensions of credit by the foreign bank or any 
                affiliate thereof, in the aggregate, are 
                secured, directly or indirectly, by 25 percent 
                or more of any class of shares of the same 
                insured depository institution.
                  (B) Definitions.--For purposes of this 
                paragraph, the following definitions shall 
                apply:
                          (i) Foreign bank.--The terms 
                        ``foreign bank'' and ``affiliate'' have 
                        the same meanings as in section 1 of 
                        the International Banking Act of 1978.
                          (ii) Credit outstanding.--The term 
                        ``credit outstanding'' includes--
                                  (I) any loan or extension of 
                                credit,
                                  (II) the issuance of a 
                                guarantee, acceptance, or 
                                letter of credit, including an 
                                endorsement or standby letter 
                                of credit, and
                                  (III) any other type of 
                                transaction that extends credit 
                                or financing to the person or 
                                group of persons.
                          (iii) Group of persons.--The term 
                        ``group of persons'' includes any 
                        number of persons that the foreign bank 
                        or any affiliate thereof reasonably 
                        believes--
                                  (I) are acting together, in 
                                concert, or with one another to 
                                acquire or control shares of 
                                the same insured depository 
                                institution, including an 
                                acquisition of shares of the 
                                same insured depository 
                                institution at approximately 
                                the same time under 
                                substantially the same terms; 
                                or
                                  (II) have made, or propose to 
                                make, a joint filing under 
                                section 13 of the Securities 
                                Exchange Act of 1934 regarding 
                                ownership of the shares of the 
                                same insured depository 
                                institution.
                  (C) Inclusion of shares held by the financial 
                institution.--Any shares of the insured 
                depository institution held by the foreign bank 
                or any affiliate thereof as principal shall be 
                included in the calculation of the number of 
                shares in which the foreign bank or any 
                affiliate thereof has a security interest for 
                purposes of subparagraph (A).
                  (D) Report requirements.--
                          (i) Timing of report.--The report 
                        required under this paragraph shall be 
                        a consolidated report on behalf of the 
                        foreign bank and all affiliates 
                        thereof, and shall be filed in writing 
                        within 30 days of the date on which the 
                        foreign bank or affiliate thereof first 
                        believes that the security for any 
                        outstanding credit consists of 25 
                        percent or more of any class of shares 
                        of an insured depository institution.
                          (ii) Content of report.--The report 
                        under this paragraph shall indicate the 
                        number and percentage of shares 
                        securing each applicable extension of 
                        credit, the identity of the borrower, 
                        and the number of shares held as 
                        principal by the foreign bank and any 
                        affiliate thereof.
                          (iii) Copy to other agencies.--A copy 
                        of any report under this paragraph 
                        shall be filed with the appropriate 
                        Federal banking agency for the foreign 
                        bank or any affiliate thereof (if other 
                        than the agency receiving the report 
                        under this paragraph).
                          (iv) Other information.--Each 
                        appropriate Federal banking agency may 
                        require any additional information 
                        necessary to carry out the agency's 
                        supervisory responsibilities.
                  (E) Exceptions.--
                          (i) Exception where information 
                        provided by borrower.--Notwithstanding 
                        subparagraph (A), a foreign bank or any 
                        affiliate thereof shall not be required 
                        to report a transaction under this 
                        paragraph if the person or group of 
                        persons referred to in such 
                        subparagraph has disclosed the amount 
                        borrowed from such foreign bank or any 
                        affiliate thereof and the security 
                        interest of the foreign bank or any 
                        affiliate thereof to the appropriate 
                        Federal banking agency for the insured 
                        depository institution in connection 
                        with a notice filed under this 
                        subsection, an application filed under 
                        the Bank Holding Company Act of 1956, 
                        section 10 of the Home Owners' Loan 
                        Act, or any other application filed 
                        with the appropriate Federal banking 
                        agency for the insured depository 
                        institution as a substitute for a 
                        notice under this subsection, such as 
                        an application for deposit insurance, 
                        membership in the Federal Reserve 
                        System, or a national bank charter.
                          (ii) Exception for shares owned for 
                        more than 1 year.--Notwithstanding 
                        subparagraph (A), a foreign bank and 
                        any affiliate thereof shall not be 
                        required to report a transaction 
                        involving--
                                  (I) a person or group of 
                                persons that has been the owner 
                                or owners of record of the 
                                stock for a period of 1 year or 
                                more; or
                                  (II) stock issued by a newly 
                                chartered bank before the 
                                bank's opening.
  (10) The reports required by paragraph (9) of this subsection 
shall contain such of the information referred to in paragraph 
(6) of this subsection, and such other relevant information, as 
the appropriate Federal banking agency may require by 
regulation or by specific request in connection with any 
particular report.
  (11) The Federal banking agency receiving a notice or report 
filed pursuant to paragraph (1) or (9) shall immediately 
furnish to the other Federal banking agencies a copy of such 
notice or report.
  (12) Whenever such a change in control occurs, each insured 
depository institution shall report promptly to the appropriate 
Federal banking agency any changes or replacement of its chief 
executive officer or of any director occurring in the next 
twelve-month period, including in its report a statement of the 
past and current business and professional affiliations of the 
new chief executive officer or directors.
  (13) The appropriate Federal banking agencies are authorized 
to issue rules and regulations to carry out this subsection.
  (14) Within two years after the effective date of the Change 
in Bank Control Act of 1978, and each year thereafter in each 
appropriate Federal banking agency's annual report to the 
Congress, the appropriate Federal banking agency shall report 
to the Congress the results of the administration of this 
subsection, and make any recommendations as to changes in the 
law which in the opinion of the appropriate Federal banking 
agency would be desirable.
  (15) Investigative and Enforcement Authority.--
          (A) Investigations.--The appropriate Federal banking 
        agency may exercise any authority vested in such agency 
        under section 8(n) in the course of conducting any 
        investigation under paragraph (2)(B) or any other 
        investigation which the agency, in its discretion, 
        determines is necessary to determine whether any person 
        has filed inaccurate, incomplete, or misleading 
        information under this subsection or otherwise is 
        violating, has violated, or is about to violate any 
        provision of this subsection or any regulation 
        prescribed under this subsection.
          (B) Enforcement.--Whenever it appears to the 
        appropriate Federal banking agency that any person is 
        violating, has violated, or is about to violate any 
        provision of this subsection or any regulation 
        prescribed under this subsection, the agency may, in 
        its discretion, apply to the appropriate district court 
        of the United States or the United States court of any 
        territory for--
                  (i) a temporary or permanent injunction or 
                restraining order enjoining such person from 
                violating this subsection or any regulation 
                prescribed under this subsection; or
                  (ii) such other equitable relief as may be 
                necessary to prevent any such violation 
                (including divestiture).
          (C) Jurisdiction.--
                  (i) The district courts of the United States 
                and the United States courts in any territory 
                shall have the same jurisdiction and power in 
                connection with any exercise of any authority 
                by the appropriate Federal banking agency under 
                subparagraph (A) as such courts have under 
                section 8(n).
                  (ii) The district courts of the United States 
                and the United States courts of any territory 
                shall have jurisdiction and power to issue any 
                injunction or restraining order or grant any 
                equitable relief described in subparagraph (B). 
                When appropriate, any injunction, order, or 
                other equitable relief granted under this 
                paragraph shall be granted without requiring 
                the posting of any bond. The resignation, 
                termination of employment or participation, 
                divestiture of control, or separation of or by 
                an institution-affiliated party (including a 
                separation caused by the closing of a 
                depository institution) shall not affect the 
                jurisdiction and authority of the appropriate 
                Federal banking agency to issue any notice and 
                proceed under this subsection against any such 
                party, if such notice is served before the end 
                of the 6-year period beginning on the date such 
                party ceased to be such a party with respect to 
                such depository institution (whether such date 
                occurs before, on, or after the date of the 
                enactment of this sentence).
          (16) Civil money penalty.--
                  (A) First tier.--Any person who violates any 
                provision of this subsection, or any regulation 
                or order issued by the appropriate Federal 
                banking agency under this subsection, shall 
                forfeit and pay a civil penalty of not more 
                than $5,000 for each day during which such 
                violation continues.
                  (B) Second tier.--Notwithstanding 
                subparagraph (A), any person who--
                          (i)(I) commits any violation 
                        described in any clause of subparagraph 
                        (A);
                          (II) recklessly engages in an unsafe 
                        or unsound practice in conducting the 
                        affairs of a depository institution; or
                          (III) breaches any fiduciary duty;
                          (ii) which violation, practice, or 
                        breach--
                                  (I) is part of a pattern of 
                                misconduct;
                                  (II) causes or is likely to 
                                cause more than a minimal loss 
                                to such institution; or
                                  (III) results in pecuniary 
                                gain or other benefit to such 
                                person,
                shall forfeit and pay a civil penalty of not 
                more than $25,000 for each day during which 
                such violation, practice, or breach continues.
                  (C) Third tier.--Notwithstanding 
                subparagraphs (A) and (B), any person who--
                          (i) knowingly--
                                  (I) commits any violation 
                                described in any clause of 
                                subparagraph (A);
                                  (II) engages in any unsafe or 
                                unsound practice in conducting 
                                the affairs of a depository 
                                institution; or
                                  (III) breaches any fiduciary 
                                duty; and
                          (ii) knowingly or recklessly causes a 
                        substantial loss to such institution or 
                        a substantial pecuniary gain or other 
                        benefit to such person by reason of 
                        such violation, practice, or breach,
                shall forfeit and pay a civil penalty in an 
                amount not to exceed the applicable maximum 
                amount determined under subparagraph (D) for 
                each day during which such violation, practice, 
                or breach continues.
                  (D) Maximum amounts of penalties for any 
                violation described in subparagraph (c).--The 
                maximum daily amount of any civil penalty which 
                may be assessed pursuant to subparagraph (C) 
                for any violation, practice, or breach 
                described in such subparagraph is--
                          (i) in the case of any person other 
                        than a depository institution, an 
                        amount to not exceed [$1,000,000] 
                        $1,500,000; and
                          (ii) in the case of a depository 
                        institution, an amount not to exceed 
                        the lesser of--
                                  (I) [$1,000,000] $1,500,000; 
                                or
                                  (II) 1 percent of the total 
                                assets of such institution.
                  (E) Assessment; etc.--Any penalty imposed 
                under subparagraph (A), (B), or (C) shall be 
                assessed and collected by the appropriate 
                Federal banking agency in the manner provided 
                in subparagraphs (E), (F), (G), and (I) of 
                section 8(i)(2) for penalties imposed (under 
                such section) and any such assessment shall be 
                subject to the provisions of such section.
                  (F) Hearing.--The depository institution or 
                other person against whom any penalty is 
                assessed under this paragraph shall be afforded 
                an agency hearing if such institution or other 
                person submits a request for such hearing 
                within 20 days after the issuance of the notice 
                of assessment. Section 8(h) shall apply to any 
                proceeding under this paragraph.
                  (G) Disbursement.--All penalties collected 
                under authority of this paragraph shall be 
                deposited into the Treasury.
          (17) Exceptions.--This subsection shall not apply 
        with respect to a transaction which is subject to--
                  (A) section 3 of the Bank Holding Company Act 
                of 1956;
                  (B) section 18(c) of this Act; or
                  (C) section 10 of the Home Owners' Loan Act.
          (18) Applicability of change in control provisions to 
        other institutions.--For purposes of this subsection, 
        the term ``insured depository institution'' includes--
                  (A) any depository institution holding 
                company; and
                  (B) any other company which controls an 
                insured depository institution and is not a 
                depository institution holding company.
  (k) The appropriate Federal banking agencies are authorized 
to issue rules and regulations, including definitions of terms, 
to require the reporting and public disclosure of information 
by a bank or any executive officer or prinicipal shareholder 
thereof concerning extensions of credit by the bank to any of 
its executive officers or principal shareholders, or the 
related interests of such persons.
  (l) Designation of Fund Membership for Newly Insured 
Depository Institutions; Definitions.--For purposes of this 
section:
          (1) Bank insurance fund.--Any institution which--
                  (A) becomes an insured depository 
                institution; and
                  (B) does not become a Savings Association 
                Insurance Fund member pursuant to paragraph 
                (2),
        shall be a Bank Insurance Fund member.
          (2) Savings association insurance fund.--Any savings 
        association, other than any Federal savings bank 
        chartered pursuant to section 5(o) of the Home Owners' 
        Loan Act, which becomes an insured depository 
        institution shall be a Savings Association Insurance 
        Fund member.
          (3) Transition provision.--
                  (A) Bank insurance fund.--Any depository 
                institution the deposits of which were insured 
                by the Federal Deposit Insurance Corporation on 
                the day before the date of the enactment of the 
                Financial Institutions Reform, Recovery, and 
                Enforcement Act of 1989, including--
                          (i) any Federal savings bank 
                        chartered pursuant to section 5(o) of 
                        the Home Owners' Loan Act; and
                          (ii) any cooperative bank,
                shall be a Bank Insurance Fund member as of 
                such date of enactment.
                  (B) Savings association insurance fund.--Any 
                savings association which is an insured 
                depository institution by operation of section 
                4(a)(2) shall be a Savings Association 
                Insurance Fund member as of the date of the 
                enactment of the Financial Institutions Reform, 
                Recovery, and Enforcement Act of 1989.
          (4) Bank insurance fund member.--The term ``Bank 
        Insurance Fund member'' means any depository 
        institution the deposits of which are insured by the 
        Bank Insurance Fund.
          (5) Savings association insurance fund member.--The 
        term ``Savings Association Insurance Fund member'' 
        means any depository institution the deposits of which 
        are insured by the Savings Association Insurance Fund.
          (6) Bank insurance fund reserve ratio.--The term 
        ``Bank Insurance Fund reserve ratio'' means the ratio 
        of the net worth of the Bank Insurance Fund to the 
        value of the aggregate estimated insured deposits held 
        in all Bank Insurance Fund members.
          (7) Savings association insurance fund reserve 
        ratio.--The term ``Savings Association Insurance Fund 
        reserve ratio'' means the ratio of the net worth of the 
        Savings Association Insurance Fund to the value of the 
        aggregate estimated insured deposits held in all 
        Savings Association Insurance Fund members.
  (m) Secondary Reserve Offsets Against Premiums.--
          (1) Offsets in calendar years beginning before 
        1993.--Subject to the maximum amount limitation 
        contained in paragraph (2) and notwithstanding any 
        other provision of law, any insured savings association 
        may offset such association's pro rata share of the 
        statutorily prescribed amount against any premium 
        assessed against such association under subsection (b) 
        of this section for any calendar year beginning before 
        1993.
          (2) Annual maximum amount limitation.--The amount of 
        any offset allowed for any savings association under 
        paragraph (1) for any calendar year beginning before 
        1993 shall not exceed an amount which is equal to 20 
        percent of such association's pro rata share of the 
        statutorily prescribed amount (as computed for such 
        calendar year).
          (3) Offsets in calendar years beginning after 1992.--
        Notwithstanding any other provision of law, a savings 
        association may offset such association's pro rata 
        share of the statutorily prescribed amount against any 
        premium assessed against such association under 
        subsection (b) for any calendar year beginning after 
        1992.
          (4) Transferability.--No right, title, or interest of 
        any insured depository institution in or with respect 
        to its pro rata share of the secondary reserve shall be 
        assignable or transferable whether by operation of law 
        or otherwise, except to the extent that the Corporation 
        may provide for transfer of such pro rata share in 
        cases of merger or consolidation, transfer of bulk 
        assets or assumption of liabilities, and similar 
        transactions, as defined by the Corporation for 
        purposes of this paragraph.
          (5) Pro rata distribution on termination of insured 
        status.--If--
                  (A) the status of any savings association as 
                an insured depository institution is terminated 
                pursuant to any provision of section 8 or the 
                insurance of accounts of any such institution 
                is otherwise terminated;
                  (B) a receiver or other legal custodian is 
                appointed for the purpose of liquidation or 
                winding up the affairs of any savings 
                association; or
                  (C) the Corporation makes a determination 
                that for the purposes of this subsection any 
                savings association has otherwise gone into 
                liquidation,
        the Corporation shall pay in cash to such institution 
        its pro rata share of the secondary reserve, in 
        accordance with such terms and conditions as the 
        Corporation may prescribe, or, at the option of the 
        Corporation, the Corporation may apply the whole or any 
        part of the amount which would otherwise be paid in 
        cash toward the payment of any indebtedness or 
        obligation, whether matured or not, of such institution 
        to the Corporation, existing or arising before such 
        payment in cash. Such payment or such application need 
        not be made to the extent that the provisions of the 
        exception in paragraph (4) are applicable.
          (6) Statutorily prescribed amount defined.--For 
        purposes of this subsection, the term ``statutorily 
        prescribed amount'' means, with respect to any calendar 
        year which ends after the date of the enactment of the 
        Financial Institutions Reform, Recovery, and 
        Enforcement Act of 1989--
                  (A) $823,705,000, minus
                  (B) the sum of--
                          (i) the aggregate amount of offsets 
                        made before such date of enactment by 
                        all insured institutions under section 
                        404(e)(2) of the National Housing Act 
                        (as in effect before such date of 
                        enactment); and
                          (ii) the aggregate amount of offsets 
                        made by all savings associations under 
                        this subsection before the beginning of 
                        such calendar year.
          (7) Savings association's pro rata amount.--For 
        purposes of this subsection, any savings association's 
        pro rata share of the statutorily prescribed amount is 
        the percentage which is equal to such association's 
        share of the secondary reserve as determined under 
        section 404(e) of the National Housing Act on the day 
        before the date on which the Federal Savings and Loan 
        Insurance Corporation ceased to recognize the secondary 
        reserve (as such Act was in effect on the day before 
        such date).
          (8) Year of enactment rule.--With respect to the 
        calendar year in which the Financial Institutions 
        Reform, Recovery, and Enforcement Act of 1989 is 
        enacted, the Corporation shall make such adjustments as 
        may be necessary--
                  (A) in the computation of the statutorily 
                prescribed amount which shall be applicable for 
                the remainder of such calendar year after 
                taking into account the aggregate amount of 
                offsets by all insured institutions under 
                section 404(e)(2) of the National Housing Act 
                (as in effect before the date of the enactment 
                of the Financial Institutions Reform, Recovery, 
                and Enforcement Act of 1989) after the 
                beginning of such calendar year and before such 
                date of enactment; and
                  (B) in the computation of the maximum amount 
                of any savings association's offset for such 
                calendar year under paragraph (1) after taking 
                into account--
                          (i) the amount of any offset by such 
                        savings association under section 
                        404(e)(2) of the National Housing Act 
                        (as in effect before such date of 
                        enactment) after the beginning of such 
                        calendar year and before such date of 
                        enactment; and
                          (ii) the change of such association's 
                        premium year from the 1-year period 
                        applicable under section 404(b) of the 
                        National Housing Act (as in effect 
                        before such date of enactment) to a 
                        calendar year basis.
  (n) Collections on Behalf of the Comptroller of the 
Currency.--When requested by the Comptroller of the Currency, 
the Corporation shall collect on behalf of the Comptroller 
assessments on Federal savings associations levied by the 
Comptroller under section 9 of the Home Owners' Loan Act. The 
Corporation shall be reimbursed for its actual costs for the 
collection of such assessments. Any such assessments by the 
Comptroller shall be in addition to any amounts assessed by the 
Corporation.
  Sec. 8. (a) Termination of Insurance.--
          (1) Voluntary termination.--Any insured depository 
        institution which is not--
                  (A) a national member bank;
                  (B) a State member bank;
                  (C) a Federal branch;
                  (D) a Federal savings association; or
                  (E) an insured branch which is required to be 
                insured under subsection (a) or (b) of section 
                6 of the International Banking Act of 1978,
        may terminate such depository institution's status as 
        an insured depository institution if such insured 
        institution provides written notice to the Corporation 
        of the institution's intent to terminate such status 
        not less than 90 days before the effective date of such 
        termination.
          (2) Involuntary termination.--
                  (A) Notice to primary regulator.--If the 
                Board of Directors determines that--
                          (i) an insured depository institution 
                        or the directors or trustees of an 
                        insured depository institution have 
                        engaged or are engaging in unsafe or 
                        unsound practices in conducting the 
                        business of the depository institution;
                          (ii) an insured depository 
                        institution is in an unsafe or unsound 
                        condition to continue operations as an 
                        insured institution; or
                          (iii) an insured depository 
                        institution or the directors or 
                        trustees of the insured institution 
                        have violated any applicable law, 
                        regulation, order, condition imposed in 
                        writing by the Corporation in 
                        connection with the approval of any 
                        application or other request by the 
                        insured depository institution, or 
                        written agreement entered into between 
                        the insured depository institution and 
                        the Corporation,
                the Board of Directors shall notify the 
                appropriate Federal banking agency with respect 
                to such institution (if other than the 
                Corporation) or the State banking supervisor of 
                such institution (if the Corporation is the 
                appropriate Federal banking agency) of the 
                Board's determination and the facts and 
                circumstances on which such determination is 
                based for the purpose of securing the 
                correction of such practice, condition, or 
                violation. Such notice shall be given to the 
                appropriate Federal banking agency not less 
                than 30 days before the notice required by 
                subparagraph (B), except that this period for 
                notice to the appropriate Federal banking 
                agency may be reduced or eliminated with the 
                agreement of such agency.
                  (B) Notice of intention to terminate 
                insurance.--If, after giving the notice 
                required under subparagraph (A) with respect to 
                an insured depository institution, the Board of 
                Directors determines that any unsafe or unsound 
                practice or condition or any violation 
                specified in such notice requires the 
                termination of the insured status of the 
                insured depository institution, the Board 
                shall--
                          (i) serve written notice to the 
                        insured depository institution of the 
                        Board's intention to terminate the 
                        insured status of the institution;
                          (ii) provide the insured depository 
                        institution with a statement of the 
                        charges on the basis of which the 
                        determination to terminate such 
                        institution's insured status was made 
                        (or a copy of the notice under 
                        subparagraph (A)); and
                          (iii) notify the insured depository 
                        institution of the date (not less than 
                        30 days after notice under this 
                        subparagraph) and place for a hearing 
                        before the Board of Directors (or any 
                        person designated by the Board) with 
                        respect to the termination of the 
                        institution's insured status.
          (3) Hearing; termination.--If, on the basis of the 
        evidence presented at a hearing before the Board of 
        Directors (or any person designated by the Board for 
        such purpose), in which all issues shall be determined 
        on the record pursuant to section 554 of title 5, 
        United States Code, and the written findings of the 
        Board of Directors (or such person) with respect to 
        such evidence (which shall be conclusive), the Board of 
        Directors finds that any unsafe or unsound practice or 
        condition or any violation specified in the notice to 
        an insured depository institution under paragraph 
        (2)(B) or subsection (w) has been established, the 
        Board of Directors may issue an order terminating the 
        insured status of such depository institution effective 
        as of a date subsequent to such finding.
          (4) Appearance; consent to termination.--Unless the 
        depository institution shall appear at the hearing by a 
        duly authorized representative, it shall be deemed to 
        have consented to the termination of its status as an 
        insured depository institution and termination of such 
        status thereupon may be ordered.
          (5) Judicial review.--Any insured depository 
        institution whose insured status has been terminated by 
        order of the Board of Directors under this subsection 
        shall have the right of judicial review of such order 
        only to the same extent as provided for the review of 
        orders under subsection (h) of this section.
          (6) Publication of notice of termination.--The 
        Corporation may publish notice of such termination and 
        the depository institution shall give notice of such 
        termination to each of its depositors at his last 
        address of record on the books of the depository 
        institution, in such manner and at such time as the 
        Board of Directors may find to be necessary and may 
        order for the protection of depositors.
          (7) Temporary insurance of deposits insured as of 
        termination.--After the termination of the insured 
        status of any depository institution under the 
        provisions of this subsection, the insured deposits of 
        each depositor in the depository institution on the 
        date of such termination, less all subsequent 
        withdrawals from any deposits of such depositor, shall 
        continue for a period of at least 6 months or up to 2 
        years, within the discretion of the Board of Directors, 
        to be insured, and the depository institution shall 
        continue to pay to the Corporation assessments as in 
        the case of an insured depository institution during 
        such period. No additions to any such deposits and no 
        new deposits in such depository institution made after 
        the date of such termination shall be insured by the 
        Corporation, and the depository institution shall not 
        advertise or hold itself out as having insured deposits 
        unless in the same connection it shall also state with 
        equal prominence that such additions to deposits and 
        new deposits made after such date are not so insured. 
        Such depository institution shall, in all other 
        respects, be subject to the duties and obligations of 
        an insured depository institution for the period 
        referred to in the 1st sentence from the date of such 
        termination, and in the event that such depository 
        institution shall be closed on account of inability to 
        meet the demands of its depositors within such period, 
        the Corporation shall have the same powers and rights 
        with respect to such depository institution as in case 
        of an insured depository institution.
          (8) Temporary suspension of insurance.--
                  (A) In general.--If the Board of Directors 
                initiates a termination proceeding under 
                paragraph (2), and the Board of Directors, 
                after consultation with the appropriate Federal 
                banking agency, finds that an insured 
                depository institution (other than a savings 
                association to which subparagraph (B) applies) 
                has no tangible capital under the capital 
                guidelines or regulations of the appropriate 
                Federal banking agency, the Corporation may 
                issue a temporary order suspending deposit 
                insurance on all deposits received by the 
                institution.
                  (B) Special rule for certain savings 
                institutions.--
                          (i) Certain goodwill included in 
                        tangible capital.--In determining the 
                        tangible capital of a savings 
                        association for purposes of this 
                        paragraph, the Board of Directors shall 
                        include goodwill to the extent it is 
                        considered a component of capital under 
                        section 5(t) of the Home Owners' Loan 
                        Act. Any savings association which 
                        would be subject to a suspension order 
                        under subparagraph (A) but for the 
                        operation of this subparagraph, shall 
                        be considered by the Corporation to be 
                        a ``special supervisory association''.
                          (ii) Suspension order.--The 
                        Corporation may issue a temporary order 
                        suspending deposit insurance on all 
                        deposits received by a special 
                        supervisory association whenever the 
                        Board of Directors determines that--
                                  (I) the capital of such 
                                association, as computed 
                                utilizing applicable accounting 
                                standards, has suffered a 
                                material decline;
                                  (II) that such association 
                                (or its directors or officers) 
                                is engaging in an unsafe or 
                                unsound practice in conducting 
                                the business of the 
                                association;
                                  (III) that such association 
                                is in an unsafe or unsound 
                                condition to continue operating 
                                as an insured association; or
                                  (IV) that such association 
                                (or its directors or officers) 
                                has violated any applicable 
                                law, rule, regulation, or 
                                order, or any condition imposed 
                                in writing by a Federal banking 
                                agency, or any written 
                                agreement including a capital 
                                improvement plan entered into 
                                with any Federal banking 
                                agency, or that the association 
                                has failed to enter into a 
                                capital improvement plan which 
                                is acceptable to the 
                                Corporation within the time 
                                period set forth in section 
                                5(t) of the Home Owners' Loan 
                                Act.
                        Nothing in this paragraph limits the 
                        right of the Corporation or the 
                        Comptroller of the Currency to enforce 
                        a contractual provision which 
                        authorizes the Corporation or the 
                        Comptroller of the Currency, as a 
                        successor to the Federal Savings and 
                        Loan Insurance Corporation or the 
                        Federal Home Loan Bank Board, to 
                        require a savings association to write 
                        down or amortize goodwill at a faster 
                        rate than otherwise required under this 
                        Act or under applicable accounting 
                        standards.
                  (C) Effective period of temporary order.--Any 
                order issued under subparagraph (A) shall 
                become effective not earlier than 10 days from 
                the date of service upon the institution and, 
                unless set aside, limited, or suspended by a 
                court in proceedings authorized hereunder, such 
                temporary order shall remain effective and 
                enforceable until an order of the Board under 
                paragraph (3) becomes final or until the 
                Corporation dismisses the proceedings under 
                paragraph (3).
                  (D) Judicial review.--Before the close of the 
                10-day period beginning on the date any 
                temporary order has been served upon an insured 
                depository institution under subparagraph (A), 
                such institution may apply to the United States 
                District Court for the District of Columbia, or 
                the United States district court for the 
                judicial district in which the home office of 
                the institution is located, for an injunction 
                setting aside, limiting, or suspending the 
                enforcement, operation, or effectiveness of 
                such order, and such court shall have 
                jurisdiction to issue such injunction.
                  (E) Continuation of insurance for prior 
                deposits.--The insured deposits of each 
                depositor in such depository institution on the 
                effective date of the order issued under this 
                paragraph, minus all subsequent withdrawals 
                from any deposits of such depositor, shall 
                continue to be insured, subject to the 
                administrative proceedings as provided in this 
                Act.
                  (F) Publication of order.--The depository 
                institution shall give notice of such order to 
                each of its depositors in such manner and at 
                such times as the Board of Directors may find 
                to be necessary and may order for the 
                protection of depositors.
                  (G) Notice by corporation.--If the 
                Corporation determines that the depository 
                institution has not substantially complied with 
                the notice to depositors required by the Board 
                of Directors, the Corporation may provide such 
                notice in such manner as the Board of Directors 
                may find to be necessary and appropriate.
                  (H) Lack of notice.--Notwithstanding 
                subparagraph (A), any deposit made after the 
                effective date of a suspension order issued 
                under this paragraph shall remain insured to 
                the extent that the depositor establishes 
                that--
                          (i) such deposit consists of 
                        additions made by automatic deposit the 
                        depositor was unable to prevent; or
                          (ii) such depositor did not have 
                        actual knowledge of the suspension of 
                        insurance.
          (9) Final decisions to terminate insurance.--Any 
        decision by the Board of Directors to--
                  (A) issue a temporary order terminating 
                deposit insurance; or
                  (B) issue a final order terminating deposit 
                insurance (other than under subsection (p) or 
                (q));
        shall be made by the Board of Directors and may not be 
        delegated.
          (10) Low- to moderate-income housing lender.--In 
        making any determination regarding the termination of 
        insurance of a solvent savings association, the 
        Corporation may consider the extent of the 
        association's low- to moderate-income housing loans.
  (b)(1) If, in the opinion of the appropriate Federal banking 
agency, any insured depository institution, depository 
institution which has insured deposits, or any institution-
affiliated party is engaging or has engaged, or the agency has 
reasonable cause to believe that the depository institution or 
any institution-affiliated party is about to engage, in an 
unsafe or unsound practice in conducting the business of such 
depository institution, or is violating or has violated, or the 
agency has reasonable cause to believe that the depository 
institution or any institution-affiliated party is about to 
violate, a law, rule, or regulation, or any condition imposed 
in writing by a Federal banking agency in connection with any 
action on any application, notice, or other request by the 
depository institution or institution-affiliated party, or any 
written agreement entered into with the agency, the appropriate 
Federal banking agency for the depository institution may issue 
and serve upon the depository institution or such party a 
notice of charges in respect thereof. The notice shall contain 
a statement of the facts constituting the alleged violation or 
violations or the unsafe or unsound practice or practices, and 
shall fix a time and place at which a hearing will be held to 
determine whether an order to cease and desist therefrom should 
issue against the depository institution or the institution-
affiliated party. Such hearing shall be fixed for a date not 
earlier than thirty days nor later than sixty days after 
service of such notice unless an earlier or a later date is set 
by the agency at the request of any party so served. Unless the 
party or parties so served shall appear at the hearing 
personally or by a duly authorized representative, they shall 
be deemed to have consented to the issuance of the cease-and-
desist order. In the event of such consent, or if upon the 
record made at any such hearing, the agency shall find that any 
violation or unsafe or unsound practice specified in the notice 
of charges has been established, the agency may issue and serve 
upon the depository institution or the institution-affiliated 
party an order to cease and desist from any such violation or 
practice. Such order may, by provisions which may be mandatory 
or otherwise, require the depository institution or its 
institution-affiliated parties to cease and desist from the 
same, and, further, to take affirmative action to correct the 
conditions resulting from any such violation or practice.
  (2) A cease-and-desist order shall become effective at the 
expiration of thirty days after the service of such order upon 
the depository institution or other person concerned (except in 
the case of a cease-and-desist order issued upon consent, which 
shall become effective at the time specified therein), and 
shall remain effective and enforceable as provided therein, 
except to such extent as it is stayed, modified, terminated, or 
set aside by action of the agency or a reviewing court.
  (3) This subsection, subsections (c) through (s) and 
subsection (u) of this section, and section 50 of this Act 
shall apply to any bank holding company, and to any 
``subsidiary'' (other than a bank) of a bank holding company, 
as those terms are defined in the Bank Holding Company Act of 
1956, any savings and loan holding company and any subsidiary 
(other than a depository institution) of a savings and loan 
holding company (as such terms are defined in section 10 of 
Home Owners' Loan [Act))] Act), any noninsured State member 
bank and to any organization organized and operated under 
section 25(a) of the Federal Reserve Act or operating under 
section 25 of the Federal Reserve Act, in the same manner as 
they apply to a State member insured bank. Nothing in this 
subsection or in subsection (c) of this section shall authorize 
any Federal banking agency, other than the Board of Governors 
of the Federal Reserve System, to issue a notice of charges or 
cease-and-desist order against a bank holding company or any 
subsidiary thereof (other than a bank or subsidiary of that 
bank) or against a savings and loan holding company or any 
subsidiary thereof (other than a depository institution or a 
subsidiary of such depository institution).
  (4) This subsection, subsections (c) through (s) and 
subsection (u) of this section, and section 50 of this Act 
shall apply to any foreign bank or company to which subsection 
(a) of section 8 of the International Banking Act of 1978 
applies and to any subsidiary (other than a bank) of any such 
foreign bank or company in the same manner as they apply to a 
bank holding company and any subsidiary thereof (other than a 
bank) under paragraph (3) of this subsection. For the purposes 
of this paragraph, the term ``subsidiary'' shall have the 
meaning assigned to it in section 2 of the Bank Holding Company 
Act of 1956.
  (5) This section shall apply, in the same manner as it 
applies to any insured depository institution for which the 
appropriate Federal banking agency is the Comptroller of the 
Currency, to any national banking association chartered by the 
Comptroller of the Currency, including an uninsured 
association.
          (6) Affirmative action to correct conditions 
        resulting from violations or practices.--The authority 
        to issue an order under this subsection and subsection 
        (c) which requires an insured depository institution or 
        any institution-affiliated party to take affirmative 
        action to correct or remedy any conditions resulting 
        from any violation or practice with respect to which 
        such order is issued includes the authority to require 
        such depository institution or such party to--
                  (A) make restitution or provide 
                reimbursement, indemnification, or guarantee 
                against loss if--
                          (i) such depository institution or 
                        such party was unjustly enriched in 
                        connection with such violation or 
                        practice; or
                          (ii) the violation or practice 
                        involved a reckless disregard for the 
                        law or any applicable regulations or 
                        prior order of the appropriate Federal 
                        banking agency;
                  (B) restrict the growth of the institution;
                  (C) dispose of any loan or asset involved;
                  (D) rescind agreements or contracts; and
                  (E) employ qualified officers or employees 
                (who may be subject to approval by the 
                appropriate Federal banking agency at the 
                direction of such agency); and
                  (F) take such other action as the banking 
                agency determines to be appropriate.
          (7) Authority to limit activities.--The authority to 
        issue an order under this subsection or subsection (c) 
        includes the authority to place limitations on the 
        activities or functions of an insured depository 
        institution or any institution-affiliated party.
          (8) Unsatisfactory asset quality, management, 
        earnings, or liquidity as unsafe or unsound practice.--
        If an insured depository institution receives, in its 
        most recent report of examination, a less-than-
        satisfactory rating for asset quality, management, 
        earnings, or liquidity, the appropriate Federal banking 
        agency may (if the deficiency is not corrected) deem 
        the institution to be engaging in an unsafe or unsound 
        practice for purposes of this subsection.
          (9)
          (10) Standard for certain orders.--No authority under 
        this subsection or subsection (c) to prohibit any 
        institution-affiliated party from withdrawing, 
        transferring, removing, dissipating, or disposing of 
        any funds, assets, or other property may be exercised 
        unless the appropriate Federal banking agency meets the 
        standards of Rule 65 of the Federal Rules of Civil 
        Procedure, without regard to the requirement of such 
        rule that the applicant show that the injury, loss, or 
        damage is irreparable and immediate.
  (c)(1) Whenever the appropriate Federal banking agency shall 
determine that the violation or threatened violation or the 
unsafe or unsound practice or practices, specified in the 
notice of charges served upon the depository institution or any 
institution-affiliated party pursuant to paragraph (1) of 
subsection (b) of this section, or the continuation thereof, is 
likely to cause insolvency or significant dissipation of assets 
or earnings of the depository institution, or is likely to 
weaken the condition of the depository institution or otherwise 
prejudice the interests of its depositors prior to the 
completion of the proceedings conducted pursuant to paragraph 
(1) of subsection (b) of this section, the agency may issue a 
temporary order requiring the depository institution or such 
party to cease and desist from any such violation or practice 
and to take affirmative action to prevent or remedy such 
insolvency, dissipation, condition, or prejudice pending 
completion of such proceedings. Such order may include any 
requirement authorized under subsection (b)(6). Such order 
shall become effective upon service upon the depository 
institution or such party participating in the conduct of the 
affairs of such depository institution and, unless set aside, 
limited, or suspended by a court in proceedings authorized by 
paragraph (2) of this subsection, shall remain effective and 
enforceable pending the completion of the administrative 
proceedings pursuant to such notice and until such time as the 
agency shall dismiss the charges specified in such notice, or 
if a cease-and-desist order is issued against the depository 
institution or such party, until the effective date of such 
order.
  (2) Within ten days after the depository institution 
concerned or any institution-affiliated party has been served 
with a temporary cease-and-desist order, the depository 
institution or such party may apply to the United States 
district court for the judicial district in which the home 
office of the depository institution is located, or the United 
States District Court for the District of Columbia, for an 
injunction setting aside, limiting, or suspending the 
enforcement, operation, or effectiveness of such order pending 
the completion of the administrative proceedings pursuant to 
the notice of charges served upon the depository institution or 
such party under paragraph (1) of subsection (b) of this 
section, and such court shall have jurisdiction to issue such 
injunction.
          (3) Incomplete or inaccurate records.--
                  (A) Temporary order.--If a notice of charges 
                served under subsection (b)(1) specifies, on 
                the basis of particular facts and 
                circumstances, that an insured depository 
                institution's books and records are so 
                incomplete or inaccurate that the appropriate 
                Federal banking agency is unable, through the 
                normal supervisory process, to determine the 
                financial condition of that depository 
                institution or the details or purpose of any 
                transaction or transactions that may have a 
                material effect on the financial condition of 
                that depository institution, the agency may 
                issue a temporary order requiring--
                          (i) the cessation of any activity or 
                        practice which gave rise, whether in 
                        whole or in part, to the incomplete or 
                        inaccurate state of the books or 
                        records; or
                          (ii) affirmative action to restore 
                        such books or records to a complete and 
                        accurate state, until the completion of 
                        the proceedings under subsection 
                        (b)(1).
                  (B) Effective period.--Any temporary order 
                issued under subparagraph (A)--
                          (i) shall become effective upon 
                        service; and
                          (ii) unless set aside, limited, or 
                        suspended by a court in proceedings 
                        under paragraph (2), shall remain in 
                        effect and enforceable until the 
                        earlier of--
                                  (I) the completion of the 
                                proceeding initiated under 
                                subsection (b)(1) in connection 
                                with the notice of charges; or
                                  (II) the date the appropriate 
                                Federal banking agency 
                                determines, by examination or 
                                otherwise, that the insured 
                                depository institution's books 
                                and records are accurate and 
                                reflect the financial condition 
                                of the depository institution.
          (4) False advertising or misuse of names to indicate 
        insured status.--
                  (A) Temporary order.--
                          (i) In general.--If a notice of 
                        charges served under subsection (b)(1) 
                        specifies on the basis of particular 
                        facts that any person engaged or is 
                        engaging in conduct described in 
                        section 18(a)(4), the Corporation or 
                        other appropriate Federal banking 
                        agency may issue a temporary order 
                        requiring--
                                  (I) the immediate cessation 
                                of any activity or practice 
                                described, which gave rise to 
                                the notice of charges; and
                                  (II) affirmative action to 
                                prevent any further, or to 
                                remedy any existing, violation.
                          (ii) Effect of order.--Any temporary 
                        order issued under this subparagraph 
                        shall take effect upon service.
                  (B) Effective period of temporary order.--A 
                temporary order issued under subparagraph (A) 
                shall remain effective and enforceable, pending 
                the completion of an administrative proceeding 
                pursuant to subsection (b)(1) in connection 
                with the notice of charges--
                          (i) until such time as the 
                        Corporation or other appropriate 
                        Federal banking agency dismisses the 
                        charges specified in such notice; or
                          (ii) if a cease-and-desist order is 
                        issued against such person, until the 
                        effective date of such order.
                  (C) Civil money penalties.--Any violation of 
                section 18(a)(4) shall be subject to civil 
                money penalties, as set forth in subsection 
                (i), except that for any person other than an 
                insured depository institution or an 
                institution-affiliated party that is found to 
                have violated this paragraph, the Corporation 
                or other appropriate Federal banking agency 
                shall not be required to demonstrate any loss 
                to an insured depository institution.
  (d) In the case of violation or threatened violation of, or 
failure to obey, a temporary cease-and-desist order issued 
pursuant to paragraph (1) of subsection (c) of the section, the 
appropriate Federal banking agency may apply to the United 
States district court, or the United States court of any 
territory, within the jurisdiction of which the home office of 
the depository institution is located, for an injunction to 
enforce such order, and, if the court shall determine that 
there has been such violation or threatened violation or 
failure to obey, it shall be the duty of the court to issue 
such injunction.
  (e) Removal and Prohibition Authority.--
          (1) Authority to issue order.--Whenever the 
        appropriate Federal banking agency determines that--
                  (A) any institution-affiliated party has, 
                directly or indirectly--
                          (i) violated--
                                  (I) any law or regulation;
                                  (II) any cease-and-desist 
                                order which has become final;
                                  (III) any condition imposed 
                                in writing by a Federal banking 
                                agency in connection with any 
                                action on any application, 
                                notice, or request by such 
                                depository institution or 
                                institution-affiliated party; 
                                or
                                  (IV) any written agreement 
                                between such depository 
                                institution and such agency;
                          (ii) engaged or participated in any 
                        unsafe or unsound practice in 
                        connection with any insured depository 
                        institution or business institution; or
                          (iii) committed or engaged in any 
                        act, omission, or practice which 
                        constitutes a breach of such party's 
                        fiduciary duty;
                  (B) by reason of the violation, practice, or 
                breach described in any clause of subparagraph 
                (A)--
                          (i) such insured depository 
                        institution or business institution has 
                        suffered or will probably suffer 
                        financial loss or other damage;
                          (ii) the interests of the insured 
                        depository institution's depositors 
                        have been or could be prejudiced; or
                          (iii) such party has received 
                        financial gain or other benefit by 
                        reason of such violation, practice, or 
                        breach; and
                  (C) such violation, practice, or breach--
                          (i) involves personal dishonesty on 
                        the part of such party; or
                          (ii) demonstrates willful or 
                        continuing disregard by such party for 
                        the safety or soundness of such insured 
                        depository institution or business 
                        institution,
        the appropriate Federal banking agency for the 
        depository institution may serve upon such party a 
        written notice of the agency's intention to remove such 
        party from office or to prohibit any further 
        participation by such party, in any manner, in the 
        conduct of the affairs of any insured depository 
        institution.
          (2) Specific violations.--
                  (A) In general.--Whenever the appropriate 
                Federal banking agency determines that--
                          (i) an institution-affiliated party 
                        has committed a violation of any 
                        provision of subchapter II of chapter 
                        53 of title 31, United States Code, and 
                        such violation was not inadvertent or 
                        unintentional;
                          (ii) an officer or director of an 
                        insured depository institution has 
                        knowledge that an institution-
                        affiliated party of the insured 
                        depository institution has violated any 
                        such provision or any provision of law 
                        referred to in subsection 
                        (g)(1)(A)(ii);
                          (iii) an officer or director of an 
                        insured depository institution has 
                        committed any violation of the 
                        Depository Institution Management 
                        Interlocks Act; or
                          (iv) an institution-affiliated party 
                        of a subsidiary (other than a bank) of 
                        a bank holding company or of a 
                        subsidiary (other than a savings 
                        association) of a savings and loan 
                        holding company has been convicted of 
                        any criminal offense involving 
                        dishonesty or a breach of trust or a 
                        criminal offense under section 1956, 
                        1957, or 1960 of title 18, United 
                        States Code, or has agreed to enter 
                        into a pretrial diversion or similar 
                        program in connection with a 
                        prosecution for such an offense,
                the agency may serve upon such party, officer, 
                or director a written notice of the agency's 
                intention to remove such party from office.
                  (B) Factors to be considered.--In determining 
                whether an officer or director should be 
                removed as a result of the application of 
                subparagraph (A)(ii), the agency shall consider 
                whether the officer or director took 
                appropriate action to stop, or to prevent the 
                recurrence of, a violation described in such 
                subparagraph.
          (3) Suspension order.--
                  (A) Suspension or prohibition authorized.--If 
                the appropriate Federal banking agency serves 
                written notice under paragraph (1) or (2) to 
                any institution-affiliated party of such 
                agency's intention to issue an order under such 
                paragraph, the appropriate Federal banking 
                agency may suspend such party from office or 
                prohibit such party from further participation 
                in any manner in the conduct of the affairs of 
                the depository institution, if the agency--
                          (i) determines that such action is 
                        necessary for the protection of the 
                        depository institution or the interests 
                        of the depository institution's 
                        depositors; and
                          (ii) serves such party with written 
                        notice of the suspension order.
                  (B) Effective period.--Any suspension order 
                issued under subparagraph (A)--
                          (i) shall become effective upon 
                        service; and
                          (ii) unless a court issues a stay of 
                        such order under subsection (f), shall 
                        remain in effect and enforceable 
                        until--
                                  (I) the date the appropriate 
                                Federal banking agency 
                                dismisses the charges contained 
                                in the notice served under 
                                paragraph (1) or (2) with 
                                respect to such party; or
                                  (II) the effective date of an 
                                order issued by the agency to 
                                such party under paragraph (1) 
                                or (2).
                  (C) Copy of order.--If an appropriate Federal 
                banking agency issues a suspension order under 
                subparagraph (A) to any institution-affiliated 
                party, the agency shall serve a copy of such 
                order on any insured depository institution 
                with which such party is associated at the time 
                such order is issued.
  (4) A notice of intention to remove an institution-affiliated 
party from office or to prohibit such party from participating 
in the conduct of the affairs of an insured depository 
institution, shall contain a statement of the facts 
constituting grounds therefor, and shall fix a time and place 
at which a hearing will be held thereon. Such hearing shall be 
fixed for a date not earlier than thirty days nor later than 
sixty days after the date of service of such notice, unless an 
earlier or a later date is set by the agency at the request of 
(A) such party, and for good cause shown, or (B) the Attorney 
General of the United States. Unless such party shall appear at 
the hearing in person or by a duly authorized representative, 
such party shall be deemed to have consented to the issuance of 
an order of such removal or prohibition. In the event of such 
consent, or if upon the record made at any such hearing the 
agency shall find that any of the grounds specified in such 
notice have been established, the agency may issue such orders 
of suspension or removal from office, or prohibition from 
participation in the conduct of the affairs of the depository 
institution, as it may deem appropriate. Any such order shall 
become effective at the expiration of thirty days after service 
upon such depository institution and such party (except in the 
case of an order issued upon consent, which shall become 
effective at the time specified therein). Such order shall 
remain effective and enforceable except to such extent as it is 
stayed, modified, terminated, or set aside by action of the 
agency or a reviewing court.
  (5) For the purpose of enforcing any law, rule, regulation, 
or cease-and-desist order in connection with an interlocking 
relationship, the term ``officer'' within the term 
``institution-affiliated party'' as used in this subsection 
means an employee or officer with management functions, and the 
term ``director'' within the term ``institution-affiliated 
party'' as used in this subsection includes an advisory or 
honorary director, a trustee of a depository institution under 
the control of trustees, or any person who has a representative 
or nominee serving in any such capacity.
          (6) Prohibition of certain specific activities.--Any 
        person subject to an order issued under this subsection 
        shall not--
                  (A) participate in any manner in the conduct 
                of the affairs of any institution or agency 
                specified in paragraph (7)(A);
                  (B) solicit, procure, transfer, attempt to 
                transfer, vote, or attempt to vote any proxy, 
                consent, or authorization with respect to any 
                voting rights in any institution described in 
                subparagraph (A);
                  (C) violate any voting agreement previously 
                approved by the appropriate Federal banking 
                agency; or
                  (D) vote for a director, or serve or act as 
                an institution-affiliated party.
          (7) Industrywide Prohibition.--
                  (A) In general.--Except as provided in 
                subparagraph (B), any person who, pursuant to 
                an order issued under this subsection or 
                subsection (g), has been removed or suspended 
                from office in an insured depository 
                institution or prohibited from participating in 
                the conduct of the affairs of an insured 
                depository institution may not, while such 
                order is in effect, continue or commence to 
                hold any office in, or participate in any 
                manner in the conduct of the affairs of--
                          (i) any insured depository 
                        institution;
                          (ii) any institution treated as an 
                        insured bank under subsection (b)(3) or 
                        (b)(4), or as a savings association 
                        under subsection (b)(9);
                          (iii) any insured credit union under 
                        the Federal Credit Union Act;
                          (iv) any institution chartered under 
                        the Farm Credit Act of 1971;
                          (v) any appropriate Federal 
                        depository institution regulatory 
                        agency; and
                          (vi) the Federal Housing Finance 
                        Agency and any Federal home loan bank.
                  (B) Exception if agency provides written 
                consent.--If, on or after the date an order is 
                issued under this subsection which removes or 
                suspends from office any institution-affiliated 
                party or prohibits such party from 
                participating in the conduct of the affairs of 
                an insured depository institution, such party 
                receives the written consent of--
                          (i) the agency that issued such 
                        order; and
                          (ii) the appropriate Federal 
                        financial institutions regulatory 
                        agency of the institution described in 
                        any clause of subparagraph (A) with 
                        respect to which such party proposes to 
                        become an institution-affiliated party,
                subparagraph (A) shall, to the extent of such 
                consent, cease to apply to such party with 
                respect to the institution described in each 
                written consent. Any agency that grants such a 
                written consent shall report such action to the 
                Corporation and publicly disclose such consent.
                  (C) Violation of paragraph treated as 
                violation of order.--Any violation of 
                subparagraph (A) by any person who is subject 
                to an order described in such subparagraph 
                shall be treated as a violation of the order.
                  (D) Appropriate federal financial 
                institutions regulatory agency defined.--For 
                purposes of this paragraph and subsection (j), 
                the term ``appropriate Federal financial 
                institutions regulatory agency'' means--
                          (i) the appropriate Federal banking 
                        agency, in the case of an insured 
                        depository institution;
                          (ii) the Farm Credit Administration, 
                        in the case of an institution chartered 
                        under the Farm Credit Act of 1971;
                          (iii) the National Credit Union 
                        Administration Board, in the case of an 
                        insured credit union (as defined in 
                        section 101(7) of the Federal Credit 
                        Union Act); and
                          (iv) the Secretary of the Treasury, 
                        in the case of the Federal Housing 
                        Finance Agency and any Federal home 
                        loan bank.
                  (E) Consultation between agencies.--The 
                agencies referred to in clauses (i) and (ii) of 
                subparagraph (B) shall consult with each other 
                before providing any written consent described 
                in subparagraph (B).
                  (F) Applicability.--This paragraph shall only 
                apply to a person who is an individual, unless 
                the appropriate Federal banking agency 
                specifically finds that it should apply to a 
                corporation, firm, or other business 
                enterprise.
  (f) Within ten days after any institution-affiliated party 
has been suspended from office and/or prohibited from 
participation in the conduct of the affairs of an insured 
depository institution under subsection (e)(3) of this section, 
such party may apply to the United States district court for 
the judicial district in which the home office of the 
depository institution is located, or the United States 
District Court for the District of Columbia, for a stay of such 
suspension and/or prohibition pending the completion of the 
administrative proceedings pursuant to the notice served upon 
such party under subsection (e)(1) or (e)(2) of this section, 
and such court shall have jurisdiction to stay such suspension 
and/or prohibition.
  (g) Suspension, Removal, and Prohibition From Participation 
Orders in the Case of Certain Criminal Offenses.--
          (1) Suspension or prohibition.--
                  (A) In general.--Whenever any institution-
                affiliated party is the subject of any 
                information, indictment, or complaint, 
                involving the commission of or participation 
                in--
                          (i) a crime involving dishonesty or 
                        breach of trust which is punishable by 
                        imprisonment for a term exceeding one 
                        year under State or Federal law, or
                          (ii) a criminal violation of section 
                        1956, 1957, or 1960 of title 18, United 
                        States Code, or section 5322 or 5324 of 
                        title 31, United States Code,
                the appropriate Federal banking agency may, if 
                continued service or participation by such 
                party posed, poses, or may pose a threat to the 
                interests of the depositors of, or threatened, 
                threatens, or may threaten to impair public 
                confidence in, any relevant depository 
                institution (as defined in subparagraph (E)), 
                by written notice served upon such party, 
                suspend such party from office or prohibit such 
                party from further participation in any manner 
                in the conduct of the affairs of any depository 
                institution.
                  (B) Provisions applicable to notice.--
                          (i) Copy.--A copy of any notice under 
                        subparagraph (A) shall also be served 
                        upon any depository institution that 
                        the subject of the notice is affiliated 
                        with at the time the notice is issued.
                          (ii) Effective period.--A suspension 
                        or prohibition under subparagraph (A) 
                        shall remain in effect until the 
                        information, indictment, or complaint 
                        referred to in such subparagraph is 
                        finally disposed of or until terminated 
                        by the agency.
                  (C) Removal or prohibition.--
                          (i) In general.--If a judgment of 
                        conviction or an agreement to enter a 
                        pretrial diversion or other similar 
                        program is entered against an 
                        institution-affiliated party in 
                        connection with a crime described in 
                        subparagraph (A)(i), at such time as 
                        such judgment is not subject to further 
                        appellate review, the appropriate 
                        Federal banking agency may, if 
                        continued service or participation by 
                        such party posed, poses, or may pose a 
                        threat to the interests of the 
                        depositors of, or threatened, 
                        threatens, or may threaten to impair 
                        public confidence in, any relevant 
                        depository institution (as defined in 
                        subparagraph (E)), issue and serve upon 
                        such party an order removing such party 
                        from office or prohibiting such party 
                        from further participation in any 
                        manner in the conduct of the affairs of 
                        any depository institution without the 
                        prior written consent of the 
                        appropriate agency.
                          (ii) Required for certain offenses.--
                        In the case of a judgment of conviction 
                        or agreement against an institution-
                        affiliated party in connection with a 
                        violation described in subparagraph 
                        (A)(ii), the appropriate Federal 
                        banking agency shall issue and serve 
                        upon such party an order removing such 
                        party from office or prohibiting such 
                        party from further participation in any 
                        manner in the conduct of the affairs of 
                        any depository institution without the 
                        prior written consent of the 
                        appropriate agency.
                  (D) Provisions applicable to order.--
                          (i) Copy.--A copy of any order under 
                        subparagraph (C) shall also be served 
                        upon any depository institution that 
                        the subject of the order is affiliated 
                        with at the time the order is issued, 
                        whereupon the institution-affiliated 
                        party who is subject to the order (if a 
                        director or an officer) shall cease to 
                        be a director or officer of such 
                        depository institution.
                          (ii) Effect of acquittal.--A finding 
                        of not guilty or other disposition of 
                        the charge shall not preclude the 
                        agency from instituting proceedings 
                        after such finding or disposition to 
                        remove such party from office or to 
                        prohibit further participation in 
                        depository institution affairs, 
                        pursuant to paragraph (1), (2), or (3) 
                        of subsection (e) of this section.
                          (iii) Effective period.--Any notice 
                        of suspension or order of removal 
                        issued under this paragraph shall 
                        remain effective and outstanding until 
                        the completion of any hearing or appeal 
                        authorized under paragraph (3) unless 
                        terminated by the agency.
                  (E) Relevant depository institution.--For 
                purposes of this subsection, the term 
                ``relevant depository institution'' means any 
                depository institution of which the party is or 
                was an institution-affiliated party at the time 
                at which--
                          (i) the information, indictment, or 
                        complaint described in subparagraph (A) 
                        was issued; or
                          (ii) the notice is issued under 
                        subparagraph (A) or the order is issued 
                        under subparagraph (C)(i).
  (2) If at any time, because of the suspension of one or more 
directors pursuant to this section, there shall be on the board 
of directors of a national bank less than a quorum of directors 
not so suspended, all powers and functions vested in or 
exercisable by such board shall vest in and be exercisable by 
the director or directors on the board not so suspended, until 
such time as there shall be a quorum of the board of directors. 
In the event all of the directors of a national bank are 
suspended pursuant to this section, the Comptroller of the 
Currency shall appoint persons to serve temporarily as 
directors in their place and stead pending the termination of 
such suspensions, or until such time as those who have been 
suspended, cease to be directors of the bank and their 
respective successors take office.
  (3) Within thirty days from service of any notice of 
suspension or order of removal issued pursuant to paragraph (1) 
of this subsection, the institution-affiliated party concerned 
may request in writing an opportunity to appear before the 
agency to show that the continued service to or participation 
in the conduct of the affairs of the depository institution by 
such party does not, or is not likely to, pose a threat to the 
interests of the bank's depositors or threaten to impair public 
confidence in the depository institution. Upon receipt of any 
such request, the appropriate Federal banking agency shall fix 
a time (not more than thirty days after receipt of such 
request, unless extended at the request of such party) and 
place at which such party may appear, personally or through 
counsel, before one or more members of the agency or designated 
employees of the agency to submit written materials (or, at the 
discretion of the agency, oral testimony) and oral argument. 
Within sixty days of such hearing, the agency shall notify such 
party whether the suspension or prohibition from participation 
in any manner in the conduct of the affairs of the depository 
institution will be continued, terminated, or otherwise 
modified, or whether the order removing such party from office 
or prohibiting such party from further participation in any 
manner in the conduct of the affairs of the depository 
institution will be rescinded or otherwise modified. Such 
notification shall contain a statement of the basis for the 
agency's decision, if adverse to such party. The Federal 
banking agencies are authorized to prescribe such rules as may 
be necessary to effectuate the purposes of this subsection.
  (h)(1) Any hearing provided for in this section (other than 
the hearing provided for in subsection (g)(3) of this section) 
shall be held in the Federal judicial district or in the 
territory in which the home office of the depository 
institution is located unless the party afforded the hearing 
consents to another place, and shall be conducted in accordance 
with the provisions of chapter 5 of title 5 of the United 
States Code. After such hearing, and within ninety days after 
the appropriate Federal banking agency or Board of Governors of 
the Federal Reserve System has notified the parties that the 
case has been submitted to it for final decision, it shall 
render its decision (which shall include findings of fact upon 
which its decision is predicated) and shall issue and serve 
upon each party to the proceeding an order or orders consistent 
with the provisions of this section. Judicial review of any 
such order shall be exclusively as provided in this subsection 
(h). Unless a petition for review is timely filed in a court of 
appeals of the United States, as hereinafter provided in 
paragraph (2) of this subsection, and thereafter until the 
record in the proceeding has been filed as so provided, the 
issuing agency may at any time, upon such notice and in such 
manner as it shall deem proper, modify, terminate, or set aside 
any such order. Upon such filing of the record, the agency may 
modify, terminate, or set aside any such order with permission 
of the court.
  (2) Any party to any proceeding under paragraph (1) may 
obtain a review of any order served pursuant to paragraph (1) 
of this subsection (other than an order issued with the consent 
of the depository institution or the institution-affiliated 
party concerned, or an order issued under paragraph (1) of 
subsection (g) of this section) by the filing in the court of 
appeals of the United States for the circuit in which the home 
office of the depository institution is located, or in the 
United States Court of Appeals for the District of Columbia 
Circuit, within thirty days after the date of service of such 
order, a written petition praying that the order of the agency 
be modified, terminated, or set aside. A copy of such petition 
shall be forthwith transmitted by the clerk of the court to the 
agency, and thereupon the agency shall file in the court the 
record in the proceeding, as provided in section 2112 of title 
28 of the United States Code. Upon the filing of such petition, 
such court shall have jurisdiction, which upon the filing of 
the record shall except as provided in the last sentence of 
said paragraph (1) be exclusive, to affirm, modify, terminate, 
or set aside, in whole or in part, the order of the agency. 
Review of such proceedings shall be had as provided in chapter 
7 of title 5 of the United States Code. The judgment and decree 
of the court shall be final, except that the same shall be 
subject to review by the Supreme Court upon certiorari, as 
provided in section 1254 of title 28 of the United States Code.
  (3) The commencement of proceedings for judicial review under 
paragraph (2) of this subsection shall not, unless specifically 
ordered by the court, operate as a stay of any order issued by 
the agency.
  (i)(1) The appropriate Federal banking agency may in its 
discretion apply to the United States district court, or the 
United States court of any territory, within the jurisdiction 
of which the home office of the depository institution is 
located, for the enforcement of any effective and outstanding 
notice or order issued under this section or under section 38 
or 39, and such courts shall have jurisdiction and power to 
order and require compliance herewith; but except as otherwise 
provided in this section or under section 38 or 39 no court 
shall have jurisdiction to affect by injunction or otherwise 
the issuance or enforcement of any notice or order under any 
such section, or to review, modify, suspend, terminate, or set 
aside any such notice or order.
          (2) Civil money penalty.--
                  (A) First tier.--Any insured depository 
                institution which, and any institution-
                affiliated party who--
                          (i) violates any law or regulation;
                          (ii) violates any final order or 
                        temporary order issued pursuant to 
                        subsection (b), (c), (e), (g), or (s) 
                        or any final order under section 38 or 
                        39;
                          (iii) violates any condition imposed 
                        in writing by a Federal banking agency 
                        in connection with any action on any 
                        application, notice, or other request 
                        by the depository institution or 
                        institution-affiliated party; or
                          (iv) violates any written agreement 
                        between such depository institution and 
                        such agency,
                shall forfeit and pay a civil penalty of not 
                more than $5,000 for each day during which such 
                violation continues.
                  (B) Second tier.--Notwithstanding 
                subparagraph (A), any insured depository 
                institution which, and any institution-
                affiliated party who--
                          (i)(I) commits any violation 
                        described in any clause of subparagraph 
                        (A);
                          (II) recklessly engages in an unsafe 
                        or unsound practice in conducting the 
                        affairs of such insured depository 
                        institution; or
                          (III) breaches any fiduciary duty;
                          (ii) which violation, practice, or 
                        breach--
                                  (I) is part of a pattern of 
                                misconduct;
                                  (II) causes or is likely to 
                                cause more than a minimal loss 
                                to such depository institution; 
                                or
                                  (III) results in pecuniary 
                                gain or other benefit to such 
                                party,
                shall forfeit and pay a civil penalty of not 
                more than $25,000 for each day during which 
                such violation, practice, or breach continues.
                  (C) Third tier.--Notwithstanding 
                subparagraphs (A) and (B), any insured 
                depository institution which, and any 
                institution-affiliated party who--
                          (i) knowingly--
                                  (I) commits any violation 
                                described in any clause of 
                                subparagraph (A);
                                  (II) engages in any unsafe or 
                                unsound practice in conducting 
                                the affairs of such depository 
                                institution; or
                                  (III) breaches any fiduciary 
                                duty; and
                          (ii) knowingly or recklessly causes a 
                        substantial loss to such depository 
                        institution or a substantial pecuniary 
                        gain or other benefit to such party by 
                        reason of such violation, practice, or 
                        breach,
                shall forfeit and pay a civil penalty in an 
                amount not to exceed the applicable maximum 
                amount determined under subparagraph (D) for 
                each day during which such violation, practice, 
                or breach continues.
                  (D) Maximum amounts of penalties for any 
                violation described in subparagraph (c).--The 
                maximum daily amount of any civil penalty which 
                may be assessed pursuant to subparagraph (C) 
                for any violation, practice, or breach 
                described in such subparagraph is--
                          (i) in the case of any person other 
                        than an insured depository institution, 
                        an amount to not exceed [$1,000,000] 
                        $1,500,000; and
                          (ii) in the case of any insured 
                        depository institution, an amount not 
                        to exceed the lesser of--
                                  (I) [$1,000,000] $1,500,000; 
                                or
                                  (II) 1 percent of the total 
                                assets of such institution.
                  (E) Assessment.--
                          (i) Written notice.--Any penalty 
                        imposed under subparagraph (A), (B), or 
                        (C) may be assessed and collected by 
                        the appropriate Federal banking agency 
                        by written notice.
                          (ii) Finality of assessment.--If, 
                        with respect to any assessment under 
                        clause (i), a hearing is not requested 
                        pursuant to subparagraph (H) within the 
                        period of time allowed under such 
                        subparagraph, the assessment shall 
                        constitute a final and unappealable 
                        order.
                  (F) Authority to modify or remit penalty.--
                Any appropriate Federal banking agency may 
                compromise, modify, or remit any penalty which 
                such agency may assess or had already assessed 
                under subparagraph (A), (B), or (C).
                  (G) Mitigating factors.--In determining the 
                amount of any penalty imposed under 
                subparagraph (A), (B), or (C), the appropriate 
                agency shall take into account the 
                appropriateness of the penalty with respect 
                to--
                          (i) the size of financial resources 
                        and good faith of the insured 
                        depository institution or other person 
                        charged;
                          (ii) the gravity of the violation;
                          (iii) the history of previous 
                        violations; and
                          (iv) such other matters as justice 
                        may require.
                  (H) Hearing.--The insured depository 
                institution or other person against whom any 
                penalty is assessed under this paragraph shall 
                be afforded an agency hearing if such 
                institution or person submits a request for 
                such hearing within 20 days after the issuance 
                of the notice of assessment.
                  (I) Collection.--
                          (i) Referral.--If any insured 
                        depository institution or other person 
                        fails to pay an assessment after any 
                        penalty assessed under this paragraph 
                        has become final, the agency that 
                        imposed the penalty shall recover the 
                        amount assessed by action in the 
                        appropriate United States district 
                        court.
                          (ii) Appropriateness of penalty not 
                        reviewable.--In any civil action under 
                        clause (i), the validity and 
                        appropriateness of the penalty shall 
                        not be subject to review.
                  (J) Disbursement.--All penalties collected 
                under authority of this paragraph shall be 
                deposited into the Treasury.
                  (K) Regulations.--Each appropriate Federal 
                banking agency shall prescribe regulations 
                establishing such procedures as may be 
                necessary to carry out this paragraph.
          (3) Notice under this section after separation from 
        service.--The resignation, termination of employment or 
        participation, or separation of an institution-
        affiliated party (including a separation caused by the 
        closing of an insured depository institution) shall not 
        affect the jurisdiction and authority of the 
        appropriate Federal banking agency to issue any notice 
        or order and proceed under this section against any 
        such party, if such notice or order is served before 
        the end of the 6-year period beginning on the date such 
        party ceased to be such a party with respect to such 
        depository institution (whether such date occurs 
        before, on, or after the date of the enactment of this 
        paragraph).
          (4) Prejudgment attachment.--
                  (A) In general.--In any action brought by an 
                appropriate Federal banking agency (excluding 
                the Corporation when acting in a manner 
                described in section 11(d)(18)) pursuant to 
                this section, or in actions brought in aid of, 
                or to enforce an order in, any administrative 
                or other civil action for money damages, 
                restitution, or civil money penalties brought 
                by such agency, the court may, upon application 
                of the agency, issue a restraining order that--
                          (i) prohibits any person subject to 
                        the proceeding from withdrawing, 
                        transferring, removing, dissipating, or 
                        disposing of any funds, assets or other 
                        property; and
                          (ii) appoints a temporary receiver to 
                        administer the restraining order.
                  (B) Standard.--
                          (i) Showing.--Rule 65 of the Federal 
                        Rules of Civil Procedure shall apply 
                        with respect to any proceeding under 
                        subparagraph (A) without regard to the 
                        requirement of such rule that the 
                        applicant show that the injury, loss, 
                        or damage is irreparable and immediate.
                          (ii) State proceeding.--If, in the 
                        case of any proceeding in a State 
                        court, the court determines that rules 
                        of civil procedure available under the 
                        laws of such State provide 
                        substantially similar protections to a 
                        party's right to due process as Rule 65 
                        (as modified with respect to such 
                        proceeding by clause (i)), the relief 
                        sought under subparagraph (A) may be 
                        requested under the laws of such State.
  (j) Criminal Penalty.--Whoever, being subject to an order in 
effect under subsection (e) or (g), without the prior written 
approval of the appropriate Federal financial institutions 
regulatory agency, knowingly participates, directly or 
indirectly, in any manner (including by engaging in an activity 
specifically prohibited in such an order or in subsection 
(e)(6)) in the conduct of the affairs of--
          (1) any insured depository institution;
          (2) any institution treated as an insured bank under 
        subsection (b)(3) or (b)(4);
          (3) any insured credit union (as defined in section 
        101(7) of the Federal Credit Union Act); or
          (4) any institution chartered under the Farm Credit 
        Act of 1971,
shall be fined not more than [$1,000,000] $1,500,000, 
imprisoned for not more than 5 years, or both.
  (k)
  (l) Any service required or authorized to be made by the 
appropriate Federal banking agency under this section may be 
made by registered mail, or in such other manner reasonably 
calculated to give actual notice as the agency may by 
regulation or otherwise provide. Copies of any notice or order 
served by the agency upon any State depository institution or 
any institution-affiliated party, pursuant to the provisions of 
this section, shall also be sent to the appropriate State 
supervisory authority.
  (m) In connection with any proceeding under subsection (b), 
(c)(1), or (e) of this section involving an insured State bank 
or any institution-affiliated party, the appropriate Federal 
banking agency shall provide the appropriate State supervisory 
authority with notice of the agency's intent to institute such 
a proceeding and the grounds therefor. Unless within such time 
as the Federal banking agency deems appropriate in the light of 
the circumstances of the case (which time must be specified in 
the notice prescribed in the preceding sentence) satisfactory 
corrective action is effectuated by action of the State 
supervisory authority, the agency may proceed as provided in 
this section. No bank or other party who is the subject of any 
notice or order issued by the agency under this section shall 
have standing to raise the requirements of this subsection as 
ground for attacking the validity of any such notice or order.
  (n) In the course of or in connection with any proceeding 
under this section, or in connection with any claim for insured 
deposits or any examination or investigation under section 
10(c), the agency conducting the proceeding, examination, or 
investigation or considering the claim for insured deposits, or 
any member or designated representative thereof, including any 
person designated to conduct any hearing under this section, 
shall have the power to administer oaths and affirmations, to 
take or cause to be taken depositions, and to issue, revoke, 
quash, or modify subpenas and subpenas duces tecum; and such 
agency is empowered to make rules and regulations with respect 
to any such proceedings, claims, examinations, or 
investigations. The attendance of witnesses and the production 
of documents provided for in this subsection may be required 
from any place in any State or in any territory or other place 
subject to the jurisdiction of the United States at any 
designated place where such proceeding is being conducted. Any 
such agency or any party to proceedings under this section may 
apply to the United States District Court for the District of 
Columbia, or the United States district court for the judicial 
district or the United States court in any territory in which 
such proceeding is being conducted, or where the witness 
resides or carries on business, for enforcement of any subpena 
or subpena duces tecum issued pursuant to this subsection, and 
such courts shall have jurisdiction and power to order and 
require compliance therewith. Witnesses subpenaed under this 
subsection shall be paid the same fees and mileage that are 
paid witnesses in the district courts of the United States. Any 
court having jurisdiction of any proceeding instituted under 
this section by an insured depository institution or a director 
or officer thereof, may allow to any such party such reasonable 
expenses and attorneys' fees as it deems just and proper; and 
such expenses and fees shall be paid by the depository 
institution or from its assets. Any person who willfully shall 
fail or refuse to attend and testify or to answer any lawful 
inquiry or to produce books, papers, correspondence, memoranda, 
contracts, agreements, or other records, if in such person's 
power so to do, in obedience to the subpoena of the appropriate 
Federal banking agency, shall be guilty of a misdemeanor and, 
upon conviction, shall be subject to a fine of not more than 
$1,000 or to imprisonment for a term of not more than one year 
or both.
  (o) Whenever the insured status of a State member bank shall 
be terminated by action of the Board of Directors, the Board of 
Governors of the Federal Reserve System shall terminate its 
membership in the Federal Reserve System in accordance with the 
provisions of section 9 of the Federal Reserve Act, and 
whenever the insured status of a national member bank shall be 
so terminated the Comptroller of the Currency shall appoint a 
receiver for the bank, which shall be the Corporation. Except 
as provided in subsection (c) or (d) of section 4, whenever a 
member bank shall cease to be a member of the Federal Reserve 
System, its status as an insured depository institution shall, 
without notice or other action by the Board of Directors, 
terminate on the date the bank shall cease to be a member of 
the Federal Reserve System, with like effect as if its insured 
status had been terminated on said date by the Board of 
Directors after proceedings under subsection (a) of this 
section. Whenever the insured status of an insured Federal 
savings bank shall be terminated by action of the Board of 
Directors, the Comptroller of the Currency shall appoint a 
receiver for the bank, which shall be the Corporation.
  (p) Notwithstanding any other provision of law, whenever the 
Board of Directors shall determine that an insured depository 
institution is not engaged in the business of receiving 
deposits, other than trust funds as herein defined, the 
Corporation shall notify the depository institution that its 
insured status will terminate at the expiration of the first 
full assessment period following such notice. A finding by the 
Board of Directors that a depository institution is not engaged 
in the business of receiving deposits, other than such trust 
funds, shall be conclusive. The Board of Directors shall 
prescribe the notice to be given by the depository institution 
of such termination and the Corporation may publish notice 
thereof. Upon the termination of the insured status of any such 
depository institution, its deposits shall thereupon cease to 
be insured and the depository institution shall thereafter be 
relieved of all future obligations to the Corporation, 
including the obligation to pay future assessments.
  (q) Whenever the liabilities of an insured depository 
institution for deposits shall have been assumed by another 
insured depository institution or depository institutions, 
whether by way of merger, consolidation, or other statutory 
assumption, or pursuant to contract (1) the insured status of 
the depository institution whose liabilities are so assumed 
shall terminate on the date of receipt by the Corporation of 
satisfactory evidence of such assumption; (2) the separate 
insurance of all deposits so assumed shall terminate at the end 
of six months from the date such assumption takes effect or, in 
the case of any time deposit, the earliest maturity date after 
the six-month period. Where the deposits of an insured 
depository institution are assumed by a newly insured 
depository institution, the depository institution whose 
deposits are assumed shall not be required to pay any 
assessment with respect to the deposits which have been so 
assumed after the assessment period in which the assumption 
takes effect.
  (r)(1) Except as otherwise specifically provided in this 
section, the provisions of this section shall be applied to 
foreign banks in accordance with this subsection.
  (2) An act or practice outside the United States on the part 
of a foreign bank or any officer, director, employee, or agent 
thereof may not constitute the basis for any action by any 
officer or agency of the United States under this section, 
unless--
          (A) such officer or agency alleges a belief that such 
        act or practice has been, is, or is likely to be a 
        cause of or carried on in connection with or in 
        furtherance of an act or practice within any one or 
        more States which, in and of itself, would constitute 
        an appropriate basis for action by a Federal officer or 
        agency under this section; or
          (B) the alleged act or practice is one which, if 
        proven, would, in the judgment of the Board of 
        Directors, adversely affect the insurance risk assumed 
        by the Corporation.
  (3) In any case in which any action or proceeding is brought 
pursuant to an allegation under paragraph (2) of this 
subsection for the suspension or removal of any officer, 
director, or other person associated with a foreign bank, and 
such person fails to appear promptly as a party to such action 
or proceeding and to comply with any effective order or 
judgment therein, any failure by the foreign bank to secure his 
removal from any office he holds in such bank and from any 
further participation in its affairs shall, in and of itself, 
constitute grounds for termination of the insurance of the 
deposits in any branch of the bank.
  (4) Where the venue of any judicial or administrative 
proceeding under this section is to be determined by reference 
to the location of the home office of a bank, the venue of such 
a proceeding with respect to a foreign bank having one or more 
branches or agencies in not more than one judicial district or 
other relevant jurisdiction shall be within such jurisdiction. 
Where such a bank has branches or agencies in more than one 
such jurisdiction, the venue shall be in the jurisdiction 
within which the branch or branches or agency or agencies 
involved in the proceeding are located, and if there is more 
than one such jurisdiction, the venue shall be proper in any 
such jurisdiction in which the proceeding is brought or to 
which it may appropriately be transferred.
  (5) Any service required or authorized to be made on a 
foreign bank may be made on any branch or agency located within 
any State, but if such service is in connection with an action 
or proceeding involving one or more branches or one or more 
agencies located in any State, service shall be made on at 
least one branch or agency so involved.
  (s) Compliance With Monetary Transaction Recordkeeping and 
Report Requirements.--
          (1) Compliance procedures required.--Each appropriate 
        Federal banking agency shall prescribe regulations 
        requiring insured depository institutions to establish 
        and maintain procedures reasonably designed to assure 
        and monitor the compliance of such depository 
        institutions with the requirements of subchapter II of 
        chapter 53 of title 31, United States Code.
          (2) Examinations of depository institution to include 
        review of compliance procedures.--
                  (A) In general.--Each examination of an 
                insured depository institution by the 
                appropriate Federal banking agency shall 
                include a review of the procedures required to 
                be established and maintained under paragraph 
                (1).
                  (B) Exam report requirement.--The report of 
                examination shall describe any problem with the 
                procedures maintained by the insured depository 
                institution.
          (3) Order to comply with requirements.--If the 
        appropriate Federal banking agency determines that an 
        insured depository institution--
                  (A) has failed to establish and maintain the 
                procedures described in paragraph (1); or
                  (B) has failed to correct any problem with 
                the procedures maintained by such depository 
                institution which was previously reported to 
                the depository institution by such agency,
        the agency shall issue an order in the manner 
        prescribed in subsection (b) or (c) requiring such 
        depository institution to cease and desist from its 
        violation of this subsection or regulations prescribed 
        under this subsection.
  (t) Authority of FDIC To Take Enforcement Action Against 
Insured Depository Institutions and Institution-Affiliated 
Parties.--
          (1) Recommending action by appropriate federal 
        banking agency.--The Corporation, based on an 
        examination of an insured depository institution by the 
        Corporation or by the appropriate Federal banking 
        agency or on other information, may recommend in 
        writing to the appropriate Federal banking agency that 
        the agency take any enforcement action authorized under 
        section 7(j), this section, or section 18(j) with 
        respect to any insured depository institution, any 
        depository institution holding company, or any 
        institution-affiliated party. The recommendation shall 
        be accompanied by a written explanation of the concerns 
        giving rise to the recommendation.
          (2) FDIC's authority to act if appropriate federal 
        banking agency fails to follow recommendation.--If the 
        appropriate Federal banking agency does not, before the 
        end of the 60-day period beginning on the date on which 
        the agency receives the recommendation under paragraph 
        (1), take the enforcement action recommended by the 
        Corporation or provide a plan acceptable to the 
        Corporation for responding to the Corporation's 
        concerns, the Corporation may take the recommended 
        enforcement action if the Board of Directors 
        determines, upon a vote of its members, that--
                  (A) the insured depository institution is in 
                an unsafe or unsound condition;
                  (B) the institution or institution-affiliated 
                party is engaging in unsafe or unsound 
                practices, and the recommended enforcement 
                action will prevent the institution or 
                institution-affiliated party from continuing 
                such practices;
                  (C) the conduct or threatened conduct 
                (including any acts or omissions) poses a risk 
                to the Deposit Insurance Fund, or may prejudice 
                the interests of the institution's [depositors 
                or] depositors; or
                  (D) the conduct or threatened conduct 
                (including any acts or omissions) of the 
                depository institution holding company poses a 
                risk to the Deposit Insurance Fund, provided 
                that such authority may not be used with 
                respect to a depository institution holding 
                company that is in generally sound condition 
                and whose conduct does not pose a foreseeable 
                and material risk of loss to the Deposit 
                Insurance Fund;
          (3) Effect of exigent circumstances.--
                  (A) Authority to act.--The Corporation may, 
                upon a vote of the Board of Directors, and 
                after notice to the appropriate Federal banking 
                agency, exercise its authority under paragraph 
                (2) in exigent circumstances without regard to 
                the time period set forth in paragraph (2).
                  (B) Agreement on exigent circumstances.--The 
                Corporation shall, by agreement with the 
                appropriate Federal banking agency, set forth 
                those exigent circumstances in which the 
                Corporation may act under subparagraph (A).
          (4) Corporation's powers; institution's duties.--For 
        purposes of this subsection--
                  (A) the Corporation shall have the same 
                powers with respect to any insured depository 
                institution and its affiliates as the 
                appropriate Federal banking agency has with 
                respect to the institution and its affiliates; 
                and
                  (B) the institution and its affiliates shall 
                have the same duties and obligations with 
                respect to the Corporation as the institution 
                and its affiliates have with respect to the 
                appropriate Federal banking agency.
          (5) Requests for formal actions and investigations.--
                  (A) Submission of requests.--A regional 
                office of an appropriate Federal banking agency 
                (including a Federal Reserve bank) that 
                requests a formal investigation of or civil 
                enforcement action against an insured 
                depository institution or institution-
                affiliated party shall submit the request 
                concurrently to the chief officer of the 
                appropriate Federal banking agency and to the 
                Corporation.
                  (B) Agencies required to report on 
                requests.--Each appropriate Federal banking 
                agency shall report semiannually to the 
                Corporation on the status or disposition of all 
                requests under subparagraph (A), including the 
                reasons for any decision by the agency to 
                approve or deny such requests.
          (6) Powers and duties with respect to depository 
        institution holding companies.--For purposes of 
        exercising the backup authority provided in this 
        subsection--
                  (A) the Corporation shall have the same 
                powers with respect to a depository institution 
                holding company and its affiliates as the 
                appropriate Federal banking agency has with 
                respect to the holding company and its 
                affiliates; and
                  (B) the holding company and its affiliates 
                shall have the same duties and obligations with 
                respect to the Corporation as the holding 
                company and its affiliates have with respect to 
                the appropriate Federal banking agency.
          (6) Referral to [bureau of consumer financial 
        protection] Consumer law enforcement agency.--Subject 
        to subtitle B of the Consumer Financial Protection Act 
        of 2010, each appropriate Federal banking agency shall 
        make a referral to the [Bureau of Consumer Financial 
        Protection] Consumer Law Enforcement Agency when the 
        Federal banking agency has a reasonable belief that a 
        violation of an enumerated consumer law, as defined in 
        the Consumer Financial Protection Act of 2010, has been 
        committed by any insured depository institution or 
        institution-affiliated party within the jurisdiction of 
        that appropriate Federal banking agency.
  (u) Public Disclosures of Final Orders and Agreements.--
          (1) In general.--The appropriate Federal banking 
        agency shall publish and make available to the public 
        on a monthly basis--
                  (A) any written agreement or other written 
                statement for which a violation may be enforced 
                by the appropriate Federal banking agency, 
                unless the appropriate Federal banking agency, 
                in its discretion, determines that publication 
                would be contrary to the public interest;
                  (B) any final order issued with respect to 
                any administrative enforcement proceeding 
                initiated by such agency under this section or 
                any other law; and
                  (C) any modification to or termination of any 
                order or agreement made public pursuant to this 
                paragraph.
          (2) Hearings.--All hearings on the record with 
        respect to any notice of charges issued by a Federal 
        banking agency shall be open to the public, unless the 
        agency, in its discretion, determines that holding an 
        open hearing would be contrary to the public interest.
          (3) Transcript of hearing.--A transcript that 
        includes all testimony and other documentary evidence 
        shall be prepared for all hearings commenced pursuant 
        to subsection (i). A transcript of public hearings 
        shall be made available to the public pursuant to 
        section 552 of title 5, United States Code.
          (4) Delay of publication under exceptional 
        circumstances.--If the appropriate Federal banking 
        agency makes a determination in writing that the 
        publication of a final order pursuant to paragraph 
        (1)(B) would seriously threaten the safety and 
        soundness of an insured depository institution, the 
        agency may delay the publication of the document for a 
        reasonable time.
          (5) Documents filed under seal in public enforcement 
        hearings.--The appropriate Federal banking agency may 
        file any document or part of a document under seal in 
        any administrative enforcement hearing commenced by the 
        agency if disclosure of the document would be contrary 
        to the public interest. A written report shall be made 
        part of any determination to withhold any part of a 
        document from the transcript of the hearing required by 
        paragraph (2).
          (6) Retention of documents.--Each Federal banking 
        agency shall keep and maintain a record, for a period 
        of at least 6 years, of all documents described in 
        paragraph (1) and all informal enforcement agreements 
        and other supervisory actions and supporting documents 
        issued with respect to or in connection with any 
        administrative enforcement proceeding initiated by such 
        agency under this section or any other laws.
          (7) Disclosures to congress.--No provision of this 
        subsection may be construed to authorize the 
        withholding, or to prohibit the disclosure, of any 
        information to the Congress or any committee or 
        subcommittee of the Congress.
  (v) Foreign Investigations.--
          (1) Requesting assistance from foreign banking 
        authorities.--In conducting any investigation, 
        examination, or enforcement action under this Act, the 
        appropriate Federal banking agency may--
                  (A) request the assistance of any foreign 
                banking authority; and
                  (B) maintain an office outside the United 
                States.
          (2) Providing assistance to foreign banking 
        authorities.--
                  (A) In general.--Any appropriate Federal 
                banking agency may, at the request of any 
                foreign banking authority, assist such 
                authority if such authority states that the 
                requesting authority is conducting an 
                investigation to determine whether any person 
                has violated, is violating, or is about to 
                violate any law or regulation relating to 
                banking matters or currency transactions 
                administered or enforced by the requesting 
                authority.
                  (B) Investigation by federal banking 
                agency.--Any appropriate Federal banking agency 
                may, in such agency's discretion, investigate 
                and collect information and evidence pertinent 
                to a request for assistance under subparagraph 
                (A). Any such investigation shall comply with 
                the laws of the United States and the policies 
                and procedures of the appropriate Federal 
                banking agency.
                  (C) Factors to consider.--In deciding whether 
                to provide assistance under this paragraph, the 
                appropriate Federal banking agency shall 
                consider--
                          (i) whether the requesting authority 
                        has agreed to provide reciprocal 
                        assistance with respect to banking 
                        matters within the jurisdiction of any 
                        appropriate Federal banking agency; and
                          (ii) whether compliance with the 
                        request would prejudice the public 
                        interest of the United States.
                  (D) Treatment of foreign banking authority.--
                For purposes of any Federal law or appropriate 
                Federal banking agency regulation relating to 
                the collection or transfer of information by 
                any appropriate Federal banking agency, the 
                foreign banking authority shall be treated as 
                another appropriate Federal banking agency.
          (3) Rule of construction.--Paragraphs (1) and (2) 
        shall not be construed to limit the authority of an 
        appropriate Federal banking agency or any other Federal 
        agency to provide or receive assistance or information 
        to or from any foreign authority with respect to any 
        matter.
  (w) Termination of Insurance for Money Laundering or Cash 
Transaction Reporting Offenses.--
          (1) In general.--
                  (A) Conviction of title 18 offenses.--
                          (i) Duty to notify.--If an insured 
                        State depository institution has been 
                        convicted of any criminal offense under 
                        section 1956 or 1957 of title 18, 
                        United States Code, the Attorney 
                        General shall provide to the 
                        Corporation a written notification of 
                        the conviction and shall include a 
                        certified copy of the order of 
                        conviction from the court rendering the 
                        decision.
                          (ii) Notice of termination; 
                        pretermination hearing.--After receipt 
                        of written notification from the 
                        Attorney General by the Corporation of 
                        such a conviction, the Board of 
                        Directors shall issue to the insured 
                        depository institution a notice of its 
                        intention to terminate the insured 
                        status of the insured depository 
                        institution and schedule a hearing on 
                        the matter, which shall be conducted in 
                        all respects as a termination hearing 
                        pursuant to paragraphs (3) through (5) 
                        of subsection (a).
                  (B) Conviction of title 31 offenses.--If an 
                insured State depository institution is 
                convicted of any criminal offense under section 
                5322 or 5324 of title 31, United States Code, 
                after receipt of written notification from the 
                Attorney General by the Corporation, the Board 
                of Directors may initiate proceedings to 
                terminate the insured status of the insured 
                depository institution in the manner described 
                in subparagraph (A).
                  (C) Notice to state supervisor.--The 
                Corporation shall simultaneously transmit a 
                copy of any notice issued under this paragraph 
                to the appropriate State financial institutions 
                supervisor.
          (2) Factors to be considered.--In determining whether 
        to terminate insurance under paragraph (1), the Board 
        of Directors shall take into account the following 
        factors:
                  (A) The extent to which directors or senior 
                executive officers of the depository 
                institution knew of, or were involved in, the 
                commission of the money laundering offense of 
                which the institution was found guilty.
                  (B) The extent to which the offense occurred 
                despite the existence of policies and 
                procedures within the depository institution 
                which were designed to prevent the occurrence 
                of any such offense.
                  (C) The extent to which the depository 
                institution has fully cooperated with law 
                enforcement authorities with respect to the 
                investigation of the money laundering offense 
                of which the institution was found guilty.
                  (D) The extent to which the depository 
                institution has implemented additional internal 
                controls (since the commission of the offense 
                of which the depository institution was found 
                guilty) to prevent the occurrence of any other 
                money laundering offense.
                  (E) The extent to which the interest of the 
                local community in having adequate deposit and 
                credit services available would be threatened 
                by the termination of insurance.
          (3) Notice to state banking supervisor and public.--
        When the order to terminate insured status initiated 
        pursuant to this subsection is final, the Board of 
        Directors shall--
                  (A) notify the State banking supervisor of 
                any State depository institution described in 
                paragraph (1), where appropriate, at least 10 
                days prior to the effective date of the order 
                of termination of the insured status of such 
                depository institution, including a State 
                branch of a foreign bank; and
                  (B) publish notice of the termination of the 
                insured status of the depository institution in 
                the Federal Register.
          (4) Temporary insurance of previously insured 
        deposits.--Upon termination of the insured status of 
        any State depository institution pursuant to paragraph 
        (1), the deposits of such depository institution shall 
        be treated in accordance with subsection (a)(7).
          (5) Successor liability.--This subsection shall not 
        apply to a successor to the interests of, or a person 
        who acquires, an insured depository institution that 
        violated a provision of law described in paragraph (1), 
        if the successor succeeds to the interests of the 
        violator, or the acquisition is made, in good faith and 
        not for purposes of evading this subsection or 
        regulations prescribed under this subsection.
          (6) Definition.--The term ``senior executive 
        officer'' has the same meaning as in regulations 
        prescribed under section 32(f) of this Act.

           *       *       *       *       *       *       *

  Sec. 10. [(a)] [The] (a)  Powers._
          (1) In general._The Board of Directors shall 
        administer the affairs of the Corporation fairly and 
        impartially and without discrimination. The Board of 
        Directors of the Corporation, subject to paragraph (2), 
        shall determine and prescribe the manner in which its 
        obligations shall be incurred and its expenses allowed 
        and paid. The Corporation shall be entitled to the free 
        use of the United States mails in the same manner as 
        the executive departments of the Government. The 
        Corporation with the consent of any Federal Reserve 
        bank or of any board, commission, independent 
        establishment, or executive department of the 
        Government, including any field service thereof, may 
        avail itself of the use of information, services, and 
        facilities thereof in carrying out the provisions of 
        this Act.
          (2) Appropriations requirement.--
                  (A) Operating Fund.--There is established an 
                Operating Fund, to which Congress shall provide 
                annual appropriations to the Corporation, which 
                shall be separate from the Deposit Insurance 
                Fund.
                  (B) Recovery of costs of annual 
                appropriation.--The Corporation shall collect 
                assessments and other fees, as provided under 
                this Act, that are designed to recover the 
                costs to the Government of the annual 
                appropriation to the Corporation by Congress. 
                Except as provided in (E) and subject to 
                subparagraph (F), the Corporation may only 
                incur obligations, or allow and pay expenses, 
                from the Operating Fund pursuant to an 
                appropriations Act.
                  (C) Deposits.--Assessments and other fees 
                described under subparagraph (B) for any fiscal 
                year--
                          (i) shall be deposited in the 
                        Operating Fund; and
                          (ii) except as provided in 
                        subparagraph (E), shall not be 
                        collected for any fiscal year except to 
                        the extent provided in advance in 
                        appropriation Acts.
                  (D) Credits.--Amounts deposited in the 
                Operating Fund during a fiscal year shall be 
                credited as offsetting the amount appropriated 
                to the Operating Fund for such fiscal year.
                  (E) Lapse of Appropriation.--If on the first 
                day of a fiscal year an appropriation to the 
                Corporation has not been enacted, the 
                Corporation shall continue to collect the 
                assessments and other fees described under 
                subparagraph (B) at the rate in effect during 
                the preceding fiscal year, until 60 days after 
                the date such an appropriation is enacted.
                  (F) Exception for certain programs.--This 
                paragraph shall not apply to the Corporation's 
                Insurance Business Line Programs and 
                Receivership Management Business Line Programs, 
                as in existence on the date of enactment of 
                this paragraph.
  (b) Examinations.--
          (1) Appointment of examiners and claims agents.--The 
        Board of Directors shall appoint examiners and claims 
        agents.
          (2) Regular examinations.--Any examiner appointed 
        under paragraph (1) shall have power, on behalf of the 
        Corporation, to examine--
                  (A) any insured State nonmember bank or 
                insured State branch of any foreign bank;
                  (B) any depository institution which files an 
                application with the Corporation to become an 
                insured depository institution; and
                  (C) any insured depository institution in 
                default,
        whenever the Board of Directors determines an 
        examination of any such depository institution is 
        necessary.
          (3) Special examination of any insured depository 
        institution.--
                  (A) In general.--In addition to the 
                examinations authorized under paragraph (2), 
                any examiner appointed under paragraph (1) 
                shall have power, on behalf of the Corporation, 
                to make any special examination of any insured 
                depository institution or nonbank financial 
                company supervised by the Board of Governors or 
                a bank holding company described in section 
                165(a) of the Financial Stability Act of 2010, 
                whenever the Board of Directors determines that 
                a special examination of any such depository 
                institution is necessary to determine the 
                condition of such depository institution for 
                insurance purposes[, or of such nonbank 
                financial company supervised by the Board of 
                Governors or bank holding company described in 
                section 165(a) of the Financial Stability Act 
                of 2010, for the purpose of implementing its 
                authority to provide for orderly liquidation of 
                any such company under title II of that Act], 
                provided that such authority may not be used 
                with respect to any such company that is in a 
                generally sound condition.
                  (B) Limitation.--Before conducting a special 
                examination of a nonbank financial company 
                supervised by the Board of Governors or a bank 
                holding company described in section 165(a) of 
                the Financial Stability Act of 2010, the 
                Corporation shall review any available and 
                acceptable resolution plan that the company has 
                submitted in accordance with section 165(d) of 
                that Act, consistent with the nonbinding effect 
                of such plan, and available reports of 
                examination, and shall coordinate to the 
                maximum extent practicable with the Board of 
                Governors, in order to minimize duplicative or 
                conflicting examinations.
          (4) Examination of affiliates.--
                  (A) In general.--In making any examination 
                under paragraph (2) or (3), any examiner 
                appointed under paragraph (1) shall have power, 
                on behalf of the Corporation, to make such 
                examinations of the affairs of any affiliate of 
                any depository institution as may be necessary 
                to disclose fully--
                          (i) the relationship between such 
                        depository institution and any such 
                        affiliate; and
                          (ii) the effect of such relationship 
                        on the depository institution.
                  (B) Commitment by foreign banks to allow 
                examinations of affiliates.--No branch or 
                depository institution subsidiary of a foreign 
                bank may become an insured depository 
                institution unless such foreign bank submits a 
                written binding commitment to the Board of 
                Directors to permit any examination of any 
                affiliate of such branch or depository 
                institution subsidiary pursuant to subparagraph 
                (A) to the extent determined by the Board of 
                Directors to be necessary to carry out the 
                purposes of this Act.
          (5) Examination of insured state branches.--The Board 
        of Directors shall--
                  (A) coordinate examinations of insured State 
                branches of foreign banks with examinations 
                conducted by the Board of Governors of the 
                Federal Reserve System under section 7(c)(1) of 
                the International Banking Act of 1978; and
                  (B) to the extent possible, participate in 
                any simultaneous examination of the United 
                States operations of a foreign bank requested 
                by the Board under such section.
          (6) Power and duty of examiners.--Each examiner 
        appointed under paragraph (1) shall--
                  (A) have power to make a thorough examination 
                of any insured depository institution or 
                affiliate under paragraph (2), (3), (4), or 
                (5); and
                  (B) shall make a full and detailed report of 
                condition of any insured depository institution 
                or affiliate examined to the Corporation.
          (7) Power of claim agents.--Each claim agent 
        appointed under paragraph (1) shall have power to 
        investigate and examine all claims for insured 
        deposits.
  (c) In connection with examinations of insured depository 
institutions and any State nonmember bank, savings association, 
or other institution making application to become insured 
depository institutions, and affiliates thereof, or with other 
types of investigations to determine compliance with applicable 
law and regulations, the appropriate Federal banking agency, or 
its designated representatives, are authorized to administer 
oaths and affirmations, and to examine and and to take and 
preserve testimony under oath as to any matter in respect to 
the affairs or ownership of any such bank or institution or 
affiliate thereof, and to exercise such other powers as are set 
forth in section 8(n) of this Act.
  (d) Annual On-Site Examinations of All Insured Depository 
Institutions Required.--
          (1) In general.--The appropriate Federal banking 
        agency shall, not less than once during each 12-month 
        period, conduct a full-scope, on-site examination of 
        each insured depository institution.
          (2) Examinations by corporation.--Paragraph (1) shall 
        not apply during any 12-month period in which the 
        Corporation has conducted a full-scope, on-site 
        examination of the insured depository institution.
          (3) State examinations acceptable.--The examinations 
        required by paragraph (1) may be conducted in alternate 
        12-month periods, as appropriate, if the appropriate 
        Federal banking agency determines that an examination 
        of the insured depository institution conducted by the 
        State during the intervening 12-month period carries 
        out the purpose of this subsection.
          (4)  18-month rule for certain small institutions.--
        Paragraphs (1), (2), and (3) shall apply with ``18-
        month'' substituted for ``12-month'' if--
                  (A) the insured depository institution has 
                total assets of less than $1,000,000,000;
                  (B) the institution is well capitalized, as 
                defined in section 38;
                  (C) when the institution was most recently 
                examined, it was found to be well managed, and 
                its composite condition--
                          (i) was found to be outstanding; or
                          (ii) was found to be outstanding or 
                        good, in the case of an insured 
                        depository institution that has total 
                        assets of not more than $200,000,000;
                  (D) the insured institution is not currently 
                subject to a formal enforcement proceeding or 
                order by the Corporation or the appropriate 
                Federal banking agency; and
                  (E) no person acquired control of the 
                institution during the 12-month period in which 
                a full-scope, on-site examination would be 
                required but for this paragraph.
          (5) Certain government-controlled institutions 
        exempted.--Paragraph (1) does not apply to--
                  (A) any institution for which the Corporation 
                is conservator; or
                  (B) any bridge depository institution, none 
                of the voting securities of which are owned by 
                a person or agency other than the Corporation.
          (6) Coordinated examinations.--To minimize the 
        disruptive effects of examinations on the operations of 
        insured depository institutions--
                  (A) each appropriate Federal banking agency 
                shall, to the extent practicable and consistent 
                with principles of safety and soundness and the 
                public interest--
                          (i) coordinate examinations to be 
                        conducted by that agency at an insured 
                        depository institution and its 
                        affiliates;
                          (ii) coordinate with the other 
                        appropriate Federal banking agencies in 
                        the conduct of such examinations;
                          (iii) work to coordinate with the 
                        appropriate State bank supervisor--
                                  (I) the conduct of all 
                                examinations made pursuant to 
                                this subsection; and
                                  (II) the number, types, and 
                                frequency of reports required 
                                to be submitted to such 
                                agencies and supervisors by 
                                insured depository 
                                institutions, and the type and 
                                amount of information required 
                                to be included in such reports; 
                                and
                          (iv) use copies of reports of 
                        examinations of insured depository 
                        institutions made by any other Federal 
                        banking agency or appropriate State 
                        bank supervisor to eliminate 
                        duplicative requests for information; 
                        and
                  (B) not later than 2 years after the date of 
                enactment of the Riegle Community Development 
                and Regulatory Improvement Act of 1994, the 
                Federal banking agencies shall jointly 
                establish and implement a system for 
                determining which one of the Federal banking 
                agencies or State bank supervisors shall be the 
                lead agency responsible for managing a unified 
                examination of each insured depository 
                institution and its affiliates, as required by 
                this subsection.
          (7) Separate examinations permitted.--Notwithstanding 
        paragraph (6), each appropriate Federal banking agency 
        may conduct a separate examination in an emergency or 
        under other exigent circumstances, or when the agency 
        believes that a violation of law may have occurred.
          (8) Report.--At the time the system provided for in 
        paragraph (6) is established, the Federal banking 
        agencies shall submit a joint report describing the 
        system to the Committee on Banking, Housing, and Urban 
        Affairs of the Senate and the Committee on Banking, 
        Finance and Urban Affairs of the House of 
        Representatives. Thereafter, the Federal banking 
        agencies shall annually submit a joint report to the 
        Committee on Banking, Housing, and Urban Affairs of the 
        Senate and the Committee on Banking, Finance and Urban 
        Affairs of the House of Representatives regarding the 
        progress of the agencies in implementing the system and 
        indicating areas in which enhancements to the system, 
        including legislature improvements, would be 
        appropriate.
          (9) Standards for determining adequacy of state 
        examinations.--The Federal Financial Institutions 
        Examination Council shall issue guidelines establishing 
        standards to be used at the discretion of the 
        appropriate Federal banking agency for purposes of 
        making a determination under paragraph (3).
          (10) Agencies authorized to increase maximum asset 
        amount of institutions for certain purposes.--At any 
        time after the end of the 2-year period beginning on 
        the date of enactment of the Riegle Community 
        Development and Regulatory Improvement Act of 1994, the 
        appropriate Federal banking agency, in the agency's 
        discretion, may increase the maximum amount limitation 
        contained in paragraph (4)(C)(ii), by regulation, from 
        $200,000,000 to an amount not to exceed $1,000,000,000 
        for purposes of such paragraph, if the agency 
        determines that the greater amount would be consistent 
        with the principles of safety and soundness for insured 
        depository institutions.
  (e) Examination Fees.--
          (1) Regular and special examinations of depository 
        institutions.--The cost of conducting any regular 
        examination or special examination of any depository 
        institution under subsection (b)(2), (b)(3), or (d) or 
        of any entity described in section 3(q)(2) may be 
        assessed by the Corporation against the institution or 
        entity to meet the expenses of the Corporation in 
        carrying out such examinations.
          (2) Examination of affiliates.--The cost of 
        conducting any examination of any affiliate of any 
        insured depository institution under subsection (b)(4) 
        may be assessed by the Corporation against each 
        affiliate which is examined to meet the Corporation's 
        expenses in carrying out such examination.
          (3) Assessment against depository institution in case 
        of affiliate's refusal to pay.--
                  (A) In general.--Subject to subparagraph (B), 
                if any affiliate of any insured depository 
                institution--
                          (i) refuses to pay any assessment 
                        under paragraph (2); or
                          (ii) fails to pay any such assessment 
                        before the end of the 60-day period 
                        beginning on the date the affiliate 
                        receives notice of the assessment,
                the Corporation may assess such cost against, 
                and collect such cost from, the depository 
                institution.
                  (B) Affiliate of more than 1 depository 
                institution.--If any affiliate referred to in 
                subparagraph (A) is an affiliate of more than 1 
                insured depository institution, the assessment 
                under subparagraph (A) may be assessed against 
                the depository institutions in such proportions 
                as the Corporation determines to be 
                appropriate.
          (4) Civil money penalty for affiliate's refusal to 
        cooperate.--
                  (A) Penalty imposed.--If any affiliate of any 
                insured depository institution--
                          (i) refuses to permit an examiner 
                        appointed by the Board of Directors 
                        under subsection (b)(1) to conduct an 
                        examination; or
                          (ii) refuses to provide any 
                        information required to be disclosed in 
                        the course of any examination,
                the depository institution shall forfeit and 
                pay a penalty of not more than $5,000 for each 
                day that any such refusal continues.
                  (B) Assessment and collection.--Any penalty 
                imposed under subparagraph (A) shall be 
                assessed and collected by the Corporation in 
                the manner provided in section 8(i)(2).
          (5) Deposits of examination assessment.--Amounts 
        received by the Corporation under this subsection 
        (other than paragraph (4)) may be deposited in the 
        manner provided in section 13.
  (f) Preservation of Agency Records.--
          (1) In general.--A Federal banking agency may cause 
        any and all records, papers, or documents kept by the 
        agency or in the possession or custody of the agency to 
        be--
                  (A) photographed or microphotographed or 
                otherwise reproduced upon film; or
                  (B) preserved in any electronic medium or 
                format which is capable of--
                          (i) being read or scanned by 
                        computer; and
                          (ii) being reproduced from such 
                        electronic medium or format by printing 
                        any other form of reproduction of 
                        electronically stored data.
          (2) Treatment as original records.--Any photographs, 
        microphotographs, or photographic film or copies 
        thereof described in paragraph (1)(A) or reproduction 
        of electronically stored data described in paragraph 
        (1)(B) shall be deemed to be an original record for all 
        purposes, including introduction in evidence in all 
        State and Federal courts or administrative agencies, 
        and shall be admissible to prove any act, transaction, 
        occurrence, or event therein recorded.
          (3) Authority of the federal banking agencies.--Any 
        photographs, microphotographs, or photographic film or 
        copies thereof described in paragraph (1)(A) or 
        reproduction of electronically stored data described in 
        paragraph (1)(B) shall be preserved in such manner as 
        the Federal banking agency shall prescribe, and the 
        original records, papers, or documents may be destroyed 
        or otherwise disposed of as the Federal banking agency 
        may direct.
  (g) Authority To Prescribe Regulations and Definitions.--
Except to the extent that authority under this Act is conferred 
on any of the Federal banking agencies other than the 
Corporation, the Corporation may--
          (1) prescribe regulations to carry out this Act; and
          (2) by regulation define terms as necessary to carry 
        out this Act.
  (h) Coordination of Examination Authority.--
          (1) State bank supervisors of home and host states.--
                  (A) Home state of bank.--The appropriate 
                State bank supervisor of the home State of an 
                insured State bank has authority to examine and 
                supervise the bank.
                  (B) Host state branches.--The State bank 
                supervisor of the home State of an insured 
                State bank and any State bank supervisor of an 
                appropriate host State shall exercise its 
                respective authority to supervise and examine 
                the branches of the bank in a host State in 
                accordance with the terms of any applicable 
                cooperative agreement between the home State 
                bank supervisor and the State bank supervisor 
                of the relevant host State.
                  (C) Supervisory fees.--Except as expressly 
                provided in a cooperative agreement between the 
                State bank supervisors of the home State and 
                any host State of an insured State bank, only 
                the State bank supervisor of the home State of 
                an insured State bank may levy or charge State 
                supervisory fees on the bank.
          (2) Host state examination.--
                  (A) In general.--With respect to a branch 
                operated in a host State by an out-of-State 
                insured State bank that resulted from an 
                interstate merger transaction approved under 
                section 44, or that was established in such 
                State pursuant to section 5155(g) of the 
                Revised Statutes of the United States, the 
                third undesignated paragraph of section 9 of 
                the Federal Reserve Act or section 18(d)(4) of 
                this Act, the appropriate State bank supervisor 
                of such host State may--
                          (i) with written notice to the State 
                        bank supervisor of the bank's home 
                        State and subject to the terms of any 
                        applicable cooperative agreement with 
                        the State bank supervisor of such home 
                        State, examine such branch for the 
                        purpose of determining compliance with 
                        host State laws that are applicable 
                        pursuant to section 24(j), including 
                        those that govern community 
                        reinvestment, fair lending, and 
                        consumer protection; and
                          (ii) if expressly permitted under and 
                        subject to the terms of a cooperative 
                        agreement with the State bank 
                        supervisor of the bank's home State or 
                        if such out-of-State insured State bank 
                        has been determined to be in a troubled 
                        condition by either the State bank 
                        supervisor of the bank's home State or 
                        the bank's appropriate Federal banking 
                        agency, participate in the examination 
                        of the bank by the State bank 
                        supervisor of the bank's home State to 
                        ascertain that the activities of the 
                        branch in such host State are not 
                        conducted in an unsafe or unsound 
                        manner.
                  (B) Notice of determination.--
                          (i) In general.--The State bank 
                        supervisor of the home State of an 
                        insured State bank shall notify the 
                        State bank supervisor of each host 
                        State of the bank if there has been a 
                        final determination that the bank is in 
                        a troubled condition.
                          (ii) Timing of notice.--The State 
                        bank supervisor of the home State of an 
                        insured State bank shall provide notice 
                        under clause (i) as soon as is 
                        reasonably possible, but in all cases 
                        not later than 15 business days after 
                        the date on which the State bank 
                        supervisor has made such final 
                        determination or has received written 
                        notification of such final 
                        determination.
          (3) Host state enforcement.--If the State bank 
        supervisor of a host State determines that a branch of 
        an out-of-State insured State bank is violating any law 
        of the host State that is applicable to such branch 
        pursuant to section 24(j), including a law that governs 
        community reinvestment, fair lending, or consumer 
        protection, the State bank supervisor of the host State 
        or, to the extent authorized by the law of the host 
        State, a host State law enforcement officer may, with 
        written notice to the State bank supervisor of the 
        bank's home State and subject to the terms of any 
        applicable cooperative agreement with the State bank 
        supervisor of the bank's home State, undertake such 
        enforcement actions and proceedings as would be 
        permitted under the law of the host State as if the 
        branch were a bank chartered by that host State.
          (4) Cooperative agreement.--
                  (A) In general.--The State bank supervisors 
                from 2 or more States may enter into 
                cooperative agreements to facilitate State 
                regulatory supervision of State banks, 
                including cooperative agreements relating to 
                the coordination of examinations and joint 
                participation in examinations.
                  (B) Definition.--For purposes of this 
                subsection, the term ``cooperative agreement'' 
                means a written agreement that is signed by the 
                home State bank supervisor and the host State 
                bank supervisor to facilitate State regulatory 
                supervision of State banks, and includes 
                nationwide or multi-State cooperative 
                agreements and cooperative agreements solely 
                between the home State and host State.
                  (C) Rule of construction.--Except for State 
                bank supervisors, no provision of this 
                subsection relating to such cooperative 
                agreements shall be construed as limiting in 
                any way the authority of home State and host 
                State law enforcement officers, regulatory 
                supervisors, or other officials that have not 
                signed such cooperative agreements to enforce 
                host State laws that are applicable to a branch 
                of an out-of-State insured State bank located 
                in the host State pursuant to section 24(j).
          (5) Federal regulatory authority.--No provision of 
        this subsection shall be construed as limiting in any 
        way the authority of any Federal banking agency.
          (6) State taxation authority not affected.--No 
        provision of this subsection shall be construed as 
        affecting the authority of any State or political 
        subdivision of any State to adopt, apply, or administer 
        any tax or method of taxation to any bank, bank holding 
        company, or foreign bank, or any affiliate of any bank, 
        bank holding company, or foreign bank, to the extent 
        that such tax or tax method is otherwise permissible by 
        or under the Constitution of the United States or other 
        Federal law.
          (7) Definitions.--For purpose of this section, the 
        following definitions shall apply:
                  (A) Host state, home state, out-of-State 
                bank.--The terms ``host State'', ``home 
                State'', and ``out-of-State bank'' have the 
                same meanings as in section 44(g).
                  (B) State supervisory fees.--The term ``State 
                supervisory fees'' means assessments, 
                examination fees, branch fees, license fees, 
                and all other fees that are levied or charged 
                by a State bank supervisor directly upon an 
                insured State bank or upon branches of an 
                insured State bank.
                  (C) Troubled condition.--Solely for purposes 
                of paragraph (2)(B), an insured State bank has 
                been determined to be in ``troubled condition'' 
                if the bank--
                          (i) has a composite rating, as 
                        determined in its most recent report of 
                        examination, of 4 or 5 under the 
                        Uniform Financial Institutions Ratings 
                        System;
                          (ii) is subject to a proceeding 
                        initiated by the Corporation for 
                        termination or suspension of deposit 
                        insurance; or
                          (iii) is subject to a proceeding 
                        initiated by the State bank supervisor 
                        of the bank's home State to vacate, 
                        revoke, or terminate the charter of the 
                        bank, or to liquidate the bank, or to 
                        appoint a receiver for the bank.
                  (D) Final determination.--For purposes of 
                paragraph (2)(B), the term ``final 
                determination'' means the transmittal of a 
                report of examination to the bank or 
                transmittal of official notice of proceedings 
                to the bank.
  (i) Flood Insurance Compliance by Insured Depository 
Institutions.--
          (1) Examinations.--The appropriate Federal banking 
        agency shall, during each scheduled on-site examination 
        required by this section, determine whether the insured 
        depository institution is complying with the 
        requirements of the national flood insurance program.
          (2) Report.--
                  (A) Requirement.--Not later than 1 year after 
                the date of enactment of the Riegle Community 
                Development and Regulatory Improvement Act of 
                1994 and biennially thereafter for the next 4 
                years, each appropriate Federal banking agency 
                shall submit a report to the Congress on 
                compliance by insured depository institutions 
                with the requirements of the national flood 
                insurance program.
                  (B) Contents.--Each report submitted under 
                this paragraph shall include a description of 
                the methods used to determine compliance, the 
                number of institutions examined during the 
                reporting year, a listing and total number of 
                institutions found not to be in compliance, 
                actions taken to correct incidents of 
                noncompliance, and an analysis of compliance, 
                including a discussion of any trends, patterns, 
                and problems, and recommendations regarding 
                reasonable actions to improve the efficiency of 
                the examinations processes.
  (j) Consultation Among Examiners.--
          (1) In general.--Each appropriate Federal banking 
        agency shall take such action as may be necessary to 
        ensure that examiners employed by the agency--
                  (A) consult on examination activities with 
                respect to any depository institution; and
                  (B) achieve an agreement and resolve any 
                inconsistencies in the recommendations to be 
                given to such institution as a consequence of 
                any examinations.
          (2) Examiner-in-charge.--Each appropriate Federal 
        banking agency shall consider appointing an examiner-
        in-charge with respect to a depository institution to 
        ensure consultation on examination activities among all 
        of the examiners of that agency involved in 
        examinations of the institution.
  (k) One-Year Restrictions on Federal Examiners of Financial 
Institutions.--
          (1) In general.--In addition to other applicable 
        restrictions set forth in title 18, United States Code, 
        the penalties set forth in paragraph (6) of this 
        subsection shall apply to any person who--
                  (A) was an officer or employee (including any 
                special Government employee) of a Federal 
                banking agency or a Federal reserve bank;
                  (B) served 2 or more months during the final 
                12 months of his or her employment with such 
                agency or entity as the senior examiner (or a 
                functionally equivalent position) of a 
                depository institution or depository 
                institution holding company with continuing, 
                broad responsibility for the examination (or 
                inspection) of that depository institution or 
                depository institution holding company on 
                behalf of the relevant agency or Federal 
                reserve bank; and
                  (C) within 1 year after the termination date 
                of his or her service or employment with such 
                agency or entity, knowingly accepts 
                compensation as an employee, officer, director, 
                or consultant from--
                          (i) such depository institution, any 
                        depository institution holding company 
                        that controls such depository 
                        institution, or any other company that 
                        controls such depository institution; 
                        or
                          (ii) such depository institution 
                        holding company or any depository 
                        institution that is controlled by such 
                        depository institution holding company.
          (2) Definitions.--For purposes of this subsection--
                  (A) the term ``depository institution'' 
                includes an uninsured branch or agency of a 
                foreign bank, if such branch or agency is 
                located in any State; and
                  (B) the term ``depository institution holding 
                company'' includes any foreign bank or company 
                described in section 8(a) of the International 
                Banking Act of 1978.
          (3) Rules of construction.--For purposes of this 
        subsection, a foreign bank shall be deemed to control 
        any branch or agency of the foreign bank, and a person 
        shall be deemed to act as a consultant for a depository 
        institution, depository institution holding company, or 
        other company, only if such person directly works on 
        matters for, or on behalf of, such depository 
        institution, depository institution holding company, or 
        other company.
          (4) Regulations.--
                  (A) In general.--Each Federal banking agency 
                shall prescribe rules or regulations to 
                administer and carry out this subsection, 
                including rules, regulations, or guidelines to 
                define the scope of persons referred to in 
                paragraph (1)(B).
                  (B) Consultation required.--The Federal 
                banking agencies shall consult with each other 
                for the purpose of assuring that the rules and 
                regulations issued by the agencies under 
                subparagraph (A) are, to the extent possible, 
                consistent, comparable, and practicable, taking 
                into account any differences in the supervisory 
                programs utilized by the agencies for the 
                supervision of depository institutions and 
                depository institution holding companies.
          (5) Waiver.--
                  (A) Agency authority.--A Federal banking 
                agency may grant a waiver, on a case by case 
                basis, of the restriction imposed by this 
                subsection to any officer or employee 
                (including any special Government employee) of 
                that agency, and the Board of Governors of the 
                Federal Reserve System may grant a waiver of 
                the restriction imposed by this subsection to 
                any officer or employee of a Federal reserve 
                bank, if the head of such agency certifies in 
                writing that granting the waiver would not 
                affect the integrity of the supervisory program 
                of the relevant Federal banking agency.
                  (B) Definition.--For purposes of this 
                paragraph, the head of an agency is--
                          (i) the Comptroller of the Currency, 
                        in the case of the Office of the 
                        Comptroller of the Currency;
                          (ii) the Chairman of the Board of 
                        Governors of the Federal Reserve 
                        System, in the case of the Board of 
                        Governors of the Federal Reserve 
                        System; and
                          (iii) the Chairperson of the Board of 
                        Directors, in the case of the 
                        Corporation.
          (6) Penalties.--
                  (A) In general.--In addition to any other 
                administrative, civil, or criminal remedy or 
                penalty that may otherwise apply, whenever a 
                Federal banking agency determines that a person 
                subject to paragraph (1) has become associated, 
                in the manner described in paragraph (1)(C), 
                with a depository institution, depository 
                institution holding company, or other company 
                for which such agency serves as the appropriate 
                Federal banking agency, the agency shall impose 
                upon such person one or more of the following 
                penalties:
                          (i) Industry-wide prohibition 
                        order.--The Federal banking agency 
                        shall serve a written notice or order 
                        in accordance with and subject to the 
                        provisions of section 8(e)(4) for 
                        written notices or orders under 
                        paragraph (1) or (2) of section 8(e), 
                        upon such person of the intention of 
                        the agency--
                                  (I) to remove such person 
                                from office or to prohibit such 
                                person from further 
                                participation in the conduct of 
                                the affairs of the depository 
                                institution, depository 
                                institution holding company, or 
                                other company for a period of 
                                up to 5 years; and
                                  (II) to prohibit any further 
                                participation by such person, 
                                in any manner, in the conduct 
                                of the affairs of any insured 
                                depository institution for a 
                                period of up to 5 years.
                          (ii) Civil monetary penalty.--The 
                        Federal banking agency may, in an 
                        administrative proceeding or civil 
                        action in an appropriate United States 
                        district court, impose on such person a 
                        civil monetary penalty of not more than 
                        $250,000. Any administrative proceeding 
                        under this clause shall be conducted in 
                        accordance with section 8(i). In lieu 
                        of an action by the Federal banking 
                        agency under this clause, the Attorney 
                        General of the United States may bring 
                        a civil action under this clause in the 
                        appropriate United States district 
                        court.
                  (B) Scope of prohibition order.--Any person 
                subject to an order issued under subparagraph 
                (A)(i) shall be subject to paragraphs (6) and 
                (7) of section 8(e) in the same manner and to 
                the same extent as a person subject to an order 
                issued under such section.
                  (C) Definitions.--Solely for purposes of this 
                paragraph, the ``appropriate Federal banking 
                agency'' for a company that is not a depository 
                institution or depository institution holding 
                company shall be the Federal banking agency on 
                whose behalf the person described in paragraph 
                (1) performed the functions described in 
                paragraph (1)(B).
  Sec. 11. (a) Deposit Insurance.--
          (1) Insured amounts payable.--
                  (A) In general.--The Corporation shall insure 
                the deposits of all insured depository 
                institutions as provided in this Act.
                  (B) Net amount of insured deposit.--The net 
                amount to any depositor at an insured 
                depository institution shall not exceed the 
                standard maximum deposit insurance amount as 
                determined in accordance with subparagraphs 
                (C), (D), (E) and (F) and paragraph (3).
                  (C) Aggregation of deposits.--For the purpose 
                of determining the net amount due to any 
                depositor under subparagraph (B), the 
                Corporation shall aggregate the amounts of all 
                deposits in the insured depository institution 
                which are maintained by a depositor in the same 
                capacity and the same right for the benefit of 
                the depositor either in the name of the 
                depositor or in the name of any other person, 
                other than any amount in a trust fund described 
                in paragraph (1) or (2) of section 7(i) or any 
                funds described in section 7(i)(3).
                  (D) Coverage for certain employee benefit 
                plan deposits.--
                          (i) Pass-through insurance.--The 
                        Corporation shall provide pass-through 
                        deposit insurance for the deposits of 
                        any employee benefit plan.
                          (ii) Prohibition on acceptance of 
                        benefit plan deposits.--An insured 
                        depository institution that is not well 
                        capitalized or adequately capitalized 
                        may not accept employee benefit plan 
                        deposits.
                          (iii) Definitions.--For purposes of 
                        this subparagraph, the following 
                        definitions shall apply:
                                  (I) Capital standards.--The 
                                terms ``well capitalized'' and 
                                ``adequately capitalized'' have 
                                the same meanings as in section 
                                38.
                                  (II) Employee benefit plan.--
                                The term ``employee benefit 
                                plan'' has the same meaning as 
                                in paragraph (5)(B)(ii), and 
                                includes any eligible deferred 
                                compensation plan described in 
                                section 457 of the Internal 
                                Revenue Code of 1986.
                                  (III) Pass-through deposit 
                                insurance.--The term ``pass-
                                through deposit insurance'' 
                                means, with respect to an 
                                employee benefit plan, deposit 
                                insurance coverage based on the 
                                interest of each participant, 
                                in accordance with regulations 
                                issued by the Corporation.
                  (E) Standard maximum deposit insurance amount 
                defined.--For purposes of this Act, the term 
                ``standard maximum deposit insurance amount'' 
                means $250,000, adjusted as provided under 
                subparagraph (F) after March 31, 2010. 
                Notwithstanding any other provision of law, the 
                increase in the standard maximum deposit 
                insurance amount to $250,000 shall apply to 
                depositors in any institution for which the 
                Corporation was appointed as receiver or 
                conservator on or after January 1, 2008, and 
                before October 3, 2008. The Corporation shall 
                take such actions as are necessary to carry out 
                the requirements of this section with respect 
                to such depositors, without regard to any time 
                limitations under this Act. In implementing 
                this and the preceding 2 sentences, any payment 
                on a deposit claim made by the Corporation as 
                receiver or conservator to a depositor above 
                the standard maximum deposit insurance amount 
                in effect at the time of the appointment of the 
                Corporation as receiver or conservator shall be 
                deemed to be part of the net amount due to the 
                depositor under subparagraph (B).
                  (F) Inflation adjustment.--
                          (i) In general.--By April 1 of 2010, 
                        and the 1st day of each subsequent 5-
                        year period, the Board of Directors and 
                        the National Credit Union 
                        Administration Board shall jointly 
                        consider the factors set forth under 
                        clause (v), and, upon determining that 
                        an inflation adjustment is appropriate, 
                        shall jointly prescribe the amount by 
                        which the standard maximum deposit 
                        insurance amount and the standard 
                        maximum share insurance amount (as 
                        defined in section 207(k) of the 
                        Federal Credit Union Act) applicable to 
                        any depositor at an insured depository 
                        institution shall be increased by 
                        calculating the product of--
                                  (I) $100,000; and
                                  (II) the ratio of the 
                                published annual value of the 
                                Personal Consumption 
                                Expenditures Chain-Type Price 
                                Index (or any successor index 
                                thereto), published by the 
                                Department of Commerce, for the 
                                calendar year preceding the 
                                year in which the adjustment is 
                                calculated under this clause, 
                                to the published annual value 
                                of such index for the calendar 
                                year preceding the date this 
                                subparagraph takes effect under 
                                the Federal Deposit Insurance 
                                Reform Act of 2005.
                        The values used in the calculation 
                        under subclause (II) shall be, as of 
                        the date of the calculation, the values 
                        most recently published by the 
                        Department of Commerce.
                          (ii) Rounding.--If the amount 
                        determined under clause (ii) for any 
                        period is not a multiple of $10,000, 
                        the amount so determined shall be 
                        rounded down to the nearest $10,000.
                          (iii) Publication and report to the 
                        congress.--Not later than April 5 of 
                        any calendar year in which an 
                        adjustment is required to be calculated 
                        under clause (i) to the standard 
                        maximum deposit insurance amount and 
                        the standard maximum share insurance 
                        amount under such clause, the Board of 
                        Directors and the National Credit Union 
                        Administration Board shall--
                                  (I) publish in the Federal 
                                Register the standard maximum 
                                deposit insurance amount, the 
                                standard maximum share 
                                insurance amount, and the 
                                amount of coverage under 
                                paragraph (3)(A) and section 
                                207(k)(3) of the Federal Credit 
                                Union Act, as so calculated; 
                                and
                                  (II) jointly submit a report 
                                to the Congress containing the 
                                amounts described in subclause 
                                (I).
                          (iv)  6-month implementation 
                        period.--Unless an Act of Congress 
                        enacted before July 1 of the calendar 
                        year in which an adjustment is required 
                        to be calculated under clause (i) 
                        provides otherwise, the increase in the 
                        standard maximum deposit insurance 
                        amount and the standard maximum share 
                        insurance amount shall take effect on 
                        January 1 of the year immediately 
                        succeeding such calendar year.
                          (v) Inflation adjustment 
                        consideration.--In making any 
                        determination under clause (i) to 
                        increase the standard maximum deposit 
                        insurance amount and the standard 
                        maximum share insurance amount, the 
                        Board of Directors and the National 
                        Credit Union Administration Board shall 
                        jointly consider--
                                  (I) the overall state of the 
                                Deposit Insurance Fund and the 
                                economic conditions affecting 
                                insured depository 
                                institutions;
                                  (II) potential problems 
                                affecting insured depository 
                                institutions; or
                                  (III) whether the increase 
                                will cause the reserve ratio of 
                                the fund to fall below 1.15 
                                percent of estimated insured 
                                deposits.
          (2) Government depositors.--
                  (A) In general.--Notwithstanding any 
                limitation in this Act or in any other 
                provision of law relating to the amount of 
                deposit insurance available to any 1 
                depositor--
                          (i) a government depositor shall, for 
                        the purpose of determining the amount 
                        of insured deposits under this 
                        subsection, be deemed to be a depositor 
                        separate and distinct from any other 
                        officer, employee, or agent of the 
                        United States or any public unit 
                        referred to in subparagraph (B); and
                          (ii) except as provided in 
                        subparagraph (C), the deposits of a 
                        government depositor shall be insured 
                        in an amount equal to the standard 
                        maximum deposit insurance amount (as 
                        determined under paragraph (1)).
                  (B) Government depositor.--In this paragraph, 
                the term ``government depositor'' means a 
                depositor that 
                is--
                          (i) an officer, employee, or agent of 
                        the United States having official 
                        custody of public funds and lawfully 
                        investing or depositing the same in 
                        time and savings deposits in an insured 
                        depository institution;
                          (ii) an officer, employee, or agent 
                        of any State of the United States, or 
                        of any county, municipality, or 
                        political subdivision thereof having 
                        official custody of public funds and 
                        lawfully investing or depositing the 
                        same in time and savings deposits in an 
                        insured depository institution in such 
                        State;
                          (iii) an officer, employee, or agent 
                        of the District of Columbia having 
                        official custody of public funds and 
                        lawfully investing or depositing the 
                        same in time and savings deposits in an 
                        insured depository institution in the 
                        District of Columbia;
                          (iv) an officer, employee, or agent 
                        of the Commonwealth of Puerto Rico, of 
                        the Virgin Islands, of American Samoa, 
                        of the Trust Territory of the Pacific 
                        Islands, or of Guam, or of any county, 
                        municipality, or political subdivision 
                        thereof having official custody of 
                        public funds and lawfully investing or 
                        depositing the same in time and savings 
                        deposits in an insured depository 
                        institution in the Commonwealth of 
                        Puerto Rico, the Virgin Islands, 
                        American Samoa, the Trust Territory of 
                        the Pacific Islands, or Guam, 
                        respectively; or
                          (v) an officer, employee, or agent of 
                        any Indian tribe (as defined in section 
                        3(c) of the Indian Financing Act of 
                        1974) or agency thereof having official 
                        custody of tribal funds and lawfully 
                        investing or depositing the same in 
                        time and savings deposits in an insured 
                        depository institution.
                  (C) Authority to limit deposits.--The 
                Corporation may limit the aggregate amount of 
                funds that may be invested or deposited in 
                deposits in any insured depository institution 
                by any government depositor on the basis of the 
                size of any such bank in terms of its assets: 
                Provided, however, such limitation may be 
                exceeded by the pledging of acceptable 
                securities to the government depositor when and 
                where required.
          (3) Certain retirement accounts.--
                  (A) In general.--Notwithstanding any 
                limitation in this Act relating to the amount 
                of deposit insurance available for the account 
                of any 1 depositor, deposits in an insured 
                depository institution made in connection 
                with--
                          (i) any individual retirement account 
                        described in section 408(a) of the 
                        Internal Revenue Code of 1986;
                          (ii) subject to the exception 
                        contained in paragraph (1)(D)(ii), any 
                        eligible deferred compensation plan 
                        described in section 457 of such Code; 
                        and
                          (iii) any individual account plan 
                        defined in section 3(34) of the 
                        Employee Retirement Income Security 
                        Act, and any plan described in section 
                        401(d) of the Internal Revenue Code of 
                        1986, to the extent that participants 
                        and beneficiaries under such plan have 
                        the right to direct the investment of 
                        assets held in individual accounts 
                        maintained on their behalf by the plan,
                shall be aggregated and insured in an amount 
                not to exceed $250,000 (which amount shall be 
                subject to inflation adjustments as provided in 
                paragraph (1)(F), except that $250,000 shall be 
                substituted for $100,000 wherever such term 
                appears in such paragraph) per participant per 
                insured depository institution.
                  (B) Amounts taken into account.--For purposes 
                of subparagraph (A), the amount aggregated for 
                insurance coverage under this paragraph shall 
                consist of the present vested and ascertainable 
                interest of each participant under the plan, 
                excluding any remainder interest created by, or 
                as a result of, the plan.
          (4) Deposit insurance fund.--
                  (A) Establishment.--There is established the 
                Deposit Insurance Fund, which the Corporation 
                shall--
                          (i) maintain and administer;
                          (ii) use to carry out its insurance 
                        purposes, in the manner provided by 
                        this subsection; and
                          (iii) invest in accordance with 
                        section 13(a).
                  (B) Uses.--The Deposit Insurance Fund shall 
                be available to the Corporation for use with 
                respect to insured depository institutions the 
                deposits of which are insured by the Deposit 
                Insurance Fund.
                  (C) Limitation on use.--Notwithstanding any 
                provision of law other than section 
                13(c)(4)(G), the Deposit Insurance Fund shall 
                not be used in any manner to benefit any 
                shareholder or affiliate (other than an insured 
                depository institution that receives assistance 
                in accordance with the provisions of this Act) 
                of--
                          (i) any insured depository 
                        institution for which the Corporation 
                        has been appointed conservator or 
                        receiver, in connection with any type 
                        of resolution by the Corporation;
                          (ii) any other insured depository 
                        institution in default or in danger of 
                        default, in connection with any type of 
                        resolution by the Corporation; or
                          (iii) any insured depository 
                        institution, in connection with the 
                        provision of assistance under this 
                        section or section 13 with respect to 
                        such institution, except that this 
                        clause shall not prohibit any 
                        assistance to any insured depository 
                        institution that is not in default, or 
                        that is not in danger of default, that 
                        is acquiring (as defined in section 
                        13(f)(8)(B)) another insured depository 
                        institution.
                  (D) Deposits.--All amounts assessed against 
                insured depository institutions by the 
                Corporation shall be deposited into the Deposit 
                Insurance Fund.
          (5) Certain investment contracts not treated as 
        insured deposits.--
                  (A) In general.--A liability of an insured 
                depository institution shall not be treated as 
                an insured deposit if the liability arises 
                under any insured depository institution 
                investment contract between any insured 
                depository institution and any employee benefit 
                plan which expressly permits benefit-responsive 
                withdrawals or transfers.
                  (B) Definitions.--For purposes of 
                subparagraph (A)--
                          (i) Benefit-responsive withdrawals or 
                        transfers.--The term ``benefit-
                        responsive withdrawals or transfers'' 
                        means any withdrawal or transfer of 
                        funds (consisting of any portion of the 
                        principal and any interest credited at 
                        a rate guaranteed by the insured 
                        depository institution investment 
                        contract) during the period in which 
                        any guaranteed rate is in effect, 
                        without substantial penalty or 
                        adjustment, to pay benefits provided by 
                        the employee benefit plan or to permit 
                        a plan participant or beneficiary to 
                        redirect the investment of his or her 
                        account balance.
                          (ii) Employee benefit plan.--The term 
                        ``employee benefit plan''--
                                  (I) has the meaning given to 
                                such term in section 3(3) of 
                                the Employee Retirement Income 
                                Security Act of 1974; and
                                  (II) includes any plan 
                                described in section 401(d) of 
                                the Internal Revenue Code of 
                                1986.
  (b) For the purposes of this Act an insured depository 
institution shall be deemed to have been closed on account of 
inability to meet the demands of its depositors in any case in 
which it has been closed for the purpose of liquidation without 
adequate provision being made for payment of its depositors.
  (c) Appointment of Corporation as Conservator or Receiver.--
          (1) In general.--Notwithstanding any other provision 
        of Federal law, the law of any State, or the 
        constitution of any State, the Corporation may accept 
        appointment and act as conservator or receiver for any 
        insured depository institution upon appointment in the 
        manner provided in paragraph (2) or (3).
          (2) Federal depository institutions.--
                  (A) Appointment.--
                          (i) Conservator.--The Corporation 
                        may, at the discretion of the 
                        supervisory authority, be appointed 
                        conservator of any insured Federal 
                        depository institution and the 
                        Corporation may accept such 
                        appointment.
                          (ii) Receiver.--The Corporation shall 
                        be appointed receiver, and shall accept 
                        such appointment, whenever a receiver 
                        is appointed for the purpose of 
                        liquidation or winding up the affairs 
                        of an insured Federal depository 
                        institution by the appropriate Federal 
                        banking agency, notwithstanding any 
                        other provision of Federal law.
                  (B) Additional powers.--In addition to and 
                not in derogation of the powers conferred and 
                the duties imposed by this section on the 
                Corporation as conservator or receiver, the 
                Corporation, to the extent not inconsistent 
                with such powers and duties, shall have any 
                other power conferred on or any duty (which is 
                related to the exercise of such power) imposed 
                on a conservator or receiver for any Federal 
                depository institution under any other 
                provision of law.
                  (C) Corporation not subject to any other 
                agency.--When acting as conservator or receiver 
                pursuant to an appointment described in 
                subparagraph (A), the Corporation shall not be 
                subject to the direction or supervision of any 
                other agency or department of the United States 
                or any State in the exercise of the 
                Corporation's rights, powers, and privileges.
                  (D) Depository institution in conservatorship 
                subject to banking agency supervision.--
                Notwithstanding subparagraph (C), any Federal 
                depository institution for which the 
                Corporation has been appointed conservator 
                shall remain subject to the supervision of the 
                appropriate Federal banking agency.
          (3) Insured state depository institutions.--
                  (A) Appointment by appropriate state 
                supervisor.--Whenever the authority having 
                supervision of any insured State depository 
                institution appoints a conservator or receiver 
                for such institution and tenders appointment to 
                the Corporation, the Corporation may accept 
                such appointment.
                  (B) Additional powers.--In addition to the 
                powers conferred and the duties related to the 
                exercise of such powers imposed by State law on 
                any conservator or receiver appointed under the 
                law of such State for an insured State 
                depository institution, the Corporation, as 
                conservator or receiver pursuant to an 
                appointment described in subparagraph (A), 
                shall have the powers conferred and the duties 
                imposed by this section on the Corporation as 
                conservator or receiver.
                  (C) Corporation not subject to any other 
                agency.--When acting as conservator or receiver 
                pursuant to an appointment described in 
                subparagraph (A), the Corporation shall not be 
                subject to the direction or supervision of any 
                other agency or department of the United States 
                or any State in the exercise of its rights, 
                powers, and privileges.
                  (D) Depository institution in conservatorship 
                subject to banking agency supervision.--
                Notwithstanding subparagraph (C), any insured 
                State depository institution for which the 
                Corporation has been appointed conservator 
                shall remain subject to the supervision of the 
                appropriate State bank or savings association 
                supervisor.
          (4) Appointment of corporation by the corporation.--
        Notwithstanding any other provision of Federal law, the 
        law of any State, or the constitution of any State, the 
        Corporation may appoint itself as sole conservator or 
        receiver of any insured State depository institution 
        if--
                  (A) the Corporation determines--
                          (i) that--
                                  (I) a conservator, receiver, 
                                or other legal custodian has 
                                been appointed for such 
                                institution;
                                  (II) such institution has 
                                been subject to the appointment 
                                of any such conservator, 
                                receiver, or custodian for a 
                                period of at least 15 
                                consecutive days; and
                                  (III) 1 or more of the 
                                depositors in such institution 
                                is unable to withdraw any 
                                amount of any insured deposit; 
                                or
                          (ii) that such institution has been 
                        closed by or under the laws of any 
                        State; and
                  (B) the Corporation determines that 1 or more 
                of the grounds specified in paragraph (5)--
                          (i) existed with respect to such 
                        institution at the time--
                                  (I) the conservator, 
                                receiver, or other legal 
                                custodian was appointed; or
                                  (II) such institution was 
                                closed; or
                          (ii) exist at any time--
                                  (I) during the appointment of 
                                the conservator, receiver, or 
                                other legal custodian; or
                                  (II) while such institution 
                                is closed.
          (5) Grounds for appointing conservator or receiver.--
        The grounds for appointing a conservator or receiver 
        (which may be the Corporation) for any insured 
        depository institution are as follows:
                  (A) Assets insufficient for obligations.--The 
                institution's assets are less than the 
                institution's obligations to its creditors and 
                others, including members of the institution.
                  (B) Substantial dissipation.--Substantial 
                dissipation of assets or earnings due to--
                          (i) any violation of any statute or 
                        regulation; or
                          (ii) any unsafe or unsound practice.
                  (C) Unsafe or unsound condition.--An unsafe 
                or unsound condition to transact business.
                  (D) Cease and desist orders.--Any willful 
                violation of a cease-and-desist order which has 
                become final.
                  (E) Concealment.--Any concealment of the 
                institution's books, papers, records, or 
                assets, or any refusal to submit the 
                institution's books, papers, records, or 
                affairs for inspection to any examiner or to 
                any lawful agent of the appropriate Federal 
                banking agency or State bank or savings 
                association supervisor.
                  (F) Inability to meet obligations.--The 
                institution is likely to be unable to pay its 
                obligations or meet its depositors' demands in 
                the normal course of business.
                  (G) Losses.--The institution has incurred or 
                is likely to incur losses that will deplete all 
                or substantially all of its capital, and there 
                is no reasonable prospect for the institution 
                to become adequately capitalized (as defined in 
                section 38(b)) without Federal assistance.
                  (H) Violations of law.--Any violation of any 
                law or regulation, or any unsafe or unsound 
                practice or condition that is likely to--
                          (i) cause insolvency or substantial 
                        dissipation of assets or earnings;
                          (ii) weaken the institution's 
                        condition; or
                          (iii) otherwise seriously prejudice 
                        the interests of the institution's 
                        depositors or the Deposit Insurance 
                        Fund.
                  (I) Consent.--The institution, by resolution 
                of its board of directors or its shareholders 
                or members, consents to the appointment.
                  (J) Cessation of insured status.--The 
                institution ceases to be an insured 
                institution.
                  (K) Undercapitalization.--The institution is 
                undercapitalized (as defined in section 38(b)), 
                and--
                          (i) has no reasonable prospect of 
                        becoming adequately capitalized (as 
                        defined in that section);
                          (ii) fails to become adequately 
                        capitalized when required to do so 
                        under section 38(f)(2)(A);
                          (iii) fails to submit a capital 
                        restoration plan acceptable to that 
                        agency within the time prescribed under 
                        section 38(e)(2)(D); or
                          (iv) materially fails to implement a 
                        capital restoration plan submitted and 
                        accepted under section 38(e)(2).
                  (L) The institution--
                          (i) is critically undercapitalized, 
                        as defined in section 38(b); or
                          (ii) otherwise has substantially 
                        insufficient capital.
                  (M) Money laundering offense.--The Attorney 
                General notifies the appropriate Federal 
                banking agency or the Corporation in writing 
                that the insured depository institution has 
                been found guilty of a criminal offense under 
                section 1956 or 1957 of title 18, United States 
                Code, or section 5322 or 5324 of title 31, 
                United States Code.
          (6) Appointment by comptroller of the currency.--
                  (A) Conservator.--The Corporation may, at the 
                discretion of the Comptroller of the Currency, 
                be appointed conservator and the Corporation 
                may accept any such appointment.
                  (B) Receiver.--The Corporation may, at the 
                discretion of the Comptroller of the Currency, 
                be appointed receiver and the Corporation may 
                accept any such appointment.
          (7) Judicial review.--If the Corporation is appointed 
        (including the appointment of the Corporation as 
        receiver by the Board of Directors) as conservator or 
        receiver of a depository institution under paragraph 
        (4), (9), or (10), the depository institution may, not 
        later than 30 days thereafter, bring an action in the 
        United States district court for the judicial district 
        in which the home office of such depository institution 
        is located, or in the United States District Court for 
        the District of Columbia, for an order requiring the 
        Corporation to be removed as the conservator or 
        receiver (regardless of how such appointment was made), 
        and the court shall, upon the merits, dismiss such 
        action or direct the Corporation to be removed as the 
        conservator or receiver.
          (8) Replacement of conservator of state depository 
        institution.--
                  (A) In general.--In the case of any insured 
                State depository institution for which the 
                Corporation appointed itself as conservator 
                pursuant to paragraph (4), the Corporation may, 
                without any requirement of notice, hearing, or 
                other action, replace itself as conservator 
                with itself as receiver of such institution.
                  (B) Replacement treated as removal of 
                incumbent.--The replacement of a conservator 
                with a receiver under subparagraph (A) shall be 
                treated as the removal of the Corporation as 
                conservator.
                  (C) Right of review of original appointment 
                not affected.--The replacement of a conservator 
                with a receiver under subparagraph (A) shall 
                not affect any right of the insured State 
                depository institution to obtain review, 
                pursuant to paragraph (7), of the original 
                appointment of the conservator.
          (9) Appropriate federal banking agency may appoint 
        corporation as conservator or receiver for insured 
        state depository institution to carry out section 38.--
                  (A) In general.--The appropriate Federal 
                banking agency may appoint the Corporation as 
                sole receiver (or, subject to paragraph (11), 
                sole conservator) of any insured State 
                depository institution, after consultation with 
                the appropriate State supervisor, if the 
                appropriate Federal banking agency determines 
                that--
                          (i) 1 or more of the grounds 
                        specified in subparagraphs (K) and (L) 
                        of paragraph (5) exist with respect to 
                        that institution; and
                          (ii) the appointment is necessary to 
                        carry out the purpose of section 38.
                  (B) Nondelegation.--The appropriate Federal 
                banking agency shall not delegate any action 
                under subparagraph (A).
          (10) Corporation may appoint itself as conservator or 
        receiver for insured depository institution to prevent 
        loss to deposit insurance fund.--The Board of Directors 
        may appoint the Corporation as sole conservator or 
        receiver of an insured depository institution, after 
        consultation with the appropriate Federal banking 
        agency and the appropriate State supervisor (if any), 
        if the Board of Directors determines that--
                  (A) 1 or more of the grounds specified in any 
                subparagraph of paragraph (5) exist with 
                respect to the institution; and
                  (B) the appointment is necessary to reduce--
                          (i) the risk that the Deposit 
                        Insurance Fund would incur a loss with 
                        respect to the insured depository 
                        institution, or
                          (ii) any loss that the Deposit 
                        Insurance Fund is expected to incur 
                        with respect to that institution.
          (11) Appropriate federal banking agency shall not 
        appoint conservator under certain provisions without 
        giving corporation opportunity to appoint receiver.--
        The appropriate Federal banking agency shall not 
        appoint a conservator for an insured depository 
        institution under subparagraph (K) or (L) of paragraph 
        (5) without the Corporation's consent unless the agency 
        has given the Corporation 48 hours notice of the 
        agency's intention to appoint the conservator and the 
        grounds for the appointment.
          (12) Directors not liable for acquiescing in 
        appointment of conservator or receiver.--The members of 
        the board of directors of an insured depository 
        institution shall not be liable to the institution's 
        shareholders or creditors for acquiescing in or 
        consenting in good faith to--
                  (A) the appointment of the Corporation as 
                conservator or receiver for that institution; 
                or
                  (B) an acquisition or combination under 
                section 38(f)(2)(A)(iii).
          (13) Additional powers.--In any case in which the 
        Corporation is appointed conservator or receiver under 
        paragraph (4), (6), (9), or (10) for any insured State 
        depository institution--
                  (A) this section shall apply to the 
                Corporation as conservator or receiver in the 
                same manner and to the same extent as if that 
                institution were a Federal depository 
                institution for which the Corporation had been 
                appointed conservator or receiver; and
                  (B) the Corporation as receiver of the 
                institution may--
                          (i) liquidate the institution in an 
                        orderly manner; and
                          (ii) make any other disposition of 
                        any matter concerning the institution, 
                        as the Corporation determines is in the 
                        best interests of the institution, the 
                        depositors of the institution, and the 
                        Corporation.
  (d) Powers and Duties of Corporation as Conservator or 
Receiver.--
          (1) Rulemaking authority of corporation.--The 
        Corporation may prescribe such regulations as the 
        Corporation determines to be appropriate regarding the 
        conduct of conservatorships or receiverships.
          (2) General powers.--
                  (A) Successor to institution.--The 
                Corporation shall, as conservator or receiver, 
                and by operation of law, succeed to--
                          (i) all rights, titles, powers, and 
                        privileges of the insured depository 
                        institution, and of any stockholder, 
                        member, accountholder, depositor, 
                        officer, or director of such 
                        institution with respect to the 
                        institution and the assets of the 
                        institution; and
                          (ii) title to the books, records, and 
                        assets of any previous conservator or 
                        other legal custodian of such 
                        institution.
                  (B) Operate the institution.--The Corporation 
                may (subject to the provisions of section 40), 
                as conservator or receiver--
                          (i) take over the assets of and 
                        operate the insured depository 
                        institution with all the powers of the 
                        members or shareholders, the directors, 
                        and the officers of the institution and 
                        conduct all business of the 
                        institution;
                          (ii) collect all obligations and 
                        money due the institution;
                          (iii) perform all functions of the 
                        institution in the name of the 
                        institution which are consistent with 
                        the appointment as conservator or 
                        receiver; and
                          (iv) preserve and conserve the assets 
                        and property of such institution.
                  (C) Functions of institution's officers, 
                directors, and shareholders.--The Corporation 
                may, by regulation or order, provide for the 
                exercise of any function by any member or 
                stockholder, director, or officer of any 
                insured depository institution for which the 
                Corporation has been appointed conservator or 
                receiver.
                  (D) Powers as conservator.--The Corporation 
                may, as conservator, take such action as may 
                be--
                          (i) necessary to put the insured 
                        depository institution in a sound and 
                        solvent condition; and
                          (ii) appropriate to carry on the 
                        business of the institution and 
                        preserve and conserve the assets and 
                        property of the institution.
                  (E) Additional powers as receiver.--The 
                Corporation may (subject to the provisions of 
                section 40), as receiver, place the insured 
                depository institution in liquidation and 
                proceed to realize upon the assets of the 
                institution, having due regard to the 
                conditions of credit in the locality.
                  (F) Organization of new institutions.--The 
                Corporation may, as receiver, with respect to 
                any insured depository institution, organize a 
                new depository institution under subsection (m) 
                or a bridge depository institution under 
                subsection (n).
                  (G) Merger; Transfer of assets and 
                liabilities.--
                          (i) In general.--The Corporation may, 
                        as conservator or receiver--
                                  (I) merge the insured 
                                depository institution with 
                                another insured depository 
                                institution; or
                                  (II) subject to clause (ii), 
                                transfer any asset or liability 
                                of the institution in default 
                                (including assets and 
                                liabilities associated with any 
                                trust business) without any 
                                approval, assignment, or 
                                consent with respect to such 
                                transfer.
                          (ii) Approval by appropriate federal 
                        banking agency.--No transfer described 
                        in clause (i)(II) may be made to 
                        another depository institution (other 
                        than a new depository institution or a 
                        bridge depository institution 
                        established pursuant to subsection (m) 
                        or (n)) without the approval of the 
                        appropriate Federal banking agency for 
                        such institution.
                  (H) Payment of valid obligations.--The 
                Corporation, as conservator or receiver, shall 
                pay all valid obligations of the insured 
                depository institution in accordance with the 
                prescriptions and limitations of this Act.
                  (I) Subpoena authority.--
                          (i) In general.--The Corporation may, 
                        as conservator, receiver, or exclusive 
                        manager and for purposes of carrying 
                        out any power, authority, or duty with 
                        respect to an insured depository 
                        institution (including determining any 
                        claim against the institution and 
                        determining and realizing upon any 
                        asset of any person in the course of 
                        collecting money due the institution), 
                        exercise any power established under 
                        section 8(n), and the provisions of 
                        such section shall apply with respect 
                        to the exercise of any such power under 
                        this subparagraph in the same manner as 
                        such provisions apply under such 
                        section.
                          (ii) Authority of board of 
                        directors.--A subpoena or subpoena 
                        duces tecum may be issued under clause 
                        (i) only by, or with the written 
                        approval of, the Board of Directors or 
                        their designees (or, in the case of a 
                        subpoena or subpoena duces tecum issued 
                        by the Resolution Trust Corporation 
                        under this subparagraph [and section 
                        21A(b)(4)], only by, or with the 
                        written approval of, the Board of 
                        Directors of such Corporation or their 
                        designees).
                          (iii) Rule of construction.--This 
                        subsection shall not be construed as 
                        limiting any rights that the 
                        Corporation, in any capacity, might 
                        otherwise have under section 10(c) of 
                        this Act.
                  (J) Incidental powers.--The Corporation may, 
                as conservator or receiver--
                          (i) exercise all powers and 
                        authorities specifically granted to 
                        conservators or receivers, 
                        respectively, under this Act and such 
                        incidental powers as shall be necessary 
                        to carry out such powers; and
                          (ii) take any action authorized by 
                        this Act,
                which the Corporation determines is in the best 
                interests of the depository institution, its 
                depositors, or the Corporation.
                  (K) Utilization of private sector.--In 
                carrying out its responsibilities in the 
                management and disposition of assets from 
                insured depository institutions, as 
                conservator, receiver, or in its corporate 
                capacity, the Corporation shall utilize the 
                services of private persons, including real 
                estate and loan portfolio asset management, 
                property management, auction marketing, legal, 
                and brokerage services, only if such services 
                are available in the private sector and the 
                Corporation determines utilization of such 
                services is the most practicable, efficient, 
                and cost effective.
          (3) Authority of receiver to determine claims.--
                  (A) In general.--The Corporation may, as 
                receiver, determine claims in accordance with 
                the requirements of this subsection and 
                regulations prescribed under paragraph (4).
                  (B) Notice requirements.--The receiver, in 
                any case involving the liquidation or winding 
                up of the affairs of a closed depository 
                institution, shall--
                          (i) promptly publish a notice to the 
                        depository institution's creditors to 
                        present their claims, together with 
                        proof, to the receiver by a date 
                        specified in the notice which shall be 
                        not less than 90 days after the 
                        publication of such notice; and
                          (ii) republish such notice 
                        approximately 1 month and 2 months, 
                        respectively, after the publication 
                        under clause (i).
                  (C) Mailing required.--The receiver shall 
                mail a notice similar to the notice published 
                under subparagraph (B)(i) at the time of such 
                publication to any creditor shown on the 
                institution's books--
                          (i) at the creditor's last address 
                        appearing in such books; or
                          (ii) upon discovery of the name and 
                        address of a claimant not appearing on 
                        the institution's books within 30 days 
                        after the discovery of such name and 
                        address.
          (4) Rulemaking authority relating to determination of 
        claims.--
                  (A) In general.--The Corporation may 
                prescribe regulations regarding the allowance 
                or disallowance of claims by the receiver and 
                providing for administrative determination of 
                claims and review of such determination.
                  (B) Final settlement payment procedure.--
                          (i) In general.--In the handling of 
                        receiverships of insured depository 
                        institutions, to maintain essential 
                        liquidity and to prevent financial 
                        disruption, the Corporation may, after 
                        the declaration of an institution's 
                        insolvency, settle all uninsured and 
                        unsecured claims on the receivership 
                        with a final settlement payment which 
                        shall constitute full payment and 
                        disposition of the Corporation's 
                        obligations to such claimants.
                          (ii) Final settlement payment.--For 
                        purposes of clause (i), a final 
                        settlement payment shall be payment of 
                        an amount equal to the product of the 
                        final settlement payment rate and the 
                        amount of the uninsured and unsecured 
                        claim on the receivership; and
                          (iii) Final settlement payment 
                        rate.--For purposes of clause (ii), the 
                        final settlement payment rate shall be 
                        a percentage rate reflecting an average 
                        of the Corporation's receivership 
                        recovery experience, determined by the 
                        Corporation in such a way that over 
                        such time period as the Corporation may 
                        deem appropriate, the Corporation in 
                        total will receive no more or less than 
                        it would have received in total as a 
                        general creditor standing in the place 
                        of insured depositors in each specific 
                        receivership.
                          (iv) Corporation authority.--The 
                        Corporation may undertake such 
                        supervisory actions and promulgate such 
                        regulations as may be necessary to 
                        assure that the requirements of this 
                        section can be implemented with respect 
                        to each insured depository institution 
                        in the event of its insolvency.
          (5) Procedures for determination of claims.--
                  (A) Determination period.--
                          (i) In general.--Before the end of 
                        the 180-day period beginning on the 
                        date any claim against a depository 
                        institution is filed with the 
                        Corporation as receiver, the 
                        Corporation shall determine whether to 
                        allow or disallow the claim and shall 
                        notify the claimant of any 
                        determination with respect to such 
                        claim.
                          (ii) Extension of time.--The period 
                        described in clause (i) may be extended 
                        by a written agreement between the 
                        claimant and the Corporation.
                          (iii) Mailing of notice sufficient.--
                        The requirements of clause (i) shall be 
                        deemed to be satisfied if the notice of 
                        any determination with respect to any 
                        claim is mailed to the last address of 
                        the claimant which appears--
                                  (I) on the depository 
                                institution's books;
                                  (II) in the claim filed by 
                                the claimant; or
                                  (III) in documents submitted 
                                in proof of the claim.
                          (iv) Contents of notice of 
                        disallowance.--If any claim filed under 
                        clause (i) is disallowed, the notice to 
                        the claimant shall contain--
                                  (I) a statement of each 
                                reason for the disallowance; 
                                and
                                  (II) the procedures available 
                                for obtaining agency review of 
                                the determination to disallow 
                                the claim or judicial 
                                determination of the claim.
                  (B) Allowance of proven claims.--The receiver 
                shall allow any claim received on or before the 
                date specified in the notice published under 
                paragraph (3)(B)(i) by the receiver from any 
                claimant which is proved to the satisfaction of 
                the receiver.
                  (C) Disallowance of claims filed after end of 
                filing period.--
                          (i) In general.--Except as provided 
                        in clause (ii), claims filed after the 
                        date specified in the notice published 
                        under paragraph (3)(B)(i) shall be 
                        disallowed and such disallowance shall 
                        be final.
                          (ii) Certain exceptions.--Clause (i) 
                        shall not apply with respect to any 
                        claim filed by any claimant after the 
                        date specified in the notice published 
                        under paragraph (3)(B)(i) and such 
                        claim may be considered by the receiver 
                        if--
                                  (I) the claimant did not 
                                receive notice of the 
                                appointment of the receiver in 
                                time to file such claim before 
                                such date; and
                                  (II) such claim is filed in 
                                time to permit payment of such 
                                claim.
                  (D) Authority to disallow claims.--
                          (i) In general.--The receiver may 
                        disallow any portion of any claim by a 
                        creditor or claim of security, 
                        preference, or priority which is not 
                        proved to the satisfaction of the 
                        receiver.
                          (ii) Payments to less than fully 
                        secured creditors.--In the case of a 
                        claim of a creditor against an insured 
                        depository institution which is secured 
                        by any property or other asset of such 
                        institution, any receiver appointed for 
                        any insured depository institution--
                                  (I) may treat the portion of 
                                such claim which exceeds an 
                                amount equal to the fair market 
                                value of such property or other 
                                asset as an unsecured claim 
                                against the institution; and
                                  (II) may not make any payment 
                                with respect to such unsecured 
                                portion of the claim other than 
                                in connection with the 
                                disposition of all claims of 
                                unsecured creditors of the 
                                institution.
                          (iii) Exceptions.--No provision of 
                        this paragraph shall apply with respect 
                        to--
                                  (I) any extension of credit 
                                from any Federal home loan bank 
                                or Federal Reserve bank to any 
                                insured depository institution; 
                                or
                                  (II) any security interest in 
                                the assets of the institution 
                                securing any such extension of 
                                credit.
                  (E) No judicial review of determination 
                pursuant to subparagraph (d).--No court may 
                review the Corporation's determination pursuant 
                to subparagraph (D) to disallow a claim.
                  (F) Legal effect of filing.--
                          (i) Statute of limitation tolled.--
                        For purposes of any applicable statute 
                        of limitations, the filing of a claim 
                        with the receiver shall constitute a 
                        commencement of an action.
                          (ii) No prejudice to other actions.--
                        Subject to paragraph (12), the filing 
                        of a claim with the receiver shall not 
                        prejudice any right of the claimant to 
                        continue any action which was filed 
                        before the appointment of the receiver.
          (6) Provision for agency review or judicial 
        determination of claims.--
                  (A) In general.--Before the end of the 60-day 
                period beginning on the earlier of--
                          (i) the end of the period described 
                        in paragraph (5)(A)(i) with respect to 
                        any claim against a depository 
                        institution for which the Corporation 
                        is receiver; or
                          (ii) the date of any notice of 
                        disallowance of such claim pursuant to 
                        paragraph (5)(A)(i),
                the claimant may request administrative review 
                of the claim in accordance with subparagraph 
                (A) or (B) of paragraph (7) or file suit on 
                such claim (or continue an action commenced 
                before the appointment of the receiver) in the 
                district or territorial court of the United 
                States for the district within which the 
                depository institution's principal place of 
                business is located or the United States 
                District Court for the District of Columbia 
                (and such court shall have jurisdiction to hear 
                such claim).
                  (B) Statute of limitations.--If any claimant 
                fails to--
                          (i) request administrative review of 
                        any claim in accordance with 
                        subparagraph (A) or (B) of paragraph 
                        (7); or
                          (ii) file suit on such claim (or 
                        continue an action commenced before the 
                        appointment of the receiver),
                before the end of the 60-day period described 
                in subparagraph (A), the claim shall be deemed 
                to be disallowed (other than any portion of 
                such claim which was allowed by the receiver) 
                as of the end of such period, such disallowance 
                shall be final, and the claimant shall have no 
                further rights or remedies with respect to such 
                claim.
          (7) Review of claims.--
                  (A) Administrative hearing.--If any claimant 
                requests review under this subparagraph in lieu 
                of filing or continuing any action under 
                paragraph (6) and the Corporation agrees to 
                such request, the Corporation shall consider 
                the claim after opportunity for a hearing on 
                the record. The final determination of the 
                Corporation with respect to such claim shall be 
                subject to judicial review under chapter 7 of 
                title 5, United States Code.
          (B) Other review procedures.--
                  (i) In general.--The Corporation shall also 
                establish such alternative dispute resolution 
                processes as may be appropriate for the 
                resolution of claims filed under paragraph 
                (5)(A)(i).
                  (ii) Criteria.--In establishing alternative 
                dispute resolution processes, the Corporation 
                shall strive for procedures which are 
                expeditious, fair, independent, and low cost.
                  (iii) Voluntary binding or nonbinding 
                procedures.--The Corporation may establish both 
                binding and nonbinding processes, which may be 
                conducted by any government or private party, 
                but all parties, including the claimant and the 
                Corporation, must agree to the use of the 
                process in a particular case.
                  (iv) Consideration of incentives.--The 
                Corporation shall seek to develop incentives 
                for claimants to participate in the alternative 
                dispute resolution process.
          (8) Expedited determination of claims.--
                  (A) Establishment required.--The Corporation 
                shall establish a procedure for expedited 
                relief outside of the routine claims process 
                established under paragraph (5) for claimants 
                who--
                          (i) allege the existence of legally 
                        valid and enforceable or perfected 
                        security interests in assets of any 
                        depository institution for which the 
                        Corporation has been appointed 
                        receiver; and
                          (ii) allege that irreparable injury 
                        will occur if the routine claims 
                        procedure is followed.
                  (B) Determination period.--Before the end of 
                the 90-day period beginning on the date any 
                claim is filed in accordance with the 
                procedures established pursuant to subparagraph 
                (A), the Corporation shall--
                          (i) determine--
                                  (I) whether to allow or 
                                disallow such claim; or
                                  (II) whether such claim 
                                should be determined pursuant 
                                to the procedures established 
                                pursuant to paragraph (5); and
                          (ii) notify the claimant of the 
                        determination, and if the claim is 
                        disallowed, provide a statement of each 
                        reason for the disallowance and the 
                        procedure for obtaining agency review 
                        or judicial determination.
                  (C) Period for filing or renewing suit.--Any 
                claimant who files a request for expedited 
                relief shall be permitted to file a suit, or to 
                continue a suit filed before the appointment of 
                the receiver, seeking a determination of the 
                claimant's rights with respect to such security 
                interest after the earlier of--
                          (i) the end of the 90-day period 
                        beginning on the date of the filing of 
                        a request for expedited relief; or
                          (ii) the date the Corporation denies 
                        the claim.
                  (D) Statute of limitations.--If an action 
                described in subparagraph (C) is not filed, or 
                the motion to renew a previously filed suit is 
                not made, before the end of the 30-day period 
                beginning on the date on which such action or 
                motion may be filed in accordance with 
                subparagraph (B), the claim shall be deemed to 
                be disallowed as of the end of such period 
                (other than any portion of such claim which was 
                allowed by the receiver), such disallowance 
                shall be final, and the claimant shall have no 
                further rights or remedies with respect to such 
                claim.
                  (E) Legal effect of filing.--
                          (i) Statute of limitation tolled.--
                        For purposes of any applicable statute 
                        of limitations, the filing of a claim 
                        with the receiver shall constitute a 
                        commencement of an action.
                          (ii) No prejudice to other actions.--
                        Subject to paragraph (12), the filing 
                        of a claim with the receiver shall not 
                        prejudice any right of the claimant to 
                        continue any action which was filed 
                        before the appointment of the receiver.
          (9) Agreement as basis of claim.--
                  (A) Requirements.--Except as provided in 
                subparagraph (B), any agreement which does not 
                meet the requirements set forth in section 
                13(e) shall not form the basis of, or 
                substantially comprise, a claim against the 
                receiver or the Corporation.
                  (B) Exception to contemporaneous execution 
                requirement.--Notwithstanding section 13(e)(2), 
                any agreement relating to an extension of 
                credit between a Federal home loan bank or 
                Federal Reserve bank and any insured depository 
                institution which was executed before the 
                extension of credit by such bank to such 
                institution shall be treated as having been 
                executed contemporaneously with such extension 
                of credit for purposes of subparagraph (A).
          (10) Payment of claims.--
                  (A) In general.--The receiver may, in the 
                receiver's discretion and to the extent funds 
                are available, pay creditor claims which are 
                allowed by the receiver, approved by the 
                Corporation pursuant to a final determination 
                pursuant to paragraph (7) or (8), or determined 
                by the final judgment of any court of competent 
                jurisdiction in such manner and amounts as are 
                authorized under this Act.
                  (B) Payment of dividends on claims.--The 
                receiver may, in the receiver's sole 
                discretion, pay dividends on proved claims at 
                any time, and no liability shall attach to the 
                Corporation (in such Corporation's corporate 
                capacity or as receiver), by reason of any such 
                payment, for failure to pay dividends to a 
                claimant whose claim is not proved at the time 
                of any such payment.
                  (C) Rulemaking authority of corporation.--The 
                Corporation may prescribe such rules, including 
                definitions of terms, as it deems appropriate 
                to establish a single uniform interest rate for 
                or to make payments of post insolvency interest 
                to creditors holding proven claims against the 
                receivership estates of insured Federal or 
                State depository institutions following 
                satisfaction by the receiver of the principal 
                amount of all creditor claims.
          (11) Depositor preference.--
                  (A) In general.--Subject to section 
                5(e)(2)(C), amounts realized from the 
                liquidation or other resolution of any insured 
                depository institution by any receiver 
                appointed for such institution shall be 
                distributed to pay claims (other than secured 
                claims to the extent of any such security) in 
                the following order of priority:
                          (i) Administrative expenses of the 
                        receiver.
                          (ii) Any deposit liability of the 
                        institution.
                          (iii) Any other general or senior 
                        liability of the institution (which is 
                        not a liability described in clause 
                        (iv) or (v)).
                          (iv) Any obligation subordinated to 
                        depositors or general creditors (which 
                        is not an obligation described in 
                        clause (v)).
                          (v) Any obligation to shareholders or 
                        members arising as a result of their 
                        status as shareholders or members 
                        (including any depository institution 
                        holding company or any shareholder or 
                        creditor of such company).
                  (B) Effect on state law.--
                          (i) In general.--The provisions of 
                        subparagraph (A) shall not supersede 
                        the law of any State except to the 
                        extent such law is inconsistent with 
                        the provisions of such subparagraph, 
                        and then only to the extent of the 
                        inconsistency.
                          (ii) Procedure for determination of 
                        inconsistency.--Upon the Corporation's 
                        own motion or upon the request of any 
                        person with a claim described in 
                        subparagraph (A) or any State which is 
                        submitted to the Corporation in 
                        accordance with procedures which the 
                        Corporation shall prescribe, the 
                        Corporation shall determine whether any 
                        provision of the law of any State is 
                        inconsistent with any provision of 
                        subparagraph (A) and the extent of any 
                        such inconsistency.
                          (iii) Judicial review.--The final 
                        determination of the Corporation under 
                        clause (ii) shall be subject to 
                        judicial review under chapter 7 of 
                        title 5, United States Code.
                  (C) Accounting report.--Any distribution by 
                the Corporation in connection with any claim 
                described in subparagraph (A)(v) shall be 
                accompanied by the accounting report required 
                under paragraph (15)(B).
          (12) Suspension of legal actions.--
                  (A) In general.--After the appointment of a 
                conservator or receiver for an insured 
                depository institution, the conservator or 
                receiver may request a stay for a period not to 
                exceed--
                          (i) 45 days, in the case of any 
                        conservator; and
                          (ii) 90 days, in the case of any 
                        receiver,
                in any judicial action or proceeding to which 
                such institution is or becomes a party.
                  (B) Grant of stay by all courts required.--
                Upon receipt of a request by any conservator or 
                receiver pursuant to subparagraph (A) for a 
                stay of any judicial action or proceeding in 
                any court with jurisdiction of such action or 
                proceeding, the court shall grant such stay as 
                to all parties.
          (13) Additional rights and duties.--
                  (A) Prior final adjudication.--The 
                Corporation shall abide by any final 
                unappealable judgment of any court of competent 
                jurisdiction which was rendered before the 
                appointment of the Corporation as conservator 
                or receiver.
                  (B) Rights and remedies of conservator or 
                receiver.--In the event of any appealable 
                judgment, the Corporation as conservator or 
                receiver shall--
                          (i) have all the rights and remedies 
                        available to the insured depository 
                        institution (before the appointment of 
                        such conservator or receiver) and the 
                        Corporation in its corporate capacity, 
                        including removal to Federal court and 
                        all appellate rights; and
                          (ii) not be required to post any bond 
                        in order to pursue such remedies.
                  (C) No attachment or execution.--No 
                attachment or execution may issue by any court 
                upon assets in the possession of the receiver.
                  (D) Limitation on judicial review.--Except as 
                otherwise provided in this subsection, no court 
                shall have jurisdiction over--
                          (i) any claim or action for payment 
                        from, or any action seeking a 
                        determination of rights with respect 
                        to, the assets of any depository 
                        institution for which the Corporation 
                        has been appointed receiver, including 
                        assets which the Corporation may 
                        acquire from itself as such receiver; 
                        or
                          (ii) any claim relating to any act or 
                        omission of such institution or the 
                        Corporation as receiver.
                  (E) Disposition of assets.--In exercising any 
                right, power, privilege, or authority as 
                conservator or receiver in connection with any 
                sale or disposition of assets of any insured 
                depository institution for which the 
                Corporation has been appointed conservator or 
                receiver, including any sale or disposition of 
                assets acquired by the Corporation under 
                section 13(d)(1), the Corporation shall conduct 
                its operations in a manner which--
                          (i) maximizes the net present value 
                        return from the sale or disposition of 
                        such assets;
                          (ii) minimizes the amount of any loss 
                        realized in the resolution of cases;
                          (iii) ensures adequate competition 
                        and fair and consistent treatment of 
                        offerors;
                          (iv) prohibits discrimination on the 
                        basis of race, sex, or ethnic groups in 
                        the solicitation and consideration of 
                        offers; and
                          (v) maximizes the preservation of the 
                        availability and affordability of 
                        residential real property for low- and 
                        moderate-income individuals.
          (14) Statute of limitations for actions brought by 
        conservator or receiver.--
                  (A) In general.--Notwithstanding any 
                provision of any contract, the applicable 
                statute of limitations with regard to any 
                action brought by the Corporation as 
                conservator or receiver shall be--
                          (i) in the case of any contract 
                        claim, the longer of--
                                  (I) the 6-year period 
                                beginning on the date the claim 
                                accrues; or
                                  (II) the period applicable 
                                under State law; and
                          (ii) in the case of any tort claim 
                        (other than a claim which is subject to 
                        section 21A(b)(14) of the Federal Home 
                        Loan Bank Act), the longer of--
                                  (I) the 3-year period 
                                beginning on the date the claim 
                                accrues; or
                                  (II) the period applicable 
                                under State law.
                  (B) Determination of the date on which a 
                claim accrues.--For purposes of subparagraph 
                (A), the date on which the statute of 
                limitations begins to run on any claim 
                described in such subparagraph shall be the 
                later of--
                          (i) the date of the appointment of 
                        the Corporation as conservator or 
                        receiver; or
                          (ii) the date on which the cause of 
                        action accrues.
                  (C) Revival of expired state causes of 
                action.--
                          (i) In general.--In the case of any 
                        tort claim described in clause (ii) for 
                        which the statute of limitation 
                        applicable under State law with respect 
                        to such claim has expired not more than 
                        5 years before the appointment of the 
                        Corporation as conservator or receiver, 
                        the Corporation may bring an action as 
                        conservator or receiver on such claim 
                        without regard to the expiration of the 
                        statute of limitation applicable under 
                        State law.
                          (ii) Claims described.--A tort claim 
                        referred to in clause (i) is a claim 
                        arising from fraud, intentional 
                        misconduct resulting in unjust 
                        enrichment, or intentional misconduct 
                        resulting in substantial loss to the 
                        institution.
          (15) Accounting and recordkeeping requirements.--
                  (A) In general.--The Corporation as 
                conservator or receiver shall, consistent with 
                the accounting and reporting practices and 
                procedures established by the Corporation, 
                maintain a full accounting of each 
                conservatorship and receivership or other 
                disposition of institutions in default.
                  (B) Annual accounting or report.--With 
                respect to each conservatorship or receivership 
                to which the Corporation was appointed, the 
                Corporation shall make an annual accounting or 
                report, as appropriate, available to the 
                Secretary of the Treasury, the Comptroller 
                General of the United States, and the authority 
                which appointed the Corporation as conservator 
                or receiver.
                  (C) Availability of reports.--Any report 
                prepared pursuant to subparagraph (B) shall be 
                made available by the Corporation upon request 
                to any shareholder of the depository 
                institution for which the Corporation was 
                appointed conservator or receiver or any other 
                member of the public.
                  (D) Recordkeeping requirement.--
                          (i) In general.--Except as provided 
                        in clause (ii), after the end of the 6-
                        year period beginning on the date the 
                        Corporation is appointed as receiver of 
                        an insured depository institution, the 
                        Corporation may destroy any records of 
                        such institution which the Corporation, 
                        in the Corporation's discretion, 
                        determines to be unnecessary unless 
                        directed not to do so by a court of 
                        competent jurisdiction or governmental 
                        agency, or prohibited by law.
                          (ii) Old records.--Notwithstanding 
                        clause (i), the Corporation may destroy 
                        records of an insured depository 
                        institution which are at least 10 years 
                        old as of the date on which the 
                        Corporation is appointed as the 
                        receiver of such depository institution 
                        in accordance with clause (i) at any 
                        time after such appointment is final, 
                        without regard to the 6-year period of 
                        limitation contained in clause (i).
          (16) Contracts with state housing finance 
        authorities.--
                  (A) In general.--The Corporation may enter 
                into contracts with any State housing finance 
                authority for the sale of mortgage-related 
                assets (as such terms are defined in section 
                1301 of the Financial Institutions Reform, 
                Recovery, and Enforcement Act of 1989) of any 
                depository institution in default (including 
                assets and liabilities associated with any 
                trust business), such contracts to be effective 
                in accordance with their terms without any 
                further approval, assignment, or consent with 
                respect thereto.
                  (B) Factors to consider.--In evaluating the 
                disposition of mortgage related assets to any 
                State housing finance authority the Corporation 
                shall consider--
                          (i) the State housing finance 
                        authority's ability to acquire and 
                        service current, delinquent, and 
                        defaulted mortgage related assets;
                          (ii) the State housing finance 
                        authority's ability to further national 
                        housing policies;
                          (iii) the State housing finance 
                        authority's sensitivity to the impact 
                        of the sale of mortgage related assets 
                        upon the State and local communities;
                          (iv) the costs to the Federal 
                        Government associated with alternative 
                        ownership or disposition of the 
                        mortgage related assets;
                          (v) the minimization of future 
                        guaranties which may be required of the 
                        Federal Government;
                          (vi) the maximization of mortgage 
                        related asset values; and
                          (vii) the utilization of institutions 
                        currently established in mortgage 
                        related asset market activities.
          (17) Fraudulent transfers.--
                  (A) In general.--The Corporation, as 
                conservator or receiver for any insured 
                depository institution, and any conservator 
                appointed by the Comptroller of the Currency 
                may avoid a transfer of any interest of an 
                institution-affiliated party, or any person who 
                the Corporation or conservator determines is a 
                debtor of the institution, in property, or any 
                obligation incurred by such party or person, 
                that was made within 5 years of the date on 
                which the Corporation or conservator was 
                appointed conservator or receiver if such party 
                or person voluntarily or involuntarily made 
                such transfer or incurred such liability with 
                the intent to hinder, delay, or defraud the 
                insured depository institution, the Corporation 
                or other conservator, or any other appropriate 
                Federal banking agency.
                  (B) Right of recovery.--To the extent a 
                transfer is avoided under subparagraph (A), the 
                Corporation or any conservator described in 
                such subparagraph may recover, for the benefit 
                of the insured depository institution, the 
                property transferred, or, if a court so orders, 
                the value of such property (at the time of such 
                transfer) from--
                          (i) the initial transferee of such 
                        transfer or the institution-affiliated 
                        party or person for whose benefit such 
                        transfer was made; or
                          (ii) any immediate or mediate 
                        transferee of any such initial 
                        transferee.
                  (C) Rights of transferee or obligee.--The 
                Corporation or any conservator described in 
                subparagraph (A) may not recover under 
                subparagraph (B) from--
                          (i) any transferee that takes for 
                        value, including satisfaction or 
                        securing of a present or antecedent 
                        debt, in good faith; or
                          (ii) any immediate or mediate good 
                        faith transferee of such transferee.
                  (D) Rights under this paragraph.--The rights 
                under this paragraph of the Corporation and any 
                conservator described in subparagraph (A) shall 
                be superior to any rights of a trustee or any 
                other party (other than any party which is a 
                Federal agency) under title 11, United States 
                Code.
          (18) Attachment of assets and other injunctive 
        relief.--Subject to paragraph (19), any court of 
        competent jurisdiction may, at the request of--
                  (A) the Corporation (in the Corporation's 
                capacity as conservator or receiver for any 
                insured depository institution or in the 
                Corporation's corporate capacity with respect 
                to any asset acquired or liability assumed by 
                the Corporation under section 11, 12, or 13); 
                or
                  (B) any conservator appointed by the 
                Comptroller of the Currency,
        issue an order in accordance with Rule 65 of the 
        Federal Rules of Civil Procedure, including an order 
        placing the assets of any person designated by the 
        Corporation or such conservator under the control of 
        the court and appointing a trustee to hold such assets.
          (19) Standards.--
                  (A) Showing.--Rule 65 of the Federal Rules of 
                Civil Procedure shall apply with respect to any 
                proceeding under paragraph (18) without regard 
                to the requirement of such rule that the 
                applicant show that the injury, loss, or damage 
                is irreparable and immediate.
                  (B) State proceeding.--If, in the case of any 
                proceeding in a State court, the court 
                determines that rules of civil procedure 
                available under the laws of such State provide 
                substantially similar protections to such 
                party's right to due process as Rule 65 (as 
                modified with respect to such proceeding by 
                subparagraph (A)), the relief sought by the 
                Corporation or a conservator pursuant to 
                paragraph (18) may be requested under the laws 
                of such State.
          (20) Treatment of claims arising from breach of 
        contracts executed by the receiver or conservator.--
        Notwithstanding any other provision of this subsection, 
        any final and unappealable judgment for monetary 
        damages entered against a receiver or conservator for 
        an insured depository institution for the breach of an 
        agreement executed or approved by such receiver or 
        conservator after the date of its appointment shall be 
        paid as an administrative expense of the receiver or 
        conservator. Nothing in this paragraph shall be 
        construed to limit the power of a receiver or 
        conservator to exercise any rights under contract or 
        law, including to terminate, breach, cancel, or 
        otherwise discontinue such agreement.
  (e) Provisions Relating to Contracts Entered Into Before 
Appointment of Conservator or Receiver.--
          (1) Authority to repudiate contracts.--In addition to 
        any other rights a conservator or receiver may have, 
        the conservator or receiver for any insured depository 
        institution may disaffirm or repudiate any contract or 
        lease--
                  (A) to which such institution is a party;
                  (B) the performance of which the conservator 
                or receiver, in the conservator's or receiver's 
                discretion, determines to be burdensome; and
                  (C) the disaffirmance or repudiation of which 
                the conservator or receiver determines, in the 
                conservator's or receiver's discretion, will 
                promote the orderly administration of the 
                institution's affairs.
          (2) Timing of repudiation.--The conservator or 
        receiver appointed for any insured depository 
        institution in accordance with subsection (c) shall 
        determine whether or not to exercise the rights of 
        repudiation under this subsection within a reasonable 
        period following such appointment.
          (3) Claims for damages for repudiation.--
                  (A) In general.--Except as otherwise provided 
                in subparagraph (C) and paragraphs (4), (5), 
                and (6), the liability of the conservator or 
                receiver for the disaffirmance or repudiation 
                of any contract pursuant to paragraph (1) shall 
                be--
                          (i) limited to actual direct 
                        compensatory damages; and
                          (ii) determined as of--
                                  (I) the date of the 
                                appointment of the conservator 
                                or receiver; or
                                  (II) in the case of any 
                                contract or agreement referred 
                                to in paragraph (8), the date 
                                of the disaffirmance or 
                                repudiation of such contract or 
                                agreement.
                  (B) No liability for other damages.--For 
                purposes of subparagraph (A), the term ``actual 
                direct compensatory damages'' does not 
                include--
                          (i) punitive or exemplary damages;
                          (ii) damages for lost profits or 
                        opportunity; or
                          (iii) damages for pain and suffering.
                  (C) Measure of damages for repudiation of 
                financial contracts.--In the case of any 
                qualified financial contract or agreement to 
                which paragraph (8) applies, compensatory 
                damages shall be--
                          (i) deemed to include normal and 
                        reasonable costs of cover or other 
                        reasonable measures of damages utilized 
                        in the industries for such contract and 
                        agreement claims; and
                          (ii) paid in accordance with this 
                        subsection and subsection (i) except as 
                        otherwise specifically provided in this 
                        section.
          (4) Leases under which the institution is the 
        lessee.--
                  (A) In general.--If the conservator or 
                receiver disaffirms or repudiates a lease under 
                which the insured depository institution was 
                the lessee, the conservator or receiver shall 
                not be liable for any damages (other than 
                damages determined pursuant to subparagraph 
                (B)) for the disaffirmance or repudiation of 
                such lease.
                  (B) Payments of rent.--Notwithstanding 
                subparagraph (A), the lessor under a lease to 
                which such subparagraph applies shall--
                          (i) be entitled to the contractual 
                        rent accruing before the later of the 
                        date--
                                  (I) the notice of 
                                disaffirmance or repudiation is 
                                mailed; or
                                  (II) the disaffirmance or 
                                repudiation becomes effective,
                        unless the lessor is in default or 
                        breach of the terms of the lease;
                          (ii) have no claim for damages under 
                        any acceleration clause or other 
                        penalty provision in the lease; and
                          (iii) have a claim for any unpaid 
                        rent, subject to all appropriate 
                        offsets and defenses, due as of the 
                        date of the appointment which shall be 
                        paid in accordance with this subsection 
                        and subsection (i).
          (5) Leases under which the institution is the 
        lessor.--
                  (A) In general.--If the conservator or 
                receiver repudiates an unexpired written lease 
                of real property of the insured depository 
                institution under which the institution is the 
                lessor and the lessee is not, as of the date of 
                such repudiation, in default, the lessee under 
                such lease may either--
                          (i) treat the lease as terminated by 
                        such repudiation; or
                          (ii) remain in possession of the 
                        leasehold interest for the balance of 
                        the term of the lease unless the lessee 
                        defaults under the terms of the lease 
                        after the date of such repudiation.
                  (B) Provisions applicable to lessee remaining 
                in possession.--If any lessee under a lease 
                described in subparagraph (A) remains in 
                possession of a leasehold interest pursuant to 
                clause (ii) of such subparagraph--
                          (i) the lessee--
                                  (I) shall continue to pay the 
                                contractual rent pursuant to 
                                the terms of the lease after 
                                the date of the repudiation of 
                                such lease;
                                  (II) may offset against any 
                                rent payment which accrues 
                                after the date of the 
                                repudiation of the lease, any 
                                damages which accrue after such 
                                date due to the nonperformance 
                                of any obligation of the 
                                insured depository institution 
                                under the lease after such 
                                date; and
                          (ii) the conservator or receiver 
                        shall not be liable to the lessee for 
                        any damages arising after such date as 
                        a result of the repudiation other than 
                        the amount of any offset allowed under 
                        clause (i)(II).
          (6) Contracts for the sale of real property.--
                  (A) In general.--If the conservator or 
                receiver repudiates any contract (which meets 
                the requirements of each paragraph of section 
                13(e)) for the sale of real property and the 
                purchaser of such real property under such 
                contract is in possession and is not, as of the 
                date of such repudiation, in default, such 
                purchaser may either--
                          (i) treat the contract as terminated 
                        by such repudiation; or
                          (ii) remain in possession of such 
                        real property.
                  (B) Provisions applicable to purchaser 
                remaining in possession.--If any purchaser of 
                real property under any contract described in 
                subparagraph (A) remains in possession of such 
                property pursuant to clause (ii) of such 
                subparagraph--
                          (i) the purchaser--
                                  (I) shall continue to make 
                                all payments due under the 
                                contract after the date of the 
                                repudiation of the contract; 
                                and
                                  (II) may offset against any 
                                such payments any damages which 
                                accrue after such date due to 
                                the nonperformance (after such 
                                date) of any obligation of the 
                                depository institution under 
                                the contract; and
                          (ii) the conservator or receiver 
                        shall--
                                  (I) not be liable to the 
                                purchaser for any damages 
                                arising after such date as a 
                                result of the repudiation other 
                                than the amount of any offset 
                                allowed under clause (i)(II);
                                  (II) deliver title to the 
                                purchaser in accordance with 
                                the provisions of the contract; 
                                and
                                  (III) have no obligation 
                                under the contract other than 
                                the performance required under 
                                subclause (II).
                  (C) Assignment and sale allowed.--
                          (i) In general.--No provision of this 
                        paragraph shall be construed as 
                        limiting the right of the conservator 
                        or receiver to assign the contract 
                        described in subparagraph (A) and sell 
                        the property subject to the contract 
                        and the provisions of this paragraph.
                          (ii) No liability after assignment 
                        and sale.--If an assignment and sale 
                        described in clause (i) is consummated, 
                        the conservator or receiver shall have 
                        no further liability under the contract 
                        described in subparagraph (A) or with 
                        respect to the real property which was 
                        the subject of such contract.
          (7) Provisions applicable to service contracts.--
                  (A) Services performed before appointment.--
                In the case of any contract for services 
                between any person and any insured depository 
                institution for which the Corporation has been 
                appointed conservator or receiver, any claim of 
                such person for services performed before the 
                appointment of the conservator or the receiver 
                shall be--
                          (i) a claim to be paid in accordance 
                        with subsections (d) and (i); and
                          (ii) deemed to have arisen as of the 
                        date the conservator or receiver was 
                        appointed.
                  (B) Services performed after appointment and 
                prior to repudiation.--If, in the case of any 
                contract for services described in subparagraph 
                (A), the conservator or receiver accepts 
                performance by the other person before the 
                conservator or receiver makes any determination 
                to exercise the right of repudiation of such 
                contract under this section--
                          (i) the other party shall be paid 
                        under the terms of the contract for the 
                        services performed; and
                          (ii) the amount of such payment shall 
                        be treated as an administrative expense 
                        of the conservatorship or receivership.
                  (C) Acceptance of performance no bar to 
                subsequent repudiation.--The acceptance by any 
                conservator or receiver of services referred to 
                in subparagraph (B) in connection with a 
                contract described in such subparagraph shall 
                not affect the right of the conservator or 
                receiver to repudiate such contract under this 
                section at any time after such performance.
          (8) Certain qualified financial contracts.--
                  (A) Rights of parties to contracts.--Subject 
                to paragraphs (9) and (10) of this subsection 
                and notwithstanding any other provision of this 
                Act (other than subsection (d)(9) of this 
                section and section 13(e)), any other Federal 
                law, or the law of any State, no person shall 
                be stayed or prohibited from exercising--
                          (i) any right such person has to 
                        cause the termination, liquidation, or 
                        acceleration of any qualified financial 
                        contract with an insured depository 
                        institution which arises upon the 
                        appointment of the Corporation as 
                        receiver for such institution at any 
                        time after such appointment;
                          (ii) any right under any security 
                        agreement or arrangement or other 
                        credit enhancement related to one or 
                        more qualified financial contracts 
                        described in clause (i);
                          (iii) any right to offset or net out 
                        any termination value, payment amount, 
                        or other transfer obligation arising 
                        under or in connection with 1 or more 
                        contracts and agreements described in 
                        clause (i), including any master 
                        agreement for such contracts or 
                        agreements.
                  (B) Applicability of other provisions.--
                Subsection (d)(12) shall apply in the case of 
                any judicial action or proceeding brought 
                against any receiver referred to in 
                subparagraph (A), or the insured depository 
                institution for which such receiver was 
                appointed, by any party to a contract or 
                agreement described in subparagraph (A)(i) with 
                such institution.
                  (C) Certain transfers not avoidable.--
                          (i) In general.--Notwithstanding 
                        paragraph (11), section 5242 of the 
                        Revised Statutes of the United States 
                        or any other Federal or State law 
                        relating to the avoidance of 
                        preferential or fraudulent transfers, 
                        the Corporation, whether acting as such 
                        or as conservator or receiver of an 
                        insured depository institution, may not 
                        avoid any transfer of money or other 
                        property in connection with any 
                        qualified financial contract with an 
                        insured depository institution.
                          (ii) Exception for certain 
                        transfers.--Clause (i) shall not apply 
                        to any transfer of money or other 
                        property in connection with any 
                        qualified financial contract with an 
                        insured depository institution if the 
                        Corporation determines that the 
                        transferee had actual intent to hinder, 
                        delay, or defraud such institution, the 
                        creditors of such institution, or any 
                        conservator or receiver appointed for 
                        such institution.
                  (D) Certain contracts and agreements 
                defined.--For purposes of this subsection, the 
                following definitions shall apply:
                          (i) Qualified financial contract.--
                        The term ``qualified financial 
                        contract'' means any securities 
                        contract, commodity contract, forward 
                        contract, repurchase agreement, swap 
                        agreement, and any similar agreement 
                        that the Corporation determines by 
                        regulation, resolution, or order to be 
                        a qualified financial contract for 
                        purposes of this paragraph.
                          (ii) Securities contract.--The term 
                        ``securities contract''--
                                  (I) means a contract for the 
                                purchase, sale, or loan of a 
                                security, a certificate of 
                                deposit, a mortgage loan, any 
                                interest in a mortgage loan, a 
                                group or index of securities, 
                                certificates of deposit, or 
                                mortgage loans or interests 
                                therein (including any interest 
                                therein or based on the value 
                                thereof) or any option on any 
                                of the foregoing, including any 
                                option to purchase or sell any 
                                such security, certificate of 
                                deposit, mortgage loan, 
                                interest, group or index, or 
                                option, and including any 
                                repurchase or reverse 
                                repurchase transaction on any 
                                such security, certificate of 
                                deposit, mortgage loan, 
                                interest, group or index, or 
                                option (whether or not such 
                                repurchase or reverse 
                                repurchase transaction is a 
                                ``repurchase agreement'', as 
                                defined in clause (v));
                                  (II) does not include any 
                                purchase, sale, or repurchase 
                                obligation under a 
                                participation in a commercial 
                                mortgage loan unless the 
                                Corporation determines by 
                                regulation, resolution, or 
                                order to include any such 
                                agreement within the meaning of 
                                such term;
                                  (III) means any option 
                                entered into on a national 
                                securities exchange relating to 
                                foreign currencies;
                                  (IV) means the guarantee 
                                (including by novation) by or 
                                to any securities clearing 
                                agency of any settlement of 
                                cash, securities, certificates 
                                of deposit, mortgage loans or 
                                interests therein, group or 
                                index of securities, 
                                certificates of deposit, or 
                                mortgage loans or interests 
                                therein (including any interest 
                                therein or based on the value 
                                thereof) or option on any of 
                                the foregoing, including any 
                                option to purchase or sell any 
                                such security, certificate of 
                                deposit, mortgage loan, 
                                interest, group or index, or 
                                option (whether or not such 
                                settlement is in connection 
                                with any agreement or 
                                transaction referred to in 
                                subclauses (I) through (XII) 
                                (other than subclause (II));
                                  (V) means any margin loan;
                                  (VI) means any extension of 
                                credit for the clearance or 
                                settlement of securities 
                                transactions;
                                  (VII) means any loan 
                                transaction coupled with a 
                                securities collar transaction, 
                                any prepaid securities forward 
                                transaction, or any total 
                                return swap transaction coupled 
                                with a securities sale 
                                transaction;
                                  (VIII) means any other 
                                agreement or transaction that 
                                is similar to any agreement or 
                                transaction referred to in this 
                                clause;
                                  (IX) means any combination of 
                                the agreements or transactions 
                                referred to in this clause;
                                  (X) means any option to enter 
                                into any agreement or 
                                transaction referred to in this 
                                clause;
                                  (XI) means a master agreement 
                                that provides for an agreement 
                                or transaction referred to in 
                                subclause (I), (III), (IV), 
                                (V), (VI), (VII), (VIII), (IX), 
                                or (X), together with all 
                                supplements to any such master 
                                agreement, without regard to 
                                whether the master agreement 
                                provides for an agreement or 
                                transaction that is not a 
                                securities contract under this 
                                clause, except that the master 
                                agreement shall be considered 
                                to be a securities contract 
                                under this clause only with 
                                respect to each agreement or 
                                transaction under the master 
                                agreement that is referred to 
                                in subclause (I), (III), (IV), 
                                (V), (VI), (VII), (VIII), (IX), 
                                or (X); and
                                  (XII) means any security 
                                agreement or arrangement or 
                                other credit enhancement 
                                related to any agreement or 
                                transaction referred to in this 
                                clause, including any guarantee 
                                or reimbursement obligation in 
                                connection with any agreement 
                                or transaction referred to in 
                                this clause.
                          (iii) Commodity contract.--The term 
                        ``commodity contract'' means--
                                  (I) with respect to a futures 
                                commission merchant, a contract 
                                for the purchase or sale of a 
                                commodity for future delivery 
                                on, or subject to the rules of, 
                                a contract market or board of 
                                trade;
                                  (II) with respect to a 
                                foreign futures commission 
                                merchant, a foreign future;
                                  (III) with respect to a 
                                leverage transaction merchant, 
                                a leverage transaction;
                                  (IV) with respect to a 
                                clearing organization, a 
                                contract for the purchase or 
                                sale of a commodity for future 
                                delivery on, or subject to the 
                                rules of, a contract market or 
                                board of trade that is cleared 
                                by such clearing organization, 
                                or commodity option traded on, 
                                or subject to the rules of, a 
                                contract market or board of 
                                trade that is cleared by such 
                                clearing organization;
                                  (V) with respect to a 
                                commodity options dealer, a 
                                commodity option;
                                  (VI) any other agreement or 
                                transaction that is similar to 
                                any agreement or transaction 
                                referred to in this clause;
                                  (VII) any combination of the 
                                agreements or transactions 
                                referred to in this clause;
                                  (VIII) any option to enter 
                                into any agreement or 
                                transaction referred to in this 
                                clause;
                                  (IX) a master agreement that 
                                provides for an agreement or 
                                transaction referred to in 
                                subclause (I), (II), (III), 
                                (IV), (V), (VI), (VII), or 
                                (VIII), together with all 
                                supplements to any such master 
                                agreement, without regard to 
                                whether the master agreement 
                                provides for an agreement or 
                                transaction that is not a 
                                commodity contract under this 
                                clause, except that the master 
                                agreement shall be considered 
                                to be a commodity contract 
                                under this clause only with 
                                respect to each agreement or 
                                transaction under the master 
                                agreement that is referred to 
                                in subclause (I), (II), (III), 
                                (IV), (V), (VI), (VII), or 
                                (VIII); or
                                  (X) any security agreement or 
                                arrangement or other credit 
                                enhancement related to any 
                                agreement or transaction 
                                referred to in this clause, 
                                including any guarantee or 
                                reimbursement obligation in 
                                connection with any agreement 
                                or transaction referred to in 
                                this clause.
                          (iv) Forward contract.--The term 
                        ``forward contract'' means--
                                  (I) a contract (other than a 
                                commodity contract) for the 
                                purchase, sale, or transfer of 
                                a commodity or any similar 
                                good, article, service, right, 
                                or interest which is presently 
                                or in the future becomes the 
                                subject of dealing in the 
                                forward contract trade, or 
                                product or byproduct thereof, 
                                with a maturity date more than 
                                2 days after the date the 
                                contract is entered into, 
                                including, a repurchase or 
                                reverse repurchase transaction 
                                (whether or not such repurchase 
                                or reverse repurchase 
                                transaction is a ``repurchase 
                                agreement'', as defined in 
                                clause (v)), consignment, 
                                lease, swap, hedge transaction, 
                                deposit, loan, option, 
                                allocated transaction, 
                                unallocated transaction, or any 
                                other similar agreement;
                                  (II) any combination of 
                                agreements or transactions 
                                referred to in subclauses (I) 
                                and (III);
                                  (III) any option to enter 
                                into any agreement or 
                                transaction referred to in 
                                subclause (I) or (II);
                                  (IV) a master agreement that 
                                provides for an agreement or 
                                transaction referred to in 
                                subclauses (I), (II), or (III), 
                                together with all supplements 
                                to any such master agreement, 
                                without regard to whether the 
                                master agreement provides for 
                                an agreement or transaction 
                                that is not a forward contract 
                                under this clause, except that 
                                the master agreement shall be 
                                considered to be a forward 
                                contract under this clause only 
                                with respect to each agreement 
                                or transaction under the master 
                                agreement that is referred to 
                                in subclause (I), (II), or 
                                (III); or
                                  (V) any security agreement or 
                                arrangement or other credit 
                                enhancement related to any 
                                agreement or transaction 
                                referred to in subclause (I), 
                                (II), (III), or (IV), including 
                                any guarantee or reimbursement 
                                obligation in connection with 
                                any agreement or transaction 
                                referred to in any such 
                                subclause.
                          (v) Repurchase agreement.--The term 
                        ``repurchase agreement'' (which 
                        definition also applies to a reverse 
                        repurchase agreement)--
                                  (I) means an agreement, 
                                including related terms, which 
                                provides for the transfer of 
                                one or more certificates of 
                                deposit, mortgage-related 
                                securities (as such term is 
                                defined in the Securities 
                                Exchange Act of 1934), mortgage 
                                loans, interests in mortgage-
                                related securities or mortgage 
                                loans, eligible bankers' 
                                acceptances, qualified foreign 
                                government securities or 
                                securities that are direct 
                                obligations of, or that are 
                                fully guaranteed by, the United 
                                States or any agency of the 
                                United States against the 
                                transfer of funds by the 
                                transferee of such certificates 
                                of deposit, eligible bankers' 
                                acceptances, securities, 
                                mortgage loans, or interests 
                                with a simultaneous agreement 
                                by such transferee to transfer 
                                to the transferor thereof 
                                certificates of deposit, 
                                eligible bankers' acceptances, 
                                securities, mortgage loans, or 
                                interests as described above, 
                                at a date certain not later 
                                than 1 year after such 
                                transfers or on demand, against 
                                the transfer of funds, or any 
                                other similar agreement;
                                  (II) does not include any 
                                repurchase obligation under a 
                                participation in a commercial 
                                mortgage loan unless the 
                                Corporation determines by 
                                regulation, resolution, or 
                                order to include any such 
                                participation within the 
                                meaning of such term;
                                  (III) means any combination 
                                of agreements or transactions 
                                referred to in subclauses (I) 
                                and (IV);
                                  (IV) means any option to 
                                enter into any agreement or 
                                transaction referred to in 
                                subclause (I) or (III);
                                  (V) means a master agreement 
                                that provides for an agreement 
                                or transaction referred to in 
                                subclause (I), (III), or (IV), 
                                together with all supplements 
                                to any such master agreement, 
                                without regard to whether the 
                                master agreement provides for 
                                an agreement or transaction 
                                that is not a repurchase 
                                agreement under this clause, 
                                except that the master 
                                agreement shall be considered 
                                to be a repurchase agreement 
                                under this subclause only with 
                                respect to each agreement or 
                                transaction under the master 
                                agreement that is referred to 
                                in subclause (I), (III), or 
                                (IV); and
                                  (VI) means any security 
                                agreement or arrangement or 
                                other credit enhancement 
                                related to any agreement or 
                                transaction referred to in 
                                subclause (I), (III), (IV), or 
                                (V), including any guarantee or 
                                reimbursement obligation in 
                                connection with any agreement 
                                or transaction referred to in 
                                any such subclause.
                        For purposes of this clause, the term 
                        ``qualified foreign government 
                        security'' means a security that is a 
                        direct obligation of, or that is fully 
                        guaranteed by, the central government 
                        of a member of the Organization for 
                        Economic Cooperation and Development 
                        (as determined by regulation or order 
                        adopted by the appropriate Federal 
                        banking authority).
                          (vi) Swap agreement.--The term ``swap 
                        agreement'' means--
                                  (I) any agreement, including 
                                the terms and conditions 
                                incorporated by reference in 
                                any such agreement, which is an 
                                interest rate swap, option, 
                                future, or forward agreement, 
                                including a rate floor, rate 
                                cap, rate collar, cross-
                                currency rate swap, and basis 
                                swap; a spot, same day-
                                tomorrow, tomorrow-next, 
                                forward, or other foreign 
                                exchange, precious metals, or 
                                other commodity agreement; a 
                                currency swap, option, future, 
                                or forward agreement; an equity 
                                index or equity swap, option, 
                                future, or forward agreement; a 
                                debt index or debt swap, 
                                option, future, or forward 
                                agreement; a total return, 
                                credit spread or credit swap, 
                                option, future, or forward 
                                agreement; a commodity index or 
                                commodity swap, option, future, 
                                or forward agreement; weather 
                                swap, option, future, or 
                                forward agreement; an emissions 
                                swap, option, future, or 
                                forward agreement; or an 
                                inflation swap, option, future, 
                                or forward agreement;
                                  (II) any agreement or 
                                transaction that is similar to 
                                any other agreement or 
                                transaction referred to in this 
                                clause and that is of a type 
                                that has been, is presently, or 
                                in the future becomes, the 
                                subject of recurrent dealings 
                                in the swap or other 
                                derivatives markets (including 
                                terms and conditions 
                                incorporated by reference in 
                                such agreement) and that is a 
                                forward, swap, future, option, 
                                or spot transaction on one or 
                                more rates, currencies, 
                                commodities, equity securities 
                                or other equity instruments, 
                                debt securities or other debt 
                                instruments, quantitative 
                                measures associated with an 
                                occurrence, extent of an 
                                occurrence, or contingency 
                                associated with a financial, 
                                commercial, or economic 
                                consequence, or economic or 
                                financial indices or measures 
                                of economic or financial risk 
                                or value;
                                  (III) any combination of 
                                agreements or transactions 
                                referred to in this clause;
                                  (IV) any option to enter into 
                                any agreement or transaction 
                                referred to in this clause;
                                  (V) a master agreement that 
                                provides for an agreement or 
                                transaction referred to in 
                                subclause (I), (II), (III), or 
                                (IV), together with all 
                                supplements to any such master 
                                agreement, without regard to 
                                whether the master agreement 
                                contains an agreement or 
                                transaction that is not a swap 
                                agreement under this clause, 
                                except that the master 
                                agreement shall be considered 
                                to be a swap agreement under 
                                this clause only with respect 
                                to each agreement or 
                                transaction under the master 
                                agreement that is referred to 
                                in subclause (I), (II), (III), 
                                or (IV); and
                                  (VI) any security agreement 
                                or arrangement or other credit 
                                enhancement related to any 
                                agreements or transactions 
                                referred to in subclause (I), 
                                (II), (III), (IV), or (V), 
                                including any guarantee or 
                                reimbursement obligation in 
                                connection with any agreement 
                                or transaction referred to in 
                                any such subclause.
                        Such term is applicable for purposes of 
                        this subsection only and shall not be 
                        construed or applied so as to challenge 
                        or affect the characterization, 
                        definition, or treatment of any swap 
                        agreement under any other statute, 
                        regulation, or rule, including the 
                        Gramm-Leach-Bliley Act, the Legal 
                        Certainty for Bank Products Act of 
                        2000, the securities laws (as such term 
                        is defined in section 3(a)(47) of the 
                        Securities Exchange Act of 1934) and 
                        the Commodity Exchange Act.
                          (vii) Treatment of master agreement 
                        as one agreement.--Any master agreement 
                        for any contract or agreement described 
                        in any preceding clause of this 
                        subparagraph (or any master agreement 
                        for such master agreement or 
                        agreements), together with all 
                        supplements to such master agreement, 
                        shall be treated as a single agreement 
                        and a single qualified financial 
                        contract. If a master agreement 
                        contains provisions relating to 
                        agreements or transactions that are not 
                        themselves qualified financial 
                        contracts, the master agreement shall 
                        be deemed to be a qualified financial 
                        contract only with respect to those 
                        transactions that are themselves 
                        qualified financial contracts.
                          (viii) Transfer.--The term 
                        ``transfer'' means every mode, direct 
                        or indirect, absolute or conditional, 
                        voluntary or involuntary, of disposing 
                        of or parting with property or with an 
                        interest in property, including 
                        retention of title as a security 
                        interest and foreclosure of the 
                        depository institution's equity of 
                        redemption.
                  (ix) Person.--The term ``person'' includes 
                any governmental entity in addition to any 
                entity included in the definition of such term 
                in section 1 of title 1, United States Code.
                  (E) Certain protections in event of 
                appointment of conservator.--Notwithstanding 
                any other provision of this Act (other than 
                subsections (d)(9) and (e)(10) of this section, 
                and section 13(e) of this Act), any other 
                Federal law, or the law of any State, no person 
                shall be stayed or prohibited from exercising--
                          (i) any right such person has to 
                        cause the termination, liquidation, or 
                        acceleration of any qualified financial 
                        contract with a depository institution 
                        in a conservatorship based upon a 
                        default under such financial contract 
                        which is enforceable under applicable 
                        noninsolvency law;
                          (ii) any right under any security 
                        agreement or arrangement or other 
                        credit enhancement related to one or 
                        more qualified financial contracts 
                        described in clause (i);
                          (iii) any right to offset or net out 
                        any termination values, payment 
                        amounts, or other transfer obligations 
                        arising under or in connection with 
                        such qualified financial contracts.
                  (F) Clarification.--No provision of law shall 
                be construed as limiting the right or power of 
                the Corporation, or authorizing any court or 
                agency to limit or delay, in any manner, the 
                right or power of the Corporation to transfer 
                any qualified financial contract in accordance 
                with paragraphs (9) and (10) of this subsection 
                or to disaffirm or repudiate any such contract 
                in accordance with subsection (e)(1) of this 
                section.
                  (G) Walkaway clauses not effective.--
                          (i) In general.--Notwithstanding the 
                        provisions of subparagraphs (A) and 
                        (E), and sections 403 and 404 of the 
                        Federal Deposit Insurance Corporation 
                        Improvement Act of 1991, no walkaway 
                        clause shall be enforceable in a 
                        qualified financial contract of an 
                        insured depository institution in 
                        default.
                          (ii) Limited suspension of certain 
                        obligations.--In the case of a 
                        qualified financial contract referred 
                        to in clause (i), any payment or 
                        delivery obligations otherwise due from 
                        a party pursuant to the qualified 
                        financial contract shall be suspended 
                        from the time the receiver is appointed 
                        until the earlier of--
                                  (I) the time such party 
                                receives notice that such 
                                contract has been transferred 
                                pursuant to subparagraph (A); 
                                or
                                  (II) 5:00 p.m. (eastern time) 
                                on the business day following 
                                the date of the appointment of 
                                the receiver.
                          (iii) Walkaway clause defined.--For 
                        purposes of this subparagraph, the term 
                        ``walkaway clause'' means any provision 
                        in a qualified financial contract that 
                        suspends, conditions, or extinguishes a 
                        payment obligation of a party, in whole 
                        or in part, or does not create a 
                        payment obligation of a party that 
                        would otherwise exist, solely because 
                        of such party's status as a 
                        nondefaulting party in connection with 
                        the insolvency of an insured depository 
                        institution that is a party to the 
                        contract or the appointment of or the 
                        exercise of rights or powers by a 
                        conservator or receiver of such 
                        depository institution, and not as a 
                        result of a party's exercise of any 
                        right to offset, setoff, or net 
                        obligations that exist under the 
                        contract, any other contract between 
                        those parties, or applicable law.
                  (H) Recordkeeping requirements.--The 
                Corporation, in consultation with the 
                appropriate Federal banking agencies, may 
                prescribe regulations requiring more detailed 
                recordkeeping by any insured depository 
                institution with respect to qualified financial 
                contracts (including market valuations) only if 
                such insured depository institution is in a 
                troubled condition (as such term is defined by 
                the Corporation pursuant to section 32).
          (9) Transfer of qualified financial contracts.--
                  (A) In general.--In making any transfer of 
                assets or liabilities of a depository 
                institution in default which includes any 
                qualified financial contract, the conservator 
                or receiver for such depository institution 
                shall either--
                          (i) transfer to one financial 
                        institution, other than a financial 
                        institution for which a conservator, 
                        receiver, trustee in bankruptcy, or 
                        other legal custodian has been 
                        appointed or which is otherwise the 
                        subject of a bankruptcy or insolvency 
                        proceeding--
                                  (I) all qualified financial 
                                contracts between any person or 
                                any affiliate of such person 
                                and the depository institution 
                                in default;
                                  (II) all claims of such 
                                person or any affiliate of such 
                                person against such depository 
                                institution under any such 
                                contract (other than any claim 
                                which, under the terms of any 
                                such contract, is subordinated 
                                to the claims of general 
                                unsecured creditors of such 
                                institution);
                                  (III) all claims of such 
                                depository institution against 
                                such person or any affiliate of 
                                such person under any such 
                                contract; and
                                  (IV) all property securing or 
                                any other credit enhancement 
                                for any contract described in 
                                subclause (I) or any claim 
                                described in subclause (II) or 
                                (III) under any such contract; 
                                or
                          (ii) transfer none of the qualified 
                        financial contracts, claims, property 
                        or other credit enhancement referred to 
                        in clause (i) (with respect to such 
                        person and any affiliate of such 
                        person).
                  (B) Transfer to foreign bank, foreign 
                financial institution, or branch or agency of a 
                foreign bank or financial institution.--In 
                transferring any qualified financial contracts 
                and related claims and property under 
                subparagraph (A)(i), the conservator or 
                receiver for the depository institution shall 
                not make such transfer to a foreign bank, 
                financial institution organized under the laws 
                of a foreign country, or a branch or agency of 
                a foreign bank or financial institution unless, 
                under the law applicable to such bank, 
                financial institution, branch or agency, to the 
                qualified financial contracts, and to any 
                netting contract, any security agreement or 
                arrangement or other credit enhancement related 
                to one or more qualified financial contracts, 
                the contractual rights of the parties to such 
                qualified financial contracts, netting 
                contracts, security agreements or arrangements, 
                or other credit enhancements are enforceable 
                substantially to the same extent as permitted 
                under this section.
                  (C) Transfer of contracts subject to the 
                rules of a clearing organization.--In the event 
                that a conservator or receiver transfers any 
                qualified financial contract and related 
                claims, property, and credit enhancements 
                pursuant to subparagraph (A)(i) and such 
                contract is cleared by or subject to the rules 
                of a clearing organization, the clearing 
                organization shall not be required to accept 
                the transferee as a member by virtue of the 
                transfer.
                  (D) Definitions.--For purposes of this 
                paragraph, the term ``financial institution'' 
                means a broker or dealer, a depository 
                institution, a futures commission merchant, or 
                any other institution, as determined by the 
                Corporation by regulation to be a financial 
                institution, and the term ``clearing 
                organization'' has the same meaning as in 
                section 402 of the Federal Deposit Insurance 
                Corporation Improvement Act of 1991.
          (10) Notification of transfer.--
                  (A) In general.--If--
                          (i) the conservator or receiver for 
                        an insured depository institution in 
                        default makes any transfer of the 
                        assets and liabilities of such 
                        institution; and
                          (ii) the transfer includes any 
                        qualified financial contract,
                the conservator or receiver shall notify any 
                person who is a party to any such contract of 
                such transfer by 5:00 p.m. (eastern time) on 
                the business day following the date of the 
                appointment of the receiver in the case of a 
                receivership, or the business day following 
                such transfer in the case of a conservatorship.
                  (B) Certain rights not enforceable.--
                          (i) Receivership.--A person who is a 
                        party to a qualified financial contract 
                        with an insured depository institution 
                        may not exercise any right that such 
                        person has to terminate, liquidate, or 
                        net such contract under paragraph 
                        (8)(A) of this subsection or section 
                        403 or 404 of the Federal Deposit 
                        Insurance Corporation Improvement Act 
                        of 1991, solely by reason of or 
                        incidental to the appointment of a 
                        receiver for the depository institution 
                        (or the insolvency or financial 
                        condition of the depository institution 
                        for which the receiver has been 
                        appointed)--
                                  (I) until 5:00 p.m. (eastern 
                                time) on the business day 
                                following the date of the 
                                appointment of the receiver; or
                                  (II) after the person has 
                                received notice that the 
                                contract has been transferred 
                                pursuant to paragraph (9)(A).
                          (ii) Conservatorship.--A person who 
                        is a party to a qualified financial 
                        contract with an insured depository 
                        institution may not exercise any right 
                        that such person has to terminate, 
                        liquidate, or net such contract under 
                        paragraph (8)(E) of this subsection or 
                        section 403 or 404 of the Federal 
                        Deposit Insurance Corporation 
                        Improvement Act of 1991, solely by 
                        reason of or incidental to the 
                        appointment of a conservator for the 
                        depository institution (or the 
                        insolvency or financial condition of 
                        the depository institution for which 
                        the conservator has been appointed).
                          (iii) Notice.--For purposes of this 
                        paragraph, the Corporation as receiver 
                        or conservator of an insured depository 
                        institution shall be deemed to have 
                        notified a person who is a party to a 
                        qualified financial contract with such 
                        depository institution if the 
                        Corporation has taken steps reasonably 
                        calculated to provide notice to such 
                        person by the time specified in 
                        subparagraph (A).
                  (C) Treatment of Bridge Depository 
                Institutions.--The following institutions shall 
                not be considered to be a financial institution 
                for which a conservator, receiver, trustee in 
                bankruptcy, or other legal custodian has been 
                appointed or which is otherwise the subject of 
                a bankruptcy or insolvency proceeding for 
                purposes of paragraph (9):
                          (i) A bridge depository institution.
                          (ii) A depository institution 
                        organized by the Corporation, for which 
                        a conservator is appointed either--
                                  (I) immediately upon the 
                                organization of the 
                                institution; or
                                  (II) at the time of a 
                                purchase and assumption 
                                transaction between the 
                                depository institution and the 
                                Corporation as receiver for a 
                                depository institution in 
                                default.
                  (D) Business day defined.--For purposes of 
                this paragraph, the term ``business day'' means 
                any day other than any Saturday, Sunday, or any 
                day on which either the New York Stock Exchange 
                or the Federal Reserve Bank of New York is 
                closed.
          (11) Disaffirmance or repudiation of qualified 
        financial contracts.--In exercising the rights of 
        disaffirmance or repudiation of a conservator or 
        receiver with respect to any qualified financial 
        contract to which an insured depository institution is 
        a party, the conservator or receiver for such 
        institution shall either--
                  (A) disaffirm or repudiate all qualified 
                financial contracts between--
                          (i) any person or any affiliate of 
                        such person; and
                          (ii) the depository institution in 
                        default; or
                  (B) disaffirm or repudiate none of the 
                qualified financial contracts referred to in 
                subparagraph (A) (with respect to such person 
                or any affiliate of such person).
          (12) Certain security interests not avoidable.--No 
        provision of this subsection shall be construed as 
        permitting the avoidance of any legally enforceable or 
        perfected security interest in any of the assets of any 
        depository institution except where such an interest is 
        taken in contemplation of the institution's insolvency 
        or with the intent to hinder, delay, or defraud the 
        institution or the creditors of such institution.
          (13) Authority to enforce contracts.--
                  (A) In general.--The conservator or receiver 
                may enforce any contract, other than a 
                director's or officer's liability insurance 
                contract or a depository institution bond, 
                entered into by the depository institution 
                notwithstanding any provision of the contract 
                providing for termination, default, 
                acceleration, or exercise of rights upon, or 
                solely by reason of, insolvency or the 
                appointment of or the exercise of rights or 
                powers by a conservator or receiver.
                  (B) Certain rights not affected.--No 
                provision of this paragraph may be construed as 
                impairing or affecting any right of the 
                conservator or receiver to enforce or recover 
                under a director's or officer's liability 
                insurance contract or depository institution 
                bond under other applicable law.
                  (C) Consent requirement.--
                          (i) In general.--Except as otherwise 
                        provided by this section or section 15, 
                        no person may exercise any right or 
                        power to terminate, accelerate, or 
                        declare a default under any contract to 
                        which the depository institution is a 
                        party, or to obtain possession of or 
                        exercise control over any property of 
                        the institution or affect any 
                        contractual rights of the institution, 
                        without the consent of the conservator 
                        or receiver, as appropriate, during the 
                        45-day period beginning on the date of 
                        the appointment of the conservator, or 
                        during the 90-day period beginning on 
                        the date of the appointment of the 
                        receiver, as applicable.
                          (ii) Certain exceptions.--No 
                        provision of this subparagraph shall 
                        apply to a director or officer 
                        liability insurance contract or a 
                        depository institution bond, to the 
                        rights of parties to certain qualified 
                        financial contracts pursuant to 
                        paragraph (8), or to the rights of 
                        parties to netting contracts pursuant 
                        to subtitle A of title IV of the 
                        Federal Deposit Insurance Corporation 
                        Improvement Act of 1991 (12 U.S.C. 4401 
                        et seq.), or shall be construed as 
                        permitting the conservator or receiver 
                        to fail to comply with otherwise 
                        enforceable provisions of such 
                        contract.
                          (iii) Rule of construction.--Nothing 
                        in this subparagraph shall be construed 
                        to limit or otherwise affect the 
                        applicability of title 11, United 
                        States Code.
          (14) Exception for federal reserve and federal home 
        loan banks.--No provision of this subsection shall 
        apply with respect to--
                  (A) any extension of credit from any Federal 
                home loan bank or Federal Reserve bank to any 
                insured depository institution; or
                  (B) any security interest in the assets of 
                the institution securing any such extension of 
                credit.
          (15) Selling credit card accounts receivable.--
                  (A) Notification required.--An 
                undercapitalized insured depository institution 
                (as defined in section 38) shall notify the 
                Corporation in writing before entering into an 
                agreement to sell credit card accounts 
                receivable.
                  (B) Waiver by corporation.--The Corporation 
                may at any time, in its sole discretion and 
                upon such terms as it may prescribe, waive its 
                right to repudiate an agreement to sell credit 
                card accounts receivable if the Corporation--
                          (i) determines that the waiver is in 
                        the best interests of the Deposit 
                        Insurance Fund; and
                          (ii) provides a written waiver to the 
                        selling institution.
                  (C) Effect of waiver on successors.--
                          (i) In general.--If, under 
                        subparagraph (B), the Corporation has 
                        waived its right to repudiate an 
                        agreement to sell credit card accounts 
                        receivable--
                                  (I) any provision of the 
                                agreement that restricts 
                                solicitation of a credit card 
                                customer of the selling 
                                institution, or the use of a 
                                credit card customer list of 
                                the institution, shall bind any 
                                receiver or conservator of the 
                                institution; and
                                  (II) the Corporation shall 
                                require any acquirer of the 
                                selling institution, or of 
                                substantially all of the 
                                selling institution's assets or 
                                liabilities, to agree to be 
                                bound by a provision described 
                                in subclause (I) as if the 
                                acquirer were the selling 
                                institution.
                          (ii) Exception.--Clause (i)(II) does 
                        not--
                                  (I) restrict the acquirer's 
                                authority to offer any product 
                                or service to any person 
                                identified without using a list 
                                of the selling institution's 
                                customers in violation of the 
                                agreement;
                                  (II) require the acquirer to 
                                restrict any preexisting 
                                relationship between the 
                                acquirer and a customer; or
                                  (III) apply to any 
                                transaction in which the 
                                acquirer acquires only insured 
                                deposits.
                  (D) Waiver not actionable.--The Corporation 
                shall not, in any capacity, be liable to any 
                person for damages resulting from the waiver of 
                or failure to waive the Corporation's right 
                under this section to repudiate any contract or 
                lease, including an agreement to sell credit 
                card accounts receivable. No court shall issue 
                any order affecting any such waiver or failure 
                to waive.
                  (E) Other authority not affected.--This 
                paragraph does not limit any other authority of 
                the Corporation to waive the Corporation's 
                right to repudiate an agreement or lease under 
                this section.
          (16) Certain credit card customer lists protected.--
                  (A) In general.--If any insured depository 
                institution sells credit card accounts 
                receivable under an agreement negotiated at 
                arm's length that provides for the sale of the 
                institution's credit card customer list, the 
                Corporation shall prohibit any party to a 
                transaction with respect to the institution 
                under this section or section 13 from using the 
                list, except as permitted under the agreement.
                  (B) Fraudulent transactions excluded.--
                Subparagraph (A) does not limit the 
                Corporation's authority to repudiate any 
                agreement entered into with the intent to 
                hinder, delay, or defraud the institution, the 
                institution's creditors, or the Corporation.
          (17) Savings clause.--The meanings of terms used in 
        this subsection are applicable for purposes of this 
        subsection only, and shall not be construed or applied 
        so as to challenge or affect the characterization, 
        definition, or treatment of any similar terms under any 
        other statute, regulation, or rule, including the 
        Gramm-Leach-Bliley Act, the Legal Certainty for Bank 
        Products Act of 2000, the securities laws (as that term 
        is defined in section 3(a)(47) of the Securities 
        Exchange Act of 1934), and the Commodity Exchange Act.
  (f) Payment of Insured Deposits.--
          (1) In general.--In case of the liquidation of, or 
        other closing or winding up of the affairs of, any 
        insured depository institution, payment of the insured 
        deposits in such institution shall be made by the 
        Corporation as soon as possible, subject to the 
        provisions of subsection (g), either by cash or by 
        making available to each depositor a transferred 
        deposit in a new insured depository institution in the 
        same community or in another insured depository 
        institution in an amount equal to the insured deposit 
        of such depositor.
          (2) Proof of claims.--The Corporation, in its 
        discretion, may require proof of claims to be filed and 
        may approve or reject such claims for insured deposits.
          (3) Resolution of disputes.--A determination by the 
        Corporation regarding any claim for insurance coverage 
        shall be treated as a final determination for purposes 
        of this section. In its discretion, the Corporation may 
        promulgate regulations prescribing procedures for 
        resolving any disputed claim relating to any insured 
        deposit or any determination of insurance coverage with 
        respect to any deposit.
          (4) Review of corporation determination.--A final 
        determination made by the Corporation regarding any 
        claim for insurance coverage shall be a final agency 
        action reviewable in accordance with chapter 7 of title 
        5, United States Code, by the United States district 
        court for the Federal judicial district where the 
        principal place of business of the depository 
        institution is located.
          (5) Statute of limitations.--Any request for review 
        of a final determination by the Corporation regarding 
        any claim for insurance coverage shall be filed with 
        the appropriate United States district court not later 
        than 60 days after the date on which such determination 
        is issued.
  (g) Subrogation of corporation.--
          (1) In general.--Notwithstanding any other provision 
        of Federal law, the law of any State, or the 
        constitution of any State, the Corporation, upon the 
        payment to any depositor as provided in subsection (f) 
        in connection with any insured depository institution 
        or insured branch described in such subsection or the 
        assumption of any deposit in such institution or branch 
        by another insured depository institution pursuant to 
        this section or section 13, shall be subrogated to all 
        rights of the depositor against such institution or 
        branch to the extent of such payment or assumption.
          (2) Dividends on subrogated amounts.--The subrogation 
        of the Corporation under paragraph (1) with respect to 
        any insured depository institution shall include the 
        right on the part of the Corporation to receive the 
        same dividends from the proceeds of the assets of such 
        institution and recoveries on account of stockholders' 
        liability as would have been payable to the depositor 
        on a claim for the insured deposit, but such depositor 
        shall retain such claim for any uninsured or unassumed 
        portion of the deposit.
          (3) Waiver of certain claims.--With respect to any 
        bank which closes after May 25, 1938, the Corporation 
        shall waive, in favor only of any person against whom 
        stockholders' individual liability may be asserted, any 
        claim on account of such liability in excess of the 
        liability, if any, to the bank or its creditors, for 
        the amount unpaid upon such stock in such bank; but any 
        such waiver shall be effected in such manner and on 
        such terms and conditions as will not increase 
        recoveries or dividends on account of claims to which 
        the Corporation is not subrogated.
          (4) Applicability of state law.--Subject to 
        subsection (d)(11), if the Corporation is appointed 
        pursuant to subsection (c)(3), or determines not to 
        invoke the authority conferred in subsection (c)(4), 
        the rights of depositors and other creditors of any 
        State depository institution shall be determined in 
        accordance with the applicable provisions of State law.
  (h) Conditions Applicable To Resolution Proceedings.--
          (1) Consideration of local economic impact 
        required.--The Corporation shall fully consider the 
        adverse economic impact on local communities, including 
        businesses and farms, of actions to be taken by it 
        during the administration and liquidation of loans of a 
        depository institution in default.
          (2) Actions to alleviate adverse economic impact to 
        be considered.--The actions which the Corporation shall 
        consider include the release of proceeds from the sale 
        of products and services for family living and business 
        expenses and shortening the undue length of the 
        decisionmaking process for the acceptance of offers of 
        settlement contingent upon third party financing.
          (3) Guidelines required.--The Corporation shall adopt 
        and publish procedures and guidelines to minimize 
        adverse economic effects caused by its actions on 
        individual debtors in the community.
          (4) Financial services industry impact analysis.--
        After the appointment of the Corporation as conservator 
        or receiver for any insured depository institution and 
        before taking any action under this section or section 
        13 in connection with the resolution of such 
        institution, the Corporation shall--
                  (A) evaluate the likely impact of the means 
                of resolution, and any action which the 
                Corporation may take in connection with such 
                resolution, on the viability of other insured 
                depository institutions in the same community; 
                and
                  (B) take such evaluation into account in 
                determining the means for resolving the 
                institution and establishing the terms and 
                conditions for any such action.
  (i) Valuation of Claims in Default.--
          (1) In general.--Notwithstanding any other provision 
        of Federal law or the law of any State and regardless 
        of the method which the Corporation determines to 
        utilize with respect to an insured depository 
        institution in default or in danger of default, 
        including transactions authorized under subsection (n) 
        and section 13(c), this subsection shall govern the 
        rights of the creditors (other than insured depositors) 
        of such institution.
          (2) Maximum liability.--The maximum liability of the 
        Corporation, acting as receiver or in any other 
        capacity, to any person having a claim against the 
        receiver or the insured depository institution for 
        which such receiver is appointed shall equal the amount 
        such claimant would have received if the Corporation 
        had liquidated the assets and liabilities of such 
        institution without exercising the Corporation's 
        authority under subsection (n) of this section or 
        section 13.
          (3) Additional payments authorized.--
                  (A) In general.--The Corporation may, in its 
                discretion and in the interests of minimizing 
                its losses, use its own resources to make 
                additional payments or credit additional 
                amounts to or with respect to or for the 
                account of any claimant or category of 
                claimants. Notwithstanding any other provision 
                of Federal or State law, or the constitution of 
                any State, the Corporation shall not be 
                obligated, as a result of having made any such 
                payment or credited any such amount to or with 
                respect to or for the account of any claimant 
                or category of claimants, to make payments to 
                any other claimant or category of claimants.
                  (B) Manner of payment.--The Corporation may 
                make the payments or credit the amounts 
                specified in subparagraph (A) directly to the 
                claimants or may make such payments or credit 
                such amounts to an open insured depository 
                institution to induce such institution to 
                accept liability for such claims.
  (j) Limitation on court action.--Except as provided in this 
section, no court may take any action, except at the request of 
the Board of Directors by regulation or order, to restrain or 
affect the exercise of powers or functions of the Corporation 
as a conservator or a receiver.
  (k) Liability of directors and officers.--A director or 
officer of an insured depository institution may be held 
personally liable for monetary damages in any civil action by, 
on behalf of, or at the request or direction of the 
Corporation, which action is prosecuted wholly or partially for 
the benefit of the Corporation--
          (1) acting as conservator or receiver of such 
        institution,
          (2) acting based upon a suit, claim, or cause of 
        action purchased from, assigned by, or otherwise 
        conveyed by such receiver or conservator, or
          (3) acting based upon a suit, claim, or cause of 
        action purchased from, assigned by, or otherwise 
        conveyed in whole or in part by an insured depository 
        institution or its affiliate in connection with 
        assistance provided under section 13,
for gross negligence, including any similar conduct or conduct 
that demonstrates a greater disregard of a duty of care (than 
gross negligence) including intentional tortious conduct, as 
such terms are defined and determined under applicable State 
law. Nothing in this paragraph shall impair or affect any right 
of the Corporation under other applicable law.
  (l) Damages.--In any proceeding related to any claim against 
an insured depository institution's director, officer, 
employee, agent, attorney, accountant, appraiser, or any other 
party employed by or providing services to an insured 
depository institution, recoverable damages determined to 
result from the improvident or otherwise improper use or 
investment of any insured depository institution's assets shall 
include principal losses and appropriate interest.
  (m) New Depository Institutions.--
          (1) Organization authorized.--As soon as possible 
        after the default of an insured depository institution, 
        the Corporation, if it finds that it is advisable and 
        in the interest of the depositors of the insured 
        depository institution in default or the public shall 
        organize a new national bank or Federal savings 
        association in the same community as the insured 
        depository institution in default to assume the insured 
        deposits of such depository institution in default and 
        otherwise to perform temporarily the functions 
        hereinafter provided for.
          (2) Articles of association.--The articles of 
        association and the organization certificate of the new 
        depository institution shall be executed by 
        representatives designated by the Corporation.
          (3) Capital stock.--No capital stock need be paid in 
        by the Corporation.
          (4) Executive officer.--The new depository 
        institution shall not have a board of directors, but 
        shall be managed by an executive officer appointed by 
        the Board of Directors of the Corporation who shall be 
        subject to its directions.
          (5) Subject to laws relating to national banks.--In 
        all other respects the new depository institution shall 
        be organized in accordance with the then existing 
        provisions of law relating to the organization of 
        national banking associations.
          (6) New deposits.--The new depository institution 
        may, with the approval of the Corporation, accept new 
        deposits which shall be subject to withdrawal on demand 
        and which, except where the new depository institution 
        is the only depository institution in the community, 
        shall not exceed an amount equal to the standard 
        maximum deposit insurance amount from any depositor.
          (7) Insured status.--The new depository institution, 
        without application to or approval by the Corporation, 
        shall be an insured depository institution and shall 
        maintain on deposit with the Federal Reserve bank of 
        its district reserves in the amount required by law for 
        member banks, but it shall not be required to subscribe 
        for stock of the Federal Reserve bank.
          (8) Investments.--Funds of the new depository 
        institution shall be kept on hand in cash, invested in 
        obligations of the United States or obligations 
        guaranteed as to principal and interest by the United 
        States, or deposited with the Corporation, any Federal 
        Reserve bank, or, to the extent of the insurance 
        coverage on any such deposit, an insured depository 
        institution.
          (9) Conduct of business.--The new depository 
        institution, unless otherwise authorized by the 
        Comptroller of the Currency, shall transact business 
        only as authorized by this Act and as may be incidental 
        to its organization.
          (10) Exempt status.--Notwithstanding any other 
        provision of Federal or State law, the new depository 
        institution, its franchise, property, and income shall 
        be exempt from all taxation now or hereafter imposed by 
        the United States, by any territory, dependency, or 
        possession thereof, or by any State, county, 
        municipality, or local taxing authority.
          (11) Transfer of deposits.--(A) Upon the organization 
        of a new depository institution, the Corporation shall 
        promptly make available to it an amount equal to the 
        estimated insured deposits of such depository 
        institution in default plus the estimated amount of the 
        expenses of operating the new depository institution, 
        and shall determine as soon as possible the amount due 
        each depositor for the depositor's insured deposit in 
        the insured depository institution in default, and the 
        total expenses of operation of the new depository 
        institution.
          (12) Earnings.--Earnings of the new depository 
        institution shall be paid over or credited to the 
        Corporation in such adjustment.
          (13) Losses.--If any new depository institution, 
        during the period it continues its status as such, 
        sustains any losses with respect to which it is not 
        effectively protected except by reason of being an 
        insured depository institution, the Corporation shall 
        furnish to it additional funds in the amount of such 
        losses.
          (14) Payment of insured deposits.--(A) The new 
        depository institution shall assume as transferred 
        deposits the payment of the insured deposits of such 
        depository institution in default to each of its 
        depositors.
          (B) Of the amounts so made available, the Corporation 
        shall transfer to the new depository institution, in 
        cash, such sums as may be necessary to enable it to 
        meet its expenses of operation and immediate cash 
        demands on such transferred deposits, and the remainder 
        of such amounts shall be subject to withdrawal by the 
        new depository institution on demand.
          (15) Issuance of stock.--(A) Whenever in the judgment 
        of the Board of Directors it is desirable to do so, the 
        Corporation shall cause capital stock of the new 
        depository institution to be offered for sale on such 
        terms and conditions as the Board of Directors shall 
        deem advisable in an amount sufficient, in the opinion 
        of the Board of Directors, to make possible the conduct 
        of the business of the new depository institution on a 
        sound basis.
          (B) The stockholders of the insured depository 
        institution in default shall be given the first 
        opportunity to purchase any shares of common stock so 
        offered.
          (16) Issuance of certificate.--Upon proof that an 
        adequate amount of capital stock in the new depository 
        institution has been subscribed and paid for in cash, 
        the Comptroller of the Currency[,] shall require the 
        articles of association and the organization 
        certificate to be amended to conform to the 
        requirements for the organization of a national bank or 
        Federal savings association, and thereafter, when the 
        requirements of law with respect to the organization of 
        a national bank or Federal savings association have 
        been complied with, the Comptroller of the Currency[,] 
        shall issue to the depository institution a certificate 
        of authority to commence business, and thereupon the 
        depository institution shall cease to have the status 
        of a new depository institution, shall be managed by 
        directors elected by its own shareholders, may exercise 
        all the powers granted by law, and shall be subject to 
        all provisions of law relating to national banks or 
        Federal savings associations. Such depository 
        institution shall thereafter be an insured national 
        bank or Federal savings association, without 
        certification to or approval by the Corporation.
          (17) Transfer to other institution.--If the capital 
        stock of the new depository institution is not offered 
        for sale, or if an adequate amount of capital for such 
        new depository institution is not subscribed and paid 
        for, the Board of Directors may offer to transfer its 
        business to any insured depository institution in the 
        same community which will take over its assets, assume 
        its liabilities, and pay to the Corporation for such 
        business such amount as the Board of Directors may deem 
        adequate; or the Board of Directors in its discretion 
        may change the location of the new depository 
        institution to the office of the Corporation or to some 
        other place or may at any time wind up its affairs as 
        herein provided.
          (18) Winding up.--Unless the capital stock of the new 
        depository institution is sold or its assets are taken 
        over and its liabilities are assumed by an insured 
        depository institution as above provided within 2 years 
        after the date of its organization, the Corporation 
        shall wind up the affairs of such depository 
        institution, after giving such notice, if any, as the 
        Comptroller of the Currency[,] may require, and shall 
        certify to the Comptroller of the Currency[,] the 
        termination of the new depository institution. 
        Thereafter the Corporation shall be liable for the 
        obligations of such depository institution and shall be 
        the owner of its assets.
          (19) Applicability of certain laws.--The provisions 
        of sections 5220 and 5221 of the Revised Statutes shall 
        not apply to a new depository institution under this 
        subsection.
  (n) Bridge Depository Institutions.--
          (1) Organization.--
                  (A) Purpose.--When 1 or more insured 
                depository institutions are in default, or when 
                the Corporation anticipates that 1 or more 
                insured depository institutions may become in 
                default, the Corporation may, in its 
                discretion, organize, and the Office of the 
                Comptroller of the Currency, with respect to 1 
                or more insured depository institutions or 1 or 
                more insured savings associations, shall 
                charter, 1 or more national banks or Federal 
                savings associations, as appropriate, with 
                respect thereto with the powers and attributes 
                of national banking associations or Federal 
                savings associations, as applicable, subject to 
                the provisions of this subsection, to be 
                referred to as ``bridge depository 
                institutions''.
                  (B) Authorities.--Upon the granting of a 
                charter to a bridge depository institution, the 
                bridge depository institution may--
                          (i) assume such deposits of such 
                        insured depository institution or banks 
                        that is or are in default or in danger 
                        of default as the Corporation may, in 
                        its discretion, determine to be 
                        appropriate;
                          (ii) assume such other liabilities 
                        (including liabilities associated with 
                        any trust business) of such insured 
                        depository institution or banks that is 
                        or are in default or in danger of 
                        default as the Corporation may, in its 
                        discretion, determine to be 
                        appropriate;
                          (iii) purchase such assets (including 
                        assets associated with any trust 
                        business) of such insured depository 
                        institution or banks that is or are in 
                        default or in danger of default as the 
                        Corporation may, in its discretion, 
                        determine to be appropriate; and
                          (iv) perform any other temporary 
                        function which the Corporation may, in 
                        its discretion, prescribe in accordance 
                        with this Act.
                  (C) Articles of association.--The articles of 
                association and organization certificate of a 
                bridge depository institution as approved by 
                the Corporation shall be executed by 3 
                representatives designated by the Corporation.
                  (D) Interim directors.--A bridge depository 
                institution shall have an interim board of 
                directors consisting of not fewer than 5 nor 
                more than 10 members appointed by the 
                Corporation.
                  (E) National bank or federal savings 
                association.--A bridge depository institution 
                shall be organized as a national bank, in the 
                case of 1 or more insured depository 
                institutions, and as a Federal savings 
                association, in the case of 1 or more insured 
                savings associations.
          (2) Chartering.--
                  (A) Conditions.--A national bank or Federal 
                savings association may be chartered by the 
                Comptroller of the Currency as a bridge 
                depository institution only if the Board of 
                Directors determines that--
                          (i) the amount which is reasonably 
                        necessary to operate such bridge 
                        depository institution will not exceed 
                        the amount which is reasonably 
                        necessary to save the cost of 
                        liquidating, including paying the 
                        insured accounts of, 1 or more insured 
                        depository institutions in default or 
                        in danger of default with respect to 
                        which the bridge depository institution 
                        is chartered;
                          (ii) the continued operation of such 
                        insured depository institution or banks 
                        in default or in danger of default with 
                        respect to which the bridge depository 
                        institution is chartered is essential 
                        to provide adequate banking services in 
                        the community where each such 
                        depository institution in default or in 
                        danger of default is located; or
                          (iii) the continued operation of such 
                        insured depository institution or banks 
                        in default or in danger of default with 
                        respect to which the bridge depository 
                        institution is chartered is in the best 
                        interest of the depositors of such 
                        depository institution or banks in 
                        default or in danger of default or the 
                        public.
                  (B) Insured national bank or federal savings 
                association.--A bridge depository institution 
                shall be an insured depository institution from 
                the time it is chartered as a national bank or 
                Federal savings association.
                  (C) Bridge bank treated as being in default 
                for certain purposes.--A bridge depository 
                institution shall be treated as an insured 
                depository institution in default at such times 
                and for such purposes as the Corporation may, 
                in its discretion, determine.
                  (D) Management.--A bridge depository 
                institution, upon the granting of its charter, 
                shall be under the management of a board of 
                directors consisting of not fewer than 5 nor 
                more than 10 members appointed by the 
                Corporation.
                  (E) Bylaws.--The board of directors of a 
                bridge depository institution shall adopt such 
                bylaws as may be approved by the Corporation.
          (3) Transfer of assets and liabilities.--
                  (A) In general.--
                          (i) Transfer upon grant of charter.--
                        Upon the granting of a charter to a 
                        bridge depository institution pursuant 
                        to this subsection, the Corporation, as 
                        receiver, or any other receiver 
                        appointed with respect to any insured 
                        depository institution in default with 
                        respect to which the bridge depository 
                        institution is chartered may transfer 
                        any assets and liabilities of such 
                        depository institution in default to 
                        the bridge depository institution in 
                        accordance with paragraph (1).
                          (ii) Subsequent transfers.--At any 
                        time after a charter is granted to a 
                        bridge depository institution, the 
                        Corporation, as receiver, or any other 
                        receiver appointed with respect to an 
                        insured depository institution in 
                        default may transfer any assets and 
                        liabilities of such insured depository 
                        institution in default as the 
                        Corporation may, in its discretion, 
                        determine to be appropriate in 
                        accordance with paragraph (1).
                          (iii) Treatment of trust business.--
                        For purposes of this paragraph, the 
                        trust business, including fiduciary 
                        appointments, of any insured depository 
                        institution in default is included 
                        among its assets and liabilities.
                          (iv) Effective without approval.--The 
                        transfer of any assets or liabilities, 
                        including those associated with any 
                        trust business, of an insured 
                        depository institution in default 
                        transferred to a bridge depository 
                        institution shall be effective without 
                        any further approval under Federal or 
                        State law, assignment, or consent with 
                        respect thereto.
                  (B) Intent of congress regarding continuing 
                operations.--It is the intent of the Congress 
                that, in order to prevent unnecessary hardship 
                or losses to the customers of any insured 
                depository institution in default with respect 
                to which a bridge depository institution is 
                chartered, especially creditworthy farmers, 
                small businesses, and households, the 
                Corporation should--
                          (i) continue to honor commitments 
                        made by the depository institution in 
                        default to creditworthy customers, and
                          (ii) not interrupt or terminate 
                        adequately secured loans which are 
                        transferred under subparagraph (A) and 
                        are being repaid by the debtor in 
                        accordance with the terms of the loan 
                        instrument.
          (4) Powers of bridge banks.--Each bridge depository 
        institution chartered under this subsection shall have 
        all corporate powers of, and be subject to the same 
        provisions of law as, a national bank or Federal 
        savings association, as appropriate, except that--
                  (A) the Corporation may--
                          (i) remove the interim directors and 
                        directors of a bridge depository 
                        institution;
                          (ii) fix the compensation of members 
                        of the interim board of directors and 
                        the board of directors and senior 
                        management, as determined by the 
                        Corporation in its discretion, of a 
                        bridge depository institution; and
                          (iii) waive any requirement 
                        established under section 5145, 5146, 
                        5147, 5148, or 5149 of the Revised 
                        Statutes (relating to directors of 
                        national banks) or section 31 of the 
                        Banking Act of 1933 which would 
                        otherwise be applicable with respect to 
                        directors of a bridge depository 
                        institution by operation of paragraph 
                        (2)(B);
                  (B) the Corporation may indemnify the 
                representatives for purposes of paragraph 
                (1)(B) and the interim directors, directors, 
                officers, employees, and agents of a bridge 
                depository institution on such terms as the 
                Corporation determines to be appropriate;
                  (C) no requirement under any provision of law 
                relating to the capital of a national bank 
                shall apply with respect to a bridge depository 
                institution;
                  (D) the Comptroller of the Currency may 
                establish a limitation on the extent to which 
                any person may become indebted to a bridge 
                depository institution without regard to the 
                amount of the bridge depository institution's 
                capital or surplus;
                  (E)(i) the board of directors of a bridge 
                depository institution shall elect a 
                chairperson who may also serve in the position 
                of chief executive officer, except that such 
                person shall not serve either as chairperson or 
                as chief executive officer without the prior 
                approval of the Corporation; and
          (ii) the board of directors of a bridge depository 
        institution may appoint a chief executive officer who 
        is not also the chairperson, except that such person 
        shall not serve as chief executive officer without the 
        prior approval of the Corporation;
                  (F) a bridge depository institution shall not 
                be required to purchase stock of any Federal 
                Reserve bank;
                  (G) the Comptroller of the Currency shall 
                waive any requirement for a fidelity bond with 
                respect to a bridge depository institution at 
                the request of the Corporation;
                  (H) any judicial action to which a bridge 
                depository institution becomes a party by 
                virtue of its acquisition of any assets or 
                assumption of any liabilities of a depository 
                institution in default shall be stayed from 
                further proceedings for a period of up to 45 
                days at the request of the bridge depository 
                institution;
                  (I) no agreement which tends to diminish or 
                defeat the right, title or interest of a bridge 
                depository institution in any asset of an 
                insured depository institution in default 
                acquired by it shall be valid against the 
                bridge depository institution unless such 
                agreement--
                          (i) is in writing,
                          (ii) was executed by such insured 
                        depository institution in default and 
                        the person or persons claiming an 
                        adverse interest thereunder, including 
                        the obligor, contemporaneously with the 
                        acquisition of the asset by such 
                        insured depository institution in 
                        default,
                          (iii) was approved by the board of 
                        directors of such insured depository 
                        institution in default or its loan 
                        committee, which approval shall be 
                        reflected in the minutes of said board 
                        or committee, and
                          (iv) has been, continuously from the 
                        time of its execution, an official 
                        record of such insured depository 
                        institution in default;
                  (J) notwithstanding section 13(e)(2), any 
                agreement relating to an extension of credit 
                between a Federal home loan bank or Federal 
                Reserve bank and any insured depository 
                institution which was executed before the 
                extension of credit by such bank to such 
                depository institution shall be treated as 
                having been executed contemporaneously with 
                such extension of credit for purposes of 
                subparagraph (I); and
                  (K) except with the prior approval of the 
                Corporation, a bridge depository institution 
                may not, in any transaction or series of 
                transactions, issue capital stock or be a party 
                to any merger, consolidation, disposition of 
                assets or liabilities, sale or exchange of 
                capital stock, or similar transaction, or 
                change its charter.
          (5) Capital.--
                  (A) No capital required.--The Corporation 
                shall not be required to--
                          (i) issue any capital stock on behalf 
                        of a bridge depository institution 
                        chartered under this subsection; or
                          (ii) purchase any capital stock of a 
                        bridge depository institution, except 
                        that notwithstanding any other 
                        provision of Federal or State law, the 
                        Corporation may purchase and retain 
                        capital stock of a bridge depository 
                        institution in such amounts and on such 
                        terms as the Corporation, in its 
                        discretion, determines to be 
                        appropriate.
                  (B) Operating funds in lieu of capital.--Upon 
                the organization of a bridge depository 
                institution, and thereafter, as the Board of 
                Directors may, in its discretion, determine to 
                be necessary or advisable, the Corporation may 
                make available to the bridge depository 
                institution, upon such terms and conditions and 
                in such form and amounts as the Corporation may 
                in its discretion determine, funds for the 
                operation of the bridge depository institution 
                in lieu of capital.
                  (C) Authority to issue capital stock.--
                Whenever the Board of Directors determines it 
                is advisable to do so, the Corporation shall 
                cause capital stock of a bridge depository 
                institution to be issued and offered for sale 
                in such amounts and on such terms and 
                conditions as the Corporation may, in its 
                discretion, determine.
                  (D) Capital levels.--A bridge depository 
                institution shall not be considered an 
                undercapitalized depository institution or a 
                critically undercapitalized depository 
                institution for purposes of section 10B(b) of 
                the Federal Reserve Act.
          (6) No federal status.--
                  (A) Agency status.--A bridge depository 
                institution is not an agency, establishment, or 
                instrumentality of the United States.
                  (B) Employee status.--Representatives for 
                purposes of paragraph (1)(B), interim 
                directors, directors, officers, employees, or 
                agents of a bridge depository institution are 
                not, solely by virtue of service in any such 
                capacity, officers or employees of the United 
                States. Any employee of the Corporation or of 
                any Federal instrumentality who serves at the 
                request of the Corporation as a representative 
                for purposes of paragraph (1)(B), interim 
                director, director, officer, employee, or agent 
                of a bridge depository institution shall not--
                          (i) solely by virtue of service in 
                        any such capacity lose any existing 
                        status as an officer or employee of the 
                        United States for purposes of title 5, 
                        United States Code, or any other 
                        provision of law, or
                          (ii) receive any salary or benefits 
                        for service in any such capacity with 
                        respect to a bridge depository 
                        institution in addition to such salary 
                        or benefits as are obtained through 
                        employment with the Corporation or such 
                        Federal instrumentality.
          (7) Assistance authorized.--The Corporation may, in 
        its discretion, provide assistance under section 13(c) 
        to facilitate any transaction described in clause (i), 
        (ii), or (iii) of paragraph (10)(A) with respect to any 
        bridge depository institution in the same manner and to 
        the same extent as such assistance may be provided 
        under such section with respect to an insured 
        depository institution in default, or to facilitate a 
        bridge depository institution's acquisition of any 
        assets or the assumption of any liabilities of an 
        insured depository institution in default.
          (8) Acquisition.--
                  (A) In general.--The responsible agency shall 
                notify the Attorney General of any transaction 
                involving the merger or sale of a bridge 
                depository institution requiring approval under 
                section 18(c) and if a report on competitive 
                factors is requested within 10 days, such 
                transaction may not be consummated before the 
                5th calendar day after the date of approval by 
                the responsible agency with respect thereto. If 
                the responsible agency has found that it must 
                act immediately to prevent the probable failure 
                of 1 of the depository institutions involved, 
                the preceding sentence does not apply and the 
                transaction may be consummated immediately upon 
                approval by the agency.
                  (B) By out-of-state holding company.--Any 
                depository institution, including an out-of-
                State depository institution, or any out-of-
                State depository institution holding company 
                may acquire and retain the capital stock or 
                assets of, or otherwise acquire and retain a 
                bridge depository institution if the bridge 
                depository institution at any time had assets 
                aggregating $500,000,000 or more, as determined 
                by the Corporation on the basis of the bridge 
                depository institution's reports of condition 
                or on the basis of the last available reports 
                of condition of any insured depository 
                institution in default, which institution has 
                been acquired, or whose assets have been 
                acquired, by the bridge depository institution. 
                The acquiring entity may acquire the bridge 
                depository institution only in the same manner 
                and to the same extent as such entity may 
                acquire an insured depository institution in 
                default under section 13(f)(2).
          (9) Duration of bridge depository institution.--
        Subject to paragraphs (11) and (12), the status of a 
        bridge depository institution as such shall terminate 
        at the end of the 2-year period following the date it 
        was granted a charter. The Board of Directors may, in 
        its discretion, extend the status of the bridge 
        depository institution as such for 3 additional 1-year 
        periods.
          (10) Termination of bridge depository institution 
        status.--The status of any bridge depository 
        institution as such shall terminate upon the earliest 
        of--
                  (A) the merger or consolidation of the bridge 
                depository institution with a depository 
                institution that is not a bridge depository 
                institution;
                  (B) at the election of the Corporation, the 
                sale of a majority of the capital stock of the 
                bridge depository institution to an entity 
                other than the Corporation and other than 
                another bridge depository institution;
                  (C) the sale of 80 percent, or more, of the 
                capital stock of the bridge depository 
                institution to an entity other than the 
                Corporation and other than another bridge 
                depository institution;
                  (D) at the election of the Corporation, 
                either the assumption of all or substantially 
                all of the deposits and other liabilities of 
                the bridge depository institution by a 
                depository institution holding company or a 
                depository institution that is not a bridge 
                depository institution, or the acquisition of 
                all or substantially all of the assets of the 
                bridge depository institution by a depository 
                institution holding company, a depository 
                institution that is not a bridge depository 
                institution, or other entity as permitted under 
                applicable law; and
                  (E) the expiration of the period provided in 
                paragraph (9), or the earlier dissolution of 
                the bridge depository institution as provided 
                in paragraph (12).
          (11) Effect of termination events.--
                  (A) Merger or consolidation.--A bridge 
                depository institution that participates in a 
                merger or consolidation as provided in 
                paragraph (10)(A) shall be for all purposes a 
                national bank or a Federal savings association, 
                as the case may be, with all the rights, 
                powers, and privileges thereof, and such merger 
                or consolidation shall be conducted in 
                accordance with, and shall have the effect 
                provided in, the provisions of applicable law.
                  (B) Charter conversion.--Following the sale 
                of a majority of the capital stock of the 
                bridge depository institution as provided in 
                paragraph (10)(B), the Corporation may amend 
                the charter of the bridge depository 
                institution to reflect the termination of the 
                status of the bridge depository institution as 
                such, whereupon the depository institution 
                shall remain a national bank or a Federal 
                savings association, as the case may be,, with 
                all of the rights, powers, and privileges 
                thereof, subject to all laws and regulations 
                applicable thereto.
                  (C) Sale of stock.--Following the sale of 80 
                percent or more of the capital stock of a 
                bridge depository institution as provided in 
                paragraph (10)(C), the depository institution 
                shall remain a national bank or a Federal 
                savings association, as the case may be,, with 
                all of the rights, powers, and privileges 
                thereof, subject to all laws and regulations 
                applicable thereto.
                  (D) Assumption of liabilities and sale of 
                assets.--Following the assumption of all or 
                substantially all of the liabilities of the 
                bridge depository institution, or the sale of 
                all or substantially all of the assets of the 
                bridge depository institution, as provided in 
                paragraph (10)(D), at the election of the 
                Corporation the bridge depository institution 
                may retain its status as such for the period 
                provided in paragraph (9).
                  (E) Effect on holding companies.--A 
                depository institution holding company 
                acquiring a bridge depository institution under 
                section 13(f), paragraph (8)(B) (or any 
                predecessor provision), or both provisions, 
                shall not be impaired or adversely affected by 
                the termination of the status of a bridge 
                depository institution as a result of 
                subparagraph (A), (B), (C), or (D) of paragraph 
                (10), and shall be entitled to the rights and 
                privileges provided in section 13(f).
                  (F) Amendments to charter.--Following the 
                consummation of a transaction described in 
                subparagraph (A), (B), (C), or (D) of paragraph 
                (10), the charter of the resulting institution 
                shall be amended to reflect the termination of 
                bridge depository institution status, if 
                appropriate.
          (12) Dissolution of bridge depository institution.--
                  (A) In general.--Notwithstanding any other 
                provision of State or Federal law, if the 
                bridge depository institution's status as such 
                has not previously been terminated by the 
                occurrence of an event specified in 
                subparagraph (A), (B), (C), or (D) of paragraph 
                (10)--
                          (i) the Board of Directors may, in 
                        its discretion, dissolve a bridge 
                        depository institution in accordance 
                        with this paragraph at any time; and
                          (ii) the Board of Directors shall 
                        promptly commence dissolution 
                        proceedings in accordance with this 
                        paragraph upon the expiration of the 2-
                        year period following the date the 
                        bridge depository institution was 
                        chartered, or any extension thereof, as 
                        provided in paragraph (9).
                  (B) Procedures.--The Comptroller of the 
                Currency shall appoint the Corporation as 
                receiver for a bridge depository institution 
                upon certification by the Board of Directors to 
                the Comptroller of the Currency of its 
                determination to dissolve the bridge depository 
                institution. The Corporation as such receiver 
                shall wind up the affairs of the bridge 
                depository institution in conformity with the 
                provisions of law relating to the liquidation 
                of closed national banks or Federal savings 
                associations, as appropriate. With respect to 
                any such bridge depository institution, the 
                Corporation as such receiver shall have all the 
                rights, powers, and privileges and shall 
                perform the duties related to the exercise of 
                such rights, powers, or privileges granted by 
                law to a receiver of any insured depository 
                institution and notwithstanding any other 
                provision of law in the exercise of such 
                rights, powers, and privileges the Corporation 
                shall not be subject to the direction or 
                supervision of any State agency or other 
                Federal agency.
          (13) Multiple bridge depository institutions.--
        Subject to paragraph (1)(B)(i), the Corporation may, in 
        the Corporation's discretion, organize 2 or more bridge 
        depository institutions under this subsection to assume 
        any deposits of, assume any other liabilities of, and 
        purchase any assets of a single depository institution 
        in default.
  (o) Supervisory Records.--In addition to the requirements of 
section 7(a)(2) to provide to the Corporation copies of reports 
of examination and reports of condition, whenever the 
Corporation has been appointed as receiver for an insured 
depository institution, the appropriate Federal banking agency 
shall make available all supervisory records to the receiver 
which may be used by the receiver in any manner the receiver 
determines to be appropriate.
  (p) Certain Sales of Assets Prohibited.--
          (1) Persons who engaged in improper conduct with, or 
        caused losses to, depository institutions.--The 
        Corporation shall prescribe regulations which, at a 
        minimum, shall prohibit the sale of assets of a failed 
        institution by the Corporation to--
                  (A) any person who--
                          (i) has defaulted, or was a member of 
                        a partnership or an officer or director 
                        of a corporation that has defaulted, on 
                        1 or more obligations the aggregate 
                        amount of which exceed $1,000,000, to 
                        such failed institution;
                          (ii) has been found to have engaged 
                        in fraudulent activity in connection 
                        with any obligation referred to in 
                        clause (i); and
                          (iii) proposes to purchase any such 
                        asset in whole or in part through the 
                        use of the proceeds of a loan or 
                        advance of credit from the Corporation 
                        or from any institution for which the 
                        Corporation has been appointed as 
                        conservator or receiver;
                  (B) any person who participated, as an 
                officer or director of such failed institution 
                or of any affiliate of such institution, in a 
                material way in transactions that resulted in a 
                substantial loss to such failed institution;
                  (C) any person who has been removed from, or 
                prohibited from participating in the affairs 
                of, such failed institution pursuant to any 
                final enforcement action by an appropriate 
                Federal banking agency; or
                  (D) any person who has demonstrated a pattern 
                or practice of defalcation regarding 
                obligations to such failed institution.
          (2) Convicted debtors.--Except as provided in 
        paragraph (3), any person who--
                  (A) has been convicted of an offense under 
                section 215, 656, 657, 1005, 1006, 1007, 1008, 
                1014, 1032, 1341, 1343, or 1344 of title 18, 
                United States Code, or of conspiring to commit 
                such an offense, affecting any insured 
                depository institution for which any 
                conservator or receiver has been appointed; and
                  (B) is in default on any loan or other 
                extension of credit from such insured 
                depository institution which, if not paid, will 
                cause substantial loss to the institution, the 
                Deposit Insurance Fund, or the Corporation,
        may not purchase any asset of such institution from the 
        conservator or receiver.
          (3) Settlement of claims.--Paragraphs (1) and (2) 
        shall not apply to the sale or transfer by the 
        Corporation of any asset of any insured depository 
        institution to any person if the sale or transfer of 
        the asset resolves or settles, or is part of the 
        resolution or settlement, of--
                  (A) 1 or more claims that have been, or could 
                have been, asserted by the Corporation against 
                the person; or
                  (B) obligations owed by the person to any 
                insured depository institution or the 
                Corporation.
          (4) Definition of default.--For purposes of this 
        subsection, the term ``default'' means a failure to 
        comply with the terms of a loan or other obligation to 
        such an extent that the property securing the 
        obligation is foreclosed upon.
  (q) Expedited Procedures for Certain Claims.--
          (1) Time for filing notice of appeal.--The notice of 
        appeal of any order, whether interlocutory or final, 
        entered in any case brought by the Corporation against 
        an insured depository institution's director, officer, 
        employee, agent, attorney, accountant, or appraiser or 
        any other person employed by or providing services to 
        an insured depository institution shall be filed not 
        later than 30 days after the date of entry of the 
        order. The hearing of the appeal shall be held not 
        later than 120 days after the date of the notice of 
        appeal. The appeal shall be decided not later than 180 
        days after the date of the notice of appeal.
          (2) Scheduling.--Consistent with section 1657 of 
        title 18, United States Code, a court of the United 
        States shall expedite the consideration of any case 
        brought by the Corporation against an insured 
        depository institution's director, officer, employee, 
        agent, attorney, accountant, or appraiser or any other 
        person employed by or providing services to an insured 
        depository institution. As far as practicable the court 
        shall give such case priority on its docket.
          (3) Judicial discretion.--The court may modify the 
        schedule and limitations stated in paragraphs (1) and 
        (2) in a particular case, based on a specific finding 
        that the ends of justice that would be served by making 
        such a modification would outweigh the best interest of 
        the public in having the case resolved expeditiously.
  (r) Foreign Investigations.--The Corporation, as conservator 
or receiver of any insured depository institution and for 
purposes of carrying out any power, authority, or duty with 
respect to an insured depository institution--
          (1) may request the assistance of any foreign banking 
        authority and provide assistance to any foreign banking 
        authority in accordance with section 8(v); and
          (2) may each maintain an office to coordinate foreign 
        investigations or investigations on behalf of foreign 
        banking authorities.
  (s) Prohibition on Entering Secrecy Agreements and Protective 
Orders.--The Corporation may not enter into any agreement or 
approve any protective order which prohibits the Corporation 
from disclosing the terms of any settlement of an 
administrative or other action for damages or restitution 
brought by the Corporation in its capacity as conservator or 
receiver for an insured depository institution.
  (t) Agencies May Share Information Without Waiving 
Privilege.--
          (1) In general.--A covered agency, in any capacity, 
        shall not be deemed to have waived any privilege 
        applicable to any information by transferring that 
        information to or permitting that information to be 
        used by--
                  (A) any other covered agency, in any 
                capacity; or
                  (B) any other agency of the Federal 
                Government (as defined in section 6 of title 
                18, United States Code).
          (2) Definitions.--For purposes of this subsection:
                  (A) Covered agency.--The term ``covered 
                agency'' means any of the following:
                          (i) Any Federal banking agency.
                          (ii) The Farm Credit Administration.
                          (iii) The Farm Credit System 
                        Insurance Corporation.
                          (iv) The National Credit Union 
                        Administration.
                          (v) The General Accounting Office.
                          [(vi) The Bureau of Consumer 
                        Financial Protection.]
                          (vi) The Consumer Law Enforcement 
                        Agency.
                          (vii) Federal Housing Finance Agency.
                  (B) Privilege.--The term ``privilege'' 
                includes any work-product, attorney-client, or 
                other privilege recognized under Federal or 
                State law.
          (3) Rule of construction.--Paragraph (1) shall not be 
        construed as implying that any person waives any 
        privilege applicable to any information because 
        paragraph (1) does not apply to the transfer or use of 
        that information.
  (u) Purchase Rights of Tenants.--
          (1) Notice.--Except as provided in paragraph (3), the 
        Corporation may make available for sale a 1- to 4-
        family residence (including a manufactured home) to 
        which the Corporation acquires title only after the 
        Corporation has provided the household residing in the 
        property notice (in writing and mailed to the property) 
        of the availability of such property and the preference 
        afforded such household under paragraph (2).
          (2) Preference.--In selling such a property, the 
        Corporation shall give preference to any bona fide 
        offer made by the household residing in the property, 
        if--
                  (A) such offer is substantially similar in 
                amount to other offers made within such period 
                (or expected by the Corporation to be made 
                within such period);
                  (B) such offer is made during the period 
                beginning upon the Corporation making such 
                property available and of a reasonable 
                duration, as determined by the Corporation 
                based on the normal period for sale of such 
                properties; and
                  (C) the household making the offer complies 
                with any other requirements applicable to 
                purchasers of such property, including any 
                downpayment and credit requirements.
          (3) Exceptions.--Paragraphs (1) and (2) shall not 
        apply to--
                  (A) any residence transferred in connection 
                with the transfer of substantially all of the 
                assets of an insured depository institution for 
                which the Corporation has been appointed 
                conservator or receiver;
                  (B) any eligible single family property (as 
                such term is defined in section 40(p)); or
                  (C) any residence for which the household 
                occupying the residence was the mortgagor under 
                a mortgage on such residence and to which the 
                Corporation acquired title pursuant to default 
                on such mortgage.
  (v) Preference for Sales for Homeless Families.--Subject to 
subsection (u), in selling any real property (other than 
eligible residential property and eligible condominium 
property, as such terms are defined in section 40(p)) to which 
the Corporation acquires title, the Corporation shall give 
preference among offers to purchase the property that will 
result in the same net present value proceeds, to any offer 
that would provide for the property to be used, during the 
remaining useful life of the property, to provide housing or 
shelter for homeless persons (as such term is defined in 
section 103 of the Stewart B. McKinney Homeless Assistance Act) 
or homeless families.
  (w) Preferences for Sales of Certain Commercial Real 
Properties.--
          (1) Authority.--In selling any eligible commercial 
        real properties of the Corporation, the Corporation 
        shall give preference, among offers to purchase the 
        property that will result in the same net present value 
        proceeds, to any offer--
                  (A) that is made by a public agency or 
                nonprofit organization; and
                  (B) under which the purchaser agrees that the 
                property shall be used, during the remaining 
                useful life of the property, for offices and 
                administrative purposes of the purchaser to 
                carry out a program to acquire residential 
                properties to provide (i) homeownership and 
                rental housing opportunities for very-low-, 
                low-, and moderate-income families, or (ii) 
                housing or shelter for homeless persons (as 
                such term is defined in section 103 of the 
                Stewart B. McKinney Homeless Assistance Act) or 
                homeless families.
          (2) Definitions.--For purposes of this subsection, 
        the following definitions shall apply:
                  (A) Eligible commercial real property.--The 
                term ``eligible commercial real property'' 
                means any property (i) to which the Corporation 
                acquires title, and (ii) that the Corporation, 
                in the discretion of the Corporation, 
                determines is suitable for use for the location 
                of offices or other administrative functions 
                involved with carrying out a program referred 
                to in paragraph (1)(B).
                  (B) Nonprofit organization and public 
                agency.--The terms ``nonprofit organization'' 
                and ``public agency'' have the same meanings as 
                in section 40(p).

           *       *       *       *       *       *       *

  Sec. 13. (a) Investment of Corporation's Funds.--
          (1) Authority.--Funds held in the Deposit Insurance 
        Fund or the FSLIC Resolution Fund, that are not 
        otherwise employed shall be invested in obligations of 
        the United States or in obligations guaranteed as to 
        principal and interest by the United States.
          (2) Limitation.--The Corporation shall not sell or 
        purchase any obligations described in paragraph (1) for 
        its own account, at any one time aggregating in excess 
        of $100,000, without the approval of the Secretary of 
        the Treasury. The Secretary may approve a transaction 
        or class of transactions subject to the provisions of 
        this paragraph under such conditions as the Secretary 
        may determine.
  (b) The depository accounts of the Corporation shall be kept 
with the Treasurer of the United States, or, with the approval 
of the Secretary of the Treasury, with a Federal Reserve bank, 
or with a depository institution designated as a depositary or 
fiscal agent of the United States: Provided, That the Secretary 
of the Treasury may waive the requirements of this subsection 
under such conditions as he may determine: And provided 
further, That this subsection shall not apply to the 
establishment and maintenance in any depository institution for 
temporary purposes of depository accounts not in excess of 
$50,000 in any one depository institution, or to the 
establishment and maintenance in any depository institution of 
any depository accounts to facilitate the payment of insured 
desposits, or the making of loans to, or the purchase of assets 
of, insured depository institutions. When designated for that 
purpose by the Secretary of the Treasury, the Corporation shall 
be a depositary of public moneys, except receipts from customs, 
under such regulations as may be prescribed by the said 
Secretary, and may also be employed as a financial agent of the 
Government. It shall perform all such reasonable duties as 
depositary of public moneys and financial agent of the 
Government as may be required of it.
  (c)(1) The Corporation is authorized, in its sole discretion 
and upon such terms and conditions as the Board of Directors 
may prescribe, to make loans to, to make deposits in, to 
purchase the assets or securities of, to assume the liabilities 
of, or to make contributions to, any insured depository 
institution--
          (A) if such action is taken to prevent the default of 
        such insured depository institution;
          (B) if, with respect to an insured bank in default, 
        such action is taken to restore such insured bank to 
        normal operation; or
          (C) if, when severe financial conditions exist which 
        threaten the stability of a significant number of 
        insured depository institutions or of insured 
        depository institutions possessing significant 
        financial resources, such action is taken in order to 
        lessen the risk to the Corporation posed by such 
        insured depository institution under such threat of 
        instability.
  (2)(A) In order to facilitate a merger or consolidation of 
another insured depository institution described in 
subparagraph (B) with another insured depository institution or 
the sale of any or all of the assets of such insured depository 
institution or the assumption of any or all of such insured 
depository institution's liabilities by another insured 
depository institution, or the acquisition of the stock of such 
insured depository institution, the Corporation is authorized, 
in its sole discretion and upon such terms and conditions as 
the Board of Directors may prescribe--
          (i) to purchase any such assets or assume any such 
        liabilities;
          (ii) to make loans or contributions to, or deposits 
        in, or purchase the securities of, such insured 
        institution or the company which controls or will 
        acquire control of such insured institution;
          (iii) to guarantee such insured institution or the 
        company which controls or will acquire control of such 
        insured institution against loss by reason of such 
        insured institution's merging or consolidating with or 
        assuming the liabilities and purchasing the assets of 
        such insured depository institution or by reason of 
        such company acquiring control of such insured 
        depository institution; or
          (iv) to take any combination of the actions referred 
        to in subparagraphs (i) through (iii).
  (B) For the purpose of subparagraph (A), the insured 
depository institution must be an insured depository 
institution--
          (i) which is in default;
          (ii) which, in the judgment of the Board of 
        Directors, is in danger of default; or
          (iii) which, when severe financial conditions exist 
        which threaten the stability of a significant number of 
        insured depository institutions or of insured 
        depository institutions possessing significant 
        financial resources, is determined by the Corporation, 
        in its sole discretion, to require assistance under 
        subparagraph (A) in order to lessen the risk to the 
        Corporation posed by such insured depository 
        institution under such threat of instability.
          (C) Any action to which the Corporation is or becomes 
        a party by acquiring any asset or exercising any other 
        authority set forth in this section shall be stayed for 
        a period of 60 days at the request of the Corporation.
  (3) The Corporation may provide any person acquiring control 
of, merging with, consolidating with or acquiring the assets of 
an insured depository institution under subsection (f) or (k) 
of this section with such financial assistance as it could 
provide an insured institution under this subsection.
          (4) Least-cost resolution required.--
                  (A) In general.--Notwithstanding any other 
                provision of this Act, the Corporation may not 
                exercise any authority under this subsection or 
                subsection (d), (f), (h), (i), or (k) with 
                respect to any insured depository institution 
                unless--
                          (i) the Corporation determines that 
                        the exercise of such authority is 
                        necessary to meet the obligation of the 
                        Corporation to provide insurance 
                        coverage for the insured deposits in 
                        such institution; and
                          (ii) the total amount of the 
                        expenditures by the Corporation and 
                        obligations incurred by the Corporation 
                        (including any immediate and long-term 
                        obligation of the Corporation and any 
                        direct or contingent liability for 
                        future payment by the Corporation) in 
                        connection with the exercise of any 
                        such authority with respect to such 
                        institution is the least costly to the 
                        Deposit Insurance Fund of all possible 
                        methods for meeting the Corporation's 
                        obligation under this section.
                  (B) Determining least costly approach.--In 
                determining how to satisfy the Corporation's 
                obligations to an institution's insured 
                depositors at the least possible cost to the 
                Deposit Insurance Fund, the Corporation shall 
                comply with the following provisions:
                          (i) Present-value analysis; 
                        documentation required.--The 
                        Corporation shall--
                                  (I) evaluate alternatives on 
                                a present-value basis, using a 
                                realistic discount rate;
                                  (II) document that evaluation 
                                and the assumptions on which 
                                the evaluation is based, 
                                including any assumptions with 
                                regard to interest rates, asset 
                                recovery rates, asset holding 
                                costs, and payment of 
                                contingent liabilities; and
                                  (III) retain the 
                                documentation for not less than 
                                5 years.
                          (ii) Foregone tax revenues.--Federal 
                        tax revenues that the Government would 
                        forego as the result of a proposed 
                        transaction, to the extent reasonably 
                        ascertainable, shall be treated as if 
                        they were revenues foregone by the 
                        Deposit Insurance Fund.
                  (C) Time of determination.--
                          (i) General rule.--For purposes of 
                        this subsection, the determination of 
                        the costs of providing any assistance 
                        under paragraph (1) or (2) or any other 
                        provision of this section with respect 
                        to any depository institution shall be 
                        made as of the date on which the 
                        Corporation makes the determination to 
                        provide such assistance to the 
                        institution under this section.
                          (ii) Rule for liquidations.--For 
                        purposes of this subsection, the 
                        determination of the costs of 
                        liquidation of any depository 
                        institution shall be made as of the 
                        earliest of--
                                  (I) the date on which a 
                                conservator is appointed for 
                                such institution;
                                  (II) the date on which a 
                                receiver is appointed for such 
                                institution; or
                                  (III) the date on which the 
                                Corporation makes any 
                                determination to provide any 
                                assistance under this section 
                                with respect to such 
                                institution.
                  (D) Liquidation costs.--In determining the 
                cost of liquidating any depository institution 
                for the purpose of comparing the costs under 
                subparagraph (A) (with respect to such 
                institution), the amount of such cost may not 
                exceed the amount which is equal to the sum of 
                the insured deposits of such institution as of 
                the earliest of the dates described in 
                subparagraph (C), minus the present value of 
                the total net amount the Corporation reasonably 
                expects to receive from the disposition of the 
                assets of such institution in connection with 
                such liquidation.
                  (E) Deposit insurance fund available for 
                intended purpose only.--
                          (i) In general.--After December 31, 
                        1994, or at such earlier time as the 
                        Corporation determines to be 
                        appropriate, the Corporation may not 
                        take any action, directly or 
                        indirectly, with respect to any insured 
                        depository institution that would have 
                        the effect of increasing losses to the 
                        Deposit Insurance Fund by protecting--
                                  (I) depositors for more than 
                                the insured portion of deposits 
                                (determined without regard to 
                                whether such institution is 
                                liquidated); or
                                  (II) creditors other than 
                                depositors.
                          (ii) Deadline for regulations.--The 
                        Corporation shall prescribe regulations 
                        to implement clause (i) not later than 
                        January 1, 1994, and the regulations 
                        shall take effect not later than 
                        January 1, 1995.
                          (iii) Purchase and assumption 
                        transactions.--No provision of this 
                        subparagraph shall be construed as 
                        prohibiting the Corporation from 
                        allowing any person who acquires any 
                        assets or assumes any liabilities of 
                        any insured depository institution for 
                        which the Corporation has been 
                        appointed conservator or receiver to 
                        acquire uninsured deposit liabilities 
                        of such institution so long as the 
                        insurance fund does not incur any loss 
                        with respect to such deposit 
                        liabilities in an amount greater than 
                        the loss which would have been incurred 
                        with respect to such liabilities if the 
                        institution had been liquidated.
                  (F) Discretionary determinations.--Any 
                determination which the Corporation may make 
                under this paragraph shall be made in the sole 
                discretion of the Corporation.
                  [(G) Systemic risk.--
                          [(i) Emergency determination by 
                        secretary of the treasury.--
                        Notwithstanding subparagraphs (A) and 
                        (E), if, upon the written 
                        recommendation of the Board of 
                        Directors (upon a vote of not less than 
                        two-thirds of the members of the Board 
                        of Directors) and the Board of 
                        Governors of the Federal Reserve System 
                        (upon a vote of not less than two-
                        thirds of the members of such Board), 
                        the Secretary of the Treasury (in 
                        consultation with the President) 
                        determines that--
                                  [(I) the Corporation's 
                                compliance with subparagraphs 
                                (A) and (E) with respect to an 
                                insured depository institution 
                                for which the Corporation has 
                                been appointed receiver would 
                                have serious adverse effects on 
                                economic conditions or 
                                financial stability; and
                                  [(II) any action or 
                                assistance under this 
                                subparagraph would avoid or 
                                mitigate such adverse effects,
                        the Corporation may take other action 
                        or provide assistance under this 
                        section for the purpose of winding up 
                        the insured depository institution for 
                        which the Corporation has been 
                        appointed receiver as necessary to 
                        avoid or mitigate such effects.
                          [(ii) Repayment of loss.--
                                  [(I) In general.--The 
                                Corporation shall recover the 
                                loss to the Deposit Insurance 
                                Fund arising from any action 
                                taken or assistance provided 
                                with respect to an insured 
                                depository institution under 
                                clause (i) from 1 or more 
                                special assessments on insured 
                                depository institutions, 
                                depository institution holding 
                                companies (with the concurrence 
                                of the Secretary of the 
                                Treasury with respect to 
                                holding companies), or both, as 
                                the Corporation determines to 
                                be appropriate.
                                  [(II) Treatment of depository 
                                institution holding 
                                companies.--For purposes of 
                                this clause, sections 7(c)(2) 
                                and 18(h) shall apply to 
                                depository institution holding 
                                companies as if they were 
                                insured depository 
                                institutions.
                                  [(III) Regulations.--The 
                                Corporation shall prescribe 
                                such regulations as it deems 
                                necessary to implement this 
                                clause. In prescribing such 
                                regulations, defining terms, 
                                and setting the appropriate 
                                assessment rate or rates, the 
                                Corporation shall establish 
                                rates sufficient to cover the 
                                losses incurred as a result of 
                                the actions of the Corporation 
                                under clause (i) and shall 
                                consider: the types of entities 
                                that benefit from any action 
                                taken or assistance provided 
                                under this subparagraph; 
                                economic conditions, the 
                                effects on the industry, and 
                                such other factors as the 
                                Corporation deems appropriate 
                                and relevant to the action 
                                taken or the assistance 
                                provided. Any funds so 
                                collected that exceed actual 
                                losses shall be placed in the 
                                Deposit Insurance Fund.
                          [(iii) Documentation required.--The 
                        Secretary of the Treasury shall--
                                  [(I) document any 
                                determination under clause (i); 
                                and
                                  [(II) retain the 
                                documentation for review under 
                                clause (iv).
                          [(iv) GAO review.--The Comptroller 
                        General of the United States shall 
                        review and report to the Congress on 
                        any determination under clause (i), 
                        including--
                                  [(I) the basis for the 
                                determination;
                                  [(II) the purpose for which 
                                any action was taken pursuant 
                                to such clause; and
                                  [(III) the likely effect of 
                                the determination and such 
                                action on the incentives and 
                                conduct of insured depository 
                                institutions and uninsured 
                                depositors.
                          [(v) Notice.--
                                  [(I) In general.--Not later 
                                than 3 days after making a 
                                determination under clause (i), 
                                the Secretary of the Treasury 
                                shall provide written notice of 
                                any determination under clause 
                                (i) to the Committee on 
                                Banking, Housing, and Urban 
                                Affairs of the Senate and the 
                                Committee on Banking, Finance 
                                and Urban Affairs of the House 
                                of Representatives.
                                  [(II) Description of basis of 
                                determination.--The notice 
                                under subclause (I) shall 
                                include a description of the 
                                basis for any determination 
                                under clause (i).]
                          (H) Rule of construction.--No 
                        provision of law shall be construed as 
                        permitting the Corporation to take any 
                        action prohibited by paragraph (4) 
                        unless such provision expressly 
                        provides, by direct reference to this 
                        paragraph, that this paragraph shall 
                        not apply with respect to such action.
  (5) The Corporation may not use its authority under this 
subsection to purchase the voting or common stock of an insured 
depository institution. Nothing in the preceding sentence shall 
be construed to limit the ability of the Corporation to enter 
into and enforce covenants and agreements that it determines to 
be necessary to protect its financial interest.
  (6)(A) During any period in which an insured depository 
institution has received assistance under this subsection and 
such assistance is still outstanding, such insured depository 
institution may defer the payment of any State or local tax 
which is determined on the basis of the deposits held by such 
insured depository institution or of the interest or dividends 
paid on such deposits.
  (B) When such insured depository institution no longer has 
any outstanding assistance, such insured depository institution 
shall pay all taxes which were deferred under subparagraph (A). 
Such payments shall be made in accordance with a payment plan 
established by the Corporation, after consultation with the 
applicable State and local taxing authorities.
  (7) The transfer of any assets or liabilities associated with 
any trust business of an insured depository institution in 
default under subparagraph (2)(A) shall be effective without 
any State or Federal approval, assignment, or consent with 
respect thereto.
          (8) Assistance before appointment of conservator or 
        receiver.--
                  (A) In general.--Subject to the least-cost 
                provisions of paragraph (4), the Corporation 
                shall consider providing direct financial 
                assistance under this section for depository 
                institutions before the appointment of a 
                conservator or receiver for such institution 
                only under the following circumstances:
                          (i) Troubled condition criteria.--The 
                        Corporation determines--
                                  (I) grounds for the 
                                appointment of a conservator or 
                                receiver exist or likely will 
                                exist in the future unless the 
                                depository institution's 
                                capital levels are increased; 
                                and
                                  (II) it is unlikely that the 
                                institution can meet all 
                                currently applicable capital 
                                standards without assistance.
                          (ii) Other criteria.--The depository 
                        institution meets the following 
                        criteria:
                                  (I) The appropriate Federal 
                                banking agency and the 
                                Corporation have determined 
                                that, during such period of 
                                time preceding the date of such 
                                determination as the agency or 
                                the Corporation considers to be 
                                relevant, the institution's 
                                management has been competent 
                                and has complied with 
                                applicable laws, rules, and 
                                supervisory directives and 
                                orders.
                                  (II) The institution's 
                                management did not engage in 
                                any insider dealing, 
                                speculative practice, or other 
                                abusive activity.
                  (B) Public disclosure.--Any determination 
                under this paragraph to provide assistance 
                under this section shall be made in writing and 
                published in the Federal Register.
  (9) Any assistance provided under this subsection may be in 
subordination to the rights of depositors and other creditors.
  (10) In its annual report to the Congress, the Corporation 
shall report the total amount it has saved, or estimates it has 
saved, by exercising the authority provided in this subsection.
          (11) Unenforceability of certain agreements.--No 
        provision contained in any existing or future 
        standstill, confidentiality, or other agreement that, 
        directly or indirectly--
                  (A) affects, restricts, or limits the ability 
                of any person to offer to acquire or acquire,
                  (B) prohibits any person from offering to 
                acquire or acquiring, or
                  (C) prohibits any person from using any 
                previously disclosed information in connection 
                with any such offer to acquire or acquisition 
                of,
        all or part of any insured depository institution, 
        including any liabilities, assets, or interest therein, 
        in connection with any transaction in which the 
        Corporation exercises its authority under section 11 or 
        13, shall be enforceable against or impose any 
        liability on such person, as such enforcement or 
        liability shall be contrary to public policy.
  (d) Sale of Assets to Corporation.--
          (1) In general.-Any conservator, receiver, or 
        liquidator appointed for any insured depository 
        institution in default, including the Corporation 
        acting in such capacity, shall be entitled to offer the 
        assets of such depository institutions for sale to the 
        Corporation or as security for loans from the 
        Corporation.
          (2) Proceeds.--The proceeds of every sale or loan of 
        assets to the Corporation shall be utilized for the 
        same purposes and in the same manner as other funds 
        realized from the liquidation of the assets of such 
        depository institutions.
          (3) Rights and powers of corporation.--
                  (A) In general.--With respect to any asset 
                acquired or liability assumed pursuant to this 
                section, the Corporation shall have all of the 
                rights, powers, privileges, and authorities of 
                the Corporation as receiver under sections 11 
                and 15(b).
                  (B) Rule of construction.--Such rights, 
                powers, privileges, and authorities shall be in 
                addition to and not in derogation of any 
                rights, powers, privileges, and authorities 
                otherwise applicable to the Corporation.
                  (C) Fiduciary responsibility.--In exercising 
                any right, power, privilege, or authority 
                described in subparagraph (A), the Corporation 
                shall continue to be subject to the fiduciary 
                duties and obligations of the Corporation as 
                receiver to claimants against the insured 
                depository institution in receivership.
                  (D) Disposition of assets.--In exercising any 
                right, power, privilege, or authority described 
                in subparagraph (A) regarding the sale or 
                disposition of assets sold to the Corporation 
                pursuant to paragraph (1), the Corporation 
                shall conduct its operations in a manner 
                which--
                          (i) maximizes the net present value 
                        return from the sale or disposition of 
                        such assets;
                          (ii) minimizes the amount of any loss 
                        realized in the resolution of cases;
                          (iii) ensures adequate competition 
                        and fair and consistent treatment of 
                        offerors;
                          (iv) prohibits discrimination on the 
                        basis of race, sex, or ethnic groups in 
                        the solicitation and consideration of 
                        offers; and
                          (v) maximizes the preservation of the 
                        availability and affordability of 
                        residential real property for low- and 
                        moderate-income individuals.
          (4) Loans.--The Corporation, in its discretion, may 
        make loans on the security of or may purchase and 
        liquidate or sell any part of the assets of an insured 
        depository institution which is now or may hereafter be 
        in default.
  (e) Agreements Against Interests of Corporation.--
          (1) In general.--No agreement which tends to diminish 
        or defeat the interest of the Corporation in any asset 
        acquired by it under this section or section 11, either 
        as security for a loan or by purchase or as receiver of 
        any insured depository institution, shall be valid 
        against the Corporation unless such agreement--
                  (A) is in writing,
                  (B) was executed by the depository 
                institution and any person claiming an adverse 
                interest thereunder, including the obligor, 
                contemporaneously with the acquisition of the 
                asset by the depository institution,
                  (C) was approved by the board of directors of 
                the depository institution or its loan 
                committee, which approval shall be reflected in 
                the minutes of said board or committee, and
                  (D) has been, continuously, from the time of 
                its execution, an official record of the 
                depository institution.
          (2) Exemptions from contemporaneous execution 
        requirement.--An agreement to provide for the lawful 
        collateralization of--
                  (A) deposits of, or other credit extension 
                by, a Federal, State, or local governmental 
                entity, or of any depositor referred to in 
                section 11(a)(2), including an agreement to 
                provide collateral in lieu of a surety bond;
                  (B) bankruptcy estate funds pursuant to 
                section 345(b)(2) of title 11, United States 
                Code;
                  (C) extensions of credit, including any 
                overdraft, from a Federal reserve bank or 
                Federal home loan bank; or
                  (D) one or more qualified financial 
                contracts, as defined in section 11(e)(8)(D),
        shall not be deemed invalid pursuant to paragraph 
        (1)(B) solely because such agreement was not executed 
        contemporaneously with the acquisition of the 
        collateral or because of pledges, delivery, or 
        substitution of the collateral made in accordance with 
        such agreement.
  (f) Assisted Emergency Interstate Acquisitions.--(1) This 
subsection shall apply only to an acquisition of an insured 
bank or a holding company by an out-of-State bank savings 
association or out-of-State holding company for which the 
Corporation provides assistance under subsection (c).
  (2)(A) Whenever an insured bank with total assets of 
$500,000,000 or more (as determined from its most recent report 
of condition) is in default, the Corporation, as receiver, may, 
in its discretion and upon such terms and conditions as the 
Corporation may determine, arrange the sale of assets of the 
closed bank and the assumption of the liabilities of the closed 
bank, including the sale of such assets to and the assumption 
of such liabilities by an insured depository institution 
located in the State where the closed bank was chartered but 
established by an out-of-State bank or holding company. Where 
otherwise lawfully required, a transaction under this 
subsection must be approved by the primary Federal or State 
supervisor of all parties thereto.
  (B)(i) Before making a determination to take any action under 
subparagraph (A), the Corporation shall consult the State bank 
supervisor of the State in which the insured bank in default 
was chartered.
  (ii) The State bank supervisor shall be given a reasonable 
opportunity, and in no event less than forty-eight hours, to 
object to the use of the provisions of this paragraph. Such 
notice may be provided by the Corporation prior to its 
appointment as receiver, but in anticipation of an impending 
appointment.
  (iii) If the State supervisor objects during such period, the 
Corporation may use the authority of this paragraph only by a 
vote of 75 percent of the Board of Directors. The Board of 
Directors shall provide to the State supervisor, as soon as 
practicable, a written certification of its determination.
  (3) Emergency Interstate Acquisitions of Insured Banks in 
Danger of Default.--
          (A) Acquisition of insured banks in danger of 
        default.--One or more out-of-State banks or out-of-
        State holding companies may acquire and retain all or 
        part of the shares or assets of, or otherwise acquire 
        and retain--
                  (i) an insured bank in danger of default 
                which has total assets of $500,000,000 or more; 
                or
                  (ii) 2 or more affiliated insured banks in 
                danger of default which have aggregate total 
                assets of $500,000,000 or more, if the 
                aggregate total assets of such banks is equal 
                to or greater than 33 percent of the aggregate 
                total assets of all affiliated insured banks.
          (B) Acquisition of a holding company or other bank 
        affiliate.--If one or more out-of-State banks or out-
        of-State holding companies acquire 1 or more affiliated 
        insured banks under subparagraph (A) the aggregate 
        total assets of which is equal to or greater than 33 
        percent of the aggregate total assets of all affiliated 
        insured banks, any such out-of-State bank or out-of-
        State holding company may also, as part of the same 
        transaction, acquire and retain the shares or assets 
        of, or otherwise acquire and retain--
                  (i) the holding company which controls the 
                affiliated insured banks so acquired; or
                  (ii) any other affiliated insured bank.
          (C) Request for assistance by corporate board of 
        directors.--The Corporation may assist an acquisition 
        or merger authorized under subparagraph (A) only if the 
        board of directors or trustees of each insured bank in 
        danger of default which is being acquired has requested 
        in writing that the Corporation assist the acquisition 
        or merger.
          (D) Certain acquisitions authorized after assistance 
        is provided.--Notwithstanding paragraph (1), if--
                  (i) at any time after the date of the 
                enactment of the Financial Institutions 
                Emergency Acquisitions Amendments of 1987, the 
                Corporation provides any assistance under 
                subsection (c) to an insured bank; and
                  (ii) at the time such assistance is granted, 
                the insured bank, the holding company which 
                controls the insured bank (if any), or any 
                affiliated insured bank is eligible to be 
                acquired by an out-of-State bank or out-of-
                State holding company under this paragraph,
        the insured bank, the holding company, and such other 
        affiliated insured bank shall remain eligible, subject 
        to such terms and conditions as the Corporation (in the 
        Corporation's discretion) may impose, to be acquired by 
        an out-of-State bank or out-of-State holding company 
        under this paragraph as long as any portion of such 
        assistance remains outstanding.
          (E) State bank supervisor approval.--The Corporation 
        may take no final action in connection with any 
        acquisition under this paragraph unless the State bank 
        supervisor of the State in which the bank in danger of 
        default is located approves the acquisition.
          (F) Other requirements not affected.--This paragraph 
        does not affect any other requirement under Federal or 
        State law for regulatory approval of an acquisition 
        under this paragraph.
          (G) Acquisition may be conditioned on receipt of 
        consideration for corporation's assistance.--Any 
        acquisition described in subparagraph (D) may be 
        conditioned on the receipt of such consideration for 
        the Corporation's assistance as the Board of Directors 
        deems appropriate.
  (4)(A) Acquisitions Not Subject to Certain Other Laws.--
Section 3(d) of the Bank Holding Company Act of 1956, any 
provision of State law, and section 408(e)(3) of the National 
Housing Act shall not apply to prohibit any acquisition under 
paragraph (2) or (3), except that an out-of-State bank may make 
such an acquisition only if such ownership is otherwise 
specifically authorized.
  (B) Any subsidiary created by operation of this subsection 
may retain and operate any existing branch or branches of the 
institution merged with or acquired under paragraph (2) or (3), 
but otherwise shall be subject to the conditions upon which a 
national bank may establish and operate branches in the State 
in which such insured institution is located.
  (C) No insured institution acquired under this subsection 
shall after it is acquired move its principal office or any 
branch office which it would be prohibited from moving if the 
institution were a national bank.
  (D) Subsequent Nonemergency Interstate Acquisitions Subject 
to State Law.--
          (i) In general.--Any out-of-State bank holding 
        company which acquires control of an insured bank in 
        any State under paragraph (2) or (3) may acquire any 
        other insured bank and establish branches in such State 
        to the same extent as a bank holding company whose 
        insured bank subsidiaries' operations are principally 
        conducted in such State may acquire any other insured 
        bank or establish branches.
          (ii) Delayed date of applicability.--Clause (i) shall 
        not apply with respect to any out-of-State bank holding 
        company referred to in such clause before the earlier 
        of--
                  (I) the end of the 2-year period beginning on 
                the date the acquisition referred to in such 
                clause with respect to such company is 
                consummated; or
                  (II) the end of any period established under 
                State law during which such out-of-State bank 
                holding company may not be treated as a bank 
                holding company whose insured bank 
                subsidiaries' operations are principally 
                conducted in such State for purposes of 
                acquiring other insured banks or establishing 
                bank branches.
          (iii) Determination of principally conducted.--For 
        purposes of this subparagraph, the State in which the 
        operations of a holding company's insured bank 
        subsidiaries are principally conducted is the State 
        determined under section 3(d) of the Bank Holding 
        Company Act of 1956 with respect to such holding 
        company.
  (E) Certain State Interstate Banking Laws Inapplicable.--Any 
holding company which acquires control of any insured bank or 
holding company under paragraph (2) or (3) or subparagraph (D) 
of this paragraph shall not, by reason of such acquisition, be 
required under the law of any State to divest any other insured 
bank or be prevented from acquiring any other bank or holding 
company.
  (5) In determining whether to arrange a sale of assets and 
assumption of liabilities or an acquisition or a merger under 
the authority of paragraph (2) or (3), the Corporation may 
solicit such offers or proposals as are practicable from any 
prospective purchasers or merger partners it determines, in its 
sole discretion, are both qualified and capable of acquiring 
the assets and liabilities of the bank in default or the bank 
in danger of default.
  (6)(A) If, after receiving offers, the offer presenting the 
lowest expense to the Corporation, that is in a form and with 
conditions acceptable to the Corporation (hereinafter referred 
to as the ``lowest acceptable offer''), is from an offeror that 
is not an existing in-State bank of the same type as the bank 
that is in default or is in danger of default (or, where the 
bank is an insured bank other than a mutual savings bank, the 
lowest acceptable offer is not from an in-State holding 
company), the Corporation shall permit the offeror which made 
the initial lowest acceptable offer and each offeror who made 
an offer the estimated cost of which to the Corporation was 
within 15 per centum or $15,000,000, whichever is less, of the 
initial lowest acceptable offer to submit a new offer.
  (B) In considering authorizations under this subsection, the 
Corporation shall give consideration to the need to minimize 
the cost of financial assistance and to the maintenance of 
specialized depository institutions. The Corporation shall 
authorize transactions under this subsection considering the 
following priorities:
          (i) First, between depository institutions of the 
        same type within the same State.
          (ii) Second, between depository institutions of the 
        same type--
                  (I) in different States which by statute 
                specifically authorize such acquisitions; or
                  (II) in the absence of such statutes, in 
                different States which are contiguous.
          (iii) Third, between depository institutions of the 
        same type in different States other than the States 
        described in clause (ii).
          (iv) Fourth, between depository institutions of 
        different types in the same State.
          (v) Fifth, between depository institutions of 
        different types--
                  (I) in different States which by statute 
                specifically authorize such acquisitions; or
                  (II) in the absence of such statutes, in 
                different States which are contiguous.
          (vi) Sixth, between depository institutions of 
        different types in different States other than the 
        States described in clause (v).
  (C) Minority Bank Priority.--In the case of a minority-
controlled bank, the Corporation shall seek an offer from other 
minority-controlled banks before proceeding with the bidding 
priorities set forth in subparagraph (B).
  (D) In determining the cost of offers and reoffers, the 
Corporation's calculations and estimations shall be 
determinative. The Corporation may set reasonable time limits 
on offers and reoffers.
  (7) No sale may be made under the provisions of paragraph (2) 
or (3)--
          (A) which would result in a monopoly, or which would 
        be in furtherance of any combination or conspiracy to 
        monopolize or to attempt to monopolize the business of 
        banking in any part of the United States;
          (B) whose effect in any section of the country may be 
        substantially to lessen competition, or to tend to 
        create a monopoly, or which in any other manner would 
        be in restraint of trade, unless the Corporation finds 
        that the anticompetitive effects of the proposed 
        transactions are clearly outweighed in the public 
        interest by the probable effect of the transaction in 
        meeting the convenience and needs of the community to 
        be served; or
          (C) if in the opinion of the Corporation the 
        acquisition threatens the safety and soundness of the 
        acquirer or does not result in the future viability of 
        the resulting depository institution.
  (8) As used in this subsection--
          (A) the term ``in-State depository institution or in-
        State holding company'' means an existing insured 
        depository institution currently operating in the State 
        in which the bank in default or the bank in danger of 
        default is chartered or a company that is operating an 
        insured depository institution subsidiary in the State 
        in which the bank in default or the bank in danger of 
        default is chartered;
          (B) the term ``acquire'' means to acquire, directly 
        or indirectly, ownership or control through--
                  (i) an acquisition of shares;
                  (ii) an acquisition of assets or assumption 
                of liabilities;
                  (iii) a merger or consolidation; or
                  (iv) any similar transaction;
          (C) the term ``affiliated insured bank'' means--
                  (i) when used in connection with a reference 
                to a holding company, an insured bank which is 
                a subsidiary of such holding company; and
                  (ii) when used in connection with a reference 
                to 2 or more insured banks, insured banks which 
                are subsidiaries of the same holding company; 
                and
          (D) the term ``subsidiary'' has the meaning given to 
        such term in section 2(d) of the Bank Holding Company 
        Act of 1956.
  (9) No Assistance Authorized for Certain Subsidiaries of 
Holding Companies.--
          (A) In general.--The Corporation shall not provide 
        any assistance to a subsidiary, other than a subsidiary 
        that is an insured depository institution, of a holding 
        company in connection with any acquisition under this 
        subsection.
          (B) Intermediate holding company permitted.--This 
        paragraph does not prohibit an intermediate holding 
        company or an affiliate of an insured depository 
        institution from being a conduit for assistance 
        ultimately intended for an insured bank.
  (10) Annual Report.--
          (A) Required.--In its annual report to Congress the 
        Corporation shall include a report on the acquisitions 
        under this subsection during the preceding year.
          (B) Contents.--The report required under subparagraph 
        (A) shall contain the following information:
                  (i) The number of acquisitions under this 
                subsection.
                  (ii) A brief description of each such 
                acquisition and the circumstances under which 
                such acquisition occurred.
  (11) Determination of Total Assets.--For purposes of this 
subsection, the total assets of any insured bank shall be 
determined on the basis of the most recent report of condition 
of such bank which is available at the time of such 
determination.
          (12) Acquisition of minority bank by minority bank 
        holding company without regard to asset size.--
                  (A) In general.--For the purpose of ensuring 
                continued minority control of a minority-
                controlled bank, paragraphs (2) and (3) shall 
                apply with respect to the acquisition of a 
                minority-controlled bank by an out-of-State 
                minority-controlled depository institution or 
                depository institution holding company without 
                regard to the fact that the total assets of 
                such minority-controlled bank are less than 
                $500,000,000.
                  (B) Definitions.--For purposes of this 
                paragraph:
                          (i) Minority bank.--The term 
                        ``minority bank'' means any depository 
                        institution described in clause (i), 
                        (ii), or (iii) of section 19(b)(1)(A) 
                        of the Federal Reserve Act--
                                  (I) more than 50 percent of 
                                the ownership or control of 
                                which is held by one or more 
                                minority individuals; and
                                  (II) more than 50 percent of 
                                the net profit or loss of which 
                                accrues to minority 
                                individuals.
                          (ii) Minority.--The term ``minority'' 
                        means any Black American, Native 
                        American, Hispanic American, or Asian 
                        American.
  (g) Prior to July 1, 1951, the Corporation shall pay out of 
its capital account to the Secretary of the Treasury an amount 
equal to 2 per centum simple interest per annum on amounts 
advanced to the Corporation on stock subscriptions by the 
Secretary of the Treasury and the Federal Reserve banks, from 
the time of such advances until the amounts thereof were 
repaid. The amount payable hereunder shall be paid in two equal 
installments, the first installment to be paid prior to 
December 31, 1950.
  (h) The powers conferred on the Board of Directors and the 
Corporation by this section to take action to reopen an insured 
depository institution in default or to avert the default of an 
insured depository institution may be used with respect to an 
insured branch of a foreign bank if, in the judgment of the 
Board of Directors, the public interest in avoiding the closing 
of such branch substantially outweighs any additional risk of 
loss to the Deposit Insurance Fund which the exercise of such 
powers would entail.
  (j) Loan Loss Amortization for Certain Banks.--
          (1) Eligibility.--The appropriate Federal banking 
        agency shall permit an agricultural bank to take the 
        actions referred to in paragraph (2) if it finds that--
                  (A) there is no evidence that fraud or 
                criminal abuse on the part of the bank led to 
                the losses referred to in paragraph (2); and
                  (B) the agricultural bank has a plan to 
                restore its capital, not later than the close 
                of the amortization period established under 
                paragraph (2), to a level prescribed by the 
                appropriate Federal banking agency.
          (2) Seven-year loss amortization.--(A) Any loss on 
        any qualified agricultural loan that an agricultural 
        bank would otherwise be required to show on its annual 
        financial statement for any year between December 31, 
        1983, and January 1, 1992, may be amortized on its 
        financial statements over a period of not to exceed 7 
        years, as provided in regulations issued by the 
        appropriate Federal banking agency.
          (B) An agricultural bank may reappraise any real 
        estate or other property, real or personal, that it 
        acquired coincident to the making of a qualified 
        agricultural loan and that it owned on January 1, 1983, 
        and any such additional property that it acquires prior 
        to January 1, 1992. Any loss that such bank would 
        otherwise be required to show on its annual financial 
        statements as the result of any such reappraisal may be 
        amortized on its financial statements over a period of 
        not to exceed 7 years, as provided in regulations 
        issued by the appropriate Federal banking agency.
          (3) Regulations.--Not later than 90 days after the 
        date of enactment of this subsection, the appropriate 
        Federal banking agency shall issue regulations 
        implementing this subsection with respect to banks that 
        it supervises, including regulations implementing the 
        capital restoration requirement of paragraph (1)(B).
          (4) Definitions.--As used in this subsection--
                  (A) the term ``agricultural bank'' means a 
                bank--
                          (i) the deposits of which are insured 
                        by the Federal Deposit Insurance 
                        Corporation;
                          (ii) which is located in an area the 
                        economy of which is dependent on 
                        agriculture;
                          (iii) which has assets of 
                        $100,000,000 or less; and
                          (iv) which has--
                                  (I) at least 25 percent of 
                                its total loans in qualified 
                                agricultural loans; or
                                  (II) fewer than 25 percent of 
                                its total loans in qualified 
                                agricultural loans but which 
                                the appropriate Federal banking 
                                agency or State bank 
                                commissioner recommends to the 
                                Corporation for eligibility 
                                under this section, or which 
                                the Corporation, on its motion, 
                                deems eligible; and
                  (B) the term ``qualified agricultural loan'' 
                means a loan made to finance the production of 
                agricultural products or livestock in the 
                United States, a loan secured by farmland or 
                farm machinery, or such other category of loans 
                as the appropriate Federal banking agency may 
                deem eligible.
          (5) Maintenance of portfolio.--As a condition of 
        eligibility under this subsection, the agricultural 
        bank must agree to maintain in its loan portfolio a 
        percentage of agricultural loans which is not lower 
        than the percentage of such loans in its loan portfolio 
        on January 1, 1986.
  (k) Emergency Acquisitions.--
          (1) In general.--
                  (A) Acquisitions authorized.--
                          (i) Transactions described.--
                        Notwithstanding any provision of State 
                        law, upon determining that severe 
                        financial conditions threaten the 
                        stability of a significant number of 
                        savings associations, or of savings 
                        associations possessing significant 
                        financial resources, the Corporation, 
                        in its discretion and if it determines 
                        such authorization would lessen the 
                        risk to the Corporation, may 
                        authorize--
                                  (I) a savings association 
                                that is eligible for assistance 
                                pursuant to subsection (c) to 
                                merge or consolidate with, or 
                                to transfer its assets and 
                                liabilities to, any other 
                                savings association or any 
                                insured bank,
                                  (II) any other savings 
                                association to acquire control 
                                of such savings association, or
                                  (III) any company to acquire 
                                control of such savings 
                                association or to acquire the 
                                assets or assume the 
                                liabilities thereof.
                        The Corporation may not authorize any 
                        transaction under this subsection 
                        unless the Corporation determines that 
                        the authorization will not present a 
                        substantial risk to the safety or 
                        soundness of the savings association to 
                        be acquired or any acquiring entity.
                          (ii) Terms of transactions.--Mergers, 
                        consolidations, transfers, and 
                        acquisitions under this subsection 
                        shall be on such terms as the 
                        Corporation shall provide.
                          (iii) Approval by appropriate 
                        agency.--Where otherwise required by 
                        law, transactions under this subsection 
                        must be approved by the appropriate 
                        Federal banking agency of every party 
                        thereto.
                          (iv) Acquisitions by savings 
                        associations.--Any Federal savings 
                        association that acquires another 
                        savings association pursuant to clause 
                        (i) may, with the concurrence of the 
                        Comptroller of the Currency, hold that 
                        savings association as a subsidiary 
                        notwithstanding the percentage 
                        limitations of section 5(c)(4)(B) of 
                        the Home Owners' Loan Act.S
                          (v) Dual service.--Dual service by a 
                        management official that would 
                        otherwise be prohibited under the 
                        Depository Institution Management 
                        Interlocks Act may, with the approval 
                        of the Corporation, continue for up to 
                        10 years.
                          (vi) Continued applicability of 
                        certain state restrictions.--Nothing in 
                        this subsection overrides or supersedes 
                        State laws restricting or limiting the 
                        activities of a savings association on 
                        behalf of another entity.
                  (B) Consultation with state official.--
                          (i) Consultation required.--Before 
                        making a determination to take any 
                        action under subparagraph (A), the 
                        Corporation shall consult the State 
                        official having jurisdiction of the 
                        acquired institution.
                          (ii) Period for state response.--The 
                        official shall be given a reasonable 
                        opportunity, and in no event less than 
                        48 hours, to object to the use of the 
                        provisions of this paragraph. Such 
                        notice may be provided by the 
                        Corporation prior to its appointment as 
                        receiver, but in anticipation of an 
                        impending appointment.
                          (iii) Approval over objection of 
                        state official.--If the official 
                        objects during such period, the 
                        Corporation may use the authority of 
                        this paragraph only by a vote of 75 
                        percent or more of the voting members 
                        of the Board of Directors. The 
                        Corporation shall provide to the 
                        official, as soon as practicable, a 
                        written certification of its 
                        determination.
          (2) Solicitation of offers.--
                  (A) In general.--In considering 
                authorizations under this subsection, the 
                Corporation may solicit such offers or 
                proposals as are practicable from any 
                prospective purchasers or merger partners it 
                determines, in its sole discretion, are both 
                qualified and capable of acquiring the assets 
                and liabilities of the savings association.
                  (B) Minority-controlled institutions.--In the 
                case of a minority-controlled depository 
                institution, the Corporation shall seek an 
                offer from other minority-controlled depository 
                institutions before seeking an offer from other 
                persons or entities.
          (3) Determination of costs.--In determining the cost 
        of offers under this subsection, the Corporation's 
        calculations and estimations shall be determinative. 
        The Corporation may set reasonable time limits on 
        offers.
          (4) Branching provisions.--
                  (A) In general.--If a merger, consolidation, 
                transfer, or acquisition under this subsection 
                involves a savings association eligible for 
                assistance and a bank or bank holding company, 
                a savings association may retain and operate 
                any existing branch or branches or any other 
                existing facilities. If the savings association 
                continues to exist as a separate entity, it may 
                establish and operate new branches to the same 
                extent as any savings association that is not 
                affiliated with a bank holding company and the 
                home office of which is located in the same 
                State.
                  (B) Restrictions.--
                          (i) In general.--Notwithstanding 
                        subparagraph (A), if--
                                  (I) a savings association 
                                described in such subparagraph 
                                does not have its home office 
                                in the State of the bank 
                                holding company bank 
                                subsidiary, and
                                  (II) such association does 
                                not qualify as a domestic 
                                building and loan association 
                                under section 7701(a)(19) of 
                                the Internal Revenue Code of 
                                1986, or does not meet the 
                                asset composition test imposed 
                                by subparagraph (C) of that 
                                section on institutions seeking 
                                so to qualify,
                        such savings association shall be 
                        subject to the conditions upon which a 
                        bank may retain, operate, and establish 
                        branches in the State in which the 
                        savings association is located.
                          (ii) Transition period.--The 
                        Corporation, for good cause shown, may 
                        allow a savings association up to 2 
                        years to comply with the requirements 
                        of clause (i).
          (5) Assistance before appointment of conservator or 
        receiver.--
                  (A) Assistance proposals.--The Corporation 
                shall consider proposals by savings 
                associations for assistance pursuant to 
                subsection (c) before grounds exist for 
                appointment of a conservator or receiver for 
                such member under the following circumstances:
                          (i) Troubled condition criteria.--The 
                        Corporation determines--
                                  (I) that grounds for 
                                appointment of a conservator or 
                                receiver exist or likely will 
                                exist in the future unless the 
                                member's tangible capital is 
                                increased;
                                  (II) that it is unlikely that 
                                the member can achieve positive 
                                tangible capital without 
                                assistance; and
                                  (III) that providing 
                                assistance pursuant to the 
                                member's proposal would be 
                                likely to lessen the risk to 
                                the Corporation.
                          (ii) Other criteria.--The member 
                        meets the following criteria:
                                  (I) Before enactment of the 
                                Financial Institutions Reform, 
                                Recovery, and Enforcement Act 
                                of 1989, the member was solvent 
                                under applicable regulatory 
                                accounting principles but had 
                                negative tangible capital.
                                  (II) The member's negative 
                                tangible capital position is 
                                substantially attributable to 
                                its participation in 
                                acquisition and merger 
                                transactions that were 
                                instituted by the Federal Home 
                                Loan Bank Board or the Federal 
                                Savings and Loan Insurance 
                                Corporation for supervisory 
                                reasons.
                                  (III) The member is a 
                                qualified thrift lender (as 
                                defined in section 10(m) of the 
                                Home Owners' Loan Act) or would 
                                be a qualified thrift lender if 
                                commercial real estate owned 
                                and nonperforming commercial 
                                loans acquired in acquisition 
                                and merger transactions that 
                                were instituted by the Federal 
                                Home Loan Bank Board or the 
                                Federal Savings and Loan 
                                Insurance Corporation for 
                                supervisory reasons were 
                                excluded from the member's 
                                total assets.
                                  (IV) The appropriate Federal 
                                banking agency has determined 
                                that the member's management is 
                                competent and has complied with 
                                applicable laws, rules, and 
                                supervisory directives and 
                                orders.
                                  (V) The member's management 
                                did not engage in insider 
                                dealing or speculative 
                                practices or other activities 
                                that jeopardized the member's 
                                safety and soundness or 
                                contributed to its impaired 
                                capital position.
                                  (VI) The member's offices are 
                                located in an economically 
                                depressed region.
                  (B) Corporation consideration of assistance 
                proposal.--If a member meets the requirements 
                of clauses (i) and (ii) of subparagraph (A), 
                the Corporation shall consider providing direct 
                financial assistance.
                  (C) Economically depressed region defined.--
                For purposes of this paragraph, the term 
                ``economically depressed region'' means any 
                geographical region which the Corporation 
                determines by regulation to be a region within 
                which real estate values have suffered serious 
                decline due to severe economic conditions, such 
                as a decline in energy or agricultural values 
                or prices.

           *       *       *       *       *       *       *

  Sec. 18. (a) Representations of Deposit Insurance.--
          (1) Insured depository institutions.--
                  (A) In general.--Each insured depository 
                institution shall display at each place of 
                business maintained by that institution a sign 
                or signs relating to the insurance of the 
                deposits of the institution, in accordance with 
                regulations to be prescribed by the 
                Corporation.
                  (B) Statement to be included.--Each sign 
                required under subparagraph (A) shall include a 
                statement that insured deposits are backed by 
                the full faith and credit of the United States 
                Government.
          (2) Regulations.--The Corporation shall prescribe 
        regulations to carry out this subsection, including 
        regulations governing the substance of signs required 
        by paragraph (1) and the manner of display or use of 
        such signs.
          (3) Penalties.--For each day that an insured 
        depository institution continues to violate paragraph 
        (1) or any regulation issued under paragraph (2), it 
        shall be subject to a penalty of not more than $100, 
        which the Corporation may recover for its use.
          (4) False advertising, misuse of fdic names, and 
        misrepresentation to indicate insured status.--
                  (A) Prohibition on false advertising and 
                misuse of fdic names.--No person may represent 
                or imply that any deposit liability, 
                obligation, certificate, or share is insured or 
                guaranteed by the Corporation, if such deposit 
                liability, obligation, certificate, or share is 
                not insured or guaranteed by the Corporation--
                          (i) by using the terms ``Federal 
                        Deposit'', ``Federal Deposit 
                        Insurance'', ``Federal Deposit 
                        Insurance Corporation'', any 
                        combination of such terms, or the 
                        abbreviation ``FDIC'' as part of the 
                        business name or firm name of any 
                        person, including any corporation, 
                        partnership, business trust, 
                        association, or other business entity; 
                        or
                          (ii) by using such terms or any other 
                        terms, sign, or symbol as part of an 
                        advertisement, solicitation, or other 
                        document.
                  (B) Prohibition on misrepresentations of 
                insured status.--No person may knowingly 
                misrepresent--
                          (i) that any deposit liability, 
                        obligation, certificate, or share is 
                        insured, under this Act, if such 
                        deposit liability, obligation, 
                        certificate, or share is not so 
                        insured; or
                          (ii) the extent to which or the 
                        manner in which any deposit liability, 
                        obligation, certificate, or share is 
                        insured under this Act, if such deposit 
                        liability, obligation, certificate, or 
                        share is not so insured, to the extent 
                        or in the manner represented.
                  (C) Authority of the appropriate federal 
                banking agency.--The appropriate Federal 
                banking agency shall have enforcement authority 
                in the case of a violation of this paragraph by 
                any person for which the agency is the 
                appropriate Federal banking agency, or any 
                institution-affiliated party thereof.
                  (D) Corporation authority if the appropriate 
                federal banking agency fails to follow 
                recommendation.--
                          (i) Recommendation.--The Corporation 
                        may recommend in writing to the 
                        appropriate Federal banking agency that 
                        the agency take any enforcement action 
                        authorized under section 8 for purposes 
                        of enforcement of this paragraph with 
                        respect to any person for which the 
                        agency is the appropriate Federal 
                        banking agency or any institution-
                        affiliated party thereof.
                          (ii) Agency response.--If the 
                        appropriate Federal banking agency does 
                        not, within 30 days of the date of 
                        receipt of a recommendation under 
                        clause (i), take the enforcement action 
                        with respect to this paragraph 
                        recommended by the Corporation or 
                        provide a plan acceptable to the 
                        Corporation for responding to the 
                        situation presented, the Corporation 
                        may take the recommended enforcement 
                        action against such person or 
                        institution-affiliated party.
                  (E) Additional authority.--In addition to its 
                authority under subparagraphs (C) and (D), for 
                purposes of this paragraph, the Corporation 
                shall have, in the same manner and to the same 
                extent as with respect to a State nonmember 
                insured bank--
                          (i) jurisdiction over--
                                  (I) any person other than a 
                                person for which another agency 
                                is the appropriate Federal 
                                banking agency or any 
                                institution-affiliated party 
                                thereof; and
                                  (II) any person that aids or 
                                abets a violation of this 
                                paragraph by a person described 
                                in subclause (I); and
                          (ii) for purposes of enforcing the 
                        requirements of this paragraph, the 
                        authority of the Corporation under--
                                  (I) section 10(c) to conduct 
                                investigations; and
                                  (II) subsections (b), (c), 
                                (d) and (i) of section 8 to 
                                conduct enforcement actions.
                  (F) Other actions preserved.--No provision of 
                this paragraph shall be construed as barring 
                any action otherwise available, under the laws 
                of the United States or any State, to any 
                Federal or State agency or individual.
  (b) No insured depository institution shall pay any dividends 
on its capital stock or interest on its capital notes or 
debentures (if such interest is required to be paid only out of 
net profits) or distribute any of its capital assets while it 
remains in default in the payment of any assessment due to the 
Corporation; and any director or officer of any insured 
depository institution who participates in the declaration or 
payment of any such dividend or interest or in any such 
distribution shall, upon conviction, be fined not more than 
$1,000 or imprisoned not more than one year, or both: Provided, 
That, if such default is due to a dispute between the insured 
depository institution and the Corporation over the amount of 
such assessment, this subsection shall not apply if the insured 
depository institution deposits security satisfactory to the 
Corporation for payment upon final determination of the issue.
  (c)(1) Except with the prior written approval of the 
responsible agency, which shall in every case referred to in 
this paragraph be the Corporation, no insured depository 
institution shall--
          (A) merge or consolidate with any noninsured bank or 
        institution;
          (B) assume liability to pay any deposits (including 
        liabilities which would be ``deposits'' except for the 
        proviso in section 3(l)(5) of this Act) made in, or 
        similar liabilities of, any noninsured bank or 
        institution; or
          (C) transfer assets to any noninsured bank or 
        institution in consideration of the assumption of 
        liabilities for any portion of the deposits made in 
        such insured depository institution.
  (2) No insured depository institution shall merge or 
consolidate with any other insured depository institution or, 
either directly or indirectly, acquire the assets of, or assume 
liability to pay any deposits made in, any other insured 
depository institution except with the prior written approval 
of the responsible agency, which shall be--
          (A) the Comptroller of the Currency if the acquiring, 
        assuming, or resulting bank is to be a national bank or 
        a Federal savings association;
          (B) the Board of Governors of the Federal Reserve 
        System if the acquiring, assuming, or resulting bank is 
        to be a State member bank; and
          (C) the Corporation if the acquiring, assuming, or 
        resulting bank is to be a State nonmember insured bank 
        or a State savings association.
  (3) Notice of any proposed transaction for which approval is 
required under paragraph (1) or (2) (referred to hereafter in 
this subsection as a ``merger transaction'') shall, unless the 
responsible agency finds that it must act immediately in order 
to prevent the probable default of one of the banks or savings 
associations involved, be published--
          (A) prior to the granting of approval of such 
        transaction,
          (B) in a form approved by the responsible agency,
          (C) at appropriate intervals during a period at least 
        as long as the period allowed for furnishing reports 
        under paragraph (4) of this subsection, and
          (D) in a newspaper of general circulation in the 
        community or communities where the main offices of the 
        banks or savings associations involved are located, or, 
        if there is no such newspaper in any such community, 
        then in the newspaper of general circulation published 
        nearest thereto.
          (4) Reports on competitive factors.--
                  (A) Request for report.--In the interests of 
                uniform standards and subject to subparagraph 
                (B), before acting on any application for 
                approval of a merger transaction, the 
                responsible agency shall--
                          (i) request a report on the 
                        competitive factors involved from the 
                        Attorney General of the United States; 
                        and
                          (ii) provide a copy of the request to 
                        the Corporation (when the Corporation 
                        is not the responsible agency).
                  (B) Furnishing of report.--The report 
                requested under subparagraph (A) shall be 
                furnished by the Attorney General to the 
                responsible agency--
                          (i) not later than 30 calendar days 
                        after the date on which the Attorney 
                        General received the request; or
                          (ii) not later than 10 calendar days 
                        after such date, if the requesting 
                        agency advises the Attorney General 
                        that an emergency exists requiring 
                        expeditious action.
                  (C) Exceptions.--A responsible agency may not 
                be required to request a report under 
                subparagraph (A) if--
                          (i) the responsible agency finds that 
                        it must act immediately in order to 
                        prevent the probable failure of 1 of 
                        the insured depository institutions 
                        involved in the merger transaction; or
                          (ii) the merger transaction involves 
                        solely an insured depository 
                        institution and 1 or more of the 
                        affiliates of such depository 
                        institution.
  (5) The responsible agency shall not approve--
          (A) any proposed merger transaction which would 
        result in a monopoly, or which would be in furtherance 
        of any combination or conspiracy to monopolize or to 
        attempt to monopolize the business of banking in any 
        part of the United States, or
          (B) any other proposed merger transaction whose 
        effect in any section of the country may be 
        substantially to lessen competition, or to tend to 
        create a monopoly, or which in any other manner would 
        be in restraint of trade, unless it finds that the 
        anticompetitive effects of the proposed transaction are 
        clearly outweighed in the public interest by the 
        probable effect of the transaction in meeting the 
        convenience and needs of the community to be served.
In every case, the responsible agency shall take into 
consideration the financial and managerial resources and future 
prospects of the existing and proposed institutions, the 
convenience and needs of the community to be served, and the 
risk to the stability of the United States banking or financial 
system.
  (6) The responsible agency shall immediately notify the 
Attorney General of any approval by it pursuant to this 
subsection of a proposed merger transaction. If the agency has 
found that it must act immediately to prevent the probable 
failure of one of the insured depository institutions involved, 
or if the proposed merger transaction is solely between an 
insured depository institution and 1 or more of its affiliates, 
and the report on the competitive factors has been dispensed 
with, the transaction may be consummated immediately upon 
approval by the agency. If the agency has advised the Attorney 
General under paragraph (4)(B)(ii) of the existence of an 
emergency requiring expeditious action and has requested a 
report on the competitive factors within 10 days, the 
transaction may not be consummated before the fifth calendar 
day after the date of approval by the agency. In all other 
cases, the transaction may not be consummated before the 
thirtieth calendar day after the date of approval by the agency 
or, if the agency has not received any adverse comment from the 
Attorney General of the United States relating to competitive 
factors, such shorter period of time as may be prescribed by 
the agency with the concurrence of the Attorney General, but in 
no event less than 15 calendar days after the date of approval.
  (7)(A) Any action brought under the antitrust laws arising 
out of a merger transaction shall be commenced prior to the 
earliest time under paragraph (6) at which a merger transaction 
approved under paragraph (5) might be consummated. The 
commencement of such an action shall stay the effectiveness of 
the agency's approval unless the court shall otherwise 
specifically order. In any such action, the court shall review 
de novo the issues presented.
  (B) In any judicial proceeding attacking a merger transaction 
approved under paragraph (5) on the ground that the merger 
transaction alone and of itself constituted a violation of any 
antitrust laws other than section 2 of the Act of July 2, 1890 
(section 2 of the Sherman Antitrust Act, 15 U.S.C. 2), the 
standards applied by the court shall be identical with those 
that the banking agencies are directed to apply under paragraph 
(5).
  (C) Upon the consummation of a merger transaction in 
compliance with this subsection and after the termination of 
any antitrust litigation commenced within the period prescribed 
in this paragraph, or upon the termination of such period if no 
such litigation is commenced therein, the transaction may not 
thereafter be attacked in any judicial proceeding on the ground 
that it alone and of itself constituted a violation of any 
antitrust laws other than section 2 of the Act of July 2, 1890 
(section 2 of the Sherman Antitrust Act, 15 U.S.C. 2), but 
nothing in this subsection shall exempt any bank or savings 
association resulting from a merger transaction from complying 
with the antitrust laws after the consummation of such 
transaction.
  (D) In any action brought under the antitrust laws arising 
out of a merger transaction approved by a Federal supervisory 
agency pursuant to this subsection, such agency, and any State 
banking supervisory agency having jurisdiction within the State 
involved, may appear as a party of its own motion and as of 
right, and be represented by its counsel.
  (8) For the purposes of this subsection, the term ``antitrust 
laws'' means the Act of July 2, 1890 (the Sherman Antitrust 
Act, 15 U.S.C. 1-7), the Act of October 15, 1914 (the Clayton 
Act, 15 U.S.C. 12-27), and any other Acts in pari materia.
  (9) Each of the responsible agencies shall include in its 
annual report to the Congress a description of each merger 
transaction approved by it during the period covered by the 
report, along with--
          (A) the name and total resources of each bank or 
        savings association involved;
          (B) whether a report was submitted by the Attorney 
        General under paragraph (4), and, if so, a summary by 
        the Attorney General of the substance of such report; 
        and
          (C) a statement by the responsible agency of the 
        basis for its approval.
  (10) Until June 30, 1976, the responsible agency shall not 
grant any approval required by law which has the practical 
effect of permitting a conversion from the mutual to the stock 
form of organization, including approval of any application 
pending on the date of enactment of this subsection, except 
that this sentence shall not be deemed to limit now or 
hereafter the authority of the responsible agency to grant 
approvals in cases where the responsible agency finds that it 
must act in order to maintain the safety, soundness, and 
stability of an insured depository institution. The responsible 
agency may by rule, regulation, or otherwise and under such 
civil penalties (which shall be cumulative to any other 
remedies) as it may prescribe take whatever action it deems 
necessary or appropriate to implement or enforce this 
subsection.
          (11) Money laundering.--In every case, the 
        responsible agency, shall take into consideration the 
        effectiveness of any insured depository institution 
        involved in the proposed merger transaction in 
        combatting money laundering activities, including in 
        overseas branches.
  (12) The provisions of this subsection do not apply to any 
merger transaction involving a foreign bank if no party to the 
transaction is principally engaged in business in the United 
States.
  (13)(A) Except as provided in subparagraph (B), the 
responsible agency may not approve an application for an 
interstate merger transaction if the resulting insured 
depository institution (including all insured depository 
institutions which are affiliates of the resulting insured 
depository institution), upon consummation of the transaction, 
would control more than 10 percent of the total amount of 
deposits of insured depository institutions in the United 
States.
  (B) Subparagraph (A) shall not apply to an interstate merger 
transaction that involves 1 or more insured depository 
institutions in default or in danger of default, or with 
respect to which the Corporation provides assistance under 
section 13.
  (C) In this paragraph--
          (i) the term ``interstate merger transaction'' means 
        a merger transaction involving 2 or more insured 
        depository institutions that have different home States 
        and that are not affiliates; and
          (ii) the term ``home State'' means--
                  (I) with respect to a national bank, the 
                State in which the main office of the bank is 
                located;
                  (II) with respect to a State bank or State 
                savings association, the State by which the 
                State bank or State savings association is 
                chartered; and
                  (III) with respect to a Federal savings 
                association, the State in which the home office 
                (as defined by the regulations of the Director 
                of the Office of Thrift Supervision, or, on and 
                after the transfer date, the Comptroller of the 
                Currency) of the Federal savings association is 
                located.
  (d)(1) No State nonmember insured bank shall establish and 
operate any new domestic branch unless it shall have the prior 
written consent of the Corporation, and no State nonmember 
insured bank shall move its main office or any such branch from 
one location to another without such consent. No foreign bank 
may move any insured branch from one location to another 
without such consent. The factors to be considered in granting 
or withholding the consent of the Corporation under this 
subsection shall be those enumerated in section 6 of this Act.
  (2) No State nonmember insured bank shall establish or 
operate any foreign branch, except with the prior written 
consent of the Corporation and upon such conditions and 
pursuant to such regulations as the Corporation may prescribe 
from time to time.
          (3) Exclusive authority for additional branches.--
                  (A) In general.--Effective June 1, 1997, a 
                State nonmember bank may not acquire, 
                establish, or operate a branch in any State 
                other than the bank's home State (as defined in 
                section 44(f)(4)) or a State in which the bank 
                already has a branch unless the acquisition, 
                establishment, or operation of a branch in such 
                State by a State nonmember bank is authorized 
                under this subsection or section 13(f), 13(k), 
                or 44.
                  (B) Retention of branches.--In the case of a 
                State nonmember bank which relocates the main 
                office of such bank from 1 State to another 
                State after May 31, 1997, the bank may retain 
                and operate branches within the State which was 
                the bank's home State (as defined in section 
                44(f)(4)) before the relocation of such office 
                only to the extent the bank would be 
                authorized, under this section or any other 
                provision of law referred to in subparagraph 
                (A), to acquire, establish, or commence to 
                operate a branch in such State if--
                          (i) the bank had no branches in such 
                        State; or
                          (ii) the branch resulted from--
                                  (I) an interstate merger 
                                transaction approved pursuant 
                                to section 44; or
                                  (II) a transaction after May 
                                31, 1997, pursuant to which the 
                                bank received assistance from 
                                the Corporation under section 
                                13(c).
          (4) State ``opt-in'' election to permit interstate 
        branching through de novo branches.--
                  (A) In general.--Subject to subparagraph (B), 
                the Corporation may approve an application by 
                an insured State nonmember bank to establish 
                and operate a de novo branch in a State (other 
                than the bank's home State) in which the bank 
                does not maintain a branch if--
                          (i) the law of the State in which the 
                        branch is located, or is to be located, 
                        would permit establishment of the 
                        branch, if the bank were a State bank 
                        chartered by such State; and
                          (ii) the conditions established in, 
                        or made applicable to this paragraph 
                        by, subparagraph (B) are met.
                  (B) Conditions on establishment and operation 
                of interstate branch.--
                          (i) Establishment.--An application by 
                        an insured State nonmember bank to 
                        establish and operate a de novo branch 
                        in a host State shall be subject to the 
                        same requirements and conditions to 
                        which an application for a merger 
                        transaction is subject under paragraphs 
                        (1), (3), and (4) of section 44(b).
                          (ii) Operation.--Subsections (c) and 
                        (d)(2) of section 44 shall apply with 
                        respect to each branch of an insured 
                        State nonmember bank which is 
                        established and operated pursuant to an 
                        application approved under this 
                        paragraph in the same manner and to the 
                        same extent such provisions of such 
                        section apply to a branch of a State 
                        bank which resulted from a merger 
                        transaction under such section 44.
                  (C) De novo branch defined.--For purposes of 
                this paragraph, the term ``de novo branch'' 
                means a branch of a State bank which--
                          (i) is originally established by the 
                        State bank as a branch; and
                          (ii) does not become a branch of such 
                        bank as a result of--
                                  (I) the acquisition by the 
                                bank of an insured depository 
                                institution or a branch of an 
                                insured depository institution; 
                                or
                                  (II) the conversion, merger, 
                                or consolidation of any such 
                                institution or branch.
                  (D) Home state defined.--The term ``home 
                State'' means the State by which a State bank 
                is chartered.
                  (E) Host state defined.--The term ``host 
                State'' means, with respect to a bank, a State, 
                other than the home State of the bank, in which 
                the bank maintains, or seeks to establish and 
                maintain, a branch.
  (e) The Corporation may require any insured depository 
institution to provide protection and indemnity against 
burglary, defalcation, and other similar insurable losses. 
Whenever any insured depository institution refuses to comply 
with any such requirement the Corporation may contract for such 
protection and indemnity and add the cost thereof to the 
assessment otherwise payable by such bank.
  (f) Whenever any insured depository institution (except a 
national bank), after written notice of the recommendations of 
the Corporation based on a report of examination of such 
insured depository institution by an examiner of the 
Corporation, shall fail to comply with such recommendations 
within one hundred and twenty days after such notice, the 
Corporation shall have the power, and is hereby authorized, to 
publish only such part of such report of examination as relates 
to any recommendation not complied with: Provided, That notice 
of intention to make such publication shall be given to the 
insured depository institution at least ninety days before such 
publication is made.
  (g)
  (h) Penalty for Failure to Timely Pay Assessments.--
          (1) In general.--Subject to paragraph (3), any 
        insured depository institution which fails or refuses 
        to pay any assessment shall be subject to a penalty in 
        an amount of not more than 1 percent of the amount of 
        the assessment due for each day that such violation 
        continues.
          (2) Exception in case of dispute.--Paragraph (1) 
        shall not apply if--
                  (A) the failure to pay an assessment is due 
                to a dispute between the insured depository 
                institution and the Corporation over the amount 
                of such assessment; and
                  (B) the insured depository institution 
                deposits security satisfactory to the 
                Corporation for payment upon final 
                determination of the issue.
          (3) Special rule for small assessment amounts.--If 
        the amount of the assessment which an insured 
        depository institution fails or refuses to pay is less 
        than $10,000 at the time of such failure or refusal, 
        the amount of any penalty to which such institution is 
        subject under paragraph (1) shall not exceed $100 for 
        each day that such violation continues.
          (4) Authority to modify or remit penalty.--The 
        Corporation, in the sole discretion of the Corporation, 
        may compromise, modify or remit any penalty which the 
        Corporation may assess or has already assessed under 
        paragraph (1) upon a finding that good cause prevented 
        the timely payment of an assessment.
  (i)(1) No insured State nonmember bank shall, without the 
prior consent of the Corporation, reduce the amount or retire 
any part of its common or preferred capital stock, or retire 
any part of its capital notes or debentures.
  (2) No insured Federal depository institution shall convert 
into an insured State depository institution if its capital 
stock or its surplus will be less than the capital stock or 
surplus, respectively, of the converting bank at the time of 
the shareholder's meeting approving such conversion, without 
the prior written consent of--
          (A) the Board of Governors of the Federal Reserve 
        System if the resulting bank is to be a State member 
        bank;
          (B) the Corporation if the resulting bank is to be a 
        State nonmember insured bank; and
          (C) the Corporation if the resulting institution is 
        to be an insured State savings association.
  (3) Without the prior written consent of the Corporation, no 
insured depository institution shall convert into a noninsured 
bank or institution.
  (4) In granting or withholding consent under this subsection, 
the responsible agency shall consider--
          (A) the financial history and condition of the bank,
          (B) the adequacy of its capital structure,
          (C) its future earnings prospects,
          (D) the general character and fitness of its 
        management,
          (E) the convenience and needs of the community to be 
        served, and
          (F) whether or not its corporate powers are 
        consistent with the purposes of this Act.
  (j) Restrictions on Transactions With Affiliates and 
Insiders.--
          (1) Transactions with affiliates.--
                  (A) In general.--Sections 23A and 23B of the 
                Federal Reserve Act shall apply with respect to 
                every nonmember insured bank in the same manner 
                and to the same extent as if the nonmember 
                insured bank were a member bank.
                  (B) Affiliate defined.--For the purpose of 
                subparagraph (A), any company that would be an 
                affiliate (as defined in sections 23A and 23B) 
                of a nonmember insured bank if the nonmember 
                insured bank were a member bank shall be deemed 
                to be an affiliate of that nonmember insured 
                bank.
          (2) Extensions of credit to officers, directors, and 
        principal shareholders.--Subsections (g) and (h) of 
        section 22 of the Federal Reserve Act shall apply with 
        respect to every nonmember insured bank in the same 
        manner and to the same extent as if the nonmember 
        insured bank were a member bank.
          (3) Avoiding extraterritorial application to foreign 
        banks.--
                  (A) Transactions with affiliates.--Paragraph 
                (1) shall not apply with respect to a foreign 
                bank solely because the foreign bank has an 
                insured branch.
                  (B) Extensions of credit to officers, 
                directors, and principal shareholders.--
                Paragraph (2) shall not apply with respect to a 
                foreign bank solely because the foreign bank 
                has an insured branch, but shall apply with 
                respect to the insured branch.
                  (C) Foreign bank defined.--For purposes of 
                this paragraph, the term ``foreign bank'' has 
                the same meaning as in section 1(b)(7) of the 
                International Banking Act of 1978.
  (k) Authority To Regulate or Prohibit Certain Forms of 
Benefits to Institution-Affiliated Parties.--
          (1) Golden parachutes and indemnification payments.--
        The Corporation may prohibit or limit, by regulation or 
        order, any golden parachute payment or indemnification 
        payment.
          (2) Factors to be taken into account.--The 
        Corporation shall prescribe, by regulation, the factors 
        to be considered by the Corporation in taking any 
        action pursuant to paragraph (1) which may include such 
        factors as the following:
                  (A) Whether there is a reasonable basis to 
                believe that the institution-affiliated party 
                has committed any fraudulent act or omission, 
                breach of trust or fiduciary duty, or insider 
                abuse with regard to the depository institution 
                or covered company that has had a material 
                affect on the financial condition of the 
                institution.
                  (B) Whether there is a reasonable basis to 
                believe that the institution-affiliated party 
                is substantially responsible for--
                          (i) the insolvency of the depository 
                        institution or covered company;
                          (ii) the appointment of a conservator 
                        or receiver for the depository 
                        institution; or
                          (iii) the troubled condition of the 
                        depository institution (as defined in 
                        the regulations prescribed pursuant to 
                        section 32(f)).
                  (C) Whether there is a reasonable basis to 
                believe that the institution-affiliated party 
                has materially violated any applicable Federal 
                or State banking law or regulation that has had 
                a material affect on the financial condition of 
                the institution.
                  (D) Whether there is a reasonable basis to 
                believe that the institution-affiliated party 
                has violated or conspired to violate--
                          (i) section 215, 656, 657, 1005, 
                        1006, 1007, 1014, 1032, or 1344 of 
                        title 18, United States Code; or
                          (ii) section 1341 or 1343 of such 
                        title affecting a federally insured 
                        financial institution.
                  (E) Whether the institution-affiliated party 
                was in a position of managerial or fiduciary 
                responsibility.
                  (F) The length of time the party was 
                affiliated with the insured depository 
                institution or covered company, and the degree 
                to which--
                          (i) the payment reasonably reflects 
                        compensation earned over the period of 
                        employment; and
                          (ii) the compensation involved 
                        represents a reasonable payment for 
                        services rendered.
          (3) Certain payments prohibited.--No insured 
        depository institution or covered company may prepay 
        the salary or any liability or legal expense of any 
        institution-affiliated party if such payment is made--
                  (A) in contemplation of the insolvency of 
                such institution or covered company or after 
                the commission of an act of insolvency; and
                  (B) with a view to, or has the result of--
                          (i) preventing the proper application 
                        of the assets of the institution to 
                        creditors; or
                          (ii) preferring one creditor over 
                        another.
          (4) Golden parachute payment defined.--For purposes 
        of this subsection--
                  (A) In general.--The term ``golden parachute 
                payment'' means any payment (or any agreement 
                to make any payment) in the nature of 
                compensation by any insured depository 
                institution or covered company for the benefit 
                of any institution-affiliated party pursuant to 
                an obligation of such institution or covered 
                company that--
                          (i) is contingent on the termination 
                        of such party's affiliation with the 
                        institution or covered company; and
                          (ii) is received on or after the date 
                        on which--
                                  (I) the insured depository 
                                institution or covered company, 
                                or any insured depository 
                                institution subsidiary of such 
                                covered company, is insolvent;
                                  (II) any conservator or 
                                receiver is appointed for such 
                                institution;
                                  (III) the institution's 
                                appropriate Federal banking 
                                agency determines that the 
                                insured depository institution 
                                is in a troubled condition (as 
                                defined in the regulations 
                                prescribed pursuant to section 
                                32(f));
                                  (IV) the insured depository 
                                institution has been assigned a 
                                composite rating by the 
                                appropriate Federal banking 
                                agency or the Corporation of 4 
                                or 5 under the Uniform 
                                Financial Institutions Rating 
                                System; or
                                  (V) the insured depository 
                                institution is subject to a 
                                proceeding initiated by the 
                                Corporation to terminate or 
                                suspend deposit insurance for 
                                such institution.
                  (B) Certain payments in contemplation of an 
                event.--Any payment which would be a golden 
                parachute payment but for the fact that such 
                payment was made before the date referred to in 
                subparagraph (A)(ii) shall be treated as a 
                golden parachute payment if the payment was 
                made in contemplation of the occurrence of an 
                event described in any subclause of such 
                subparagraph.
                  (C) Certain payments not included.--The term 
                ``golden parachute payment'' shall not 
                include--
                          (i) any payment made pursuant to a 
                        retirement plan which is qualified (or 
                        is intended to be qualified) under 
                        section 401 of the Internal Revenue 
                        Code of 1986 or other nondiscriminatory 
                        benefit plan;
                          (ii) any payment made pursuant to a 
                        bona fide deferred compensation plan or 
                        arrangement which the Board determines, 
                        by regulation or order, to be 
                        permissible; or
                          (iii) any payment made by reason of 
                        the death or disability of an 
                        institution-affiliated party.
          (5) Other definitions.--For purposes of this 
        subsection--
                  (A) Indemnification payment.--Subject to 
                paragraph (6), the term ``indemnification 
                payment'' means any payment (or any agreement 
                to make any payment) by any insured depository 
                institution or covered company for the benefit 
                of any person who is or was an institution-
                affiliated party, to pay or reimburse such 
                person for any liability or legal expense with 
                regard to any administrative proceeding or 
                civil action instituted by the appropriate 
                Federal banking agency which results in a final 
                order under which such person--
                          (i) is assessed a civil money 
                        penalty;
                          (ii) is removed or prohibited from 
                        participating in conduct of the affairs 
                        of the insured depository institution; 
                        or
                          (iii) is required to take any 
                        affirmative action described in section 
                        8(b)(6) with respect to such 
                        institution.
                  (B) Liability or legal expense.--The term 
                ``liability or legal expense'' means--
                          (i) any legal or other professional 
                        expense incurred in connection with any 
                        claim, proceeding, or action;
                          (ii) the amount of, and any cost 
                        incurred in connection with, any 
                        settlement of any claim, proceeding, or 
                        action; and
                          (iii) the amount of, and any cost 
                        incurred in connection with, any 
                        judgment or penalty imposed with 
                        respect to any claim, proceeding, or 
                        action.
                  (C) Payment.--The term ``payment'' includes--
                          (i) any direct or indirect transfer 
                        of any funds or any asset; and
                          (ii) any segregation of any funds or 
                        assets for the purpose of making, or 
                        pursuant to an agreement to make, any 
                        payment after the date on which such 
                        funds or assets are segregated, without 
                        regard to whether the obligation to 
                        make such payment is contingent on--
                                  (I) the determination, after 
                                such date, of the liability for 
                                the payment of such amount; or
                                  (II) the liquidation, after 
                                such date, of the amount of 
                                such payment.
                  (D) Covered company.--The term ``covered 
                company'' means any depository institution 
                holding company (including any company required 
                to file a report under section 4(f)(6) of the 
                Bank Holding Company Act of 1956), or any other 
                company that controls an insured depository 
                institution.
          (6) Certain commercial insurance coverage not treated 
        as covered benefit payment.--No provision of this 
        subsection shall be construed as prohibiting any 
        insured depository institution or covered company, from 
        purchasing any commercial insurance policy or fidelity 
        bond, except that, subject to any requirement described 
        in paragraph (5)(A)(iii), such insurance policy or bond 
        shall not cover any legal or liability expense of the 
        institution or covered company which is described in 
        paragraph (5)(A).
  (l) When authorized by State law, a State nonmember insured 
bank may, but only with the prior written consent of the 
Corporation and upon such conditions and under such regulations 
as the Corporation may prescribe from time to time, acquire and 
hold, directly or indirectly, stock or other evidences of 
ownership in one or more banks or other entities organized 
under the law of a foreign country or a dependency or insular 
possession of the United States and not engaged, directly or 
indirectly, in any activity in the United States except as, in 
the judgment of the Board of Directors, shall be incidental to 
the international or foreign business of such foreign bank or 
entity; and, notwithstanding the provisions of subsection (j) 
of this section, such State nonmember insured bank may, as to 
such foreign bank or entity, engage in transactions that would 
otherwise be covered thereby, but only in the manner and within 
the limit prescribed by the Corporation by general or specific 
regulation or ruling.
  (m) Activities of Savings Associations and Their 
Subsidiaries.--
          (1) Procedures.--When an insured savings association 
        establishes or acquires a subsidiary or when an insured 
        savings association elects to conduct any new activity 
        through a subsidiary that the insured savings 
        association controls, the insured savings association--
                  (A) shall notify the Corporation or the 
                Comptroller of the Currency, as appropriate, 
                not less than 30 days prior to the 
                establishment, or acquisition, of any such 
                subsidiary, and not less than 30 days prior to 
                the commencement of any such activity, and in 
                either case shall provide at that time such 
                information as each such agency may, by 
                regulation, require; and
                  (B) shall conduct the activities of the 
                subsidiary in accordance with regulations of 
                the Comptroller of the Currency and orders of 
                the Corporation and the Comptroller of the 
                Currency.
          (2) Enforcement powers.--With respect to any 
        subsidiary of an insured savings association:
                  (A) the Corporation and the Comptroller of 
                the Currency, as appropriate, shall each have, 
                with respect to such subsidiary, the respective 
                powers that each has with respect to the 
                insured savings association pursuant to this 
                section or section 8; and
                  (B) the Corporation or the Comptroller of the 
                Currency, as appropriate, may determine, after 
                notice and opportunity for hearing, that the 
                continuation by the insured savings association 
                of its ownership or control of, or its 
                relationship to, the subsidiary--
                          (i) constitutes a serious risk to the 
                        safety, soundness, or stability of the 
                        insured savings association, or
                          (ii) is inconsistent with sound 
                        banking principles or with the purposes 
                        of this Act.
                Upon making any such determination, the 
                Corporation or the Office of the Comptroller of 
                the Currency, as appropriate, shall have 
                authority to order the insured savings 
                association to divest itself of control of the 
                subsidiary. The Corporation or the Comptroller 
                of the Currency, as appropriate, may take any 
                other corrective measures with respect to the 
                subsidiary, including the authority to require 
                the subsidiary to terminate the activities or 
                operations posing such risks, as the 
                Corporation or the Comptroller of the Currency, 
                respectively, may deem appropriate.
          (3) Activities incompatible with deposit insurance.--
                  (A) In general.--The Corporation may 
                determine by regulation or order that any 
                specific activity poses a serious threat to the 
                Deposit Insurance Fund. Prior to adopting any 
                such regulation, the Corporation shall, in the 
                case of a Federal savings association, consult 
                with the Comptroller of the Currency and shall 
                provide appropriate State supervisors the 
                opportunity to comment thereon, and the 
                Corporation shall specifically take such 
                comments into consideration. Any such 
                regulation shall be issued in accordance with 
                section 553 of title 5, United States Code. If 
                the Board of Directors makes such a 
                determination with respect to an activity, the 
                Corporation shall have authority to order that 
                no savings association may engage in the 
                activity directly.
                  (B) Authority of comptroller of the 
                currency.--This section does not limit the 
                authority of the Comptroller of the Currency to 
                issue regulations to promote safety and 
                soundness, or to enforce compliance as to 
                Federal savings associations with other 
                applicable laws.
                  (C) Additional authority of fdic to prevent 
                serious risks to insurance fund.--
                Notwithstanding subparagraph (A), the 
                Corporation may prescribe and enforce such 
                regulations and issue such orders as the 
                Corporation determines to be necessary to 
                prevent actions or practices of savings 
                associations that pose a serious threat to the 
                Deposit Insurance Fund.
          (4) ``Subsidiary'' defined.--As used in this 
        subsection, the term ``subsidiary'' does not include an 
        insured depository institution.
          (5) Applicability to certain savings banks.--
        Subparagraphs (A) and (B) of paragraph (1) of this 
        subsection do not apply to--
                  (A) any Federal savings bank that was 
                chartered prior to October 15, 1982, as a 
                savings bank under State law, or
                  (B) a savings association that acquired its 
                principal assets from an institution that was 
                chartered prior to October 15, 1982, as a 
                savings bank under State law.
  (n) Calculation of Capital.--No appropriate Federal banking 
agency shall allow any insured depository institution to 
include an unidentifiable intangible asset in its calculation 
of compliance with the appropriate capital standard, if such 
unidentifiable intangible asset was acquired after April 12, 
1989, except to the extent permitted under section 5(t) of the 
Home Owners' Loan Act.
  (o) Real Estate Lending.--
          (1) Uniform regulations.--Not more than 9 months 
        after the date of enactment of the Federal Deposit 
        Insurance Corporation Improvement Act of 1991, each 
        appropriate Federal banking agency shall adopt uniform 
        regulations prescribing standards for extensions of 
        credit that are--
                  (A) secured by liens on interests in real 
                estate; or
                  (B) made for the purpose of financing the 
                construction of a building or other 
                improvements to real estate.
          (2) Standards.--
                  (A) Criteria.--In prescribing standards under 
                paragraph (1), the agencies shall consider--
                          (i) the risk posed to the Deposit 
                        Insurance Fund by such extensions of 
                        credit;
                          (ii) the need for safe and sound 
                        operation of insured depository 
                        institutions; and
                          (iii) the availability of credit.
                  (B) Variations permitted.--In prescribing 
                standards under paragraph (1), the appropriate 
                Federal banking agencies may differentiate 
                among types of loans--
                          (i) as may be required by Federal 
                        statute;
                          (ii) as may be warranted, based on 
                        the risk to the Deposit Insurance Fund; 
                        or
                          (iii) as may be warranted, based on 
                        the safety and soundness of the 
                        institutions.
          (3) Loan evaluation standard.--No appropriate Federal 
        banking agency shall adversely evaluate an investment 
        or a loan made by an insured depository institution, or 
        consider such a loan to be nonperforming, solely 
        because the loan is made to or the investment is in 
        commercial, residential, or industrial property, unless 
        such investment or loan may affect the institution's 
        safety and soundness.
          (4) Effective date.--The regulations adopted under 
        paragraph (1) shall become effective not later than 15 
        months after the date of enactment of the Federal 
        Deposit Insurance Corporation Improvement Act of 1991. 
        Such regulations shall continue in effect except as 
        uniformly amended by the appropriate Federal banking 
        agencies, acting in concert.
  (p) Periodic Review of Capital Standards.--Each appropriate 
Federal banking agency shall, in consultation with the other 
Federal banking agencies, biennially review its capital 
standards for insured depository institutions to determine 
whether those standards require sufficient capital to 
facilitate prompt corrective action to prevent or minimize loss 
to the Deposit Insurance Fund, consistent with section 38.
  (q) Sovereign Risk.--Section 25C of the Federal Reserve Act 
shall apply to every nonmember insured bank in the same manner 
and to the same extent as if the nonmember insured bank were a 
member bank.
  (r) Subsidiary Depository Institutions as Agents for Certain 
Affiliates.--
          (1) In general.--Any bank subsidiary of a bank 
        holding company may receive deposits, renew time 
        deposits, close loans, service loans, and receive 
        payments on loans and other obligations as an agent for 
        a depository institution affiliate.
          (2) Bank acting as agent is not a branch.--
        Notwithstanding any other provision of law, a bank 
        acting as an agent in accordance with paragraph (1) for 
        a depository institution affiliate shall not be 
        considered to be a branch of the affiliate.
          (3) Prohibitions on activities.--A depository 
        institution may not--
                  (A) conduct any activity as an agent under 
                paragraph (1) or (6) which such institution is 
                prohibited from conducting as a principal under 
                any applicable Federal or State law; or
                  (B) as a principal, have an agent conduct any 
                activity under paragraph (1) or (6) which the 
                institution is prohibited from conducting under 
                any applicable Federal or State law.
          (4) Existing authority not affected.--No provision of 
        this subsection shall be construed as affecting--
                  (A) the authority of any depository 
                institution to act as an agent on behalf of any 
                other depository institution under any other 
                provision of law; or
                  (B) whether a depository institution which 
                conducts any activity as an agent on behalf of 
                any other depository institution under any 
                other provision of law shall be considered to 
                be a branch of such other institution.
          (5) Agency relationship required to be consistent 
        with safe and sound banking practices.--An agency 
        relationship between depository institutions under 
        paragraph (1) or (6) shall be on terms that are 
        consistent with safe and sound banking practices and 
        all applicable regulations of any appropriate Federal 
        banking agency.
          (6) Affiliated insured savings associations.--An 
        insured savings association which was an affiliate of a 
        bank on July 1, 1994, may conduct activities as an 
        agent on behalf of such bank in the same manner as an 
        insured bank affiliate of such bank may act as agent 
        for such bank under this subsection to the extent such 
        activities are conducted only in--
                  (A) any State in which--
                          (i) the bank is not prohibited from 
                        operating a branch under any provision 
                        of Federal or State law; and
                          (ii) the savings association 
                        maintained an office or branch and 
                        conducted business as of July 1, 1994; 
                        or
                  (B) any State in which--
                          (i) the bank is not expressly 
                        prohibited from operating a branch 
                        under a State law described in section 
                        44(a)(2); and
                          (ii) the savings association 
                        maintained a main office and conducted 
                        business as of July 1, 1994.
  (s) Prohibition on Certain Affiliations.--
          (1) In general.--No depository institution may be an 
        affiliate of, be sponsored by, or accept financial 
        support, directly or indirectly, from any Government-
        sponsored enterprise.
          (2) Exception for members of a federal home loan 
        bank.--Paragraph (1) shall not apply with respect to 
        the membership of a depository institution in a Federal 
        home loan bank.
          (3) Routine business financing.--Paragraph (1) shall 
        not apply with respect to advances or other forms of 
        financial assistance provided by a Government-sponsored 
        enterprise pursuant to the statutes governing such 
        enterprise.
          (4) Student loans.--
                  (A) In general.--This subsection shall not 
                apply to any arrangement between the Holding 
                Company (or any subsidiary of the Holding 
                Company other than the Student Loan Marketing 
                Association) and a depository institution, if 
                the Secretary approves the affiliation and 
                determines that--
                          (i) the reorganization of such 
                        Association in accordance with section 
                        440 of the Higher Education Act of 
                        1965, as amended, will not be adversely 
                        affected by the arrangement;
                          (ii) the dissolution of the 
                        Association pursuant to such 
                        reorganization will occur before the 
                        end of the 2-year period beginning on 
                        the date on which such arrangement is 
                        consummated or on such earlier date as 
                        the Secretary deems appropriate: 
                        Provided, That the Secretary may extend 
                        this period for not more than 1 year at 
                        a time if the Secretary determines that 
                        such extension is in the public 
                        interest and is appropriate to achieve 
                        an orderly reorganization of the 
                        Association or to prevent market 
                        disruptions in connection with such 
                        reorganization, but no such extensions 
                        shall in the aggregate exceed 2 years;
                          (iii) the Association will not 
                        purchase or extend credit to, or 
                        guarantee or provide credit enhancement 
                        to, any obligation of the depository 
                        institution;
                          (iv) the operations of the 
                        Association will be separate from the 
                        operations of the depository 
                        institution; and
                          (v) until the ``dissolution date'' 
                        (as that term is defined in section 440 
                        of the Higher Education Act of 1965, as 
                        amended) has occurred, such depository 
                        institution will not use the trade name 
                        or service mark ``Sallie Mae'' in 
                        connection with any product or service 
                        it offers if the appropriate Federal 
                        banking agency for such depository 
                        institution determines that--
                                  (I) the depository 
                                institution is the only 
                                institution offering such 
                                product or service using the 
                                ``Sallie Mae'' name; and
                                  (II) such use would result in 
                                the depository institution 
                                having an unfair competitive 
                                advantage over other depository 
                                institutions.
                  (B) Terms and conditions.--In approving any 
                arrangement referred to in subparagraph (A) the 
                Secretary may impose any terms and conditions 
                on such an arrangement that the Secretary 
                considers appropriate, including--
                          (i) imposing additional restrictions 
                        on the issuance of debt obligations by 
                        the Association; or
                          (ii) restricting the use of proceeds 
                        from the issuance of such debt.
                  (C) Additional limitations.--In the event 
                that the Holding Company (or any subsidiary of 
                the Holding Company) enters into such an 
                arrangement, the value of the Association's 
                ``investment portfolio'' shall not at any time 
                exceed the lesser of--
                          (i) the value of such portfolio on 
                        the date of the enactment of this 
                        subsection; or
                          (ii) the value of such portfolio on 
                        the date such an arrangement is 
                        consummated. The term ``investment 
                        portfolio'' shall mean all investments 
                        shown on the consolidated balance sheet 
                        of the Association other than--
                                  (I) any instrument or assets 
                                described in section 439(d) of 
                                the Higher Education Act of 
                                1965, as such section existed 
                                on the day before the date of 
                                the repeal of such section;
                                  (II) any direct noncallable 
                                obligations of the United 
                                States or any agency thereof 
                                for which the full faith and 
                                credit of the United States is 
                                pledged; or
                                  (III) cash or cash 
                                equivalents.
                  (D) Enforcement.--The terms and conditions 
                imposed under subparagraph (B) may be enforced 
                by the Secretary in accordance with section 440 
                of the Higher Education Act of 1965.
                  (E) Definitions.--For purposes of this 
                paragraph, the following definition shall 
                apply--
                          (i) Association; holding company.--
                        Notwithstanding any provision in 
                        section 3, the terms ``Association'' 
                        and ``Holding Company'' have the same 
                        meanings as in section 440(i) of the 
                        Higher Education Act of 1965.
                          (ii) Secretary.--The term 
                        ``Secretary'' means the Secretary of 
                        the Treasury.
          (5) Government-sponsored enterprise defined.--For 
        purposes of this subsection, the term ``Government-
        sponsored enterprise'' has the meaning given to such 
        term in section 1404(e)(1)(A) of the Financial 
        Institutions Reform, Recovery, and Enforcement Act of 
        1989.
  (t) Recordkeeping Requirements.--
          (1) Requirements.--Each appropriate Federal banking 
        agency, after consultation with and consideration of 
        the views of the Commission, shall establish 
        recordkeeping requirements for banks relying on 
        exceptions contained in paragraphs (4) and (5) of 
        section 3(a) of the Securities Exchange Act of 1934. 
        Such recordkeeping requirements shall be sufficient to 
        demonstrate compliance with the terms of such 
        exceptions and be designed to facilitate compliance 
        with such exceptions.
          (2) Availability to commission; confidentiality.--
        Each appropriate Federal banking agency shall make any 
        information required under paragraph (1) available to 
        the Commission upon request. Notwithstanding any other 
        provision of law, the Commission shall not be compelled 
        to disclose any such information. Nothing in this 
        paragraph shall authorize the Commission to withhold 
        information from Congress, or prevent the Commission 
        from complying with a request for information from any 
        other Federal department or agency or any self-
        regulatory organization requesting the information for 
        purposes within the scope of its jurisdiction, or 
        complying with an order of a court of the United States 
        in an action brought by the United States or the 
        Commission. For purposes of section 552 of title 5, 
        United States Code, this paragraph shall be considered 
        a statute described in subsection (b)(3)(B) of such 
        section 552.
          (3) Definition.--As used in this subsection the term 
        ``Commission'' means the Securities and Exchange 
        Commission.
  (u) Limitation on Claims.--
          (1) In general.--No person may bring a claim against 
        any Federal banking agency (including in its capacity 
        as conservator or receiver) for the return of assets of 
        an affiliate or controlling shareholder of the insured 
        depository institution transferred to, or for the 
        benefit of, an insured depository institution by such 
        affiliate or controlling shareholder of the insured 
        depository institution, or a claim against such Federal 
        banking agency for monetary damages or other legal or 
        equitable relief in connection with such transfer, if 
        at the time of the transfer--
                  (A) the insured depository institution is 
                subject to any direction issued in writing by a 
                Federal banking agency to increase its capital; 
                and
                  (B) for that portion of the transfer that is 
                made by an entity covered by section 5(g) of 
                the Bank Holding Company Act of 1956 or section 
                45 of this Act, the Federal banking agency has 
                followed the procedure set forth in such 
                section.
          (2) Definition of claim.--For purposes of paragraph 
        (1), the term ``claim''--
                  (A) means a cause of action based on Federal 
                or State law that--
                          (i) provides for the avoidance of 
                        preferential or fraudulent transfers or 
                        conveyances; or
                          (ii) provides similar remedies for 
                        preferential or fraudulent transfers or 
                        conveyances; and
                  (B) does not include any claim based on 
                actual intent to hinder, delay, or defraud 
                pursuant to such a fraudulent transfer or 
                conveyance law.
  (v) Loans by Insured Institutions on Their Own Stock.--
          (1) General prohibition.--No insured depository 
        institution may make any loan or discount on the 
        security of the shares of its own capital stock.
          (2) Exclusion.--For purposes of this subsection, an 
        insured depository institution shall not be deemed to 
        be making a loan or discount on the security of the 
        shares of its own capital stock if it acquires the 
        stock to prevent loss upon a debt previously contracted 
        for in good faith.
  (w) Written Employment References May Contain Suspicions of 
Involvement in Illegal Activity.--
          (1) Authority to disclose information.--
        Notwithstanding any other provision of law, any insured 
        depository institution, and any director, officer, 
        employee, or agent of such institution, may disclose in 
        any written employment reference relating to a current 
        or former institution-affiliated party of such 
        institution which is provided to another insured 
        depository institution in response to a request from 
        such other institution, information concerning the 
        possible involvement of such institution-affiliated 
        party in potentially unlawful activity.
          (2) Information not required.--Nothing in paragraph 
        (1) shall be construed, by itself, to create any 
        affirmative duty to include any information described 
        in paragraph (1) in any employment reference referred 
        to in paragraph (1).
          (3) Malicious intent.--Notwithstanding any other 
        provision of this subsection, voluntary disclosure made 
        by an insured depository institution, and any director, 
        officer, employee, or agent of such institution, under 
        this subsection concerning potentially unlawful 
        activity that is made with malicious intent, shall not 
        be shielded from liability from the person identified 
        in the disclosure.
          (4) Definition.--For purposes of this subsection, the 
        term ``insured depository institution'' includes any 
        uninsured branch or agency of a foreign bank.
  (x) Privileges Not Affected by Disclosure to Banking Agency 
or Supervisor.--
          (1) In general.--The submission by any person of any 
        information to the [Bureau of Consumer Financial 
        Protection] Consumer Law Enforcement Agency, any 
        Federal banking agency, State bank supervisor, or 
        foreign banking authority for any purpose in the course 
        of any supervisory or regulatory process of such 
        [Bureau] Agency, agency, supervisor, or authority shall 
        not be construed as waiving, destroying, or otherwise 
        affecting any privilege such person may claim with 
        respect to such information under Federal or State law 
        as to any person or entity other than such [Bureau] 
        Agency, agency, supervisor, or authority.
          (2) Rule of construction.--No provision of paragraph 
        (1) may be construed as implying or establishing that--
                  (A) any person waives any privilege 
                applicable to information that is submitted or 
                transferred under any circumstance to which 
                paragraph (1) does not apply; or
                  (B) any person would waive any privilege 
                applicable to any information by submitting the 
                information to the [Bureau of Consumer 
                Financial Protection] Consumer Law Enforcement 
                Agency, any Federal banking agency, State bank 
                supervisor, or foreign banking authority, but 
                for this subsection.
  (z) General Prohibition on Sale of Assets.--
          (1) In general.--An insured depository institution 
        may not purchase an asset from, or sell an asset to, an 
        executive officer, director, or principal shareholder 
        of the insured depository institution, or any related 
        interest of such person (as such terms are defined in 
        section 22(h) of Federal Reserve Act), unless--
                  (A) the transaction is on market terms; and
                  (B) if the transaction represents more than 
                10 percent of the capital stock and surplus of 
                the insured depository institution, the 
                transaction has been approved in advance by a 
                majority of the members of the board of 
                directors of the insured depository institution 
                who do not have an interest in the transaction.
          (2) Rulemaking.--The Board of Governors of the 
        Federal Reserve System may issue such rules as may be 
        necessary to define terms and to carry out the purposes 
        this subsection. Before proposing or adopting a rule 
        under this paragraph, the Board of Governors of the 
        Federal Reserve System shall consult with the 
        Comptroller of the Currency and the Corporation as to 
        the terms of the rule.
  (y) State Lending Limit Treatment of Derivatives 
Transactions.--An insured State bank may engage in a derivative 
transaction, as defined in section 5200(b)(3) of the Revised 
Statutes of the United States (12 U.S.C. 84(b)(3)), only if the 
law with respect to lending limits of the State in which the 
insured State bank is chartered takes into consideration credit 
exposure to derivative transactions.

SEC. 19. PENALTY FOR UNAUTHORIZED PARTICIPATION BY CONVICTED 
                    INDIVIDUAL.

  (a) Prohibition.--
          (1) In general.--Except with the prior written 
        consent of the Corporation--
                  (A) any person who has been convicted of any 
                criminal offense involving dishonesty or a 
                breach of trust or money laundering, or has 
                agreed to enter into a pretrial diversion or 
                similar program in connection with a 
                prosecution for such offense, may not--
                          (i) become, or continue as, an 
                        institution-affiliated party with 
                        respect to any insured depository 
                        institution;
                          (ii) own or control, directly or 
                        indirectly, any insured depository 
                        institution; or
                          (iii) otherwise participate, directly 
                        or indirectly, in the conduct of the 
                        affairs of any insured depository 
                        institution; and
                  (B) any insured depository institution may 
                not permit any person referred to in 
                subparagraph (A) to engage in any conduct or 
                continue any relationship prohibited under such 
                subparagraph.
          (2) Minimum 10-year prohibition period for certain 
        offenses.--
                  (A) In general.--If the offense referred to 
                in paragraph (1)(A) in connection with any 
                person referred to in such paragraph is--
                          (i) an offense under--
                                  (I) section 215, 656, 657, 
                                1005, 1006, 1007, 1008, 1014, 
                                1032, 1344, 1517, 1956, or 1957 
                                of title 18, United States 
                                Code; or
                                  (II) section 1341 or 1343 of 
                                such title which affects any 
                                financial institution (as 
                                defined in section 20 of such 
                                title); or
                          (ii) the offense of conspiring to 
                        commit any such offense,
                the Corporation may not consent to any 
                exception to the application of paragraph (1) 
                to such person during the 10-year period 
                beginning on the date the conviction or the 
                agreement of the person becomes final.
                  (B) Exception by order of sentencing court.--
                          (i) In general.--On motion of the 
                        Corporation, the court in which the 
                        conviction or the agreement of a person 
                        referred to in subparagraph (A) has 
                        been entered may grant an exception to 
                        the application of paragraph (1) to 
                        such person if granting the exception 
                        is in the interest of justice.
                          (ii) Period for filing.--A motion may 
                        be filed under clause (i) at any time 
                        during the 10-year period described in 
                        subparagraph (A) with regard to the 
                        person on whose behalf such motion is 
                        made.
  (b) Penalty.--Whoever knowingly violates subsection (a) shall 
be fined not more than [$1,000,000] $1,500,000 for each day 
such prohibition is violated or imprisoned for not more than 5 
years, or both.
  (d) Bank Holding Companies.--
          (1) In general.--Subsections (a) and (b) shall apply 
        to any company (other than a foreign bank) that is a 
        bank holding company and any organization organized and 
        operated under section 25A of the Federal Reserve Act 
        or operating under section 25 of the Federal Reserve 
        Act, as if such bank holding company or organization 
        were an insured depository institution, except that 
        such subsections shall be applied for purposes of this 
        subsection by substituting ``Board of Governors of the 
        Federal Reserve System'' for ``Corporation'' each place 
        that term appears in such subsections.
          (2) Authority of board.--The Board of Governors of 
        the Federal Reserve System may provide exemptions, by 
        regulation or order, from the application of paragraph 
        (1) if the exemption is consistent with the purposes of 
        this subsection.
  (e) Savings and Loan Holding Companies.--
          (1) In general.--Subsections (a) and (b) shall apply 
        to any savings and loan holding company as if such 
        savings and loan holding company were an insured 
        depository institution, except that such subsections 
        shall be applied for purposes of this subsection by 
        substituting ``Board of Governors of the Federal 
        Reserve System'' for ``Corporation'' each place that 
        term appears in such subsections.
          (2) Authority of director.--The Board of Governors of 
        the Federal Reserve System may provide exemptions, by 
        regulation or order, from the application of paragraph 
        (1) if the exemption is consistent with the purposes of 
        this subsection.

           *       *       *       *       *       *       *


SEC. 26. ASSURING CONSISTENT OVERSIGHT OF SUBSIDIARIES OF HOLDING 
                    COMPANIES.

  (a) Definitions.--For purposes of this section:
          (1) Board.--The term ``Board''' means the Board of 
        Governors of the Federal Reserve System.
          (2) Functionally regulated subsidiary.--The term 
        ``functionally regulated subsidiary'' has the same 
        meaning as in section 5(c)(5) of the Bank [Holding 
        Company Act] Holding Company Act of 1956.
          (3) Lead insured depository institution.--The term 
        ``lead insured depository institution'' has the same 
        meaning as in section 2(o)(8) of the Bank [Holding 
        Company Act] Holding Company Act of 1956.
  (b) Examination Requirements.--Subject to subtitle B of the 
Consumer Financial Protection Act of 2010, the Board shall 
examine the activities of a nondepository institution 
subsidiary (other than a functionally regulated subsidiary or a 
subsidiary of a depository institution) of a depository 
institution holding company that are permissible for the 
insured depository institution subsidiaries of the depository 
institution holding company in the same manner, subject to the 
same standards, and with the same frequency as would be 
required if such activities were conducted in the lead insured 
depository institution of the depository institution holding 
company.
  (c) State Coordination.--
          (1) Consultation and coordination.--If a 
        nondepository institution subsidiary is supervised by a 
        State bank supervisor or other State regulatory 
        authority, the Board, in conducting the examinations 
        required in subsection (b), shall consult and 
        coordinate with such State regulator.
          (2) Alternating examinations permitted.--The 
        examinations required under subsection (b) may be 
        conducted in joint or alternating manner with a State 
        regulator, if the Board determines that an examination 
        of a nondepository institution subsidiary conducted by 
        the State carries out the purposes of this section.
  (d) Appropriate Federal Banking Agency Backup Examination 
Authority.--
          (1) In general.--In the event that the Board does not 
        conduct examinations required under subsection (b) in 
        the same manner, subject to the same standards, and 
        with the same frequency as would be required if such 
        activities were conducted by the lead insured 
        depository institution subsidiary of the depository 
        institution holding company, the appropriate Federal 
        banking agency for the lead insured depository 
        institution may recommend in writing (which shall 
        include a written explanation of the concerns giving 
        rise to the recommendation) that the Board perform the 
        examination required under subsection (b).
          (2) Examination by an appropriate federal banking 
        agency.--If the Board does not, before the end of the 
        60-day period beginning on the date on which the Board 
        receives a recommendation under paragraph (1), begin an 
        examination as required under subsection (b) or provide 
        a written explanation or plan to the appropriate 
        Federal banking agency making such recommendation 
        responding to the concerns raised by the appropriate 
        Federal banking agency for the lead insured depository 
        institution, the appropriate Federal banking agency for 
        the lead insured depository institution may, subject to 
        the Consumer Financial Protection Act of 2010, examine 
        the activities that are permissible for a depository 
        institution subsidiary conducted by such nondepository 
        institution subsidiary (other than a functionally 
        regulated subsidiary or a subsidiary of a depository 
        institution) of the depository institution holding 
        company as if the nondepository institution subsidiary 
        were an insured depository institution for which the 
        appropriate Federal banking agency of the lead insured 
        depository institution was the appropriate Federal 
        banking agency, to determine whether the activities--
                  (A) pose a material threat to the safety and 
                soundness of any insured depository institution 
                subsidiary of the depository institution 
                holding company;
                  (B) are conducted in accordance with 
                applicable Federal law; and
                  (C) are subject to appropriate systems for 
                monitoring and controlling the financial, 
                operating, and other material risks of the 
                activities that may pose a material threat to 
                the safety and soundness of the insured 
                depository institution subsidiaries of the 
                holding company.
          (3) Agency coordination with the board.--An 
        appropriate Federal banking agency that conducts an 
        examination pursuant to paragraph (2) shall coordinate 
        examination of the activities of nondepository 
        institution subsidiaries described in subsection (b) 
        with the Board in a manner that--
                  (A) avoids duplication;
                  (B) shares information relevant to the 
                supervision of the depository institution 
                holding company;
                  (C) achieves the objectives of subsection 
                (b); and
                  (D) ensures that the depository institution 
                holding company and the subsidiaries of the 
                depository institution holding company are not 
                subject to conflicting supervisory demands by 
                such agency and the Board.
          (4) Fee permitted for examination costs.--An 
        appropriate Federal banking agency that conducts an 
        examination or enforcement action pursuant to this 
        section may collect an assessment, fee, or such other 
        charge from the subsidiary as the appropriate Federal 
        banking agency determines necessary or appropriate to 
        carry out the responsibilities of the appropriate 
        Federal banking agency in connection with such 
        examination.
  (e) Referrals for Enforcement by Appropriate Federal Banking 
Agency.--
          (1) Recommendation of enforcement action.--The 
        appropriate Federal banking agency for the lead insured 
        depository institution, based upon its examination of a 
        nondepository institution subsidiary conducted pursuant 
        to subsection (d), or other relevant information, may 
        submit to the Board, in writing, a recommendation that 
        the Board take enforcement action against such 
        nondepository institution subsidiary, together with an 
        explanation of the concerns giving rise to the 
        recommendation, if the appropriate Federal banking 
        agency determines (by a vote of its members, if 
        applicable) that the activities of the nondepository 
        institution subsidiary pose a material threat to the 
        safety and soundness of any insured depository 
        institution subsidiary of the depository institution 
        holding company.
          (2) Back-up authority of the appropriate federal 
        banking agency.--If, within the 60-day period beginning 
        on the date on which the Board receives a 
        recommendation under paragraph (1), the Board does not 
        take enforcement action against the nondepository 
        institution subsidiary or provide a plan for 
        supervisory or enforcement action that is acceptable to 
        the appropriate Federal banking agency that made the 
        recommendation pursuant to paragraph (1), such agency 
        may take the recommended enforcement action against the 
        nondepository institution subsidiary, in the same 
        manner as if the nondepository institution subsidiary 
        were an insured depository institution for which the 
        agency was the appropriate Federal banking agency.
  (f) Coordination Among Appropriate Federal Banking 
Agencies.--Each Federal banking agency, prior to or when 
exercising authority under subsection (d) or (e) shall--
          (1) provide reasonable notice to, and consult with, 
        the appropriate Federal banking agency or State bank 
        supervisor (or other State regulatory agency) of the 
        nondepository institution subsidiary of a depository 
        institution holding company that is described in 
        subsection (d) before commencing any examination of the 
        subsidiary;
          (2) to the fullest extent possible--
                  (A) rely on the examinations, inspections, 
                and reports of the appropriate Federal banking 
                agency or the State bank supervisor (or other 
                State regulatory agency) of the subsidiary;
                  (B) avoid duplication of examination 
                activities, reporting requirements, and 
                requests for information; and
                  (C) ensure that the depository institution 
                holding company and the subsidiaries of the 
                depository institution holding company are not 
                subject to conflicting supervisory demands by 
                the appropriate Federal banking agencies.
  (g) Rule of Construction.--No provision of this section shall 
be construed as limiting any authority of the Board, the 
Corporation, or the Comptroller of the Currency under any other 
provision of law.
  Sec. 27. (a) In order to prevent discrimination against 
State-chartered insured depository institutions, including 
insured savings banks, or insured branches of foreign banks 
with respect to interest rates, if the applicable rate 
prescribed in this subsection exceeds the rate such State bank 
or insured branch of a foreign bank would be permitted to 
charge in the absence of this subsection, such State bank or 
such insured branch of a foreign bank may, notwithstanding any 
State constitution or statute which is hereby preempted for the 
purposes of this section, take, receive, reserve, and charge on 
any loan or discount made, or upon any note, bill of exchange, 
or other evidence of debt, interest at a rate of not more than 
1 per centum in excess of the discount rate on ninety-day 
commercial paper in effect at the Federal Reserve bank in the 
Federal Reserve district where such State bank or such insured 
branch of a foreign bank is located or at the rate allowed by 
the laws of the State, territory, or district where the bank is 
located, whichever may be greater. A loan that is valid when 
made as to its maximum rate of interest in accordance with this 
section shall remain valid with respect to such rate regardless 
of whether the loan is subsequently sold, assigned, or 
otherwise transferred to a third party, and may be enforced by 
such third party notwithstanding any State law to the contrary.
  (b) If the rate prescribed in subsection (a) exceeds the rate 
such State bank or such insured branch of a foreign bank would 
be permitted to charge in the absence of this section, and such 
State fixed rate is thereby preempted by the rate described in 
subsection (a), the taking, receiving, reserving, or charging a 
greater rate of interest than is allowed by subsection (a), 
when knowingly done, shall be deemed a forfeiture of the entire 
interest which the note, bill, or other evidence of debt 
carries with it, or which has been agreed to be paid thereon. 
If such greater rate of interest has been paid, the person who 
paid it may recover in a civil action commenced in a court of 
appropriate jurisdiction not later than two years after the 
date of such payment, an amount equal to twice the amount of 
the interest paid from such State bank or such insured branch 
of a foreign bank taking, receiving, reserving, or charging 
such interest.

           *       *       *       *       *       *       *


SEC. 43. DEPOSITORY INSTITUTIONS LACKING FEDERAL DEPOSIT INSURANCE.

  (a) Annual Independent Audit of Private Deposit Insurers.--
          (1) Audit required.--Any private deposit insurer 
        shall obtain an annual audit from an independent 
        auditor using generally accepted auditing standards. 
        The audit shall include a determination of whether the 
        private deposit insurer follows generally accepted 
        accounting principles and has set aside sufficient 
        reserves for losses.
          (2) Providing copies of audit report.--
                  (A) Private deposit insurer.--The private 
                deposit insurer shall provide a copy of the 
                audit report--
                          (i) to each depository institution 
                        the deposits of which are insured by 
                        the private deposit insurer, not later 
                        than 14 days after the audit is 
                        completed;
                          (ii) to the appropriate supervisory 
                        agency of each State in which such an 
                        institution receives deposits, not 
                        later than 7 days after the audit is 
                        completed; and
                          (iii) in the case of depository 
                        institutions described in subsection 
                        (e)(2)(A) the deposits of which are 
                        insured by the private insurer which 
                        are members of a Federal home loan 
                        bank, to the Federal Housing Finance 
                        Agency, not later than 7 days after the 
                        audit is completed.
                  (B) Depository institution.--Any depository 
                institution the deposits of which are insured 
                by the private deposit insurer shall provide a 
                copy of the audit report, upon request, to any 
                current or prospective customer of the 
                institution.
          (3) Enforcement by appropriate state supervisor.--Any 
        appropriate State supervisor of a private deposit 
        insurer, and any appropriate State supervisor of a 
        depository institution which receives deposits that are 
        insured by a private deposit insurer, may examine and 
        enforce compliance with this subsection under the 
        applicable regulatory authority of such supervisor.
  (b) Disclosure Required.--Any depository institution lacking 
Federal deposit insurance shall, within the United States, do 
the following:
          (1) Periodic statements; account records.--Include 
        conspicuously in all periodic statements of account, on 
        each signature card, and on each passbook, certificate 
        of deposit, or share certificate. a notice that the 
        institution is not federally insured, and that if the 
        institution fails, the Federal Government does not 
        guarantee that depositors will get back their money.
          (2) Advertising; premises.--
                  (A) In general.--Include clearly and 
                conspicuously in all advertising, except as 
                provided in subparagraph (B); and at each 
                station or window where deposits are normally 
                received, its principal place of business and 
                all its branches where it accepts deposits or 
                opens accounts (excluding automated teller 
                machines or point of sale terminals), and on 
                its main Internet page, a notice that the 
                institution is not federally insured.
                  (B) Exceptions.--The following need not 
                include a notice that the institution is not 
                federally insured:
                          (i) Any sign, document, or other item 
                        that contains the name of the 
                        depository institution, its logo, or 
                        its contact information, but only if 
                        the sign, document, or item does not 
                        include any information about the 
                        institution's products or services or 
                        information otherwise promoting the 
                        institution.
                          (ii) Small utilitarian items that do 
                        not mention deposit products or 
                        insurance if inclusion of the notice 
                        would be impractical.
          (3) Acknowledgment of disclosure.--
                  (A) New depositors obtained other than 
                through a conversion or merger.--With respect 
                to any depositor who was not a depositor at the 
                depository institution before the effective 
                date of the Financial Services Regulatory 
                Relief Act of 2006, and who is not a depositor 
                as described in subparagraph (B), receive any 
                deposit for the account of such depositor only 
                if the depositor has signed a written 
                acknowledgement that--
                          (i) the institution is not federally 
                        insured; and
                          (ii) if the institution fails, the 
                        Federal Government does not guarantee 
                        that the depositor will get back the 
                        depositor's money.
                  (B) New depositors obtained through a 
                conversion or merger.--With respect to a 
                depositor at a federally insured depository 
                institution that converts to, or merges into, a 
                depository institution lacking federal 
                insurance after the effective date of the 
                Financial Services Regulatory Relief Act of 
                2006, receive any deposit for the account of 
                such depositor only if--
                          (i) the depositor has signed a 
                        written acknowledgement described in 
                        subparagraph (A); or
                          (ii) the institution makes an 
                        attempt, as described in subparagraph 
                        (D) and sent by mail no later than 45 
                        days after the effective date of the 
                        conversion or merger, to obtain the 
                        acknowledgment.
                  (C) Current depositors.--Receive any deposit 
                after the effective date of the Financial 
                Services Regulatory Relief Act of 2006 for the 
                account of any depositor who was a depositor on 
                that date only if--
                          (i) the depositor has signed a 
                        written acknowledgement described in 
                        subparagraph (A); or
                          (ii) the institution has complied 
                        with the provisions of subparagraph (E) 
                        which are applicable as of the date of 
                        the deposit.
                  (D) Alternative provision of notice to new 
                depositors obtained through a conversion or 
                merger.--
                          (i) In general.--Transmit to each 
                        depositor who has not signed a written 
                        acknowledgement described in 
                        subparagraph (A)--
                                  (I) a conspicuous card 
                                containing the information 
                                described in clauses (i) and 
                                (ii) of subparagraph (A), and a 
                                line for the signature of the 
                                depositor; and
                                  (II) accompanying materials 
                                requesting the depositor to 
                                sign the card, and return the 
                                signed card to the institution.
                  (E) Alternative provision of notice to 
                current depositors.--
                          (i) In general.--Transmit to each 
                        depositor who was a depositor before 
                        the effective date of the Financial 
                        Services Regulatory Relief Act of 2006, 
                        and has not signed a written 
                        acknowledgement described in 
                        subparagraph (A)--
                                  (I) a conspicuous card 
                                containing the information 
                                described in clauses (i) and 
                                (ii) of subparagraph (A), and a 
                                line for the signature of the 
                                depositor; and
                                  (II) accompanying materials 
                                requesting the depositor to 
                                sign the card, and return the 
                                signed card to the institution.
                          (ii) Manner and timing of notice.--
                                  (I) First notice.--Make the 
                                transmission described in 
                                clause (i) via mail not later 
                                than three months after the 
                                effective date of the Financial 
                                Services Regulatory Relief Act 
                                of 2006.
                                  (II) Second notice.--Make a 
                                second transmission described 
                                in clause (i) via mail not less 
                                than 30 days and not more than 
                                three months after a 
                                transmission to the depositor 
                                in accordance with subclause 
                                (I), if the institution has 
                                not, by the date of such 
                                mailing, received from the 
                                depositor a card referred to in 
                                clause (i) which has been 
                                signed by the depositor.
  (c) Manner and Content of Disclosure.--To ensure that current 
and prospective customers understand the risks involved in 
foregoing Federal deposit insurance, the [Bureau] Agency, by 
regulation or order, shall prescribe the manner and content of 
disclosure required under this section, which shall be 
presented in such format and in such type size and manner as to 
be simple and easy to understand.
  (d) Exceptions for Institutions Not Receiving Retail 
Deposits.--The [Bureau] Agency may, by regulation or order, 
make exceptions to subsection (b) for any depository 
institution that, within the United States, does not receive 
initial deposits of less than an amount equal to the standard 
maximum deposit insurance amount from individuals who are 
citizens or residents of the United States, other than money 
received in connection with any draft or similar instrument 
issued to transmit money.
  (e) Definitions.--For purposes of this section:
          (1) Appropriate supervisor.--The ``appropriate 
        supervisor'' of a depository institution means the 
        agency primarily responsible for supervising the 
        institution.
          (2) Depository institution.--The term ``depository 
        institution'' includes--
                  (A) any entity described in section 
                19(b)(1)(A)(iv) of the Federal Reserve Act; and
                  (B) any entity that, as determined by the 
                [Bureau] Agency--
                          (i) is engaged in the business of 
                        receiving deposits; and
                          (ii) could reasonably be mistaken for 
                        a depository institution by the 
                        entity's current or prospective 
                        customers.
          (3) Lacking federal deposit insurance.--A depository 
        institution lacks Federal deposit insurance if the 
        institution is not either--
                  (A) an insured depository institution; or
                  (B) an insured credit union, as defined in 
                section 101 of the Federal Credit Union Act.
          (4) Private deposit insurer.--The term ``private 
        deposit insurer'' means any entity insuring the 
        deposits of any depository institution lacking Federal 
        deposit insurance.
          [(5) Bureau.--The term ``[Bureau] Agency'' means the 
        [Bureau] Agency of Consumer Financial Protection.]
          (5) Agency.--The term ``Agency'' means the Consumer 
        Law Enforcement Agency.
  (f) Enforcement.--
          (1) Limited enforcement authority.--Compliance with 
        the requirements of subsections (b), (c), and (e), and 
        any regulation prescribed or order issued under such 
        subsection, shall be enforced under the Consumer 
        Financial Protection Act of 2010, by the [Bureau] 
        Agency, subject to subtitle B of the Consumer Financial 
        Protection Act of 2010, and under the Federal Trade 
        Commission Act (15 U.S.C. 41 et seq.) by the Federal 
        Trade Commission.
          (2) Broad state enforcement authority.--
                  (A) In general.--Subject to subparagraph (C), 
                an appropriate State supervisor of a depository 
                institution lacking Federal deposit insurance 
                may examine and enforce compliance with the 
                requirements of this section, and any 
                regulation prescribed under this section.
                  (B) State powers.--For purposes of bringing 
                any action to enforce compliance with this 
                section, no provision of this section shall be 
                construed as preventing an appropriate State 
                supervisor of a depository institution lacking 
                Federal deposit insurance from exercising any 
                powers conferred on such official by the laws 
                of such State.
                  (C) Limitation on state action while federal 
                action pending.--If the [Bureau] Agency or 
                Federal Trade Commission has instituted an 
                enforcement action for a violation of this 
                section, no appropriate State supervisory 
                agency may, during the pendency of such action, 
                bring an action under this section against any 
                defendant named in the complaint of the 
                [Bureau] Agency or Federal Trade Commission for 
                any violation of this section that is alleged 
                in that complaint.

           *       *       *       *       *       *       *


SEC. 51. INTERNATIONAL PROCESSES.

  (a) Notice of Process; Consultation.--At least 30 calendar 
days before the Board of Directors participates in a process of 
setting financial standards as a part of any foreign or 
multinational entity, the Board of Directors shall--
          (1) issue a notice of the process, including the 
        subject matter, scope, and goals of the process, to the 
        Committee on Financial Services of the House of 
        Representatives and the Committee on Banking, Housing, 
        and Urban Affairs of the Senate;
          (2) make such notice available to the public, 
        including on the website of the Corporation; and
          (3) solicit public comment, and consult with the 
        committees described under paragraph (1), with respect 
        to the subject matter, scope, and goals of the process.
  (b) Public Reports on Process.--After the end of any process 
described under subsection (a), the Board of Directors shall 
issue a public report on the topics that were discussed at the 
process and any new or revised rulemakings or policy changes 
that the Board of Directors believes should be implemented as a 
result of the process.
  (c) Notice of Agreements; Consultation.--At least 90 calendar 
days before the Board of Directors participates in a process of 
setting financial standards as a part of any foreign or 
multinational entity, the Board of Directors shall--
          (1) issue a notice of agreement to the Committee on 
        Financial Services of the House of Representatives and 
        the Committee on Banking, Housing, and Urban Affairs of 
        the Senate;
          (2) make such notice available to the public, 
        including on the website of the Corporation; and
          (3) consult with the committees described under 
        paragraph (1) with respect to the nature of the 
        agreement and any anticipated effects such agreement 
        will have on the economy.
  (d) Definition.--For purposes of this section, the term 
``process'' shall include any official proceeding or meeting on 
financial regulation of a recognized international organization 
with authority to set financial standards on a global or 
regional level, including the Financial Stability Board, the 
Basel Committee on Banking Supervision (or a similar 
organization), and the International Association of Insurance 
Supervisors (or a similar organization).
                              ----------                              


FEDERAL RESERVE ACT

           *       *       *       *       *       *       *



SEC. 2B. APPEARANCES BEFORE AND REPORTS TO THE CONGRESS.

  (a) Appearances Before the Congress.--
          (1) In general.--The Chairman of the Board shall 
        appear before the Congress at [semi-annual] quarterly 
        hearings, as specified in paragraph (2), regarding--
                  (A) the efforts, activities, objectives and 
                plans of the Board and the Federal Open Market 
                Committee with respect to the conduct of 
                monetary policy; and
                  (B) economic developments and prospects for 
                the future described in the report required in 
                subsection (b).
          (2) Schedule.--The Chairman of the Board shall 
        appear--
                  (A) before the Committee on Banking and 
                Financial Services of the House of 
                Representatives on or about February 20 and May 
                20 of even numbered calendar years and on or 
                about July 20 and October 20 of odd numbered 
                calendar years;
                  (B) before the Committee on Banking, Housing, 
                and Urban Affairs of the Senate on or about 
                July 20 and October 20 of even numbered 
                calendar years and on or about February 20 and 
                May 20 of odd numbered calendar years; and
                  (C) before either Committee referred to in 
                subparagraph (A) or (B), upon request, 
                following the scheduled appearance of the 
                Chairman before the other Committee under 
                subparagraph (A) or (B).
  (b) Congressional Report.--The Board shall, concurrent with 
each [semi-annual] quarterly hearing required by this section, 
submit a written report to the Committee on Banking, Housing, 
and Urban Affairs of the Senate and the Committee on Banking 
and Financial Services of the House of Representatives, 
containing a discussion of the conduct of monetary policy and 
economic developments and prospects for the future, taking into 
account past and prospective developments in employment, 
unemployment, production, investment, real income, 
productivity, exchange rates, international trade and payments, 
and prices.
  (c) Public Access to Information.--The Board shall place on 
its home Internet website, a link entitled ``Audit'', which 
shall link to a webpage that shall serve as a repository of 
information made available to the public for a reasonable 
period of time, not less than 6 months following the date of 
release of the relevant information, including--
          (1) the reports prepared by the Comptroller General 
        under section 714 of title 31, United States Code;
          (2) the annual financial statements prepared by an 
        independent auditor for the Board in accordance with 
        section 11B;
          (3) the reports to the Committee on Banking, Housing, 
        and Urban Affairs of the Senate required under section 
        13(3) (relating to emergency lending authority); and
          (4) such other information as the Board reasonably 
        believes is necessary or helpful to the public in 
        understanding the accounting, financial reporting, and 
        internal controls of the Board and the Federal reserve 
        banks.

SEC. 2C. DIRECTIVE POLICY RULES OF THE FEDERAL OPEN MARKET COMMITTEE.

  (a) Definitions.--In this section the following definitions 
shall apply:
          (1) Appropriate congressional committees.--The term 
        ``appropriate congressional committees'' means the 
        Committee on Financial Services of the House of 
        Representatives and the Committee on Banking, Housing, 
        and Urban Affairs of the Senate.
          (2) Directive policy rule.--The term ``Directive 
        Policy Rule'' means a policy rule developed by the 
        Federal Open Market Committee that meets the 
        requirements of subsection (c) and that provides the 
        basis for the Open Market Operations Directive.
          (3) GDP.--The term ``GDP'' means the gross domestic 
        product of the United States as computed and published 
        by the Department of Commerce.
          (4) Intermediate policy input.--The term 
        ``Intermediate Policy Input''--
                  (A) may include any variable determined by 
                the Federal Open Market Committee as a 
                necessary input to guide open-market 
                operations;
                  (B) shall include an estimate of, and the 
                method of calculation for, the current rate of 
                inflation or current inflation expectations; 
                and
                  (C) shall include, specifying whether the 
                variable or estimate is historical, current, or 
                a forecast and the method of calculation, at 
                least one of--
                          (i) an estimate of real GDP, nominal 
                        GDP, or potential GDP;
                          (ii) an estimate of the monetary 
                        aggregate compiled by the Board of 
                        Governors of the Federal Reserve System 
                        and Federal reserve banks; or
                          (iii) an interactive variable or a 
                        net estimate composed of the estimates 
                        described in clauses (i) and (ii).
          (5) Legislative day.--The term ``legislative day'' 
        means a day on which either House of Congress is in 
        session.
          (6) Open market operations directive.--The term 
        ``Open Market Operations Directive'' means an order to 
        achieve a specified Policy Instrument Target provided 
        to the Federal Reserve Bank of New York by the Federal 
        Open Market Committee pursuant to powers authorized 
        under section 14 of this Act that guide open-market 
        operations.
          (7) Policy instrument.--The term ``Policy 
        Instrument'' means--
                  (A) the nominal Federal funds rate;
                  (B) the nominal rate of interest paid on 
                nonborrowed reserves; or
                  (C) the discount window primary credit 
                interest rate most recently published on the 
                Federal Reserve Statistical Release on selected 
                interest rates (daily or weekly), commonly 
                referred to as the H.15 release.
          (8) Policy instrument target.--The term ``Policy 
        Instrument Target'' means the target for the Policy 
        Instrument specified in the Open Market Operations 
        Directive.
          (9) Reference policy rule.--The term ``Reference 
        Policy Rule'' means a calculation of the nominal 
        Federal funds rate as equal to the sum of the 
        following:
                  (A) The rate of inflation over the previous 
                four quarters.
                  (B) One-half of the percentage deviation of 
                the real GDP from an estimate of potential GDP.
                  (C) One-half of the difference between the 
                rate of inflation over the previous four 
                quarters and two percent.
                  (D) Two percent.
  (b) Submitting a Directive Policy Rule.--Not later than 48 
hours after the end of a meeting of the Federal Open Market 
Committee, the Chairman of the Federal Open Market Committee 
shall submit to the appropriate congressional committees and 
the Comptroller General of the United States a Directive Policy 
Rule and a statement that identifies the members of the Federal 
Open Market Committee who voted in favor of the Directive 
Policy Rule.
  (c) Requirements for a Directive Policy Rule.--A Directive 
Policy Rule shall--
          (1) identify the Policy Instrument the Directive 
        Policy Rule is designed to target;
          (2) describe the strategy or rule of the Federal Open 
        Market Committee for the systematic quantitative 
        adjustment of the Policy Instrument Target to respond 
        to a change in the Intermediate Policy Inputs;
          (3) include a function that comprehensively models 
        the interactive relationship between the Intermediate 
        Policy Inputs;
          (4) include the coefficients of the Directive Policy 
        Rule that generate the current Policy Instrument Target 
        and a range of predicted future values for the Policy 
        Instrument Target if changes occur in any Intermediate 
        Policy Input;
          (5) describe the procedure for adjusting the supply 
        of bank reserves to achieve the Policy Instrument 
        Target;
          (6) include a statement as to whether the Directive 
        Policy Rule substantially conforms to the Reference 
        Policy Rule and, if applicable--
                  (A) an explanation of the extent to which it 
                departs from the Reference Policy Rule;
                  (B) a detailed justification for that 
                departure; and
                  (C) a description of the circumstances under 
                which the Directive Policy Rule may be amended 
                in the future;
          (7) include a certification that the Directive Policy 
        Rule is expected to support the economy in achieving 
        stable prices and maximum natural employment over the 
        long term;
          (8) include a calculation that describes with 
        mathematical precision the expected annual inflation 
        rate over a 5-year period; and
          (9) include a plan to use the most accurate data, 
        subject to all historical revisions, for inputs into 
        the Directive Policy Rule and the Reference Policy 
        Rule.
  (d) GAO Report.--The Comptroller General of the United States 
shall compare the Directive Policy Rule submitted under 
subsection (b) with the rule that was most recently submitted 
to determine whether the Directive Policy Rule has materially 
changed. If the Directive Policy Rule has materially changed, 
the Comptroller General shall, not later than 7 days after each 
meeting of the Federal Open Market Committee, prepare and 
submit a compliance report to the appropriate congressional 
committees specifying whether the Directive Policy Rule 
submitted after that meeting and the Federal Open Market 
Committee are in compliance with this section.
  (e) Changing Market Conditions.--
          (1) Rule of construction.--Nothing in this Act shall 
        be construed to require that the plans with respect to 
        the systematic quantitative adjustment of the Policy 
        Instrument Target described under subsection (c)(2) be 
        implemented if the Federal Open Market Committee 
        determines that such plans cannot or should not be 
        achieved due to changing market conditions.
          (2) GAO approval of update.--Upon determining that 
        plans described in paragraph (1) cannot or should not 
        be achieved, the Federal Open Market Committee shall 
        submit an explanation for that determination and an 
        updated version of the Directive Policy Rule to the 
        Comptroller General of the United States and the 
        appropriate congressional committees not later than 48 
        hours after making the determination. The Comptroller 
        General shall, not later than 48 hours after receiving 
        such updated version, prepare and submit to the 
        appropriate congressional committees a compliance 
        report determining whether such updated version and the 
        Federal Open Market Committee are in compliance with 
        this section.
  (f) Directive Policy Rule and Federal Open Market Committee 
Not in Compliance.--
          (1) In general.--If the Comptroller General of the 
        United States determines that the Directive Policy Rule 
        and the Federal Open Market Committee are not in 
        compliance with this section in the report submitted 
        pursuant to subsection (d), or that the updated version 
        of the Directive Policy Rule and the Federal Open 
        Market Committee are not in compliance with this 
        section in the report submitted pursuant to subsection 
        (e)(2), the Chairman of the Board of Governors of the 
        Federal Reserve System shall, if requested by the 
        chairman of either of the appropriate congressional 
        committees, not later than 7 legislative days after 
        such request, testify before such committee as to why 
        the Directive Policy Rule, the updated version, or the 
        Federal Open Market Committee is not in compliance.
          (2) GAO audit.--Notwithstanding subsection (b) of 
        section 714 of title 31, United States Code, upon 
        submitting a report of noncompliance pursuant to 
        subsection (d) or subsection (e)(2) and after the 
        period of 7 legislative days described in paragraph 
        (1), the Comptroller General shall audit the conduct of 
        monetary policy by the Board of Governors of the 
        Federal Reserve System and the Federal Open Market 
        Committee upon request of the appropriate congressional 
        committee. Such committee may specify the parameters of 
        such audit.
  (g) Congressional Hearings.--The Chairman of the Board of 
Governors of the Federal Reserve System shall, if requested by 
the chairman of either of the appropriate congressional 
committees and not later than 7 legislative days after such 
request, appear before such committee to explain any change to 
the Directive Policy Rule.

           *       *       *       *       *       *       *


                        state banks as members.

  Sec. 9. Any bank incorporated by special law of any State, 
operating under the Code of Law for the District of Columbia, 
or organized under the general laws of any State or of the 
United States, including Morris Plan banks and other 
incorporated banking institutions engaged in similar business, 
desiring to become a member of the Federal Reserve System, may 
make application to the Board of Governors of the Federal 
Reserve System, under such rules and regulations as it may 
prescribe, for the right to subscribe to the stock of the 
Federal reserve bank organized within the district in which the 
applying bank is located. Such application shall be for the 
same amount of stock that the applying bank would be required 
to subscribe to as a national bank. For the purposes of 
membership of any such bank the terms ``capital'' and ``capital 
stock'' shall include the amount of outstanding capital notes 
and debentures legally issued by the applying bank and 
purchased by the Reconstruction Finance Corporation. The Board 
of Governors of the Federal Reserve System, subject to the 
provisions of this Act and to such conditions as it may 
prescribe pursuant thereto may permit the applying bank to 
become a stockholder of such Federal reserve bank.
   Upon the conversion of a national bank into a State bank, or 
the merger or consolidation of a national bank with a State 
bank which is not a member of the Federal Reserve System, the 
resulting or continuing State bank may be admitted to 
membership in the Federal Reserve System by the Board of 
Governors of the Federal Reserve System in accordance with the 
provisions of this section, but, otherwise, the Federal Reserve 
bank stock owned by the national bank shall be canceled and 
paid for as provided in section 5 of this Act. Upon the merger 
or consolidation of a national bank with a State member bank 
under a State charter, the membership of the State bank in the 
Federal Reserve System shall continue.
   Any such State bank which, at the date of the approval of 
this Act, has established and is operating a branch or branches 
in conformity with the State law, may retain and operate the 
same while remaining or upon becoming a stockholder of such 
Federal reserve bank; but no such State bank may retain or 
acquire stock in a Federal reserve bank except upon 
relinquishment of any branch or branches established after the 
date of the approval of this Act beyond the limits of the city, 
town, or village in which the parent bank is situated. 
Provided, however, That nothing herein contained shall prevent 
any State member bank from establishing and operating branches 
in the United States or any dependency or insular possession 
thereof or in any foreign country, on the same terms and 
conditions and subject to the same limitations and restrictions 
as are applicable to the establishment of branches by national 
banks except that the approval of the Board of Governors of the 
Federal Reserve System, instead of the Comptroller of the 
Currency, shall be obtained before any State member bank may 
hereafter establish any branch and before any State bank 
hereafter admitted to membership may retain any branch 
established after February 25, 1927, beyond the limits of the 
city, town, or village in which the parent bank is situated. 
The approval of the Board shall likewise be obtained before any 
State member bank may establish any new branch within the 
limits of any such city, town, or village.
   In acting upon such applications the Board of Governors of 
the Federal Reserve System shall consider the financial 
condition of the applying bank, the general character of its 
management, and whether or not the corporate powers exercised 
are consistent with the purposes of this Act.
   Whenever the Board of Governors of the Federal Reserve 
System shall permit the applying bank to become a stockholder 
in the Federal reserve bank of the district its stock 
subscription shall be payable on call of the Board of Governors 
of the Federal Reserve System, and stock issued to it shall be 
held subject to the provisions of this Act.
   All banks admitted to membership under authority of this 
section shall be required to comply with the reserve and 
capital requirements of this Act, to conform to those 
provisions of law imposed on national banks which prohibit such 
banks from lending on or purchasing their own stock and which 
relate to the withdrawal or impairment of their capital stock, 
and to conform to the provisions of sections 5199(b) and 5204 
of the Revised Statutes with respect to the payment of 
dividends; except that any reference in any such provision to 
the Comptroller of the Currency shall be deemed for the 
purposes of this sentence to be a reference to the Board of 
Governors of the Federal Reserve System. Such banks and the 
officers, agents, and employees thereof shall also be subject 
to the provisions of and to the penalties prescribed by 
sections 334, 656, and 1005 of Title 18, United States Code, 
and shall be required to make reports of condition and of the 
payment of dividends to the Federal Reserve bank of which they 
become a member. Not less than three of such reports shall be 
made annually on call of the Federal Reserve bank on dates to 
be fixed by the Board of Governors of the Federal Reserve 
System. Any bank which (A) maintains procedures reasonably 
adapted to avoid any inadvertent error and, unintentionally and 
as a result of such an error, fails to make or publish any 
report required under this paragraph, within the period of time 
specified by the Board, or submits or publishes any false or 
misleading report or information, or (B) inadvertently 
transmits or publishes any report which is minimally late, 
shall be subject to a penalty of not more than $2,000 for each 
day during which such failure continues or such false or 
misleading information is not corrected. The bank shall have 
the burden of proving that an error was inadvertent and that a 
report was inadvertently transmitted or published late. Any 
bank which fails to make or publish such reports within the 
period of time specified by the Board, or submits or publishes 
any false or misleading report or information, in a manner not 
described in the 2nd preceding sentence shall be subject to a 
penalty of not more than $20,000 for each day during which such 
failure continues or such false or misleading information is 
not corrected. Notwithstanding the preceding sentence, if any 
bank knowingly or with reckless disregard for the accuracy of 
any information or report described in such sentence submits or 
publishes any false or misleading report or information, the 
Board may assess a penalty of not more than [$1,000,000] 
$1,500,000 or 1 percent of total assets of such bank, whichever 
is less, per day for each day during which such failure 
continues or such false or misleading information is not 
corrected. Any penalty imposed under any of the 4 preceding 
sentences shall be assessed and collected by the Board in the 
manner provided in subparagraphs (E), (F), (G), and (I) of 
section 8(i)(2) of the Federal Deposit Insurance Act (for 
penalties imposed under such section) and any such assessment 
(including the determination of the amount of the penalty) 
shall be subject to the provisions of such section. Any bank 
against which any penalty is assessed under this subsection 
shall be afforded an agency hearing if such bank submits a 
request for such hearing within 20 days after the issuance of 
the notice of assessment. Section 8(h) of the Federal Deposit 
Insurance Act shall apply to any proceeding under this 
paragraph. Such reports of condition shall be in such form and 
shall contain such information as the Board of Governors of the 
Federal Reserve System may require.
   As a condition of membership such banks shall likewise be 
subject to examinations made by direction of the Board of 
Governors of the Federal Reserve System or of the Federal 
reserve bank by examiners selected or approved by the Board of 
Governors of the Federal Reserve System.
   Whenever the directors of the Federal reserve bank shall 
approve the examinations made by the State authorities, such 
examinations and the reports thereof may be accepted in lieu of 
examinations made by examiners selected or approved by the 
Board of Governors of the Federal Reserve System: Provided, 
however, That when it deems it necessary the board may order 
special examinations by examiners of its own selection and 
shall in all cases approve the form of the report. The expenses 
of all examinations, other than those made by State 
authorities, may, in the discretion of the Board of Governors 
of the Federal Reserve System, be assessed against the banks 
examined and, when so assessed, shall be paid by the banks 
examined. The Board of Governors of the Federal Reserve System, 
at its discretion, may furnish any report of examination or 
other confidential supervisory information concerning any State 
member bank or other entity examined under any other authority 
of the Board, to any Federal or State agency or authority with 
supervisory or regulatory authority over the examined entity, 
to any officer, director, or receiver of the examined entity, 
and to any other person that the Board determines to be proper.
   If at any time it shall appear to the Board of Governors of 
the Federal Reserve System that a member bank has failed to 
comply with the provisions of this section or the regulations 
of the Board of Governors of the Federal Reserve System made 
pursuant thereto, or has ceased to exercise banking functions 
without a receiver or liquidating agent having been appointed 
therefor, it shall be within the power of the board after 
hearing to require such bank to surrender its stock in the 
Federal reserve bank and to forfeit all rights and privileges 
of membership. The Board of Governors of the Federal Reserve 
System may restore membership upon due proof of compliance with 
the conditions imposed by this section.
   Any State bank or trust company desiring to withdraw from 
membership in a Federal reserve bank may do so, after six 
months' written notice shall have been filed with the Board of 
Governors of the Federal Reserve System, upon the surrender and 
cancellation of all of its holdings of capital stock in the 
Federal reserve bank: Provided, That the Board of Governors of 
the Federal Reserve System, in its discretion and subject to 
such conditions as it may prescribe, may waive such six months' 
notice in individual cases and may permit any such State bank 
or trust company to withdraw from membership in a Federal 
reserve bank prior to the expiration of six months from the 
date of the written notice of its intention to withdraw: 
Provided, however, That no Federal reserve bank shall, except 
under express authority of the Board of Governors of the 
Federal Reserve System, cancel within the same calendar year 
more than twenty-five per centum of its capital stock for the 
purpose of effecting voluntary withdrawals during that year. 
All such applications shall be dealt with in the order in which 
they are filed with the board. Whenever a member bank shall 
surrender its stock holdings in a Federal reserve bank, or 
shall be ordered to do so by the Board of Governors of the 
Federal Reserve System, under authority of law, all of its 
rights and privileges as a member bank shall thereupon cease 
and determine, and after due provision has been made for any 
indebtedness due or to become due to the Federal reserve bank 
it shall be entitled to a refund of its cash paid subscription 
with interest at the rate of one-half of one per centum per 
month from date of last dividend, if earned, the amount 
refunded in no event to exceed the book value of the stock at 
that time, and shall likewise be entitled to repayment of 
deposits and of any other balance due from the Federal reserve 
bank.
   No applying bank shall be admitted to membership unless it 
possesses capital stock and surplus which, in the judgment of 
the Board of Governors of the Federal Reserve System, are 
adequate in relation to the character and condition of its 
assets and to its existing and prospective deposit liabilities 
and other corporate responsibilities: Provided, That no bank 
engaged in the business of receiving deposits other than trust 
funds, which does not possess capital stock and surplus in an 
amount equal to that which would be required for the 
establishment of a national banking association in the place in 
which it is located, shall be admitted to membership unless it 
is, or has been, approved for deposit insurance under the 
Federal Deposit Insurance Act. The capital stock of a State 
member bank shall not be reduced except with the prior consent 
of the Board.
   In order to facilitate the admission to membership in the 
Federal Reserve System of any State bank which is required 
under subsection (y) of section 12B of this Act to become a 
member of the Federal Reserve System in order to be an insured 
bank or continue to have any part of its deposits insured under 
such section 12B, the Board of Governors of the Federal Reserve 
System may waive in whole or in part the requirements of this 
section relating to the admission of such bank to membership: 
Provided, That, if such bank is admitted with a capital less 
than that required for the organization of a national bank in 
the same place and its capital and surplus are not, in the 
judgment of the Board of Governors of the Federal Reserve 
System, adequate in relation to its liabilities to depositors 
and other creditors, the said Board may, in its discretion, 
require such bank to increase its capital and surplus to such 
amount as the Board may deem necessary within such period 
prescribed by the Board as in its judgment shall be reasonable 
in view of all the circumstances: Provided, however, That no 
such bank shall be required to increase its capital to an 
amount in excess of that required for the organization of a 
national bank in the same place. (Omitted from U.S. Code.)
   Banks becoming members of the Federal Reserve System under 
authority of this section shall be subject to the provisions of 
this section and to those of this Act which relate specifically 
to member banks, but shall not be subject to examination under 
the provisions of the first two paragraphs of section fifty-two 
hundred and forty of the Revised Statutes as amended by section 
twenty-one of this Act. Subject to the provisions of this Act 
and to the regulations of the board made pursuant thereto, any 
bank becoming a member of the Federal Reserve System shall 
retain its full charter and statutory rights as a State bank or 
trust company, and may continue to exercise all corporate 
powers granted it by the State in which it was created, and 
shall be entitled to all privileges of member banks, except 
that the Board of Governors of the Federal Reserve System may 
limit the activities of State member banks and subsidiaries of 
State member banks in a manner consistent with section 24 of 
the Federal Deposit Insurance Act. No Federal reserve bank 
shall be permitted to discount for any State bank or trust 
company notes, drafts, or bills of exchange of any one borrower 
who is liable for borrowed money to such State bank or trust 
company in an amount greater than that which could be borrowed 
lawfully from such State bank or trust company were it a 
national banking association. The Federal reserve bank, as a 
condition of the discount of notes, drafts, and bills of 
exchange for such State bank or trust company, shall require a 
certificate or guaranty to the effect that the borrower is not 
liable to such bank in excess of the amount provided by this 
section, and will not be permitted to become liable in excess 
of this amount while such notes, drafts, or bills of exchange 
are under discount with the Federal reserve bank.
   It shall be unlawful for any officer, clerk, or agent of any 
bank admitted to membership under authority of this section to 
certify any check drawn upon such bank unless the person or 
company drawing the check has on deposit therewith at the time 
such check is certified an amount of money equal to the amount 
specified in such check. Any check so certified by duly 
authorized officers shall be a good and valid obligation 
against such bank, but the act of any such officer, clerk, or 
agent in violation of this section may subject such bank to a 
forfeiture of its membership in the Federal Reserve System upon 
hearing by the Board of Governors of the Federal Reserve 
System.
   All banks or trust companies incorporated by special law or 
organized under the general laws of any State, which are 
members of the Federal reserve system, when designated for that 
purpose by the Secretary of the Treasury, shall be depositaries 
of public money, under such regulations as may be prescribed by 
the Secretary; and they may also be employed as financial 
agents of the Government; and they shall perform all such 
reasonable duties, as depositaries of public money and 
financial agents of the Government, as may be required of them. 
The Secretary of the Treasury shall require of the banks and 
trust companies thus designated satisfactory security, by the 
deposit of United States bonds or otherwise, for the safe 
keeping and prompt payment of the public money deposited with 
them and for the faithful performance of their duties as 
financial agents of the Government.
   Any mutual savings bank having no capital stock (including 
any other banking institution the capital of which consists of 
weekly or other time deposits which are segregated from all 
other deposits and are regarded as capital stock for the 
purposes of taxation and the declaration of dividends), but 
having surplus and undivided profits not less than the amount 
of capital required for the organization of a national bank in 
the same place, may apply for and be admitted to membership in 
the Federal Reserve System in the same manner and subject to 
the same provisions of law as State banks and trust companies, 
except that any such savings banks shall subscribe for capital 
stock of the Federal reserve bank in an amount equal to six-
tenths of 1 per centum of its total deposit liabilities as 
shown by the most recent report of examination of such savings 
bank preceding its admission to membership. Thereafter such 
subscription shall be adjusted semiannually on the same 
percentage basis in accordance with rules and regulations 
prescribed by the Board of Governors of the Federal Reserve 
System. If any such mutual savings bank applying for membership 
is not permitted by the laws under which it was organized to 
purchase stock in a Federal reserve bank, it shall, upon 
admission to the system, deposit with the Federal reserve bank 
an amount equal to the amount which it would have been required 
to pay in on account of a subscription to capital stock. 
Thereafter such deposit shall be adjusted semiannually in the 
same manner as subscriptions for stock. Such deposits shall be 
subject to the same conditions with respect to repayment as 
amounts paid upon subscriptions to capital stock by other 
member banks and the Federal reserve bank shall pay interest 
thereon at the same rate as dividends are actually paid on 
outstanding shares of stock of such Federal reserve bank. If 
the laws under which any such savings bank was organized be 
amended so as to authorize mutual savings banks to subscribe 
for Federal reserve bank stock, such savings bank shall 
thereupon subscribe for the appropriate amount of stock in the 
Federal reserve bank, and the deposit hereinbefore provided for 
in lieu of payment upon capital stock shall be applied upon 
such subscription. If the laws under which any such savings 
bank was organized be not amended at the next session of the 
legislature following the admission of such savings bank to 
membership so as to authorize mutual savings banks to purchase 
Federal reserve bank stock, or if such laws be so amended and 
such bank fail within six months thereafter to purchase such 
stock, all of its rights and privileges as a member bank shall 
be forfeited and its membership in the Federal Reserve System 
shall be terminated in the manner prescribed elsewhere in this 
section with respect to State member banks and trust companies. 
Each such mutual savings bank shall comply with all the 
provisions of law applicable to State member banks and trust 
companies, with the regulations of the Board of Governors of 
the Federal Reserve System and with the conditions of 
membership prescribed for such savings bank at the time of 
admission to membership, except as otherwise hereinbefore 
provided with respect to capital stock.
   Each bank admitted to membership under this section shall 
obtain from each of its affiliates other than member banks and 
furnish to the Federal reserve bank of its district and to the 
Board of Governors of the Federal Reserve System not less than 
three reports during each year. Such reports shall be in such 
form as the Board of Governors of the Federal Reserve System 
may prescribe, shall be verified by the oath or affirmation of 
the president or such other officer as may be designated by the 
board of directors of such affiliate to verify such reports, 
and shall disclose the information hereinafter provided for as 
of dates identical with those fixed by the Board of Governors 
of the Federal Reserve System for reports of the condition of 
the affiliated member bank. Each such report of an affiliate 
shall be transmitted as herein provided at the same time as the 
corresponding report of the affiliated member bank, except that 
the Board of Governors of the Federal Reserve System may, in 
its discretion, extend such time for good cause shown. Each 
such report shall contain such information as in the judgment 
of the Board of Governors of the Federal Reserve System shall 
be necessary to disclose fully the relations between such 
affiliate and such bank and to enable the Board to inform 
itself as to the effect of such relations upon the affairs of 
such bank. The reports of such affiliates shall be published by 
the bank under the same conditions as govern its own condition 
reports.
   Any such affiliated member bank may be required to obtain 
from any such affiliate such additional reports as in the 
opinion of its Federal reserve bank or the Board of Governors 
of the Federal Reserve System may be necessary in order to 
obtain a full and complete knowledge of the condition of the 
affiliated member bank. Such additional reports shall be 
transmitted to the Federal reserve bank and the Board of 
Governors of the Federal Reserve System and shall be in such 
form as the Board of Governors of the Federal Reserve System 
may prescribe.
   Any such affiliated member bank which fails to obtain from 
any of its affiliates and furnish any report provided for by 
the two preceding paragraphs of this section shall be subject 
to a penalty of $100 for each day during which such failure 
continues, which, by direction of the Board of Governors of the 
Federal Reserve System, may be collected, by suit or otherwise, 
by the Federal reserve bank of the district in which such 
member bank is located.
   State member banks shall be subject to the same limitations 
and conditions with respect to the purchasing, selling, 
underwriting, and holding of investment securities and stock as 
are applicable in the case of national banks under paragraph 
``Seventh'' of section 5136 of the Revised Statutes, as 
amended. This paragraph shall not apply to any interest held by 
a State member bank in accordance with section 5136A of the 
Revised Statutes of the United States and subject to the same 
conditions and limitations provided in such section.
   After the date of the enactment of the Banking Act of 1935, 
no certificate evidencing the stock of any State member bank 
shall bear any statement purporting to represent the stock of 
any other corporation, except a member bank or a corporation 
engaged on June 16, 1934 in holding the bank premises of such 
member bank, nor shall the ownership, sale, or transfer of any 
certificate representing the stock of any State member bank be 
conditioned in any manner whatsoever upon the ownership, sale, 
or transfer of a certificate representing the stock of any 
other corporation, except a member bank or a corporation 
engaged on June 16, 1934 in holding the bank premises of such 
member bank: Provided, That this section shall not operate to 
prevent the ownership, sale, or transfer of stock of any other 
corporation being conditioned upon the ownership, sale, or 
transfer of a certificate representing stock of a State member 
bank.
   In connection with examinations of State member banks, 
examiners selected or approved by the Board of Governors of the 
Federal Reserve System shall make such examinations of the 
affairs of all affiliates of such banks as shall be necessary 
to disclose fully the relations between such banks and their 
affiliates and the effect of such relations upon the affairs of 
such banks. The expense of examination of affiliates of any 
State member bank may, in the discretion of the Board of 
Governors of the Federal Reserve System, be assessed against 
such bank and, when so assessed, shall be paid by such bank. In 
the event of the refusal to give any information requested in 
the course of the examination of any such affiliate, or in the 
event of the refusal to permit such examination, or in the 
event of the refusal to pay any expense so assessed, the Board 
of Governors of the Federal Reserve System may, in its 
discretion, require any or all State member banks affiliated 
with such affiliate to surrender their stock in the Federal 
reserve bank and to forfeit all rights and privileges of 
membership in the Federal Reserve System, as provided in this 
section.
          (23) A State member bank may make investments 
        directly or indirectly, each of which is designed 
        primarily to promote the public welfare, including the 
        welfare of primarily low- and moderate-income 
        communities or families (such as by providing housing, 
        services, or jobs), to the extent permissible under 
        State law. A State member bank shall not make any such 
        investment if the investment would expose the State 
        member bank to unlimited liability. The Board shall 
        limit a State member bank's investment in any 1 project 
        and a State member bank's aggregate investments under 
        this paragraph. The aggregate amount of investments of 
        any State member bank under this paragraph may not 
        exceed an amount equal to the sum of 5 percent of the 
        State member bank's capital stock actually paid in and 
        unimpaired and 5 percent of the State member bank's 
        unimpaired surplus, unless the Board determines, by 
        order, that a higher amount will pose no significant 
        risk to the Deposit Insurance Fund; and the State 
        member bank is adequately capitalized. In no case shall 
        the aggregate amount of investments of any State member 
        bank under this paragraph exceed an amount equal to the 
        sum of 15 percent of the State member bank's capital 
        stock actually paid in and unimpaired and 15 percent of 
        the State member bank's unimpaired surplus. The 
        foregoing standards and limitations apply to 
        investments under this paragraph made by a State member 
        bank directly and by its subsidiaries.

            board of governors of the federal reserve system

  Sec. 10. The Board of Governors of the Federal Reserve System 
(hereinafter referred to as the ``Board'') shall be composed of 
seven members, to be appointed by the President, by and with 
the advice and consent of the Senate, after the date of 
enactment of the Banking Act of 1935, for terms of fourteen 
years except as hereinafter provided, but each appointive 
member of the Federal Reserve Board in office on such date 
shall continue to serve as a member of the Board until February 
1, 1936, and the Secretary of the Treasury and the Comptroller 
of the Currency shall continue to serve as members of the Board 
until February 1, 1936. In selecting the members of the Board, 
not more than one of whom shall be selected from any one 
Federal Reserve district, the President shall have due regard 
to a fair representation of the financial, agricultural, 
industrial, and commercial interests, and geographical 
divisions of the country. In selecting members of the Board, 
the President shall appoint at least 1 member with demonstrated 
primary experience working in or supervising community banks 
having less than $10,000,000,000 in total assets. The members 
of the Board shall devote their entire time to the business of 
the Board and shall each receive and annual salary of $15,000, 
payable monthly, together with actual necessary traveling 
expenses.
   The members of the Board shall be ineligible during the time 
they are in office and for two years thereafter to hold any 
office, position, or employment in any member bank, except that 
this restriction shall not apply to a member who has served the 
full term for which he was appointed. Upon the expiration of 
the term of any appointive member of the Federal Reserve Board 
in office on the date of enactment of the Banking Act of 1935, 
the President shall fix the term of the successor to such 
member at not to exceed fourteen years, as designated by the 
President at the time of nomination, but in such manner as to 
provide for the expiration of the term of not more than one 
member in any two-year period, and thereafter each member shall 
hold office for a term of fourteen years from the expiration of 
the term of his predecessor, unless sooner removed for cause by 
the President. Of the persons thus appointed, 1 shall be 
designated by the President, by and with the advice and consent 
of the Senate, to serve as Chairman of the Board for a term of 
4 years, and 2 shall be designated by the President, by and 
with the advice and consent of the Senate, to serve as Vice 
Chairmen of the Board, each for a term of 4 years, 1 of whom 
shall serve in the absence of the Chairman, as provided in the 
fourth undesignated paragraph of this section, and 1 of whom 
shall be designated Vice Chairman for Supervision. The Vice 
Chairman for Supervision shall develop policy recommendations 
for the Board regarding supervision and regulation of 
depository institution holding companies and other financial 
firms supervised by the Board, and shall oversee the 
supervision and regulation of such firms. The chairman of the 
Board, subject to its supervision, shall be its active 
executive officer. Each member of the Board shall within 
fifteen days after notice of appointment make and subscribe to 
the oath of office. Upon the expiration of their terms of 
office, members of the Board shall continue to serve until 
their successors are appointed and have qualified. Any person 
appointed as a member of the Board after the date of enactment 
of the Banking Act of 1935 shall not be eligible for 
reappointment as such member after he shall have served a full 
term of fourteen years.
   The Board of Governors of the Federal Reserve System shall 
have power to levy semiannually upon the Federal reserve banks, 
in proportion to their capital stock and surplus, an assessment 
sufficient to pay its estimated expenses and the salaries of 
its members and employees for the half year succeeding the 
levying of such assessment, together with any deficit carried 
forward from the preceding half year, and such assessments may 
include amounts sufficient to provide for the acquisition by 
the Board in its own name of such site or building in the 
District of Columbia as in its judgment alone shall be 
necessary for the purpose of providing suitable and adequate 
quarters for the performance of its functions. After September 
1, 2000, the Board may also use such assessments to acquire, in 
its own name, a site or building (in addition to the facilities 
existing on such date) to provide for the performance of the 
functions of the Board. After approving such plans, estimates, 
and specifications as it shall have caused to be prepared, the 
Board may, notwithstanding any other provision of law, cause to 
be constructed on any site so acquired by it a building or 
buildings suitable and adequate in its judgment for its 
purposes and proceed to take all such steps as it may deem 
necessary or appropriate in connection with the construction, 
equipment, and furnishing of such building or buildings. The 
Board may maintain, enlarge, or remodel any building or 
buildings so acquired or constructed and shall have sole 
control of such building or buildings and space therein.
   The principal offices of the Board shall be in the District 
of Columbia. At meetings of the Board the chairman shall 
preside, and, in his absence, the vice chairman shall preside. 
In the absence of the chairman and the vice chairman, the Board 
shall elect a member to act as chairman pro tempore. The Board 
shall determine and prescribe the manner in which its 
obligations shall be incurred and its disbursements and 
expenses allowed and paid, and may leave on deposit in the 
Federal Reserve banks the proceeds of assessments levied upon 
them to defray its estimated expenses and the salaries of its 
members and employees, whose employment, compensation, leave, 
and expenses shall be governed solely by the provisions of this 
Act, specific amendments thereof, and rules and regulations of 
the Board not inconsistent therewith; and funds derived from 
such assessments shall not be construed to be Government funds 
or appropriated moneys. No member of the Board of Governors of 
the Federal Reserve System shall be an officer or director of 
any bank, banking institution, trust company, or Federal 
Reserve bank or hold stock in any bank, banking institution, or 
trust company; and before entering upon his duties as a member 
of the Board of Governors of the Federal Reserve System he 
shall certify under oath that he has complied with this 
requirement, and such certification shall be filed with the 
secretary of the Board. Whenever a vacancy shall occur, other 
than by expiration of term, among the six members of the Board 
of Governors of the Federal Reserve System appointed by the 
President as above provided, a successor shall be appointed by 
the President, by and with the advice and consent of the 
Senate, to fill such vacancy, and when appointed he shall hold 
office for the unexpired term of his predecessor.
   The President shall have power to fill all vacancies that 
may happen on the Board of Governors of the Federal Reserve 
System during the recess of the Senate by granting commissions 
which shall expire with the next session of the Senate.
   Nothing in this Act contained shall be construed as taking 
away any powers heretofore vested by law in the Secretary of 
the Treasury which relate to the supervision, management, and 
control of the Treasury Department and bureaus under such 
department, and wherever any power vested by this Act in the 
Board of Governors of the Federal Reserve System or the Federal 
reserve agent appears to conflict with the powers of the 
Secretary of the Treasury, such powers shall be exercised 
subject to the supervision and control of the Secretary.
   The Board of Governors of the Federal Reserve System shall 
annually make a full report of its operations to the Speaker of 
the House of Representatives, who shall cause the same to be 
printed for the information of the Congress. The report 
required under this paragraph shall include the reports 
required under section 707 of the Equal Credit Opportunity Act, 
section 18(f)(7) of the Federal Trade Commission Act, section 
114 of the Truth in Lending Act, and the tenth undesignated 
paragraph of this section.
   No Federal Reserve bank may authorize the acquisition or 
construction of any branch building, or enter into any contract 
or other obligation for the acquisition or construction of any 
branch building, without the approval of the Board.
   The Board of Governors of the Federal Reserve System shall 
keep a complete record of the action taken by the Board and by 
the Federal Open Market Committee upon all questions of policy 
relating to open-market operations and shall record therein the 
votes taken in connection with the determination of open-market 
policies and the reasons underlying the action of the Board and 
the Committee in each instance. The Board shall keep a similar 
record with respect to all questions of policy determined by 
the Board, and shall include in its annual report to the 
Congress a full account of the action so taken during the 
preceding year with respect to open-market policies and 
operations and with respect to the policies determined by it 
and shall include in such report a copy of the records required 
to be kept under the provisions of this paragraph.
          [(12)] (11) Appearances before congress.--The Vice 
        Chairman for Supervision shall appear before the 
        Committee on Banking, Housing, and Urban Affairs of the 
        Senate and the Committee on Financial Services of the 
        House of Representatives and at [semi-annual] quarterly 
        hearings regarding the efforts, activities, objectives, 
        and plans of the Board with respect to the conduct of 
        supervision and regulation of depository institution 
        holding companies and other financial firms supervised 
        by the Board. In each such appearance, the Vice 
        Chairman for Supervision shall provide written 
        testimony that includes the status of all pending and 
        anticipated rulemakings that are being made by the 
        Board of Governors of the Federal Reserve System. If, 
        at the time of any appearance described in this 
        paragraph, the position of Vice Chairman for 
        Supervision is vacant, the Vice Chairman for the Board 
        of Governors of the Federal Reserve System (who has the 
        responsibility to serve in the absence of the Chairman) 
        shall appear instead and provide the required written 
        testimony. If, at the time of any appearance described 
        in this paragraph, both Vice Chairman positions are 
        vacant, the Chairman of the Board of Governors of the 
        Federal Reserve System shall appear instead and provide 
        the required written testimony.

           *       *       *       *       *       *       *

  Sec.  11. The Board of Governors of the Federal Reserve 
System shall be authorized and empowered:
  (a)(1) To examine at its discretion the accounts, books and 
affairs of each Federal reserve bank and of each member bank 
and to require such statements and reports as it may deem 
necessary. The said board shall publish once each week a 
statement showing the condition of each Federal reserve bank 
and a consolidated statement for all Federal reserve banks. 
Such statements shall show in detail the assets and liabilities 
of the Federal reserve banks, single and combined, and shall 
furnish full information regarding the character of the money 
held as reserve and the amount, nature and maturities of the 
paper and other investments owned or held by Federal reserve 
banks.
  (2) To require any depository institution specified in this 
paragraph to make, at such intervals as the Board may 
prescribe, such reports of its liabilities and assets as the 
Board may determine to be necessary or desirable to enable the 
Board to discharge its responsibility to monitor and control 
monetary and credit aggregates. Such reports shall be made (A) 
directly to the Board in the case of member banks and in the 
case of other depository institutions whose reserve 
requirements under section 19 of this Act exceed zero, and (B) 
for all other reports to the Board through the (i) Federal 
Deposit Insurance Corporation in the case of insured State 
savings associations that are insured depository institutions 
(as defined in section 3 of the Federal Deposit Insurance Act), 
State nonmember banks, savings banks, and mutual savings banks, 
(ii) National Credit Union Administration Board in the case of 
insured credit unions, (iii) the Comptroller of the Currency in 
the case of any Federal savings association which is an insured 
depository institution (as defined in section 3 of the Federal 
Deposit Insurance Act) or which is a member as defined in 
section 2 of the Federal Home Loan Bank Act, and (iv) such 
State officer or agency as the Board may designate in the case 
of any other type of bank, savings association, or credit 
union. The Board shall endeavor to avoid the imposition of 
unnecessary burdens on reporting institutions and the 
duplication of other reporting requirements. Except as 
otherwise required by law, any data provided to any department, 
agency, or instrumentality of the United States pursuant to 
other reporting requirements shall be made available to the 
Board. The Board may classify depository institutions for the 
purposes of this paragraph and may impose different 
requirements on each such class.
  (b) To permit, or, on the affirmative vote of at least five 
members of the Board of Governors of the Federal Reserve System 
to require Federal reserve banks to rediscount the discounted 
paper of other Federal reserve banks at rates of interest to be 
fixed by the Board of Governors of the Federal Reserve System.
  (c) To suspend for a period not exceeding thirty days, and 
from time to time to renew such suspension for periods not 
exceeding fifteen days, any reserve requirements specified in 
this Act.
  (d) To supervise and regulate through the Secretary of the 
Treasury the issue and retirement of Federal reserve notes, 
except for the cancellation and destruction, and accounting 
with respect to such cancellation and destruction, of notes 
unfit for circulation, and to prescribe rules and regulations 
under which such notes may be delivered by the Secretary of the 
Treasury to the Federal reserve agents applying therefor.
  (e) To add to the number of cities classified as Reserve 
cities under existing law in which national banking 
associations are subject to the Reserve requirements set forth 
in section twenty of this Act; or to reclassify existing 
Reserve cities or to terminate their designation as such.
  (f) To suspend or remove any officer or director of any 
Federal reserve bank, the cause of such removal to be forthwith 
communicated in writing by the Board of Governors of the 
Federal Reserve System to the removed officer or director and 
to said bank.
  (g) To require the writing off of doubtful or worthless 
assets upon the books and balance sheets of Federal reserve 
banks.
  (h) To suspend, for the violation of any of the provisions of 
this Act, the operations of any Federal reserve bank, to take 
possession thereof, administer the same during the period of 
suspension, and, when deemed advisable, to liquidate or 
reorganize such bank.
  (i) To require bonds of Federal reserve agents, to make 
regulations for the safeguarding of all collateral, bonds, 
Federal reserve notes, money or property of any kind deposited 
in the hands of such agents, and said board shall perform the 
duties, functions, or services specified in this Act, and make 
all rules and regulations necessary to enable said board 
effectively to perform the same.
  (j) To exercise general supervision over said Federal reserve 
banks.
  (k) To delegate, by published order or rule and subject to 
the Administrative Procedure Act, any of its functions, other 
than those relating to rulemaking or pertaining principally to 
monetary and credit policies, to one or more administrative law 
judges, members or employees of the Board, or Federal Reserve 
banks. The assignment of responsibility for the performance of 
any function that the Board determines to delegate shall be a 
function of the Chairman. The Board shall, upon the vote of one 
member, review action taken at a delegated level within such 
time and in such manner as the Board shall by rule prescribe. 
The Board of Governors may not delegate to a Federal reserve 
bank its functions for the establishment of policies for the 
supervision and regulation of depository institution holding 
companies and other financial firms supervised by the Board of 
Governors.
  (l) To employ such attorneys, experts, assistants, clerks, or 
other employees as may be deemed necessary to conduct the 
business of the board. All salaries and fees shall be fixed in 
advance by said board and shall be paid in the same manner as 
the salaries of the members of said board. All such attorneys, 
experts, assistants, clerks, and other employees shall be 
appointed without regard to the provisions of the Act of 
January sixteenth, eighteen hundred and eighty-three (volume 
twenty-two, United States Statutes at Large, page four hundred 
and three), and amendments thereto, or any rule or regulation 
made in pursuance thereof: Provided, That nothing herein shall 
prevent the President from placing said employees in the 
classified service. Each member of the Board of Governors of 
the Federal Reserve System may employ, at a minimum, 2 
individuals, with such individuals selected by such member and 
the salaries of such individuals set by such member. A member 
may employ additional individuals as determined necessary by 
the Board of Governors.
  (n) To examine, at the Board's discretion, any depository 
institution, and any affiliate of such depository institution, 
in connection with any advance to, any discount of any 
instrument for, or any request for any such advance or discount 
by, such depository institution under this Act.
  (o) Authority To Appoint Conservator or Receiver.--The Board 
may appoint the Federal Deposit Insurance Corporation as 
conservator or receiver for a State member bank under section 
11(c)(9) of the Federal Deposit Insurance Act.
  (p) Authority.--The Board may act in its own name and through 
its own attorneys in enforcing any provision of this title, 
regulations promulgated hereunder, or any other law or 
regulation, or in any action, suit, or proceeding to which the 
Board is a party and which involves the Board's regulation or 
supervision of any bank, bank holding company (as defined in 
section 2 of the Bank Holding Company Act of 1956), or other 
entity, or the administration of its operations.
  (q) Uniform Protection Authority for Federal Reserve 
Facilities.--
          (1) Notwithstanding any other provision of law, to 
        authorize personnel to act as law enforcement officers 
        to protect and safeguard the premises, grounds, 
        property, personnel, including members of the Board, of 
        the Board, or any Federal reserve bank, and operations 
        conducted by or on behalf of the Board or a reserve 
        bank.
          (2) The Board may, subject to the regulations 
        prescribed under paragraph (5), delegate authority to a 
        Federal reserve bank to authorize personnel to act as 
        law enforcement officers to protect and safeguard the 
        bank's premises, grounds, property, personnel, and 
        operations conducted by or on behalf of the bank.
          (3) Law enforcement officers designated or authorized 
        by the Board or a reserve bank under paragraph (1) or 
        (2) are authorized while on duty to carry firearms and 
        make arrests without warrants for any offense against 
        the United States committed in their presence, or for 
        any felony cognizable under the laws of the United 
        States committed or being committed within the 
        buildings and grounds of the Board or a reserve bank if 
        they have reasonable grounds to believe that the person 
        to be arrested has committed or is committing such a 
        felony. Such officers shall have access to law 
        enforcement information that may be necessary for the 
        protection of the property or personnel of the Board or 
        a reserve bank.
          (4) For purposes of this subsection, the term ``law 
        enforcement officers'' means personnel who have 
        successfully completed law enforcement training and are 
        authorized to carry firearms and make arrests pursuant 
        to this subsection.
          (5) The law enforcement authorities provided for in 
        this subsection may be exercised only pursuant to 
        regulations prescribed by the Board and approved by the 
        Attorney General.
  (r)(1) Any action that this Act provides may be taken only 
upon the affirmative vote of 5 members of the Board may be 
taken upon the unanimous vote of all members then in office if 
there are fewer than 5 members in office at the time of the 
action.
  (2)(A) Any action that the Board is otherwise authorized to 
take under section 13(3) may be taken upon the unanimous vote 
of all available members then in office, if--
          (i) at least 2 members are available and all 
        available members participate in the action;
          (ii) the available members unanimously determine 
        that--
                  (I) unusual and exigent circumstances exist 
                and the borrower is unable to secure adequate 
                credit accommodations from other sources;
                  (II) action on the matter is necessary to 
                prevent, correct, or mitigate serious harm to 
                the economy or the stability of the financial 
                system of the United States;
                  (III) despite the use of all means available 
                (including all available telephonic, 
                telegraphic, and other electronic means), the 
                other members of the Board have not been able 
                to be contacted on the matter; and
                  (IV) action on the matter is required before 
                the number of Board members otherwise required 
                to vote on the matter can be contacted through 
                any available means (including all available 
                telephonic, telegraphic, and other electronic 
                means)[; and];
          (iii) any credit extended by a Federal reserve bank 
        pursuant to such action is payable upon demand of the 
        Board[.]; and
          (iv) the available members secure the affirmative 
        vote of not less than nine presidents of the Federal 
        reserve banks.
  (B) The available members of the Board shall document in 
writing the determinations required by subparagraph (A)(ii), 
and such written findings shall be included in the record of 
the action and in the official minutes of the Board, and copies 
of such record shall be provided as soon as practicable to the 
members of the Board who were not available to participate in 
the action and to the Chairman of the Committee on Banking, 
Housing, and Urban Affairs of the Senate and to the Chairman of 
the Committee on Financial Services of the House of 
Representatives.
  (s) Federal Reserve Transparency and Release of 
Information.--
          (1) In general.--In order to ensure the disclosure in 
        a timely manner consistent with the purposes of this 
        Act of information concerning the borrowers and 
        counterparties participating in emergency credit 
        facilities, discount window lending programs, and open 
        market operations authorized or conducted by the Board 
        or a Federal reserve bank, the Board of Governors shall 
        disclose, as provided in paragraph (2)--
                  (A) the names and identifying details of each 
                borrower, participant, or counterparty in any 
                credit facility or covered transaction;
                  (B) the amount borrowed by or transferred by 
                or to a specific borrower, participant, or 
                counterparty in any credit facility or covered 
                transaction;
                  (C) the interest rate or discount paid by 
                each borrower, participant, or counterparty in 
                any credit facility or covered transaction; and
                  (D) information identifying the types and 
                amounts of collateral pledged or assets 
                transferred in connection with participation in 
                any credit facility or covered transaction.
          (2) Mandatory release date.--In the case of--
                  (A) a credit facility, the Board shall 
                disclose the information described in paragraph 
                (1) on the date that is 1 year after the 
                effective date of the termination by the Board 
                of the authorization of the credit facility; 
                and
                  (B) a covered transaction, the Board shall 
                disclose the information described in paragraph 
                (1) on the last day of the eighth calendar 
                quarter following the calendar quarter in which 
                the covered transaction was conducted.
          (3) Earlier release date authorized.--The Chairman of 
        the Board may publicly release the information 
        described in paragraph (1) before the relevant date 
        specified in paragraph (2), if the Chairman determines 
        that such disclosure would be in the public interest 
        and would not harm the effectiveness of the relevant 
        credit facility or the purpose or conduct of covered 
        transactions.
          (4) Definitions.--For purposes of this subsection, 
        the following definitions shall apply:
                  (A) Credit facility.--The term ``credit 
                facility'' [has the same meaning as in section 
                714(f)(1)(A) of title 31, United States Code] 
                means a program or facility, including any 
                special purpose vehicle or other entity 
                established by or on behalf of the Board of 
                Governors of the Federal Reserve System or a 
                Federal reserve bank, authorized by the Board 
                of Governors under section 13(3), that is not 
                subject to audit under section 714(e) of title 
                31, United States Code.
                  (B) Covered transaction.--The term ``covered 
                transaction'' means--
                          (i) any open market transaction with 
                        a nongovernmental third party conducted 
                        under the first undesignated paragraph 
                        of section 14 or subparagraph (a), (b), 
                        or (c) of the 2nd undesignated 
                        paragraph of such section, after the 
                        date of enactment of the Dodd-Frank 
                        Wall Street Reform and Consumer 
                        Protection Act; and
                          (ii) any advance made under section 
                        10B after the date of enactment of that 
                        Act.
          (5) Termination of credit facility by operation of 
        law.--A credit facility shall be deemed to have 
        terminated as of the end of the 24-month period 
        beginning on the date on which the credit facility 
        ceases to make extensions of credit and loans, unless 
        the credit facility is otherwise terminated by the 
        Board before such date.
          (6) Consistent treatment of information.--Except as 
        provided in this subsection or section 13(3)(D), [or in 
        section 714(f)(3)(C) of title 31, United States Code, 
        the information described in paragraph (1) and 
        information concerning the transactions described in 
        section 714(f) of such title,] the information 
        described in paragraph (1) shall be confidential, 
        including for purposes of section 552(b)(3) of title 5 
        of such Code, until the relevant mandatory release date 
        described in paragraph (2), unless the Chairman of the 
        Board determines that earlier disclosure of such 
        information would be in the public interest and would 
        not harm the effectiveness of the relevant credit 
        facility or the purpose of conduct of the relevant 
        transactions.
          (7) Protection of personal privacy.--This subsection 
        [and section 13(3)(C), section 714(f)(3)(C) of title 
        31, United States Code, and], section 13(3)(C), and 
        subsection (a) or (c) of section 1109 of the Dodd-Frank 
        Wall Street Reform and Consumer Protection Act shall 
        not be construed as requiring any disclosure of 
        nonpublic personal information (as defined for purposes 
        of section 502 of the Gramm-Leach-Bliley Act (12 U.S.C. 
        6802)) concerning any individual who is referenced in 
        collateral pledged or assets transferred in connection 
        with a credit facility or covered transaction, unless 
        the person is a borrower, participant, or counterparty 
        under the credit facility or covered transaction.
          (8) Study of foia exemption impact.--
                  (A) Study.--The Inspector General of the 
                Board of Governors of the Federal Reserve 
                System shall--
                          (i) conduct a study on the impact 
                        that the exemption from section 
                        552(b)(3) of title 5 (known as the 
                        Freedom of Information Act) established 
                        under paragraph (6) has had on the 
                        ability of the public to access 
                        information about the administration by 
                        the Board of Governors of emergency 
                        credit facilities, discount window 
                        lending programs, and open market 
                        operations; and
                          (ii) make any recommendations on 
                        whether the exemption described in 
                        clause (i) should remain in effect.
                  (B) Report.--Not later than 30 months after 
                the date of enactment of [this section] this 
                subsection, the Inspector General of the Board 
                of Governors of the Federal Reserve System 
                shall submit a report on the findings of the 
                study required under subparagraph (A) to the 
                Committee on Banking, Housing, and Urban 
                Affairs of the Senate and the Committee on 
                Financial Services of the House of 
                Representatives, and publish the report on the 
                website of the Board.
          (9) Rule of construction.--Nothing in this section is 
        meant to affect any pending litigation or lawsuit filed 
        under section 552 of title 5, United States Code 
        (popularly known as the Freedom of Information Act), on 
        or before the date of enactment of the Dodd-Frank Wall 
        Street Reform and Consumer Protection Act.
  [(s)] (t) Assessments, Fees, and Other Charges for Certain 
Companies.--
          (1) In general.--The Board shall collect a total 
        amount of assessments, fees, or other charges from the 
        companies described in paragraph (2) that is equal to 
        the total expenses the Board estimates are necessary or 
        appropriate to carry out the supervisory and regulatory 
        responsibilities of the Board with respect to such 
        companies.
          (2) Companies.--The companies described in this 
        paragraph are--
                  (A) all bank holding companies having total 
                consolidated assets of $50,000,000,000 or more;
                  (B) all savings and loan holding companies 
                having total consolidated assets of 
                $50,000,000,000 or more; and
                  (C) all nonbank financial companies 
                supervised by the Board under section 113 of 
                the Dodd-Frank Wall Street Reform and Consumer 
                Protection Act.
  (u) Ethics Standards for Members and Employees.--
          (1) Prohibited and restricted financial interests and 
        transactions.--The members and employees of the Board 
        of Governors of the Federal Reserve System shall be 
        subject to the provisions under section 4401.102 of 
        title 5, Code of Federal Regulations, to the same 
        extent as such provisions apply to an employee of the 
        Securities and Exchange Commission.
          (2) Treatment of brokerage accounts and availability 
        of account statements.--The members and employees of 
        the Board of Governors of the Federal Reserve System 
        shall--
                  (A) disclose all brokerage accounts that the 
                member or employee maintains, as well as any 
                accounts in which the member or employee 
                controls trading or has a financial interest 
                (including managed accounts, trust accounts, 
                investment club accounts, and accounts of 
                spouses or minor children who live with the 
                member or employee); and
                  (B) with respect to any securities account 
                that the member or employee is required to 
                disclose to the Board of Governors, authorize 
                the brokers and dealers of such account to send 
                duplicate account statements directly to Board 
                of Governors.
          (3) Prohibitions related to outside employment and 
        activities.--The members and employees of the Board of 
        Governors of the Federal Reserve System shall be 
        subject to the prohibitions related to outside 
        employment and activities described under section 
        4401.103(c) of title 5, Code of Federal Regulations, to 
        the same extent as such prohibitions apply to an 
        employee of the Securities and Exchange Commission.
          (4) Additional ethics standards.--The members and 
        employees of the Board of Governors of the Federal 
        Reserve System shall be subject to--
                  (A) the employee responsibilities and conduct 
                regulations of the Office of Personnel 
                Management under part 735 of title 5, Code of 
                Federal Regulations;
                  (B) the canons of ethics contained in subpart 
                C of part 200 of title 17, Code of Federal 
                Regulations, to the same extent as such subpart 
                applies to the employees of the Securities and 
                Exchange Commission; and
                  (C) the regulations concerning the conduct of 
                members and employees and former members and 
                employees contained in subpart M of part 200 of 
                title 17, Code of Federal Regulations, to the 
                same extent as such subpart applies to the 
                employees of the Securities and Exchange 
                Commission.
  (v) Disclosure of Staff Salaries and Financial Information.--
The Board of Governors of the Federal Reserve System shall make 
publicly available, on the website of the Board of Governors, a 
searchable database that contains the names of all members, 
officers, and employees of the Board of Governors who receive 
an annual salary in excess of the annual rate of basic pay for 
GS-15 of the General Schedule, and--
          (1) the yearly salary information for such 
        individuals, along with any nonsalary compensation 
        received by such individuals; and
          (2) any financial disclosures required to be made by 
        such individuals.
  (w) International Processes.--
          (1) Notice of process; consultation.--At least 30 
        calendar days before any member or employee of the 
        Board of Governors of the Federal Reserve System 
        participates in a process of setting financial 
        standards as a part of any foreign or multinational 
        entity, the Board of Governors shall--
                  (A) issue a notice of the process, including 
                the subject matter, scope, and goals of the 
                process, to the Committee on Financial Services 
                of the House of Representatives and the 
                Committee on Banking, Housing, and Urban 
                Affairs of the Senate;
                  (B) make such notice available to the public, 
                including on the website of the Board of 
                Governors; and
                  (C) solicit public comment, and consult with 
                the committees described under subparagraph 
                (A), with respect to the subject matter, scope, 
                and goals of the process.
          (2) Public reports on process.--After the end of any 
        process described under paragraph (1), the Board of 
        Governors shall issue a public report on the topics 
        that were discussed during the process and any new or 
        revised rulemakings or policy changes that the Board of 
        Governors believes should be implemented as a result of 
        the process.
          (3) Notice of agreements; consultation.--At least 90 
        calendar days before any member or employee of the 
        Board of Governors of the Federal Reserve System 
        participates in a process of setting financial 
        standards as a part of any foreign or multinational 
        entity, the Board of Governors shall--
                  (A) issue a notice of agreement to the 
                Committee on Financial Services of the House of 
                Representatives and the Committee on Banking, 
                Housing, and Urban Affairs of the Senate;
                  (B) make such notice available to the public, 
                including on the website of the Board of 
                Governors; and
                  (C) consult with the committees described 
                under subparagraph (A) with respect to the 
                nature of the agreement and any anticipated 
                effects such agreement will have on the 
                economy.
          (4) Definition.--For purposes of this subsection, the 
        term ``process'' shall include any official proceeding 
        or meeting on financial regulation of a recognized 
        international organization with authority to set 
        financial standards on a global or regional level, 
        including the Financial Stability Board, the Basel 
        Committee on Banking Supervision (or a similar 
        organization), and the International Association of 
        Insurance Supervisors (or a similar organization).

           *       *       *       *       *       *       *


SEC. 11C. APPROPRIATIONS REQUIREMENT FOR NON-MONETARY POLICY RELATED 
                    ADMINISTRATIVE COSTS.

  (a) Appropriations Requirement.--
          (1) Recovery of costs of annual appropriation.--The 
        Board of Governors of the Federal Reserve System and 
        the Federal reserve banks shall collect assessments and 
        other fees, as provided under this Act, that are 
        designed to recover the costs to the Government of the 
        annual appropriation to the Board of Governors of the 
        Federal Reserve System by Congress. The Board of 
        Governors of the Federal Reserve System and the Federal 
        reserve banks may only incur obligations or allow and 
        pay expenses with respect to non-monetary policy 
        related administrative costs pursuant to an 
        appropriations Act.
          (2) Offsetting collections.--Assessments and other 
        fees described under paragraph (1) for any fiscal 
        year--
                  (A) shall be deposited and credited as 
                offsetting collections to the account providing 
                appropriations to the Board of Governors of the 
                Federal Reserve System; and
                  (B) except as provided in paragraph (3), 
                shall not be collected for any fiscal year 
                except to the extent provided in advance in 
                appropriation Acts.
          (3) Lapse of Appropriation.--If on the first day of a 
        fiscal year an appropriation to the Board of Governors 
        of the Federal Reserve System has not been enacted, the 
        Board of Governors of the Federal Reserve System shall 
        continue to collect (as offsetting collections) the 
        assessments and other fees described under paragraph 
        (1) at the rate in effect during the preceding fiscal 
        year, until 60 days after the date such an 
        appropriation is enacted.
          (4) Limitation.--This subsection shall only apply to 
        the non-monetary policy related administrative costs of 
        the Board of Governors of the Federal Reserve System.
  (b) Definitions.--For purposes of this section:
          (1) Monetary policy.--The term ``monetary policy'' 
        means a strategy for producing a generally acceptable 
        exchange medium that supports the productive employment 
        of economic resources by reliably serving as both a 
        unit of account and store of value.
          (2) Non-monetary policy related administrative 
        costs.--The term ``non-monetary policy related 
        administrative costs'' means administrative costs not 
        related to the conduct of monetary policy, and 
        includes--
                  (A) direct operating expenses for supervising 
                and regulating entities supervised and 
                regulated by the Board of Governors of the 
                Federal Reserve System, including conducting 
                examinations, conducting stress tests, 
                communicating with the entities regarding 
                supervisory matters and laws, and regulations;
                  (B) operating expenses for activities 
                integral to carrying out supervisory and 
                regulatory responsibilities, such as training 
                staff in the supervisory function, research and 
                analysis functions including library 
                subscription services, and collecting and 
                processing regulatory reports filed by 
                supervised institutions; and
                  (C) support, overhead, and pension expenses 
                related to the items described under 
                subparagraphs (A) and (B).

           *       *       *       *       *       *       *

  Sec. 12A. (a) There is hereby created a Federal Open Market 
Committee (hereinafter referred to as the ``Committee''), which 
shall consist of the members of the Board of Governors of the 
Federal Reserve System and [five] six representatives of the 
Federal Reserve banks to be selected as hereinafter provided. 
Such representatives shall be presidents or first vice 
presidents of Federal Reserve banks and, beginning with the 
election for the term commencing March 1, 1943, shall be 
elected annually as follows: [One by the board of directors of 
the Federal Reserve Bank of New York, one by the boards of 
directors of the Federal Reserve Banks of Boston, Philadelphia, 
and Richmond, one by the boards of directors of the Federal 
Reserve Banks of Cleveland and Chicago, one by the boards of 
directors of the Federal Reserve Banks of Atlanta, Dallas, and 
St. Louis, and one by the boards of directors of the Federal 
Reserve Banks of Minneapolis, Kansas City, and San Francisco.] 
One by the boards of directors of the Federal Reserve Banks of 
New York and Boston; one by the boards of directors of the 
Federal Reserve Banks of Philadelphia and Cleveland; one by the 
boards of directors of the Federal Reserve Banks of Richmond 
and Atlanta; one by the boards of directors of the Federal 
Reserve Banks of Chicago and St. Louis; one by the boards of 
directors of the Federal Reserve Banks of Minneapolis and 
Kansas City; and one by the boards of directors of the Federal 
Reserve Banks of Dallas and San Francisco. In odd numbered 
calendar years, one representative shall be elected from each 
of the Federal Reserve Banks of Boston, Philadelphia, Richmond, 
Chicago, Minneapolis, and Dallas. In even-numbered calendar 
years, one representative shall be elected from each of the 
Federal Reserve Banks of New York, Cleveland, Atlanta, St. 
Louis, Kansas City, and San Francisco. In such elections each 
board of directors shall have one vote; and the details of such 
elections may be governed by regulations prescribed by the 
committee, which may be amended from time to time. An alternate 
to serve in the absence of each such representative shall 
likewise be a president or first vice president of a Federal 
Reserve bank and shall be elected annually in the same manner. 
The meetings of said Committee shall be held at Washington, 
District of Columbia, at least four times each year upon the 
call of the chairman of the Board of Governors of the Federal 
Reserve System or at the request of any three members of the 
Committee.
  (b) No Federal Reserve bank shall engage or decline to engage 
in open-market operations under section 14 of this Act except 
in accordance with the direction of and regulations adopted by 
the Committee. The Committee shall consider, adopt, and 
transmit to the several Federal Reserve banks, regulations 
relating to the open-market transactions of such banks.
  (c) The time, character, and volume of all purchases and 
sales of paper described in section 14 of this Act as eligible 
for open-market operations shall be governed with a view to 
accommodating commerce and business and with regard to their 
bearing upon the general credit situation of the country.
  (d) Blackout Period.--
          (1) In general.--During a blackout period, the only 
        public communications that may be made by members and 
        staff of the Committee with respect to macroeconomic or 
        financial developments or about current or prospective 
        monetary policy issues are the following:
                  (A) The dissemination of published data, 
                surveys, and reports that have been cleared for 
                publication by the Board of Governors of the 
                Federal Reserve System.
                  (B) Answers to technical questions specific 
                to a data release.
                  (C) Communications with respect to the 
                prudential or supervisory functions of the 
                Board of Governors.
          (2) Blackout period defined.--For purposes of this 
        subsection, and with respect to a meeting of the 
        Committee described under subsection (a), the term 
        ``blackout period'' means the time period that--
                  (A) begins immediately after midnight on the 
                day that is one week prior to the date on which 
                such meeting takes place; and
                  (B) ends at midnight on the day after the 
                date on which such meeting takes place.
          (3) Exemption for chairman of the board of 
        governors.--Nothing in this section shall prohibit the 
        Chairman of the Board of Governors of the Federal 
        Reserve System from participating in or issuing public 
        communications.
  (e) Public Transcripts of Meetings.--The Committee shall--
          (1) record all meetings of the Committee; and
          (2) make the full transcript of such meetings 
        available to the public.

                    powers of federal reserve banks.

  Sec. 13. Any Federal reserve bank may receive from any of its 
member banks or other depository institutions, and from the 
United States, deposits of current funds in lawful money, 
national-bank notes, Federal reserve notes, or checks, and 
drafts, payable upon presentation or other items, and also, for 
collection, maturing notes and bills; or, solely for purposes 
of exchange or of collection, may receive from other Federal 
reserve banks deposits of current funds in lawful money, 
national-bank notes, or checks upon other Federal reserve 
banks, and checks and drafts, payable upon presentation within 
its district or other items, and maturing notes and bills 
payable within its district; or, solely for the purposes of 
exchange or of collection, may receive from any nonmember bank 
or trust company or other depository institution deposits of 
current funds in lawful money, national-bank notes, Federal 
reserve notes, checks and drafts payable upon presentation or 
other items, or maturing notes and bills: Provided, Such 
nonmember bank or trust company or other depository institution 
maintains with the Federal reserve bank of its district a 
balance in such amount as the Board determines taking into 
account items in transit, services provided by the Federal 
Reserve bank, and other factors as the Board may deem 
appropriate: Provided further, That nothing in this or any 
other section of this Act shall be construed as prohibiting a 
member or nonmember bank or other depository institution from 
making reasonable charges, to be determined and regulated by 
the Board of Governors of the Federal Reserve System, but in no 
case to exceed 10 cents per $100 or fraction thereof, based on 
the total of checks and drafts presented at any one time, for 
collection or payment of checks and drafts and remission 
therefor by exchange or otherwise; but no such charges shall be 
made against the Federal reserve banks.
   Upon the indorsement of any of its member banks, which shall 
be deemed a waiver of demand, notice and protest by such bank 
as to its own indorsement exclusively, any Federal reserve bank 
may discount notes, drafts, and bills of exchange arising out 
of actual commercial transactions; that is, notes, drafts, and 
bills of exchange issued or drawn for agricultural, industrial, 
or commercial purposes, or the proceeds of which have been 
used, or are to be used, for such purposes, the Board of 
Governors of the Federal Reserve System to have the right to 
determine or define the character of the paper thus eligible 
for discount, within the meaning of this Act. Nothing in this 
Act contained shall be construed to prohibit such notes, 
drafts, and bills of exchange, secured by staple agricultural 
products, or other goods, wares, or merchandise from being 
eligible for such discount, and the notes, drafts, and bills of 
exchange of factors issued as such making advances exclusively 
to producers of staple agricultural products in their raw state 
shall be eligible for such discount; but such definition shall 
not include notes, drafts, or bills covering merely investments 
or issued or drawn for the purpose of carrying or trading in 
stocks, bonds, or other investment securities, except bonds and 
notes of the Government of the United States. Notes, drafts, 
and bills admitted to discount under the terms of this 
paragraph must have a maturity at the time of discount of not 
more than 90 days, exclusive of grace.
  (3)(A) In unusual and exigent circumstances that pose a 
threat to the financial stability of the United States, the 
Board of Governors of the Federal Reserve System, by the 
affirmative vote of not less than five members and by the 
affirmative vote of not less than nine presidents of the 
Federal reserve banks, may authorize any Federal reserve bank, 
during such periods as the said board may determine, at rates 
established in accordance with the provisions of section 14, 
subdivision (d), of this Act, to discount for any financial 
institution participant in any program or facility with broad-
based eligibility, notes, drafts, and bills of exchange when 
such notes, drafts, and bills of exchange are indorsed or 
otherwise secured to the satisfaction of the Federal Reserve 
bank: Provided, That before discounting any such note, draft, 
or bill of exchange, the Federal reserve bank shall obtain 
evidence that such financial institution participant in any 
program or facility with broad-based eligibility is unable to 
secure adequate credit accommodations from other banking 
institutions. All such discounts for any financial institution 
participant in any program or facility with broad-based 
eligibility shall be subject to such limitations, restrictions, 
and regulations as the Board of Governors of the Federal 
Reserve System may prescribe.
          (B)(i) As soon as is practicable after the date of 
        enactment of this subparagraph, the Board shall 
        establish, by regulation, in consultation with the 
        Secretary of the Treasury, the policies and procedures 
        governing emergency lending under this paragraph. Such 
        policies and procedures shall be designed to ensure 
        that any emergency lending program or facility is for 
        the purpose of providing liquidity to the financial 
        system, and not to aid a failing financial company, and 
        that the security for emergency loans is sufficient to 
        protect taxpayers from losses and that any such program 
        is terminated in a timely and orderly fashion. The 
        policies and procedures established by the Board shall 
        require that a Federal reserve bank assign, consistent 
        with sound risk management practices and to ensure 
        protection for the taxpayer, a lendable value to all 
        collateral for a loan executed by a Federal reserve 
        bank under this paragraph in determining whether the 
        loan is secured satisfactorily for purposes of this 
        paragraph. Federal reserve banks may not accept equity 
        securities issued by the recipient of any loan or other 
        financial assistance under this paragraph as 
        collateral. Not later than 6 months after the date of 
        enactment of this sentence, the Board shall, by rule, 
        establish--
                          (I) a method for determining the 
                        sufficiency of the collateral required 
                        under this paragraph;
                          (II) acceptable classes of 
                        collateral;
                          (III) the amount of any discount on 
                        the value of the collateral that the 
                        Federal reserve banks will apply for 
                        purposes of calculating the sufficiency 
                        of collateral under this paragraph; and
                          (IV) a method for obtaining 
                        independent appraisals of the value of 
                        collateral the Federal reserve banks 
                        receive.
                  (ii) The Board shall establish procedures to 
                prohibit borrowing from programs and facilities 
                by borrowers that are insolvent. A borrower 
                shall not be eligible to borrow from any 
                emergency lending program or facility unless 
                the Board and all Federal banking regulators 
                with jurisdiction over the borrower certify 
                that, at the time the borrower initially 
                borrows under the program or facility, the 
                borrower is not insolvent. [Such procedures may 
                include a certification from the chief 
                executive officer (or other authorized officer) 
                of the borrower, at the time the borrower 
                initially borrows under the program or facility 
                (with a duty by the borrower to update the 
                certification if the information in the 
                certification materially changes), that the 
                borrower is not insolvent.] A borrower shall be 
                considered insolvent for purposes of this 
                subparagraph, if the borrower is in 
                bankruptcy[, resolution under title II of the 
                Dodd-Frank Wall Street Reform and Consumer 
                Protection Act, or] or is subject to resolution 
                under any other Federal or State insolvency 
                proceeding.
                  (iii) A program or facility that is 
                structured to remove assets from the balance 
                sheet of a single and specific company, or that 
                is established for the purpose of assisting a 
                single and specific company avoid bankruptcy[, 
                resolution under title II of the Dodd-Frank 
                Wall Street Reform and Consumer Protection Act, 
                or] or resolution under any other Federal or 
                State insolvency proceeding, shall not be 
                considered a program or facility with broad-
                based eligibility.
                  (iv) The Board may not establish any program 
                or facility under this paragraph without the 
                prior approval of the Secretary of the 
                Treasury.
          (C) The Board shall provide to the Committee on 
        Banking, Housing, and Urban Affairs of the Senate and 
        the Committee on Financial Services of the House of 
        Representatives--
                  (i) not later than 7 days after the Board 
                authorizes any loan or other financial 
                assistance under this paragraph, a report that 
                includes--
                          (I) the justification for the 
                        exercise of authority to provide such 
                        assistance;
                          (II) the identity of the recipients 
                        of such assistance;
                          (III) the date and amount of the 
                        assistance, and form in which the 
                        assistance was provided; and
                          (IV) the material terms of the 
                        assistance, including--
                                  (aa) duration;
                                  (bb) collateral pledged and 
                                the value thereof;
                                  (cc) all interest, fees, and 
                                other revenue or items of value 
                                to be received in exchange for 
                                the assistance;
                                  (dd) any requirements imposed 
                                on the recipient with respect 
                                to employee compensation, 
                                distribution of dividends, or 
                                any other corporate decision in 
                                exchange for the assistance; 
                                and
                                  (ee) the expected costs to 
                                the taxpayers of such 
                                assistance; and
                  (ii) once every 30 days, with respect to any 
                outstanding loan or other financial assistance 
                under this paragraph, written updates on--
                          (I) the value of collateral;
                          (II) the amount of interest, fees, 
                        and other revenue or items of value 
                        received in exchange for the 
                        assistance; and
                          (III) the expected or final cost to 
                        the taxpayers of such assistance.
          (D) The information required to be submitted to 
        Congress under subparagraph (C) related to--
                  (i) the identity of the financial institution 
                participants in an emergency lending program or 
                facility commenced under this paragraph;
                  (ii) the amounts borrowed by each financial 
                institution participant in any such program or 
                facility;
                  (iii) identifying details concerning the 
                assets or collateral held by, under, or in 
                connection with such a program or facility,
                shall be kept confidential, upon the written 
                request of the Chairman of the Board, in which 
                case such information shall be made available 
                only to the Chairpersons or Ranking Members of 
                the Committees described in subparagraph (C).
          [(E) If an entity to which a Federal reserve bank has 
        provided a loan under this paragraph becomes a covered 
        financial company, as defined in section 201 of the 
        Dodd-Frank Wall Street Reform and Consumer Protection 
        Act, at any time while such loan is outstanding, and 
        the Federal reserve bank incurs a realized net loss on 
        the loan, then the Federal reserve bank shall have a 
        claim equal to the amount of the net realized loss 
        against the covered entity, with the same priority as 
        an obligation to the Secretary of the Treasury under 
        section 210(b) of the Dodd-Frank Wall Street Reform and 
        Consumer Protection Act. ]
          (E) Penalty rate.--
                  (i) In general.--Not later than 6 months 
                after the date of enactment of this 
                subparagraph, the Board shall, with respect to 
                a recipient of any loan or other financial 
                assistance under this paragraph, establish by 
                rule a minimum interest rate on the principal 
                amount of any loan or other financial 
                assistance.
                  (ii) Minimum interest rate defined.--In this 
                subparagraph, the term ``minimum interest 
                rate'' shall mean the sum of--
                          (I) the average of the secondary 
                        discount rate of all Federal Reserve 
                        banks over the most recent 90-day 
                        period; and
                          (II) the average of the difference 
                        between a distressed corporate bond 
                        yield index (as defined by rule of the 
                        Board) and a bond yield index of debt 
                        issued by the United States (as defined 
                        by rule of the Board) over the most 
                        recent 90-day period.
          (F) Financial institution participant defined.--For 
        purposes of this paragraph, the term ``financial 
        institution participant''--
                  (i) means a company that is predominantly 
                engaged in financial activities (as defined in 
                section 102(a) of the Dodd-Frank Wall Street 
                Reform and Consumer Protection Act (12 U.S.C. 
                5311(a))); and
                  (ii) does not include an agency described in 
                subparagraph (W) of section 5312(a)(2) of title 
                31, United States Code, or an entity controlled 
                or sponsored by such an agency.
   Upon the indorsement of any of its member banks, which shall 
be deemed a waiver of demand, notice, and protest by such bank 
as to its own indorsement exclusively, and subject to 
regulations and limitations to be prescribed by the Board of 
Governors of the Federal Reserve System, any Federal reserve 
bank may discount or purchase bills of exchange payable at 
sight or on demand which grow out of the domestic shipment or 
the exportation of nonperishable, readily marketable 
agricultural and other staples and are secured by bills of 
lading or other shipping documents conveying or securing title 
to such staples: Provided, That all such bills of exchange 
shall be forwarded promptly for collection, and demand for 
payment shall be made with reasonable promptness after the 
arrival of such staples at their destination: Provided further, 
That no such bill shall in any event be held by or for the 
account of a Federal reserve bank for a period in excess of 
ninety days. In discounting such bills Federal reserve banks 
may compute the interest to be deducted on the basis of the 
estimated life of each bill and adjust the discount after 
payment of such bills to conform to the actual life thereof.
   The aggregate of notes, drafts, and bills upon which any 
person, copartnership, association, or corporation is liable as 
maker, acceptor, indorser, drawer, or guarantor, rediscounted 
for any member bank, shall at no time exceed the amount for 
which such person, copartnership, association, or corporation 
may lawfully become liable to a national banking association 
under the terms of section 5200 of the Revised Statutes, as 
amended: Provided, however, That nothing in this paragraph 
shall be construed to change the character or class of paper 
now eligible for rediscount by Federal reserve banks.
   Any Federal reserve bank may discount acceptances of the 
kinds hereinafter described, which have a maturity at the time 
of discount of not more than 90 days' sight, exclusive of days 
of grace, and which are indorsed by at least one member bank: 
Provided, That such acceptances if drawn for an agricultural 
purpose and secured at the time of acceptance by warehouse 
receipts or other such documents conveying or securing title 
covering readily marketable staples may be discounted with a 
maturity at the time of discount of not more than six months' 
sight exclusive of days of grace.
  (7)(A) Any member bank and any Federal or State branch or 
agency of a foreign bank subject to reserve requirements under 
section 7 of the International Banking Act of 1978 (hereinafter 
in this paragraph referred to as ``institutions''), may accept 
drafts or bills of exchange drawn upon it having not more than 
six months' sight to run, exclusive of days of grace--
          (i) which grow out of transactions involving the 
        importation or exportation of goods;
          (ii) which grow out of transactions involving the 
        domestic shipment of goods; or
          (iii) which are secured at the time of acceptance by 
        a warehouse receipt or other such document conveying or 
        securing title covering readily marketable staples.
  (B) Except as provided in subparagraph (C), no institution 
shall accept such bills, or be obligated for a participation 
share in such bills, in an amount equal at any time in the 
aggregate to more than 150 per centum of its paid up and 
unimpaired capital stock and surplus or, in the case of a 
United States branch or agency of a foreign bank, its dollar 
equivalent as determined by the Board under subparagraph (H).
  (C) The Board, under such conditions as it may prescribe, may 
authorize, by regulation or order, any institution to accept 
such bills, or be obligated for a participation share in such 
bills, in an amount not exceeding at any time in the aggregate 
200 per centum of its paid up and unimpaired capital stock and 
surplus or, in the case of a United States branch or agency of 
a foreign bank, its dollar equivalent as determined by the 
Board under subparagraph (H).
  (D) Notwithstanding subparagraphs (B) and (C), with respect 
to any institution, the aggregate acceptances, including 
obligations for a participation share in such acceptances, 
growing out of domestic transactions shall not exceed 50 per 
centum of the aggregate of all acceptances, including 
obligations for a participation share in such acceptances, 
authorized for such institution under this paragraph.
  (E) No institution shall accept bills, or be obligated for a 
participation share in such bills, whether in a foreign or 
domestic transaction, for any one person, partnership, 
corporation, association or other entity in an amount equal at 
any time in the aggregate to more than 10 per centum of its 
paid up and unimpaired capital stock and surplus, or, in the 
case of a United States branch or agency of a foreign bank, its 
dollar equivalent as determined by the Board under subparagraph 
(H), unless the institution is secured either by attached 
documents or by some other actual security growing out of the 
same transaction as the acceptance.
  (F) With respect to an institution which issues an 
acceptance, the limitations contained in this paragraph shall 
not apply to that portion of an acceptance which is issued by 
such institution and which is covered by a participation 
agreement sold to another institution.
  (G) In order to carry out the purposes of this paragraph, the 
Board may define any of the terms used in this paragraph, and, 
with respect to institutions which do not have capital or 
capital stock, the Board shall define an equivalent measure to 
which the limitations contained in this paragraph shall apply.
  (H) Any limitation or restriction in this paragraph based on 
paid-up and unimpaired capital stock and surplus of an 
institution shall be deemed to refer, with respect to a United 
States branch or agency of a foreign bank, to the dollar 
equivalent of the paid-up capital stock and surplus of the 
foreign bank, as determined by the Board, and if the foreign 
bank has more than one United States branch or agency, the 
business transacted by all such branches and agencies shall be 
aggregated in determining compliance with the limitation or 
restriction.
  Any Federal reserve bank may make advances for periods not 
exceeding fifteen days to its member banks on their promissory 
notes secured by the deposit or pledge of bonds, notes, 
certificates of indebtedness or Treasury bills of the United 
States, or by the deposit or pledge of debentures or other such 
obligations of Federal intermediate credit banks which are 
eligible for purchase by Federal reserve banks under section 13 
(a) of this Act, or by the deposit or pledge of bonds issued 
under the provisions of subsection (c) of section 4 of the Home 
Owners' Loan Act of 1933, as amended; and any Federal reserve 
bank may make advances for periods not exceeding ninety days to 
its member banks on their promissory notes secured by such 
notes, drafts, bills of exchange, or bankers' acceptances as 
are eligible for rediscount or for purchase by Federal reserve 
banks under the provisions of this Act, or secured by such 
obligations as are eligible for purchase under section 14(b) of 
this Act. All such advances shall be made at rates to be 
established by such Federal reserve banks, such rates to be 
subject to the review and determination of the Board of 
Governors of the Federal Reserve System. If any member bank to 
which any such advance has been made shall, during the life or 
continuance of such advance, and despite an official warning of 
the reserve bank of the district or of the Board of Governors 
of the Federal Reserve System to the contrary, increase its 
outstanding loans secured by collateral in the form of stocks, 
bonds, debentures, or other such obligations, or loans made to 
members of any organized stock exchange, investment house, or 
dealer in securities, upon any obligation, note, or bill, 
secured or unsecured, for the purpose of purchasing and/or 
carrying stocks, bonds, or other investment securities (except 
obligations of the United States) such advance shall be deemed 
immediately due and payable, and such member bank shall be 
ineligible as a borrower at the reserve bank of the district 
under the provisions of this paragraph for such period as the 
Board of Governors of the Federal Reserve System shall 
determine: Provided, That no temporary carrying or clearance 
loans made solely for the purpose of facilitating the purchase 
or delivery of securities offered for public subscription shall 
be included in the loans referred to in this paragraph.
  
  The discount and rediscount and the purchase and sale by any 
Federal reserve bank of any bills receivable and of domestic 
and foreign bills of exchange, and of acceptances authorized by 
this Act, shall be subject to such restrictions, limitations, 
and regulations as may be imposed by the Board of Governors of 
the Federal Reserve System. (Omitted from U.S. Code)
  That in addition to the powers not vested by law in national 
banking associations organized under the laws of the United 
States any such association located and doing business in any 
place the population of which does not exceed five thousand 
inhabitants, as shown by the last preceding decennial census, 
may, under such rules and regulations as may be prescribed by 
the Comptroller of the Currency, act as the agent for any fire, 
life, or other insurance company authorized by the authorities 
of the State in which said bank is located to do business in 
said State, by soliciting and selling insurance and collecting 
premiums on policies issued by such company; and may receive 
for services so rendered such fees or commissions as may be 
agreed upon between the said association and the insurance 
company for which it may act as agent: Provided, however, That 
no such bank shall in any case assume or guarantee the payment 
of any premium on insurance policies issued through its agency 
by its principal: And provided further, That the bank shall not 
guarantee the truth of any statement made by an assured in 
filing his application for insurance.
  Any member bank may accept drafts or bills of exchange drawn 
upon it having not more than three months' sight to run, 
exclusive of days of grace, drawn under regulations to be 
prescribed by the Board of Governors of the Federal Reserve 
System by banks or bankers in foreign countries or dependencies 
or insular possessions of the United States for the purpose of 
furnishing dollar exchange as required by the usages of trade 
in the respective countries, dependencies, or insular 
possessions. Such drafts or bills may be acquired by Federal 
reserve banks in such amounts and subject to such regulations, 
restrictions, and limitations as may be prescribed by the Board 
of Governors of the Federal Reserve System: Provided, however, 
That no member bank shall accept such drafts or bills of 
exchange referred to this paragraph for any one bank to an 
amount exceeding in the aggregate ten per centum of the paid-up 
and unimpaired capital and surplus of the accepting bank unless 
the draft or bill of exchange is accompanied by documents 
conveying or securing title or by some other adequate security: 
Provided further, That no member bank shall accept such drafts 
or bills in an amount exceeding at any time the aggregate of 
one-half of its paid-up and unimpaired capital and surplus. 
(Omitted from U.S. Code)
  Subject to such limitations, restrictions and regulations as 
the Board of Governors of the Federal Reserve System may 
prescribe, any Federal reserve bank may make advances to any 
individual, partnership or corporation on the promissory notes 
of such individual, partnership or corporation secured by 
direct obligations of the United States or by any obligation 
which is a direct obligation of, or fully guaranteed as to 
principal and interest by, any agency of the United States. 
Such advances shall be made for periods not exceeding 90 days 
and shall bear interest at rates fixed from time to time by the 
Federal reserve bank, subject to the review and determination 
of the Board of Governors of the Federal Reserve System.
  Subject to such restrictions, limitations, and regulations as 
may be imposed by the Board of Governors of the Federal Reserve 
System, each Federal Reserve bank may receive deposits from, 
discount paper endorsed by, and make advances to any branch or 
agency of a foreign bank in the same manner and to the same 
extent that it may exercise such powers with respect to a 
member bank if such branch or agency is maintaining reserves 
with such Reserve bank pursuant to section 7 of the 
International Banking Act of 1978. In exercising any such 
powers with respect to any such branch or agency, each Federal 
Reserve bank shall give due regard to account balances being 
maintained by such branch or agency with such Reserve bank and 
the proportion of the assets of such branch or agency being 
held as reserves under section 7 of the International Banking 
Act of 1978. For the purposes of this paragraph, the terms 
``branch,''``agency,'' and ``foreign bank'' shall have the same 
meanings assigned to them in section 1 of the International 
Banking Act of 1978.

           *       *       *       *       *       *       *

  Sec. 19. (a) The Board is authorized for the purposes of this 
section to define the terms used in this section, to determine 
what shall be deemed a payment of interest, to determine what 
types of obligations, whether issued directly by a member bank 
or indirectly by an affiliate of a member bank or by other 
means, and regardless of the use of the proceeds, shall be 
deemed a deposit, and to prescribe such regulations as it may 
deem necessary to effectuate the purposes of this section and 
to prevent evasions thereof.
  (b) Reserve Requirements.--
          (1) Definitions.--The following definitions and rules 
        apply to this subsection, subsection (c), section 11A, 
        the first paragraph of section 13, and the second, 
        thirteenth, and fourteenth paragraphs of section 16:
                  (A) The term ``depository institution'' 
                means--
                          (i) any insured bank as defined in 
                        section 3 of the Federal Deposit 
                        Insurance Act or any bank which is 
                        eligible to make application to become 
                        an insured bank under section 5 of such 
                        Act;
                          (ii) any mutual savings bank as 
                        defined in section 3 of the Federal 
                        Deposit Insurance Act or any bank which 
                        is eligible to make application to 
                        become an insured bank under section 5 
                        of such Act;
                          (iii) any savings bank as defined in 
                        section 3 of the Federal Deposit 
                        Insurance Act or any bank which is 
                        eligible to make application to become 
                        an insured bank under section 5 of such 
                        Act;
                          (iv) any insured credit union as 
                        defined in section 101 of the Federal 
                        Credit Union Act or any credit union 
                        which is eligible to make application 
                        to become an insured credit union 
                        pursuant to section 201 of such Act;
                          (v) any member as defined in section 
                        2 of the Federal Home Loan Bank Act;
                          (vi) any savings association (as 
                        defined in section 3 of the Federal 
                        Deposit Insurance Act) which is an 
                        insured depository institution (as 
                        defined in such Act) or is eligible to 
                        apply to become an insured depository 
                        institution under the Federal Deposit 
                        Insurance Act; and
                          (vii) for the purpose of section 13 
                        and the fourteenth paragraph of section 
                        16, any association or entity which is 
                        wholly owned by or which consists only 
                        of institutions referred to in clauses 
                        (i) through (vi).
                  (B) The term ``bank'' means any insured or 
                noninsured bank, as defined in section 3 of the 
                Federal Deposit Insurance Act, other than a 
                mutual savings bank or a savings bank as 
                defined in such section.
                  (C) The term ``transaction account'' means a 
                deposit or account on which the depositor or 
                account holder is permitted to make withdrawals 
                by negotiable or transferable instrument, 
                payment orders of withdrawal, telephone 
                transfers, or other similar items for the 
                purpose of making payments or transfers to 
                third persons or others. Such term includes 
                demand deposits, negotiable order of withdrawal 
                accounts, savings deposits subject to automatic 
                transfers, and share draft accounts.
                  (D) The term ``nonpersonal time deposits'' 
                means a transferable time deposit or account or 
                a time deposit or account representing funds 
                deposited to the credit of, or in which any 
                beneficial interest is held by, a depositor who 
                is not a natural person.
                  (E) The term ``reservable liabilities'' means 
                transaction accounts, nonpersonal time 
                deposits, and all net balances, loans, assets, 
                and obligations which are, or may be, subject 
                to reserve requirements under paragraph (5).
                  (F) In order to prevent evasions of the 
                reserve requirements imposed by this 
                subsection, after consultation with the Board 
                of Directors of the Federal Deposit Insurance 
                Corporation, the Comptroller of the Currency, 
                and the National Credit Union Administration 
                Board, the Board of Governors of the Federal 
                Reserve System is authorized to determine, by 
                regulation or order, that an account or deposit 
                is a transaction account if such account or 
                deposit may be used to provide funds directly 
                or indirectly for the purpose of making 
                payments or transfers to third persons or 
                others.
          (2) Reserve requirements.--(A) Each depository 
        institution shall maintain reserves against its 
        transaction accounts as the Board may prescribe by 
        regulation solely for the purpose of implementing 
        monetary policy--
                  (i) in a ratio of not greater than 3 percent 
                (and which may be zero) for that portion of its 
                total transaction accounts of $25,000,000 or 
                less, subject to subparagraph (C); and
                  (ii) in the ratio of 12 per centum, or in 
                such other ratio as the Board may prescribe not 
                greater than 14 per centum (and which may be 
                zero), for that portion of its total 
                transaction accounts in excess of $25,000,000, 
                subject to subparagraph (C).
          (B) Each depository institution shall maintain 
        reserves against its nonpersonal time deposits in the 
        ratio of 3 per centum, or in such other ratio not 
        greater than 9 per centum and not less than zero per 
        centum as the Board may prescribe by regulation solely 
        for the purpose of implementing monetary policy.
          (C) Beginning in 1981, not later than December 31 of 
        each year the Board shall issue a regulation increasing 
        for the next succeeding calendar year the dollar amount 
        which is contained in subparagraph (A) or which was 
        last determined pursuant to this subparagraph for the 
        purpose of such subparagraph, by an amount obtained by 
        multiplying such dollar amount by 80 per centum of the 
        percentage increase in the total transaction accounts 
        of all depository institutions. The increase in such 
        transaction accounts shall be determined by subtracting 
        the amount of such accounts on June 30 of the preceding 
        calendar year from the amount of such accounts on June 
        30 of the calendar year involved. In the case of any 
        such 12-month period in which there has been a decrease 
        in the total transaction accounts of all depository 
        institutions, the Board shall issue such a regulation 
        decreasing for the next succeeding calendar year such 
        dollar amount by an amount obtained by multiplying such 
        dollar amount by 80 per centum of the percentage 
        decrease in the total transaction accounts of all 
        depository institutions. The decrease in such 
        transaction accounts shall be determined by subtracting 
        the amount of such accounts on June 30 of the calendar 
        year involved from the amount of such accounts on June 
        30 of the previous calendar year.
          (D) Any reserve requirement imposed under this 
        subsection shall be uniformly applied to all 
        transaction accounts at all depository institutions. 
        Reserve requirements imposed under this subsection 
        shall be uniformly applied to nonpersonal time deposits 
        at all depository institutions, except that such 
        requirements may vary by the maturity of such deposits.
          (3) Waiver of ratio limits in extraordinary 
        circumstances.--Upon a finding by at least 5 members of 
        the Board that extraordinary circumstances require such 
        action, the Board, after consultation with the 
        appropriate committees of the Congress, may impose, 
        with respect to any liability of depository 
        institutions, reserve requirements outside the 
        limitations as to ratios and as to types of liabilities 
        otherwise prescribed by paragraph (2) for a period not 
        exceeding 180 days, and for further periods not 
        exceeding 180 days each by affirmative action by at 
        least 5 members of the Board in each instance. The 
        Board shall promptly transmit to the Congress a report 
        of any exercise of its authority under this paragraph 
        and the reasons for such exercise of authority.
          (4) Supplemental reserves.--(A) The Board may, upon 
        the affirmative vote of not less than 5 members, impose 
        a supplemental reserve requirement on every depository 
        institution of not more than 4 per centum of its total 
        transaction accounts. Such supplemental reserve 
        requirement may be imposed only if--
                  (i) the sole purpose of such requirement is 
                to increase the amount of reserves maintained 
                to a level essential for the conduct of 
                monetary policy;
                  (ii) such requirement is not imposed for the 
                purpose of reducing the cost burdens resulting 
                from the imposition of the reserve requirements 
                pursuant to paragraph (2);
                  (iii) such requirement is not imposed for the 
                purpose of increasing the amount of balances 
                needed for clearing purposes; and
                  (iv) on the date on which the supplemental 
                reserve requirement is imposed, except as 
                provided in paragraph (11), the total amount of 
                reserves required pursuant to paragraph (2) is 
                not less than the amount of reserves that would 
                be required if the initial ratios specified in 
                paragraph (2) were in effect.
          (B) The Board may require the supplemental reserve 
        authorized under subparagraph (A) only after 
        consultation with the Board of Directors of the Federal 
        Deposit Insurance Corporation, the Comptroller of the 
        Currency, and the National Credit Union Administration 
        Board. The Board shall promptly transmit to the 
        Congress a report with respect to any exercise of its 
        authority to require supplemental reserves under 
        subparagraph (A) and such report shall state the basis 
        for the determination to exercise such authority.
          (C) If a supplemental reserve under subparagraph (A) 
        has been required of depository institutions for a 
        period of one year or more, the Board shall review and 
        determine the need for continued maintenance of 
        supplemental reserves and shall transmit annual reports 
        to the Congress regarding the need, if any, for 
        continuing the supplemental reserve.
          (D) Any supplemental reserve imposed under 
        subparagraph (A) shall terminate at the close of the 
        first 90-day period after such requirement is imposed 
        during which the average amount of reserves required 
        under paragraph (2) are less than the amount of 
        reserves which would be required during such period if 
        the initial ratios specified in paragraph (2) were in 
        effect.
          (5) Reserves related to foreign obligations or 
        assets.--Foreign branches, subsidiaries, and 
        international banking facilities of nonmember 
        depository institutions shall maintain reserves to the 
        same extent required by the Board of foreign branches, 
        subsidiaries, and international banking facilities of 
        member banks. In addition to any reserves otherwise 
        required to be maintained pursuant to this subsection, 
        any depository institution shall maintain reserves in 
        such ratios as the Board may prescribe against--
                  (A) net balances owed by domestic offices of 
                such depository institution in the United 
                States to its directly related foreign offices 
                and to foreign offices of nonrelated depository 
                institutions;
                  (B) loans to United States residents made by 
                overseas offices of such depository institution 
                if such depository institution has one or more 
                offices in the United States; and
                  (C) assets (including participations) held by 
                foreign offices of a depository institution in 
                the United States which were acquired from its 
                domestic offices.
          (6) Exemption for certain deposits.--The requirements 
        imposed under paragraph (2) shall not apply to deposits 
        payable only outside the States of the United States 
        and the District of Columbia, except that nothing in 
        this subsection limits the authority of the Board to 
        impose conditions and requirements on member banks 
        under section 25 of this Act or the authority of the 
        Board under section 7 of the International Banking Act 
        of 1978.
          (7) Discount and borrowing.--Any depository 
        institution in which transaction accounts or 
        nonpersonal time deposits are held shall be entitled to 
        the same discount and borrowing privileges as member 
        banks. In the administration of discount and borrowing 
        privileges, the Board and the Federal Reserve banks 
        shall take into consideration the special needs of 
        savings and other depository institutions for access to 
        discount and borrowing facilities consistent with their 
        long-term asset portfolios and the sensitivity of such 
        institutions to trends in the national money markets.
          (8) Transitional adjustments.--
                  (A) Any depository institution required to 
                maintain reserves under this subsection which 
                was engaged in business on July 1, 1979, but 
                was not a member of the Federal Reserve System 
                on or after that date, shall maintain reserves 
                against its deposits during the first twelve-
                month period following the effective date of 
                this paragraph in amounts equal to one-eighth 
                of those otherwise required by this subsection, 
                during the second such twelve-month period in 
                amounts equal to one-fourth of those otherwise 
                required, during the third such twelve-month 
                period in amounts equal to three-eighths of 
                those otherwise required, during the fourth 
                twelve-month period in amounts equal to one-
                half of those otherwise required, and during 
                the fifth twelve-month period in amounts equal 
                to five-eighths of those otherwise required, 
                during the sixth twelve-month period in amounts 
                equal to three-fourths of those otherwise 
                required, and during the seventh twelve-month 
                period in amounts equal to seven-eighths of 
                those otherwise required. This subparagraph 
                does not apply to any category of deposits or 
                accounts which are first authorized pursuant to 
                Federal law in any State after April 1, 1980.
                  (B) With respect to any bank which was a 
                member of the Federal Reserve System during the 
                entire period beginning on July 1, 1979, and 
                ending on the effective date of the Monetary 
                Control Act of 1980, the amount of required 
                reserves imposed pursuant to this subsection on 
                and after the effective date of such Act that 
                exceeds the amount of reserves which would have 
                been required of such bank if the reserve 
                ratios in effect during the reserve computation 
                period immediately preceding such effective 
                date were applied may, at the discretion of the 
                Board and in accordance with such rules and 
                regulations as it may adopt, be reduced by 75 
                per centum during the first year which begins 
                after such effective date, 50 per centum during 
                the second year, and 25 per centum during the 
                third year.
                  (C)(i) With respect to any bank which is a 
                member of the Federal Reserve System on the 
                effective date of the Monetary Control Act of 
                1980, the amount of reserves which would have 
                been required of such bank if the reserve 
                ratios in effect during the reserve computation 
                period immediately preceding such effective 
                date were applied that exceeds the amount of 
                required reserves imposed pursuant to this 
                subsection shall, in accordance with such rules 
                and regulations as the Board may adopt, be 
                reduced by 25 per centum during the first year 
                which begins after such effective date, 50 per 
                centum during the second year, and 75 per 
                centum during the third year.
                  (ii) If a bank becomes a member bank during 
                the four-year period beginning on the effective 
                date of the Monetary Control Act of 1980, and 
                if the amount of reserves which would have been 
                required of such bank, determined as if the 
                reserve ratios in effect during the reserve 
                computation period immediately preceding such 
                effective date were applied, and as if such 
                bank had been a member during such period, 
                exceeds the amount of reserves required 
                pursuant to this subsection, the amount of 
                reserves required to be maintained by such bank 
                beginning on the date on which such bank 
                becomes a member of the Federal Reserve System 
                shall be the amount of reserves which would 
                have been required of such bank if it had been 
                a member on the day before such effective date, 
                except that the amount of such excess shall, in 
                accordance with such rules and regulations as 
                the Board may adopt, be reduced by 25 per 
                centum during the first year which begins after 
                such effective date, 50 per centum during the 
                second year, and 75 per centum during the third 
                year.
                  (D)(i) Any bank which was a member bank on 
                July 1, 1979, and which withdrew from 
                membership in the Federal Reserve System during 
                the period beginning on July 1, 1979, and 
                ending on March 31, 1980, shall maintain 
                reserves during the first twelve-month period 
                beginning on the date of enactment of this 
                clause in amounts equal to one-half of those 
                otherwise required by this subsection, during 
                the second such twelve-month period in amounts 
                equal to two-thirds of those otherwise 
                required, and during the third such twelve-
                month period in amounts equal to five-sixths of 
                those otherwise required.
                  (ii) Any bank which withdraws from membership 
                in the Federal Reserve System on or after the 
                date of enactment of the Depository 
                Institutions Deregulation and Monetary Control 
                Act of 1980 shall maintain reserves in the same 
                amount as member banks are required to maintain 
                under this subsection, pursuant to 
                subparagraphs (B) and (C)(i).
                  (E) This subparagraph applies to any 
                depository institution that, on August 1, 1978, 
                (i) was engaged in business as a depository 
                institution in a State outside the continental 
                limits of the United States, and (ii) was not a 
                member of the Federal Reserve System at any 
                time on or after such date. Such a depository 
                institution shall not be required to maintain 
                reserves against such deposits held or 
                maintained at its offices located in a State 
                outside the continental limits of the United 
                States until the first day of the sixth 
                calendar year which begins after the effective 
                date of the Monetary Control Act of 1980. Such 
                a depository institution shall maintain 
                reserves against such deposits during the sixth 
                calendar year which begins after such effective 
                date in an amount equal to one-eighth of that 
                otherwise required by paragraph (2), during the 
                seventh such year in an amount equal to one-
                fourth of that otherwise required, during the 
                eighth such year in an amount equal to three-
                eighths of that otherwise required, during the 
                ninth such year in an amount equal to one-half 
                of that otherwise required, during the tenth 
                such year in an amount equal to five-eighths of 
                that otherwise required, during the eleventh 
                such year in an amount equal to three-fourths 
                of that otherwise required, and during the 
                twelth such year in an amount equal to seven-
                eighths of that otherwise required.
          (9) Exemption.--This subsection shall not apply with 
        respect to any financial institution which--
                  (A) is organized solely to do business with 
                other financial institutions;
                  (B) is owned primarily by the financial 
                institutions with which it does business; and
                  (C) does not do business with the general 
                public.
          (10) Waivers.--In individual cases, where a Federal 
        supervisory authority waives a liquidity requirement, 
        or waives the penalty for failing to satisfy a 
        liquidity requirement, the Board shall waive the 
        reserve requirement, or waive the penalty for failing 
        to satisfy a reserve requirement, imposed pursuant to 
        this subsection for the depository institution involved 
        when requested by the Federal supervisory authority 
        involved.
          (11) Additional exemptions.--(A)(i) Notwithstanding 
        the reserve requirement ratios established under 
        paragraphs (2) and (5) of this subsection, a reserve 
        ratio of zero per centum shall apply to any combination 
        of reservable liabilities, which do not exceed 
        $2,000,000 (as adjusted under subparagraph (B)), of 
        each depository institution.
          (ii) Each depository institution may designate, in 
        accordance with such rules and regulations as the Board 
        shall prescribe, the types and amounts of reservable 
        liabilities to which the reserve ratio of zero per 
        centum shall apply, except that transaction accounts 
        which are designated to be subject to a reserve ratio 
        of zero per centum shall be accounts which would 
        otherwise be subject to a reserve ratio of 3 per centum 
        under paragraph (2).
          (iii) The Board shall minimize the reporting 
        necessary to determine whether depository institutions 
        have total reservable liabilities of less than 
        $2,000,000 (as adjusted under subparagraph (B)). 
        Consistent with the Board's responsibility to monitor 
        and control monetary and credit aggregates, depository 
        institutions which have reserve requirements under this 
        subsection equal to zero per centum shall be subject to 
        less overall reporting requirements than depository 
        institutions which have a reserve requirement under 
        this subsection that exceeds zero per centum.
          (B)(i) Beginning in 1982, not later than December 31 
        of each year, the Board shall issue a regulation 
        increasing for the next succeeding calendar year the 
        dollar amount specified in subparagraph (A), as 
        previously adjusted under this subparagraph, by an 
        amount obtained by multiplying such dollar amount by 80 
        per centum of the percentage increase in the total 
        reservable liabilities of all depository institutions.
          (ii) The increase in total reservable liabilities 
        shall be determined by subtracting the amount of total 
        reservable liabilities on June 30 of the preceding 
        calendar year from the amount of total reservable 
        liabilities on June 30 of the calendar year involved. 
        In the case of any such twelve-month period in which 
        there has been a decrease in the total reservable 
        liabilities of all depository institutions, no 
        adjustment shall be made. A decrease in total 
        reservable liabilities shall be determined by 
        subtracting the amount of total reservable liabilities 
        on June 30 of the calendar year involved from the 
        amount of total reservable liabilities on June 30 of 
        the previous calendar year.
          (12) Earnings on balances.--
                  (A) In general.--Balances maintained at a 
                Federal Reserve bank by or on behalf of a 
                depository institution may receive earnings to 
                be paid by the Federal Reserve bank at least 
                once each calendar quarter, at a rate or rates 
                established by the Federal Open Market 
                Committee not to exceed the general level of 
                short-term interest rates.
                  (B) Regulations relating to payments and 
                distributions.--The Board may prescribe 
                regulations concerning--
                          (i) the payment of earnings in 
                        accordance with this paragraph;
                          (ii) the distribution of such 
                        earnings to the depository institutions 
                        which maintain balances at such banks, 
                        or on whose behalf such balances are 
                        maintained; and
                          (iii) the responsibilities of 
                        depository institutions, Federal Home 
                        Loan Banks, and the National Credit 
                        Union Administration Central Liquidity 
                        Facility with respect to the crediting 
                        and distribution of earnings 
                        attributable to balances maintained, in 
                        accordance with subsection (c)(1)(A), 
                        in a Federal Reserve bank by any such 
                        entity on behalf of depository 
                        institutions.
                  (C) Depository institutions defined.--For 
                purposes of this paragraph, the term 
                ``depository institution'', in addition to the 
                institutions described in paragraph (1)(A), 
                includes any trust company, corporation 
                organized under section 25A or having an 
                agreement with the Board under section 25, or 
                any branch or agency of a foreign bank (as 
                defined in section 1(b) of the International 
                Banking Act of 1978).
  (c)(1) Reserves held by a depository institution to meet the 
requirements imposed pursuant to subsection (b) shall, subject 
to such rules and regulations as the Board shall prescribe, be 
in the form of--
          (A) balances maintained for such purposes by such 
        depository institution in the Federal Reserve bank of 
        which it is a member or at which it maintains an 
        account, except that (i) the Board may, by regulation 
        or order, permit depository institutions to maintain 
        all or a portion of their required reserves in the form 
        of vault cash, except that any portion so permitted 
        shall be identical for all depository institutions, and 
        (ii) vault cash may be used to satisfy any supplemental 
        reserve requirement imposed pursuant to subsection 
        (b)(4), except that all such vault cash shall be 
        excluded from any computation of earnings pursuant to 
        subsection (b); and
          (B) balances maintained by a depository institution 
        in a depository institution which maintains required 
        reserve balances at a Federal Reserve bank, in a 
        Federal Home Loan Bank, or in the National Credit Union 
        Administration Central Liquidity Facility, if such 
        depository institution, Federal Home Loan Bank, or 
        National Credit Union Administration Central Liquidity 
        Facility maintains such funds in the form of balances 
        in a Federal Reserve bank of which it is a member or at 
        which it maintains an account. Balances received by a 
        depository institution from a second depository 
        institution and used to satisfy the reserve requirement 
        imposed on such second depository institution by this 
        section shall not be subject to the reserve 
        requirements of this section imposed on such first 
        depository institution, and shall not be subject to 
        assessments or reserves imposed on such first 
        depository institution pursuant to section 7 of the 
        Federal Deposit Insurance Act (12 U.S.C. 1817), section 
        404 of the National Housing Act (12 U.S.C. 1727), or 
        section 202 of the Federal Credit Union Act (12 U.S.C. 
        1782).
  (2) The balances maintained to meet the reserve requirements 
of subsection (b) by a depository institution in a Federal 
Reserve bank or passed through a Federal Home Loan Bank or the 
National Credit Union Administration Central Liquidity Facility 
or another depository institution to a Federal Reserve bank may 
be used to satisfy liquidity requirements which may be imposed 
under other provisions of Federal or State law.
  (d) No member bank shall act as the medium or agent of any 
nonbanking corporation, partnership, association, business 
trust, or individual in making loans on the security of stocks, 
bonds, and other investment securities to brokers or dealers in 
stocks, bonds, and other investment securities. Every violation 
of this provision by any member bank shall be punishable by a 
fine of not more than $100 per day during the continuance of 
such violation; and such fine may be collected, by suit or 
otherwise, by the Federal reserve bank of the district in which 
such member bank is located.
  (e) No member bank shall keep on deposit with any depository 
institution which is not authorized to have access to Federal 
Reserve advances under section 10(b) of this Act a sum in 
excess of 10 per centum of its own paid-up capital and surplus. 
No member bank shall act as the medium or agent of a nonmember 
bank in applying for or receiving discounts from a Federal 
reserve bank under the provisions of this Act, except by 
permission of the Board of Governors of the Federal Reserve 
System.
  (f) The required balance carried by a member bank with a 
Federal reserve bank may, under the regulations and subject to 
such penalties as may be prescribed by the Board of Governors 
of the Federal Reserve System, be checked against and withdrawn 
by such member bank for the purpose of meeting existing 
liabilities.
  (g) In estimating the reserve balances required by this Act, 
member banks may deduct from the amount of their gross demand 
deposits the amounts of balances due from other banks (except 
Federal Reserve banks and foreign banks) and cash items in 
process of collection payable immediately upon presentation in 
the United States, within the meaning of these terms as defined 
by the Board of Governors of the Federal Reserve System.
  (h) National banks, or banks organized under local laws, 
located in a dependency or insular posssession or any part of 
the United States outside the continental United States may 
remain nonmember banks, and shall in that event maintain 
reserves and comply with all the conditions now provided by law 
regulating them; or said banks may, with the consent of the 
Board of Governors of the Federal Reserve System, become member 
banks of any one of the reserve districts, and shall in that 
event take stock, maintain reserves, and be subject to all the 
other provisions of this Act.
  (j) The Board may from time to time, after consulting with 
the Board of Directors of the Federal Deposit Insurance 
Corporation and the Director of the Office of Thrift 
Supervision, prescribe rules governing the payment and 
advertisement of interest on deposits, including limitations on 
the rates of interest which may be paid by member banks on time 
and savings deposits. The Board may prescribe different rate 
limitations for different classes of deposits, for deposits of 
different amounts or with different maturities or subject to 
different conditions regarding withdrawal or repayment, 
according to the nature or location of member banks or their 
depositors, or according to such other reasonable bases as the 
Board may deem desirable in the public interest. No member bank 
shall pay any time deposit before its maturity except upon such 
conditions and in accordance with such rules and regulations as 
may be prescribed by the said Board, or waive any requirement 
of notice before payment of any savings deposit except as to 
all savings deposits having the same requirement: Provided, 
That the provisions of this paragraph shall not apply to any 
deposit which is payable only at an office of a member bank 
located outside of the States of the United States and the 
District of Columbia. During the period commencing on October 
15, 1962, and ending on October 15, 1968, the provisions of 
this paragraph shall not apply to the rate of interest which 
may be paid by member banks on time deposits of foreign 
governments, monetary and financial authorities of foreign 
governments when acting as such, or international financial 
institutions of which the United States is a member.
  (k) No member bank or affiliate thereof, or any successor or 
assignee of such member bank or affiliate or any endorser, 
guarantor, or surety of such member bank or affiliate may 
plead, raise, or claim directly or by counterclaim, setoff, or 
otherwise, with respect to any deposit or obligation of such 
member bank or affiliate, any defense, right, or benefit under 
any provision of a statute or constitution of a State or of a 
territory of the United States, or of any law of the District 
of Columbia, regulating or limiting the rate of interest which 
may be charged, taken, received, or reserved, and any such 
provision is hereby preempted, and no civil or criminal penalty 
which would otherwise be applicable under such provision shall 
apply to such member bank or affiliate or to any other person.
  (l) Civil Money Penalty.--
          (1) First tier.--Any member bank which, and any 
        institution-affiliated party (within the meaning of 
        section 3(u) of the Federal Deposit Insurance Act) with 
        respect to such member bank who, violates any provision 
        of this section, or any regulation issued pursuant 
        thereto, shall forfeit and pay a civil penalty of not 
        more than $5,000 for each day during which such 
        violation continues.
          (2) Second tier.--Notwithstanding paragraph (1), any 
        member bank which, and any institution-affiliated party 
        (within the meaning of section 3(u) of the Federal 
        Deposit Insurance Act) with respect to such member bank 
        who--
                  (A)(i) commits any violation described in 
                paragraph (1);
                  (ii) recklessly engages in an unsafe or 
                unsound practice in conducting the affairs of 
                such member bank; or
                  (iii) breaches any fiduciary duty;
                  (B) which violation, practice, or breach--
                          (i) is part of a pattern of 
                        misconduct;
                          (ii) causes or is likely to cause 
                        more than a minimal loss to such member 
                        bank; or
                          (iii) results in pecuniary gain or 
                        other benefit to such party,
                shall forfeit and pay a civil penalty of not 
                more than $25,000 for each day during which 
                such violation, practice, or breach continues.
                  (3) Third tier.--Notwithstanding paragraphs 
                (1) and (2), any member bank which, and any 
                institution-affiliated party (within the 
                meaning of section 3(u) of the Federal Deposit 
                Insurance Act) with respect to such member bank 
                who--
                          (A) knowingly--
                                  (i) commits any violation 
                                described in paragraph (1);
                                  (ii) engages in any unsafe or 
                                unsound practice in conducting 
                                the affairs of such member 
                                bank; or
                                  (iii) breaches any fiduciary 
                                duty; and
                          (B) knowingly or recklessly causes a 
                        substantial loss to such member bank or 
                        a substantial pecuniary gain or other 
                        benefit to such party by reason of such 
                        violation, practice, or breach,
        shall forfeit and pay a civil penalty in an amount not 
        to exceed the applicable maximum amount determined 
        under paragraph (4) for each day during which such 
        violation, practice, or breach continues.
          (4) Maximum amounts of penalties for any violation 
        described in paragraph (3).--The maximum daily amount 
        of any civil penalty which may be assessed pursuant to 
        paragraph (3) for any violation, practice, or breach 
        described in such paragraph is--
                  (A) in the case of any person other than a 
                member bank, an amount not to exceed 
                [$1,000,000] $1,500,000; and
                  (B) in the case of a member bank, an amount 
                not to exceed the lesser of--
                          (i) [$1,000,000] $1,500,000; or
                          (ii) 1 percent of the total assets of 
                        such member bank.
          (5) Assessment; etc.--Any penalty imposed under 
        paragraph (1), (2), or (3) may be assessed and 
        collected by the Board in the manner provided in 
        subparagraphs (E), (F), (G), and (I) of section 8(i)(2) 
        of the Federal Deposit Insurance Act for penalties 
        imposed (under such section) and any such assessment 
        shall be subject to the provisions of such section.
          (6) Hearing.--The member bank or other person against 
        whom any penalty is assessed under this subsection 
        shall be afforded an agency hearing if such member bank 
        or person submits a request for such hearing within 20 
        days after the issuance of the notice of assessment. 
        Section 8(h) of the Federal Deposit Insurance Act shall 
        apply to any proceeding under this subsection.
          (7) Disbursement.--All penalties collected under 
        authority of this subsection shall be deposited into 
        the Treasury.
          (8) Violate defined.--For purposes of this section, 
        the term ``violate'' includes any action (alone or with 
        another or others) for or toward causing, bringing 
        about, participating in, counseling, or aiding or 
        abetting a violation.
          (9) Regulations.--The Board shall prescribe 
        regulations establishing such procedures as may be 
        necessary to carry out this subsection.
  (m) Notice Under This Section After Separation From 
Service.--The resignation, termination of employment or 
participation, or separation of an institution-affiliated party 
(within the meaning of section 3(u) of the Federal Deposit 
Insurance Act) with respect to a member bank (including a 
separation caused by the closing of such a bank) shall not 
affect the jurisdiction and authority of the Board to issue any 
notice and proceed under this section against any such party, 
if such notice is served before the end of the 6-year period 
beginning on the date such party ceased to be such a party with 
respect to such bank (whether such date occurs before, on, or 
after the date of the enactment of this subsection).

           *       *       *       *       *       *       *


SEC. 29. CIVIL MONEY PENALTY.

  (a) First Tier.--Any member bank which, and any institution-
affiliated party (within the meaning of section 3(u) of the 
Federal Deposit Insurance Act) with respect to such member bank 
who, violates any provision of section 22, 23A, or 23B, or any 
regulation issued pursuant thereto, shall forfeit and pay a 
civil penalty of not more than $5,000 for each day during which 
such violation continues.
  (b) Second tier.--Notwithstanding subsection (a), any member 
bank which, and any institution-affiliated party (within the 
meaning of section 3(u) of the Federal Deposit Insurance Act) 
with respect to such member bank who
          (1)(A) commits any violation described in subsection 
        (a);
          (B) recklessly engages in an unsafe or unsound 
        practice in conducting the affairs of such member bank; 
        or
          (C) breaches any fiduciary duty;
          (2) which violation, practice, or breach--
                  (A) is part of a pattern of misconduct;
                  (B) causes or is likely to cause more than a 
                minimal loss to such member bank; or
                  (C) results in pecuniary gain or other 
                benefit to such party,
shall forfeit and pay a civil penalty of not more than $25,000 
for each day during which such violation, practice, or breach 
continues.
  (c) Third tier.--Notwithstanding subsections (a) and (b), any 
member bank which, and any institution-affiliated party (within 
the meaning of section 3(u) of the Federal Deposit Insurance 
Act) with respect to such member bank who--
          (1) knowingly--
                  (A) commits any violation described in 
                subsection (a);
                  (B) engages in any unsafe or unsound practice 
                in conducting the affairs of such credit union; 
                or
                  (C) breaches any fiduciary duty; and
          (2) knowingly or recklessly causes a substantial loss 
        to such credit union or a substantial pecuniary gain or 
        other benefit to such party by reason of such 
        violation, practice, or breach,
shall forfeit and pay a civil penalty in an amount not to 
exceed the applicable maximum amount determined under 
subsection (d) for each day during which such violation, 
practice, or breach continues.
  (d) Maximum Amounts of Penalties for any Violation Described 
in Subsection (c).--The maximum daily amount of any civil 
penalty which may be assessed pursuant to subsection (c) for 
any violation, practice, or breach described in such subsection 
is--
          (1) in the case of any person other than a member 
        bank, an amount to not exceed [$1,000,000] $1,500,000; 
        and
          (2) in the case of a member bank, an amount not to 
        exceed the lesser of--
                  (A) [$1,000,000] $1,500,000; or
                  (B) 1 percent of the total assets of such 
                member bank.
  (e) Assessment; etc.--Any penalty imposed under subsection 
(a), (b), or (c) shall be assessed and collected by
          (1) in the case of a national bank, by the 
        Comptroller of the Currency; and
          (2) in the case of a State member bank, by the Board,
in the manner provided in subparagraphs (E), (F), (G), and (I) 
of section 8(i)(2) of the Federal Deposit Insurance Act for 
penalties imposed (under such section) and any such assessment 
shall be subject to the provisions of such section.
  (f) Hearing.--The member bank or other person against whom 
any penalty is assessed under this section shall be afforded an 
agency hearing if such member bank or person submits a request 
for such hearing within 20 days after the issuance of the 
notice of assessment. Section 8(h) of the Federal Deposit 
Insurance Act shall apply to any proceeding under this section.
  (g) Disbursement.--All penalties collected under authority of 
this paragraph shall be deposited into the Treasury.
  (h) Violate Defined.--For purposes of this section, the term 
``violate'' includes any action (alone or with another or 
others) for or toward causing, bringing about, participating 
in, counseling, or aiding or abetting a violation.
  (i) Regulations.--The Comptroller of the Currency and the 
Board shall prescribe regulations establishing such procedures 
as may be necessary to carry out this section.
  (m) Notice Under This Section After Separation From 
Service.--The resignation, termination of employment or 
participation, or separation of an institution-affiliated party 
(within the meaning of section 3(u) of the Federal Deposit 
Insurance Act) with respect to a member bank (including a 
separation caused by the closing of such a bank) shall not 
affect the jurisdiction and authority of the appropriate 
Federal banking agency to issue any notice and proceed under 
this section against any such party, if such notice is served 
before the end of the 6-year period beginning on the date such 
party ceased to be such a party with respect to such bank 
(whether such date occurs before, on, or after the date of the 
enactment of this subsection).

           *       *       *       *       *       *       *

                              ----------                              


                      TITLE 11, UNITED STATES CODE


                     CHAPTER 1--GENERAL PROVISIONS


Sec. 101. Definitions

   In this title the following definitions shall apply:
          (1) The term ``accountant'' means accountant 
        authorized under applicable law to practice public 
        accounting, and includes professional accounting 
        association, corporation, or partnership, if so 
        authorized.
          (2) The term ``affiliate'' means--
                  (A) entity that directly or indirectly owns, 
                controls, or holds with power to vote, 20 
                percent or more of the outstanding voting 
                securities of the debtor, other than an entity 
                that holds such securities--
                          (i) in a fiduciary or agency capacity 
                        without sole discretionary power to 
                        vote such securities; or
                          (ii) solely to secure a debt, if such 
                        entity has not in fact exercised such 
                        power to vote;
                  (B) corporation 20 percent or more of whose 
                outstanding voting securities are directly or 
                indirectly owned, controlled, or held with 
                power to vote, by the debtor, or by an entity 
                that directly or indirectly owns, controls, or 
                holds with power to vote, 20 percent or more of 
                the outstanding voting securities of the 
                debtor, other than an entity that holds such 
                securities--
                          (i) in a fiduciary or agency capacity 
                        without sole discretionary power to 
                        vote such securities; or
                          (ii) solely to secure a debt, if such 
                        entity has not in fact exercised such 
                        power to vote;
                  (C) person whose business is operated under a 
                lease or operating agreement by a debtor, or 
                person substantially all of whose property is 
                operated under an operating agreement with the 
                debtor; or
                  (D) entity that operates the business or 
                substantially all of the property of the debtor 
                under a lease or operating agreement.
          (3) The term ``assisted person'' means any person 
        whose debts consist primarily of consumer debts and the 
        value of whose nonexempt property is less than 
        $150,000.
          (4) The term ``attorney'' means attorney, 
        professional law association, corporation, or 
        partnership, authorized under applicable law to 
        practice law.
          (4A) The term ``bankruptcy assistance'' means any 
        goods or services sold or otherwise provided to an 
        assisted person with the express or implied purpose of 
        providing information, advice, counsel, document 
        preparation, or filing, or attendance at a creditors' 
        meeting or appearing in a case or proceeding on behalf 
        of another or providing legal representation with 
        respect to a case or proceeding under this title.
          (5) The term ``claim'' means--
                  (A) right to payment, whether or not such 
                right is reduced to judgment, liquidated, 
                unliquidated, fixed, contingent, matured, 
                unmatured, disputed, undisputed, legal, 
                equitable, secured, or unsecured; or
                  (B) right to an equitable remedy for breach 
                of performance if such breach gives rise to a 
                right to payment, whether or not such right to 
                an equitable remedy is reduced to judgment, 
                fixed, contingent, matured, unmatured, 
                disputed, undisputed, secured, or unsecured.
          (6) The term ``commodity broker'' means futures 
        commission merchant, foreign futures commission 
        merchant, clearing organization, leverage transaction 
        merchant, or commodity options dealer, as defined in 
        section 761 of this title, with respect to which there 
        is a customer, as defined in section 761 of this title.
          (7) The term ``community claim'' means claim that 
        arose before the commencement of the case concerning 
        the debtor for which property of the kind specified in 
        section 541(a)(2) of this title is liable, whether or 
        not there is any such property at the time of the 
        commencement of the case.
          (7A) The term ``commercial fishing operation'' 
        means--
                  (A) the catching or harvesting of fish, 
                shrimp, lobsters, urchins, seaweed, shellfish, 
                or other aquatic species or products of such 
                species; or
                  (B) for purposes of section 109 and chapter 
                12, aquaculture activities consisting of 
                raising for market any species or product 
                described in subparagraph (A).
          (7B) The term ``commercial fishing vessel'' means a 
        vessel used by a family fisherman to carry out a 
        commercial fishing operation.
          (8) The term ``consumer debt'' means debt incurred by 
        an individual primarily for a personal, family, or 
        household purpose.
          (9) The term ``corporation''--
                  (A) includes--
                          (i) association having a power or 
                        privilege that a private corporation, 
                        but not an individual or a partnership, 
                        possesses;
                          (ii) partnership association 
                        organized under a law that makes only 
                        the capital subscribed responsible for 
                        the debts of such association;
                          (iii) joint-stock company;
                          (iv) unincorporated company or 
                        association; or
                          (v) business trust; but
                  (B) does not include limited partnership.
          (9A) The term ``covered financial corporation'' means 
        any corporation incorporated or organized under any 
        Federal or State law, other than a stockbroker, a 
        commodity broker, or an entity of the kind specified in 
        paragraph (2) or (3) of section 109(b), that is--
                  (A) a bank holding company, as defined in 
                section 2(a) of the Bank Holding Company Act of 
                1956; or
                  (B) a corporation that exists for the primary 
                purpose of owning, controlling and financing 
                its subsidiaries, that has total consolidated 
                assets of $50,000,000,000 or greater, and for 
                which, in its most recently completed fiscal 
                year--
                          (i) annual gross revenues derived by 
                        the corporation and all of its 
                        subsidiaries from activities that are 
                        financial in nature (as defined in 
                        section 4(k) of the Bank Holding 
                        Company Act of 1956) and, if 
                        applicable, from the ownership or 
                        control of one or more insured 
                        depository institutions, represents 85 
                        percent or more of the consolidated 
                        annual gross revenues of the 
                        corporation; or
                          (ii) the consolidated assets of the 
                        corporation and all of its subsidiaries 
                        related to activities that are 
                        financial in nature (as defined in 
                        section 4(k) of the Bank Holding 
                        Company Act of 1956) and, if 
                        applicable, related to the ownership or 
                        control of one or more insured 
                        depository institutions, represents 85 
                        percent or more of the consolidated 
                        assets of the corporation.
          (10) The term ``creditor'' means--
                  (A) entity that has a claim against the 
                debtor that arose at the time of or before the 
                order for relief concerning the debtor;
                  (B) entity that has a claim against the 
                estate of a kind specified in section 348(d), 
                502(f), 502(g), 502(h) or 502(i) of this title; 
                or
                  (C) entity that has a community claim.
          (10A) The term ``current monthly income''--
                  (A) means the average monthly income from all 
                sources that the debtor receives (or in a joint 
                case the debtor and the debtor's spouse 
                receive) without regard to whether such income 
                is taxable income, derived during the 6-month 
                period ending on--
                          (i) the last day of the calendar 
                        month immediately preceding the date of 
                        the commencement of the case if the 
                        debtor files the schedule of current 
                        income required by section 
                        521(a)(1)(B)(ii); or
                          (ii) the date on which current income 
                        is determined by the court for purposes 
                        of this title if the debtor does not 
                        file the schedule of current income 
                        required by section 521(a)(1)(B)(ii); 
                        and
                  (B) includes any amount paid by any entity 
                other than the debtor (or in a joint case the 
                debtor and the debtor's spouse), on a regular 
                basis for the household expenses of the debtor 
                or the debtor's dependents (and in a joint case 
                the debtor's spouse if not otherwise a 
                dependent), but excludes benefits received 
                under the Social Security Act, payments to 
                victims of war crimes or crimes against 
                humanity on account of their status as victims 
                of such crimes, and payments to victims of 
                international terrorism (as defined in section 
                2331 of title 18) or domestic terrorism (as 
                defined in section 2331 of title 18) on account 
                of their status as victims of such terrorism.
          (11) The term ``custodian'' means--
                  (A) receiver or trustee of any of the 
                property of the debtor, appointed in a case or 
                proceeding not under this title;
                  (B) assignee under a general assignment for 
                the benefit of the debtor's creditors; or
                  (C) trustee, receiver, or agent under 
                applicable law, or under a contract, that is 
                appointed or authorized to take charge of 
                property of the debtor for the purpose of 
                enforcing a lien against such property, or for 
                the purpose of general administration of such 
                property for the benefit of the debtor's 
                creditors.
          (12) The term ``debt'' means liability on a claim.
          (12A) The term ``debt relief agency'' means any 
        person who provides any bankruptcy assistance to an 
        assisted person in return for the payment of money or 
        other valuable consideration, or who is a bankruptcy 
        petition preparer under section 110, but does not 
        include--
                  (A) any person who is an officer, director, 
                employee, or agent of a person who provides 
                such assistance or of the bankruptcy petition 
                preparer;
                  (B) a nonprofit organization that is exempt 
                from taxation under section 501(c)(3) of the 
                Internal Revenue Code of 1986;
                  (C) a creditor of such assisted person, to 
                the extent that the creditor is assisting such 
                assisted person to restructure any debt owed by 
                such assisted person to the creditor;
                  (D) a depository institution (as defined in 
                section 3 of the Federal Deposit Insurance Act) 
                or any Federal credit union or State credit 
                union (as those terms are defined in section 
                101 of the Federal Credit Union Act), or any 
                affiliate or subsidiary of such depository 
                institution or credit union; or
                  (E) an author, publisher, distributor, or 
                seller of works subject to copyright protection 
                under title 17, when acting in such capacity.
          (13) The term ``debtor'' means person or municipality 
        concerning which a case under this title has been 
        commenced.
          (13A) The term ``debtor's principal residence''--
                  (A) means a residential structure if used as 
                the principal residence by the debtor, 
                including incidental property, without regard 
                to whether that structure is attached to real 
                property; and
                  (B) includes an individual condominium or 
                cooperative unit, a mobile or manufactured 
                home, or trailer if used as the principal 
                residence by the debtor.
          (14) The term ``disinterested person'' means a person 
        that--
                  (A) is not a creditor, an equity security 
                holder, or an insider;
                  (B) is not and was not, within 2 years before 
                the date of the filing of the petition, a 
                director, officer, or employee of the debtor; 
                and
                  (C) does not have an interest materially 
                adverse to the interest of the estate or of any 
                class of creditors or equity security holders, 
                by reason of any direct or indirect 
                relationship to, connection with, or interest 
                in, the debtor, or for any other reason.
          (14A) The term ``domestic support obligation'' means 
        a debt that accrues before, on, or after the date of 
        the order for relief in a case under this title, 
        including interest that accrues on that debt as 
        provided under applicable nonbankruptcy law 
        notwithstanding any other provision of this title, that 
        is--
                  (A) owed to or recoverable by--
                          (i) a spouse, former spouse, or child 
                        of the debtor or such child's parent, 
                        legal guardian, or responsible 
                        relative; or
                          (ii) a governmental unit;
                  (B) in the nature of alimony, maintenance, or 
                support (including assistance provided by a 
                governmental unit) of such spouse, former 
                spouse, or child of the debtor or such child's 
                parent, without regard to whether such debt is 
                expressly so designated;
                  (C) established or subject to establishment 
                before, on, or after the date of the order for 
                relief in a case under this title, by reason of 
                applicable provisions of--
                          (i) a separation agreement, divorce 
                        decree, or property settlement 
                        agreement;
                          (ii) an order of a court of record; 
                        or
                          (iii) a determination made in 
                        accordance with applicable 
                        nonbankruptcy law by a governmental 
                        unit; and
                  (D) not assigned to a nongovernmental entity, 
                unless that obligation is assigned voluntarily 
                by the spouse, former spouse, child of the 
                debtor, or such child's parent, legal guardian, 
                or responsible relative for the purpose of 
                collecting the debt.
          (15) The term ``entity'' includes person, estate, 
        trust, governmental unit, and United States trustee.
          (16) The term ``equity security'' means--
                  (A) share in a corporation, whether or not 
                transferable or denominated ``stock'', or 
                similar security;
                  (B) interest of a limited partner in a 
                limited partnership; or
                  (C) warrant or right, other than a right to 
                convert, to purchase, sell, or subscribe to a 
                share, security, or interest of a kind 
                specified in subparagraph (A) or (B) of this 
                paragraph.
          (17) The term ``equity security holder'' means holder 
        of an equity security of the debtor.
          (18) The term ``family farmer'' means--
                  (A) individual or individual and spouse 
                engaged in a farming operation whose aggregate 
                debts do not exceed $3,237,000 and not less 
                than 50 percent of whose aggregate 
                noncontingent, liquidated debts (excluding a 
                debt for the principal residence of such 
                individual or such individual and spouse unless 
                such debt arises out of a farming operation), 
                on the date the case is filed, arise out of a 
                farming operation owned or operated by such 
                individual or such individual and spouse, and 
                such individual or such individual and spouse 
                receive from such farming operation more than 
                50 percent of such individual's or such 
                individual and spouse's gross income for--
                          (i) the taxable year preceding; or
                          (ii) each of the 2d and 3d taxable 
                        years preceding;
                the taxable year in which the case concerning 
                such individual or such individual and spouse 
                was filed; or
                  (B) corporation or partnership in which more 
                than 50 percent of the outstanding stock or 
                equity is held by one family, or by one family 
                and the relatives of the members of such 
                family, and such family or such relatives 
                conduct the farming operation, and
                          (i) more than 80 percent of the value 
                        of its assets consists of assets 
                        related to the farming operation;
                          (ii) its aggregate debts do not 
                        exceed $3,237,000 and not less than 50 
                        percent of its aggregate noncontingent, 
                        liquidated debts (excluding a debt for 
                        one dwelling which is owned by such 
                        corporation or partnership and which a 
                        shareholder or partner maintains as a 
                        principal residence, unless such debt 
                        arises out of a farming operation), on 
                        the date the case is filed, arise out 
                        of the farming operation owned or 
                        operated by such corporation or such 
                        partnership; and
                          (iii) if such corporation issues 
                        stock, such stock is not publicly 
                        traded.
          (19) The term ``family farmer with regular annual 
        income'' means family farmer whose annual income is 
        sufficiently stable and regular to enable such family 
        farmer to make payments under a plan under chapter 12 
        of this title.
          (19A) The term ``family fisherman'' means--
                  (A) an individual or individual and spouse 
                engaged in a commercial fishing operation--
                          (i) whose aggregate debts do not 
                        exceed $1,500,000 and not less than 80 
                        percent of whose aggregate 
                        noncontingent, liquidated debts 
                        (excluding a debt for the principal 
                        residence of such individual or such 
                        individual and spouse, unless such debt 
                        arises out of a commercial fishing 
                        operation), on the date the case is 
                        filed, arise out of a commercial 
                        fishing operation owned or operated by 
                        such individual or such individual and 
                        spouse; and
                          (ii) who receive from such commercial 
                        fishing operation more than 50 percent 
                        of such individual's or such 
                        individual's and spouse's gross income 
                        for the taxable year preceding the 
                        taxable year in which the case 
                        concerning such individual or such 
                        individual and spouse was filed; or
                  (B) a corporation or partnership--
                          (i) in which more than 50 percent of 
                        the outstanding stock or equity is held 
                        by--
                                  (I) 1 family that conducts 
                                the commercial fishing 
                                operation; or
                                  (II) 1 family and the 
                                relatives of the members of 
                                such family, and such family or 
                                such relatives conduct the 
                                commercial fishing operation; 
                                and
                          (ii)(I) more than 80 percent of the 
                        value of its assets consists of assets 
                        related to the commercial fishing 
                        operation;
                          (II) its aggregate debts do not 
                        exceed $1,500,000 and not less than 80 
                        percent of its aggregate noncontingent, 
                        liquidated debts (excluding a debt for 
                        1 dwelling which is owned by such 
                        corporation or partnership and which a 
                        shareholder or partner maintains as a 
                        principal residence, unless such debt 
                        arises out of a commercial fishing 
                        operation), on the date the case is 
                        filed, arise out of a commercial 
                        fishing operation owned or operated by 
                        such corporation or such partnership; 
                        and
                          (III) if such corporation issues 
                        stock, such stock is not publicly 
                        traded.
          (19B) The term ``family fisherman with regular annual 
        income'' means a family fisherman whose annual income 
        is sufficiently stable and regular to enable such 
        family fisherman to make payments under a plan under 
        chapter 12 of this title.
          (20) The term ``farmer'' means (except when such term 
        appears in the term ``family farmer'') person that 
        received more than 80 percent of such person's gross 
        income during the taxable year of such person 
        immediately preceding the taxable year of such person 
        during which the case under this title concerning such 
        person was commenced from a farming operation owned or 
        operated by such person.
          (21) The term ``farming operation'' includes farming, 
        tillage of the soil, dairy farming, ranching, 
        production or raising of crops, poultry, or livestock, 
        and production of poultry or livestock products in an 
        unmanufactured state.
          (21A) The term ``farmout agreement'' means a written 
        agreement in which--
                  (A) the owner of a right to drill, produce, 
                or operate liquid or gaseous hydrocarbons on 
                property agrees or has agreed to transfer or 
                assign all or a part of such right to another 
                entity; and
                  (B) such other entity (either directly or 
                through its agents or its assigns), as 
                consideration, agrees to perform drilling, 
                reworking, recompleting, testing, or similar or 
                related operations, to develop or produce 
                liquid or gaseous hydrocarbons on the property.
          (21B) The term ``Federal depository institutions 
        regulatory agency'' means--
                  (A) with respect to an insured depository 
                institution (as defined in section 3(c)(2) of 
                the Federal Deposit Insurance Act) for which no 
                conservator or receiver has been appointed, the 
                appropriate Federal banking agency (as defined 
                in section 3(q) of such Act);
                  (B) with respect to an insured credit union 
                (including an insured credit union for which 
                the National Credit Union Administration has 
                been appointed conservator or liquidating 
                agent), the National Credit Union 
                Administration;
                  (C) with respect to any insured depository 
                institution for which the Resolution Trust 
                Corporation has been appointed conservator or 
                receiver, the Resolution Trust Corporation; and
                  (D) with respect to any insured depository 
                institution for which the Federal Deposit 
                Insurance Corporation has been appointed 
                conservator or receiver, the Federal Deposit 
                Insurance Corporation.
          (22) The term ``financial institution'' means--
                  (A) a Federal reserve bank, or an entity that 
                is a commercial or savings bank, industrial 
                savings bank, savings and loan association, 
                trust company, federally-insured credit union, 
                or receiver, liquidating agent, or conservator 
                for such entity and, when any such Federal 
                reserve bank, receiver, liquidating agent, 
                conservator or entity is acting as agent or 
                custodian for a customer (whether or not a 
                ``customer'', as defined in section 741) in 
                connection with a securities contract (as 
                defined in section 741) such customer; or
                  (B) in connection with a securities contract 
                (as defined in section 741) an investment 
                company registered under the Investment Company 
                Act of 1940.
          (22A) The term ``financial participant'' means--
                  (A) an entity that, at the time it enters 
                into a securities contract, commodity contract, 
                swap agreement, repurchase agreement, or 
                forward contract, or at the time of the date of 
                the filing of the petition, has one or more 
                agreements or transactions described in 
                paragraph (1), (2), (3), (4), (5), or (6) of 
                section 561(a) with the debtor or any other 
                entity (other than an affiliate) of a total 
                gross dollar value of not less than 
                $1,000,000,000 in notional or actual principal 
                amount outstanding (aggregated across 
                counterparties) at such time or on any day 
                during the 15-month period preceding the date 
                of the filing of the petition, or has gross 
                mark-to-market positions of not less than 
                $100,000,000 (aggregated across counterparties) 
                in one or more such agreements or transactions 
                with the debtor or any other entity (other than 
                an affiliate) at such time or on any day during 
                the 15-month period preceding the date of the 
                filing of the petition; or
                  (B) a clearing organization (as defined in 
                section 402 of the Federal Deposit Insurance 
                Corporation Improvement Act of 1991).
          (23) The term ``foreign proceeding'' means a 
        collective judicial or administrative proceeding in a 
        foreign country, including an interim proceeding, under 
        a law relating to insolvency or adjustment of debt in 
        which proceeding the assets and affairs of the debtor 
        are subject to control or supervision by a foreign 
        court, for the purpose of reorganization or 
        liquidation.
          (24) The term ``foreign representative'' means a 
        person or body, including a person or body appointed on 
        an interim basis, authorized in a foreign proceeding to 
        administer the reorganization or the liquidation of the 
        debtor's assets or affairs or to act as a 
        representative of such foreign proceeding.
          (25) The term ``forward contract'' means--
                  (A) a contract (other than a commodity 
                contract, as defined in section 761) for the 
                purchase, sale, or transfer of a commodity, as 
                defined in section 761(8) of this title, or any 
                similar good, article, service, right, or 
                interest which is presently or in the future 
                becomes the subject of dealing in the forward 
                contract trade, or product or byproduct 
                thereof, with a maturity date more than two 
                days after the date the contract is entered 
                into, including, but not limited to, a 
                repurchase or reverse repurchase transaction 
                (whether or not such repurchase or reverse 
                repurchase transaction is a ``repurchase 
                agreement'', as defined in this section) 
                consignment, lease, swap, hedge transaction, 
                deposit, loan, option, allocated transaction, 
                unallocated transaction, or any other similar 
                agreement;
                  (B) any combination of agreements or 
                transactions referred to in subparagraphs (A) 
                and (C);
                  (C) any option to enter into an agreement or 
                transaction referred to in subparagraph (A) or 
                (B);
                  (D) a master agreement that provides for an 
                agreement or transaction referred to in 
                subparagraph (A), (B), or (C), together with 
                all supplements to any such master agreement, 
                without regard to whether such master agreement 
                provides for an agreement or transaction that 
                is not a forward contract under this paragraph, 
                except that such master agreement shall be 
                considered to be a forward contract under this 
                paragraph only with respect to each agreement 
                or transaction under such master agreement that 
                is referred to in subparagraph (A), (B), or 
                (C); or
                  (E) any security agreement or arrangement, or 
                other credit enhancement related to any 
                agreement or transaction referred to in 
                subparagraph (A), (B), (C), or (D), including 
                any guarantee or reimbursement obligation by or 
                to a forward contract merchant or financial 
                participant in connection with any agreement or 
                transaction referred to in any such 
                subparagraph, but not to exceed the damages in 
                connection with any such agreement or 
                transaction, measured in accordance with 
                section 562.
          (26) The term ``forward contract merchant'' means a 
        Federal reserve bank, or an entity the business of 
        which consists in whole or in part of entering into 
        forward contracts as or with merchants in a commodity 
        (as defined in section 761) or any similar good, 
        article, service, right, or interest which is presently 
        or in the future becomes the subject of dealing in the 
        forward contract trade.
          (27) The term ``governmental unit'' means United 
        States; State; Commonwealth; District; Territory; 
        municipality; foreign state; department, agency, or 
        instrumentality of the United States (but not a United 
        States trustee while serving as a trustee in a case 
        under this title), a State, a Commonwealth, a District, 
        a Territory, a municipality, or a foreign state; or 
        other foreign or domestic government.
          (27A) The term ``health care business''--
                  (A) means any public or private entity 
                (without regard to whether that entity is 
                organized for profit or not for profit) that is 
                primarily engaged in offering to the general 
                public facilities and services for--
                          (i) the diagnosis or treatment of 
                        injury, deformity, or disease; and
                          (ii) surgical, drug treatment, 
                        psychiatric, or obstetric care; and
                  (B) includes--
                          (i) any--
                                  (I) general or specialized 
                                hospital;
                                  (II) ancillary ambulatory, 
                                emergency, or surgical 
                                treatment facility;
                                  (III) hospice;
                                  (IV) home health agency; and
                                  (V) other health care 
                                institution that is similar to 
                                an entity referred to in 
                                subclause (I), (II), (III), or 
                                (IV); and
                          (ii) any long-term care facility, 
                        including any--
                                  (I) skilled nursing facility;
                                  (II) intermediate care 
                                facility;
                                  (III) assisted living 
                                facility;
                                  (IV) home for the aged;
                                  (V) domiciliary care 
                                facility; and
                                  (VI) health care institution 
                                that is related to a facility 
                                referred to in subclause (I), 
                                (II), (III), (IV), or (V), if 
                                that institution is primarily 
                                engaged in offering room, 
                                board, laundry, or personal 
                                assistance with activities of 
                                daily living and incidentals to 
                                activities of daily living.
          (27B) The term ``incidental property'' means, with 
        respect to a debtor's principal residence--
                  (A) property commonly conveyed with a 
                principal residence in the area where the real 
                property is located;
                  (B) all easements, rights, appurtenances, 
                fixtures, rents, royalties, mineral rights, oil 
                or gas rights or profits, water rights, escrow 
                funds, or insurance proceeds; and
                  (C) all replacements or additions.
          (28) The term ``indenture'' means mortgage, deed of 
        trust, or indenture, under which there is outstanding a 
        security, other than a voting-trust certificate, 
        constituting a claim against the debtor, a claim 
        secured by a lien on any of the debtor's property, or 
        an equity security of the debtor.
          (29) The term ``indenture trustee'' means trustee 
        under an indenture.
          (30) The term ``individual with regular income'' 
        means individual whose income is sufficiently stable 
        and regular to enable such individual to make payments 
        under a plan under chapter 13 of this title, other than 
        a stockbroker or a commodity broker.
          (31) The term ``insider'' includes--
                  (A) if the debtor is an individual--
                          (i) relative of the debtor or of a 
                        general partner of the debtor;
                          (ii) partnership in which the debtor 
                        is a general partner;
                          (iii) general partner of the debtor; 
                        or
                          (iv) corporation of which the debtor 
                        is a director, officer, or person in 
                        control;
                  (B) if the debtor is a corporation--
                          (i) director of the debtor;
                          (ii) officer of the debtor;
                          (iii) person in control of the 
                        debtor;
                          (iv) partnership in which the debtor 
                        is a general partner;
                          (v) general partner of the debtor; or
                          (vi) relative of a general partner, 
                        director, officer, or person in control 
                        of the debtor;
                  (C) if the debtor is a partnership--
                          (i) general partner in the debtor;
                          (ii) relative of a general partner 
                        in, general partner of, or person in 
                        control of the debtor;
                          (iii) partnership in which the debtor 
                        is a general partner;
                          (iv) general partner of the debtor; 
                        or
                          (v) person in control of the debtor;
                  (D) if the debtor is a municipality, elected 
                official of the debtor or relative of an 
                elected official of the debtor;
                  (E) affiliate, or insider of an affiliate as 
                if such affiliate were the debtor; and
                  (F) managing agent of the debtor.
          (32) The term ``insolvent'' means--
                  (A) with reference to an entity other than a 
                partnership and a municipality, financial 
                condition such that the sum of such entity's 
                debts is greater than all of such entity's 
                property, at a fair valuation, exclusive of--
                          (i) property transferred, concealed, 
                        or removed with intent to hinder, 
                        delay, or defraud such entity's 
                        creditors; and
                          (ii) property that may be exempted 
                        from property of the estate under 
                        section 522 of this title;
                  (B) with reference to a partnership, 
                financial condition such that the sum of such 
                partnership's debts is greater than the 
                aggregate of, at a fair valuation--
                          (i) all of such partnership's 
                        property, exclusive of property of the 
                        kind specified in subparagraph (A)(i) 
                        of this paragraph; and
                          (ii) the sum of the excess of the 
                        value of each general partner's 
                        nonpartnership property, exclusive of 
                        property of the kind specified in 
                        subparagraph (A) of this paragraph, 
                        over such partner's nonpartnership 
                        debts; and
                  (C) with reference to a municipality, 
                financial condition such that the municipality 
                is--
                          (i) generally not paying its debts as 
                        they become due unless such debts are 
                        the subject of a bona fide dispute; or
                          (ii) unable to pay its debts as they 
                        become due.
          (33) The term ``institution-affiliated party''--
                  (A) with respect to an insured depository 
                institution (as defined in section 3(c)(2) of 
                the Federal Deposit Insurance Act), has the 
                meaning given it in section 3(u) of the Federal 
                Deposit Insurance Act; and
                  (B) with respect to an insured credit union, 
                has the meaning given it in section 206(r) of 
                the Federal Credit Union Act.
          (34) The term ``insured credit union'' has the 
        meaning given it in section 101(7) of the Federal 
        Credit Union Act.
          (35) The term ``insured depository institution''--
                  (A) has the meaning given it in section 
                3(c)(2) of the Federal Deposit Insurance Act; 
                and
                  (B) includes an insured credit union (except 
                in the case of paragraphs (21B) and (33)(A) of 
                this subsection).
          (35A) The term ``intellectual property'' means--
                  (A) trade secret;
                  (B) invention, process, design, or plant 
                protected under title 35;
                  (C) patent application;
                  (D) plant variety;
                  (E) work of authorship protected under title 
                17; or
                  (F) mask work protected under chapter 9 of 
                title 17;
        to the extent protected by applicable nonbankruptcy 
        law.
          (36) The term ``judicial lien'' means lien obtained 
        by judgment, levy, sequestration, or other legal or 
        equitable process or proceeding.
          (37) The term ``lien'' means charge against or 
        interest in property to secure payment of a debt or 
        performance of an obligation.
          (38) The term ``margin payment'' means, for purposes 
        of the forward contract provisions of this title, 
        payment or deposit of cash, a security or other 
        property, that is commonly known in the forward 
        contract trade as original margin, initial margin, 
        maintenance margin, or variation margin, including 
        mark-to-market payments, or variation payments.
          (38A) The term ``master netting agreement''--
                  (A) means an agreement providing for the 
                exercise of rights, including rights of 
                netting, setoff, liquidation, termination, 
                acceleration, or close out, under or in 
                connection with one or more contracts that are 
                described in any one or more of paragraphs (1) 
                through (5) of section 561(a), or any security 
                agreement or arrangement or other credit 
                enhancement related to one or more of the 
                foregoing, including any guarantee or 
                reimbursement obligation related to 1 or more 
                of the foregoing; and
                  (B) if the agreement contains provisions 
                relating to agreements or transactions that are 
                not contracts described in paragraphs (1) 
                through (5) of section 561(a), shall be deemed 
                to be a master netting agreement only with 
                respect to those agreements or transactions 
                that are described in any one or more of 
                paragraphs (1) through (5) of section 561(a).
          (38B) The term ``master netting agreement 
        participant'' means an entity that, at any time before 
        the date of the filing of the petition, is a party to 
        an outstanding master netting agreement with the 
        debtor.
          (39) The term ``mask work'' has the meaning given it 
        in section 901(a)(2) of title 17.
          (39A) The term ``median family income'' means for any 
        year--
                  (A) the median family income both calculated 
                and reported by the Bureau of the Census in the 
                then most recent year; and
                  (B) if not so calculated and reported in the 
                then current year, adjusted annually after such 
                most recent year until the next year in which 
                median family income is both calculated and 
                reported by the Bureau of the Census, to 
                reflect the percentage change in the Consumer 
                Price Index for All Urban Consumers during the 
                period of years occurring after such most 
                recent year and before such current year.
          (40) The term ``municipality'' means political 
        subdivision or public agency or instrumentality of a 
        State.
          (40A) The term ``patient'' means any individual who 
        obtains or receives services from a health care 
        business.
          (40B) The term ``patient records'' means any record 
        relating to a patient, including a written document or 
        a record recorded in a magnetic, optical, or other form 
        of electronic medium.
          (41) The term ``person'' includes individual, 
        partnership, and corporation, but does not include 
        governmental unit, except that a governmental unit 
        that--
                  (A) acquires an asset from a person--
                          (i) as a result of the operation of a 
                        loan guarantee agreement; or
                          (ii) as receiver or liquidating agent 
                        of a person;
                  (B) is a guarantor of a pension benefit 
                payable by or on behalf of the debtor or an 
                affiliate of the debtor; or
                  (C) is the legal or beneficial owner of an 
                asset of--
                          (i) an employee pension benefit plan 
                        that is a governmental plan, as defined 
                        in section 414(d) of the Internal 
                        Revenue Code of 1986; or
                          (ii) an eligible deferred 
                        compensation plan, as defined in 
                        section 457(b) of the Internal Revenue 
                        Code of 1986;
        shall be considered, for purposes of section 1102 of 
        this title, to be a person with respect to such asset 
        or such benefit.
          (41A) The term ``personally identifiable 
        information'' means--
                  (A) if provided by an individual to the 
                debtor in connection with obtaining a product 
                or a service from the debtor primarily for 
                personal, family, or household purposes--
                          (i) the first name (or initial) and 
                        last name of such individual, whether 
                        given at birth or time of adoption, or 
                        resulting from a lawful change of name;
                          (ii) the geographical address of a 
                        physical place of residence of such 
                        individual;
                          (iii) an electronic address 
                        (including an e-mail address) of such 
                        individual;
                          (iv) a telephone number dedicated to 
                        contacting such individual at such 
                        physical place of residence;
                          (v) a social security account number 
                        issued to such individual; or
                          (vi) the account number of a credit 
                        card issued to such individual; or
                  (B) if identified in connection with 1 or 
                more of the items of information specified in 
                subparagraph (A)--
                          (i) a birth date, the number of a 
                        certificate of birth or adoption, or a 
                        place of birth; or
                          (ii) any other information concerning 
                        an identified individual that, if 
                        disclosed, will result in contacting or 
                        identifying such individual physically 
                        or electronically.
          (42) The term ``petition'' means petition filed under 
        section 301, 302, 303 and 1504 of this title, as the 
        case may be, commencing a case under this title.
          (42A) The term ``production payment'' means a term 
        overriding royalty satisfiable in cash or in kind--
                  (A) contingent on the production of a liquid 
                or gaseous hydrocarbon from particular real 
                property; and
                  (B) from a specified volume, or a specified 
                value, from the liquid or gaseous hydrocarbon 
                produced from such property, and determined 
                without regard to production costs.
          (43) The term ``purchaser'' means transferee of a 
        voluntary transfer, and includes immediate or mediate 
        transferee of such a transferee.
          (44) The term ``railroad'' means common carrier by 
        railroad engaged in the transportation of individuals 
        or property or owner of trackage facilities leased by 
        such a common carrier.
          (45) The term ``relative'' means individual related 
        by affinity or consanguinity within the third degree as 
        determined by the common law, or individual in a step 
        or adoptive relationship within such third degree.
          (46) The term ``repo participant'' means an entity 
        that, at any time before the filing of the petition, 
        has an outstanding repurchase agreement with the 
        debtor.
          (47) The term ``repurchase agreement'' (which 
        definition also applies to a reverse repurchase 
        agreement)--
                  (A) means--
                          (i) an agreement, including related 
                        terms, which provides for the transfer 
                        of one or more certificates of deposit, 
                        mortgage related securities (as defined 
                        in section 3 of the Securities Exchange 
                        Act of 1934), mortgage loans, interests 
                        in mortgage related securities or 
                        mortgage loans, eligible bankers' 
                        acceptances, qualified foreign 
                        government securities (defined as a 
                        security that is a direct obligation 
                        of, or that is fully guaranteed by, the 
                        central government of a member of the 
                        Organization for Economic Cooperation 
                        and Development), or securities that 
                        are direct obligations of, or that are 
                        fully guaranteed by, the United States 
                        or any agency of the United States 
                        against the transfer of funds by the 
                        transferee of such certificates of 
                        deposit, eligible bankers' acceptances, 
                        securities, mortgage loans, or 
                        interests, with a simultaneous 
                        agreement by such transferee to 
                        transfer to the transferor thereof 
                        certificates of deposit, eligible 
                        bankers' acceptance, securities, 
                        mortgage loans, or interests of the 
                        kind described in this clause, at a 
                        date certain not later than 1 year 
                        after such transfer or on demand, 
                        against the transfer of funds;
                          (ii) any combination of agreements or 
                        transactions referred to in clauses (i) 
                        and (iii);
                          (iii) an option to enter into an 
                        agreement or transaction referred to in 
                        clause (i) or (ii);
                          (iv) a master agreement that provides 
                        for an agreement or transaction 
                        referred to in clause (i), (ii), or 
                        (iii), together with all supplements to 
                        any such master agreement, without 
                        regard to whether such master agreement 
                        provides for an agreement or 
                        transaction that is not a repurchase 
                        agreement under this paragraph, except 
                        that such master agreement shall be 
                        considered to be a repurchase agreement 
                        under this paragraph only with respect 
                        to each agreement or transaction under 
                        the master agreement that is referred 
                        to in clause (i), (ii), or (iii); or
                          (v) any security agreement or 
                        arrangement or other credit enhancement 
                        related to any agreement or transaction 
                        referred to in clause (i), (ii), (iii), 
                        or (iv), including any guarantee or 
                        reimbursement obligation by or to a 
                        repo participant or financial 
                        participant in connection with any 
                        agreement or transaction referred to in 
                        any such clause, but not to exceed the 
                        damages in connection with any such 
                        agreement or transaction, measured in 
                        accordance with section 562 of this 
                        title; and
                  (B) does not include a repurchase obligation 
                under a participation in a commercial mortgage 
                loan.
          (48) The term ``securities clearing agency'' means 
        person that is registered as a clearing agency under 
        section 17A of the Securities Exchange Act of 1934, or 
        exempt from such registration under such section 
        pursuant to an order of the Securities and Exchange 
        Commission, or whose business is confined to the 
        performance of functions of a clearing agency with 
        respect to exempted securities, as defined in section 
        3(a)(12) of such Act for the purposes of such section 
        17A.
          (48A) The term ``securities self regulatory 
        organization'' means either a securities association 
        registered with the Securities and Exchange Commission 
        under section 15A of the Securities Exchange Act of 
        1934 or a national securities exchange registered with 
        the Securities and Exchange Commission under section 6 
        of the Securities Exchange Act of 1934.
          (49) The term ``security''--
                  (A) includes--
                          (i) note;
                          (ii) stock;
                          (iii) treasury stock;
                          (iv) bond;
                          (v) debenture;
                          (vi) collateral trust certificate;
                          (vii) pre-organization certificate or 
                        subscription;
                          (viii) transferable share;
                          (ix) voting-trust certificate;
                          (x) certificate of deposit;
                          (xi) certificate of deposit for 
                        security;
                          (xii) investment contract or 
                        certificate of interest or 
                        participation in a profit-sharing 
                        agreement or in an oil, gas, or mineral 
                        royalty or lease, if such contract or 
                        interest is required to be the subject 
                        of a registration statement filed with 
                        the Securities and Exchange Commission 
                        under the provisions of the Securities 
                        Act of 1933, or is exempt under section 
                        3(b) of such Act from the requirement 
                        to file such a statement;
                          (xiii) interest of a limited partner 
                        in a limited partnership;
                          (xiv) other claim or interest 
                        commonly known as ``security''; and
                          (xv) certificate of interest or 
                        participation in, temporary or interim 
                        certificate for, receipt for, or 
                        warrant or right to subscribe to or 
                        purchase or sell, a security; but
                  (B) does not include--
                          (i) currency, check, draft, bill of 
                        exchange, or bank letter of credit;
                          (ii) leverage transaction, as defined 
                        in section 761 of this title;
                          (iii) commodity futures contract or 
                        forward contract;
                          (iv) option, warrant, or right to 
                        subscribe to or purchase or sell a 
                        commodity futures contract;
                          (v) option to purchase or sell a 
                        commodity;
                          (vi) contract or certificate of a 
                        kind specified in subparagraph (A)(xii) 
                        of this paragraph that is not required 
                        to be the subject of a registration 
                        statement filed with the Securities and 
                        Exchange Commission and is not exempt 
                        under section 3(b) of the Securities 
                        Act of 1933 from the requirement to 
                        file such a statement; or
                          (vii) debt or evidence of 
                        indebtedness for goods sold and 
                        delivered or services rendered.
          (50) The term ``security agreement'' means agreement 
        that creates or provides for a security interest.
          (51) The term ``security interest'' means lien 
        created by an agreement.
          (51A) The term ``settlement payment'' means, for 
        purposes of the forward contract provisions of this 
        title, a preliminary settlement payment, a partial 
        settlement payment, an interim settlement payment, a 
        settlement payment on account, a final settlement 
        payment, a net settlement payment, or any other similar 
        payment commonly used in the forward contract trade.
          (51B) The term ``single asset real estate'' means 
        real property constituting a single property or 
        project, other than residential real property with 
        fewer than 4 residential units, which generates 
        substantially all of the gross income of a debtor who 
        is not a family farmer and on which no substantial 
        business is being conducted by a debtor other than the 
        business of operating the real property and activities 
        incidental thereto.
          (51C) The term ``small business case'' means a case 
        filed under chapter 11 of this title in which the 
        debtor is a small business debtor.
          (51D) The term ``small business debtor''--
                  (A) subject to subparagraph (B), means a 
                person engaged in commercial or business 
                activities (including any affiliate of such 
                person that is also a debtor under this title 
                and excluding a person whose primary activity 
                is the business of owning or operating real 
                property or activities incidental thereto) that 
                has aggregate noncontingent liquidated secured 
                and unsecured debts as of the date of the 
                filing of the petition or the date of the order 
                for relief in an amount not more than 
                $2,000,000 (excluding debts owed to 1 or more 
                affiliates or insiders) for a case in which the 
                United States trustee has not appointed under 
                section 1102(a)(1) a committee of unsecured 
                creditors or where the court has determined 
                that the committee of unsecured creditors is 
                not sufficiently active and representative to 
                provide effective oversight of the debtor; and
                  (B) does not include any member of a group of 
                affiliated debtors that has aggregate 
                noncontingent liquidated secured and unsecured 
                debts in an amount greater than $2,000,000 
                (excluding debt owed to 1 or more affiliates or 
                insiders).
          (52) The term ``State'' includes the District of 
        Columbia and Puerto Rico, except for the purpose of 
        defining who may be a debtor under chapter 9 of this 
        title.
          (53) The term ``statutory lien'' means lien arising 
        solely by force of a statute on specified circumstances 
        or conditions, or lien of distress for rent, whether or 
        not statutory, but does not include security interest 
        or judicial lien, whether or not such interest or lien 
        is provided by or is dependent on a statute and whether 
        or not such interest or lien is made fully effective by 
        statute.
          (53A) The term ``stockbroker'' means person--
                  (A) with respect to which there is a 
                customer, as defined in section 741 of this 
                title; and
                  (B) that is engaged in the business of 
                effecting transactions in securities--
                          (i) for the account of others; or
                          (ii) with members of the general 
                        public, from or for such person's own 
                        account.
          (53B) The term ``swap agreement''--
                  (A) means--
                          (i) any agreement, including the 
                        terms and conditions incorporated by 
                        reference in such agreement, which is--
                                  (I) an interest rate swap, 
                                option, future, or forward 
                                agreement, including a rate 
                                floor, rate cap, rate collar, 
                                cross-currency rate swap, and 
                                basis swap;
                                  (II) a spot, same day-
                                tomorrow, tomorrow-next, 
                                forward, or other foreign 
                                exchange, precious metals, or 
                                other commodity agreement;
                                  (III) a currency swap, 
                                option, future, or forward 
                                agreement;
                                  (IV) an equity index or 
                                equity swap, option, future, or 
                                forward agreement;
                                  (V) a debt index or debt 
                                swap, option, future, or 
                                forward agreement;
                                  (VI) a total return, credit 
                                spread or credit swap, option, 
                                future, or forward agreement;
                                  (VII) a commodity index or a 
                                commodity swap, option, future, 
                                or forward agreement;
                                  (VIII) a weather swap, 
                                option, future, or forward 
                                agreement;
                                  (IX) an emissions swap, 
                                option, future, or forward 
                                agreement; or
                                  (X) an inflation swap, 
                                option, future, or forward 
                                agreement;
                          (ii) any agreement or transaction 
                        that is similar to any other agreement 
                        or transaction referred to in this 
                        paragraph and that--
                                  (I) is of a type that has 
                                been, is presently, or in the 
                                future becomes, the subject of 
                                recurrent dealings in the swap 
                                or other derivatives markets 
                                (including terms and conditions 
                                incorporated by reference 
                                therein); and
                                  (II) is a forward, swap, 
                                future, option, or spot 
                                transaction on one or more 
                                rates, currencies, commodities, 
                                equity securities, or other 
                                equity instruments, debt 
                                securities or other debt 
                                instruments, quantitative 
                                measures associated with an 
                                occurrence, extent of an 
                                occurrence, or contingency 
                                associated with a financial, 
                                commercial, or economic 
                                consequence, or economic or 
                                financial indices or measures 
                                of economic or financial risk 
                                or value;
                          (iii) any combination of agreements 
                        or transactions referred to in this 
                        subparagraph;
                          (iv) any option to enter into an 
                        agreement or transaction referred to in 
                        this subparagraph;
                          (v) a master agreement that provides 
                        for an agreement or transaction 
                        referred to in clause (i), (ii), (iii), 
                        or (iv), together with all supplements 
                        to any such master agreement, and 
                        without regard to whether the master 
                        agreement contains an agreement or 
                        transaction that is not a swap 
                        agreement under this paragraph, except 
                        that the master agreement shall be 
                        considered to be a swap agreement under 
                        this paragraph only with respect to 
                        each agreement or transaction under the 
                        master agreement that is referred to in 
                        clause (i), (ii), (iii), or (iv); or
                          (vi) any security agreement or 
                        arrangement or other credit enhancement 
                        related to any agreements or 
                        transactions referred to in clause (i) 
                        through (v), including any guarantee or 
                        reimbursement obligation by or to a 
                        swap participant or financial 
                        participant in connection with any 
                        agreement or transaction referred to in 
                        any such clause, but not to exceed the 
                        damages in connection with any such 
                        agreement or transaction, measured in 
                        accordance with section 562; and
                  (B) is applicable for purposes of this title 
                only, and shall not be construed or applied so 
                as to challenge or affect the characterization, 
                definition, or treatment of any swap agreement 
                under any other statute, regulation, or rule, 
                including the Gramm-Leach-Bliley Act, the Legal 
                Certainty for Bank Products Act of 2000, the 
                securities laws (as such term is defined in 
                section 3(a)(47) of the Securities Exchange Act 
                of 1934) and the Commodity Exchange Act.
          (53C) The term ``swap participant'' means an entity 
        that, at any time before the filing of the petition, 
        has an outstanding swap agreement with the debtor.
          (56A) The term ``term overriding royalty'' means an 
        interest in liquid or gaseous hydrocarbons in place or 
        to be produced from particular real property that 
        entitles the owner thereof to a share of production, or 
        the value thereof, for a term limited by time, 
        quantity, or value realized.
          (53D) The term ``timeshare plan'' means and shall 
        include that interest purchased in any arrangement, 
        plan, scheme, or similar device, but not including 
        exchange programs, whether by membership, agreement, 
        tenancy in common, sale, lease, deed, rental agreement, 
        license, right to use agreement, or by any other means, 
        whereby a purchaser, in exchange for consideration, 
        receives a right to use accommodations, facilities, or 
        recreational sites, whether improved or unimproved, for 
        a specific period of time less than a full year during 
        any given year, but not necessarily for consecutive 
        years, and which extends for a period of more than 
        three years. A ``timeshare interest'' is that interest 
        purchased in a timeshare plan which grants the 
        purchaser the right to use and occupy accommodations, 
        facilities, or recreational sites, whether improved or 
        unimproved, pursuant to a timeshare plan.
          (54) The term ``transfer'' means--
                  (A) the creation of a lien;
                  (B) the retention of title as a security 
                interest;
                  (C) the foreclosure of a debtor's equity of 
                redemption; or
                  (D) each mode, direct or indirect, absolute 
                or conditional, voluntary or involuntary, of 
                disposing of or parting with--
                          (i) property; or
                          (ii) an interest in property.
          (54A) The term ``uninsured State member bank'' means 
        a State member bank (as defined in section 3 of the 
        Federal Deposit Insurance Act) the deposits of which 
        are not insured by the Federal Deposit Insurance 
        Corporation.
          (55) The term ``United States'', when used in a 
        geographical sense, includes all locations where the 
        judicial jurisdiction of the United States extends, 
        including territories and possessions of the United 
        States.

           *       *       *       *       *       *       *


Sec. 103. Applicability of chapters

  (a) Except as provided in section 1161 of this title, 
chapters 1, 3, and 5 of this title apply in a case under 
chapter 7, 11, 12, or 13 of this title, and this chapter, 
sections 307, 362(o), 555 through 557, and 559 through 562 
apply in a case under chapter 15.
  (b) Subchapters I and II of chapter 7 of this title apply 
only in a case under such chapter.
  (c) Subchapter III of chapter 7 of this title applies only in 
a case under such chapter concerning a stockbroker.
  (d) Subchapter IV of chapter 7 of this title applies only in 
a case under such chapter concerning a commodity broker.
  (e) Scope of Application.--Subchapter V of chapter 7 of this 
title shall apply only in a case under such chapter concerning 
the liquidation of an uninsured State member bank, or a 
corporation organized under section 25A of the Federal Reserve 
Act, which operates, or operates as, a multilateral clearing 
organization pursuant to section 409 of the Federal Deposit 
Insurance Corporation Improvement Act of 1991.
  (f) Except as provided in section 901 of this title, only 
chapters 1 and 9 of this title apply in a case under such 
chapter 9.
  (g) Except as provided in section 901 of this title, 
subchapters I, II, and III of chapter 11 of this title apply 
only in a case under such chapter.
  (h) Subchapter IV of chapter 11 of this title applies only in 
a case under such chapter concerning a railroad.
  (i) Chapter 13 of this title applies only in a case under 
such chapter.
  (j) Chapter 12 of this title applies only in a case under 
such chapter.
  (k) Chapter 15 applies only in a case under such chapter, 
except that--
          (1) sections 1505, 1513, and 1514 apply in all cases 
        under this title; and
          (2) section 1509 applies whether or not a case under 
        this title is pending.
  (l) Subchapter V of chapter 11 of this title applies only in 
a case under chapter 11 concerning a covered financial 
corporation.

           *       *       *       *       *       *       *


Sec. 109. Who may be a debtor

  (a) Notwithstanding any other provision of this section, only 
a person that resides or has a domicile, a place of business, 
or property in the United States, or a municipality, may be a 
debtor under this title.
  (b) A person may be a debtor under chapter 7 of this title 
only if such person is not--
          (1) a railroad;
          (2) a domestic insurance company, bank, savings bank, 
        cooperative bank, savings and loan association, 
        building and loan association, homestead association, a 
        New Markets Venture Capital company as defined in 
        section 351 of the Small Business Investment Act of 
        1958, a small business investment company licensed by 
        the Small Business Administration under section 301 of 
        the Small Business Investment Act of 1958, credit 
        union, or industrial bank or similar institution which 
        is an insured bank as defined in section 3(h) of the 
        Federal Deposit Insurance Act, except that an uninsured 
        State member bank, or a corporation organized under 
        section 25A of the Federal Reserve Act, which operates, 
        or operates as, a multilateral clearing organization 
        pursuant to section 409 of the Federal Deposit 
        Insurance Corporation Improvement Act of 1991 may be a 
        debtor if a petition is filed at the direction of the 
        Board of Governors of the Federal Reserve System; [or]
          (3)(A) a foreign insurance company, engaged in such 
        business in the United States; or
          (B) a foreign bank, savings bank, cooperative bank, 
        savings and loan association, building and loan 
        association, or credit union, that has a branch or 
        agency (as defined in section 1(b) of the International 
        Banking Act of 1978) in the United States[.]; or
          (4) a covered financial corporation.
  (c) An entity may be a debtor under chapter 9 of this title 
if and only if such entity--
          (1) is a municipality;
          (2) is specifically authorized, in its capacity as a 
        municipality or by name, to be a debtor under such 
        chapter by State law, or by a governmental officer or 
        organization empowered by State law to authorize such 
        entity to be a debtor under such chapter;
          (3) is insolvent;
          (4) desires to effect a plan to adjust such debts; 
        and
          (5)(A) has obtained the agreement of creditors 
        holding at least a majority in amount of the claims of 
        each class that such entity intends to impair under a 
        plan in a case under such chapter;
          (B) has negotiated in good faith with creditors and 
        has failed to obtain the agreement of creditors holding 
        at least a majority in amount of the claims of each 
        class that such entity intends to impair under a plan 
        in a case under such chapter;
          (C) is unable to negotiate with creditors because 
        such negotiation is impracticable; or
          (D) reasonably believes that a creditor may attempt 
        to obtain a transfer that is avoidable under section 
        547 of this title.
  (d) Only a railroad, a person that may be a debtor under 
chapter 7 of this title (except a stockbroker or a commodity 
broker), [and] an uninsured State member bank, [or] a 
corporation organized under section 25A of the Federal Reserve 
Act, which operates, or operates as, a multilateral clearing 
organization pursuant to section 409 of the Federal Deposit 
Insurance Corporation Improvement Act of 1991, or a covered 
financial corporation may be a debtor under chapter 11 of this 
title.
  (e) Only an individual with regular income that owes, on the 
date of the filing of the petition, noncontingent, liquidated, 
unsecured debts of less than $250,000 and noncontingent, 
liquidated, secured debts of less than $750,000, or an 
individual with regular income and such individual's spouse, 
except a stockbroker or a commodity broker, that owe, on the 
date of the filing of the petition, noncontingent, liquidated, 
unsecured debts that aggregate less than $250,000 and 
noncontingent, liquidated, secured debts of less than $750,000 
may be a debtor under chapter 13 of this title.
  (f) Only a family farmer or family fisherman with regular 
annual income may be a debtor under chapter 12 of this title.
  (g) Notwithstanding any other provision of this section, no 
individual or family farmer may be a debtor under this title 
who has been a debtor in a case pending under this title at any 
time in the preceding 180 days if--
          (1) the case was dismissed by the court for willful 
        failure of the debtor to abide by orders of the court, 
        or to appear before the court in proper prosecution of 
        the case; or
          (2) the debtor requested and obtained the voluntary 
        dismissal of the case following the filing of a request 
        for relief from the automatic stay provided by section 
        362 of this title.
  (h)(1) Subject to paragraphs (2) and (3), and notwithstanding 
any other provision of this section other than paragraph (4) of 
this subsection, an individual may not be a debtor under this 
title unless such individual has, during the 180-day period 
ending on the date of filing of the petition by such 
individual, received from an approved nonprofit budget and 
credit counseling agency described in section 111(a) an 
individual or group briefing (including a briefing conducted by 
telephone or on the Internet) that outlined the opportunities 
for available credit counseling and assisted such individual in 
performing a related budget analysis.
  (2)(A) Paragraph (1) shall not apply with respect to a debtor 
who resides in a district for which the United States trustee 
(or the bankruptcy administrator, if any) determines that the 
approved nonprofit budget and credit counseling agencies for 
such district are not reasonably able to provide adequate 
services to the additional individuals who would otherwise seek 
credit counseling from such agencies by reason of the 
requirements of paragraph (1).
  (B) The United States trustee (or the bankruptcy 
administrator, if any) who makes a determination described in 
subparagraph (A) shall review such determination not later than 
1 year after the date of such determination, and not less 
frequently than annually thereafter. Notwithstanding the 
preceding sentence, a nonprofit budget and credit counseling 
agency may be disapproved by the United States trustee (or the 
bankruptcy administrator, if any) at any time.
  (3)(A) Subject to subparagraph (B), the requirements of 
paragraph (1) shall not apply with respect to a debtor who 
submits to the court a certification that--
          (i) describes exigent circumstances that merit a 
        waiver of the requirements of paragraph (1);
          (ii) states that the debtor requested credit 
        counseling services from an approved nonprofit budget 
        and credit counseling agency, but was unable to obtain 
        the services referred to in paragraph (1) during the 7-
        day period beginning on the date on which the debtor 
        made that request; and
          (iii) is satisfactory to the court.
  (B) With respect to a debtor, an exemption under subparagraph 
(A) shall cease to apply to that debtor on the date on which 
the debtor meets the requirements of paragraph (1), but in no 
case may the exemption apply to that debtor after the date that 
is 30 days after the debtor files a petition, except that the 
court, for cause, may order an additional 15 days.
  (4) The requirements of paragraph (1) shall not apply with 
respect to a debtor whom the court determines, after notice and 
hearing, is unable to complete those requirements because of 
incapacity, disability, or active military duty in a military 
combat zone. For the purposes of this paragraph, incapacity 
means that the debtor is impaired by reason of mental illness 
or mental deficiency so that he is incapable of realizing and 
making rational decisions with respect to his financial 
responsibilities; and ``disability'' means that the debtor is 
so physically impaired as to be unable, after reasonable 
effort, to participate in an in person, telephone, or Internet 
briefing required under paragraph (1).

           *       *       *       *       *       *       *


CHAPTER 3--CASE ADMINISTRATION

           *       *       *       *       *       *       *



SUBCHAPTER II--OFFICERS

           *       *       *       *       *       *       *



Sec. 322. Qualification of trustee

  (a) Except as provided in subsection (b)(1), a person 
selected under section 701, 702, 703, 1104, 1163, 1202, or 1302 
of this title to serve as trustee in a case under this title 
qualifies if before seven days after such selection, and before 
beginning official duties, such person has filed with the court 
a bond in favor of the United States conditioned on the 
faithful performance of such official duties.
  (b)(1) The United States trustee qualifies wherever such 
trustee serves as trustee in a case under this title.
  (2) [The] In cases under subchapter V, the United States 
trustee shall recommend to the court, and in all other cases, 
the United States trustee shall determine--
          (A) the amount of a bond required to be filed under 
        subsection (a) of this section; and
          (B) the sufficiency of the surety on such bond.
  (c) A trustee is not liable personally or on such trustee's 
bond in favor of the United States for any penalty or 
forfeiture incurred by the debtor.
  (d) A proceeding on a trustee's bond may not be commenced 
after two years after the date on which such trustee was 
discharged.

           *       *       *       *       *       *       *


CHAPTER 7--LIQUIDATION

           *       *       *       *       *       *       *



SUBCHAPTER II--COLLECTION, LIQUIDATION, AND DISTRIBUTION OF THE ESTATE

           *       *       *       *       *       *       *



Sec. 726. Distribution of property of the estate

  (a) Except as provided in section 510 of this title, property 
of the estate shall be distributed--
          (1) first, in payment of any unpaid fees, costs, and 
        expenses of a special trustee appointed under section 
        1186, and then in payment of claims of the kind 
        specified in, and in the order specified in, section 
        507 of this title, proof of which is timely filed under 
        section 501 of this title or tardily filed on or before 
        the earlier of--
                  (A) the date that is 10 days after the 
                mailing to creditors of the summary of the 
                trustee's final report; or
                  (B) the date on which the trustee commences 
                final distribution under this section;
          (2) second, in payment of any allowed unsecured 
        claim, other than a claim of a kind specified in 
        paragraph (1), (3), or (4) of this subsection, proof of 
        which is--
                  (A) timely filed under section 501(a) of this 
                title;
                  (B) timely filed under section 501(b) or 
                501(c) of this title; or
                  (C) tardily filed under section 501(a) of 
                this title, if--
                          (i) the creditor that holds such 
                        claim did not have notice or actual 
                        knowledge of the case in time for 
                        timely filing of a proof of such claim 
                        under section 501(a) of this title; and
                          (ii) proof of such claim is filed in 
                        time to permit payment of such claim;
          (3) third, in payment of any allowed unsecured claim 
        proof of which is tardily filed under section 501(a) of 
        this title, other than a claim of the kind specified in 
        paragraph (2)(C) of this subsection;
          (4) fourth, in payment of any allowed claim, whether 
        secured or unsecured, for any fine, penalty, or 
        forfeiture, or for multiple, exemplary, or punitive 
        damages, arising before the earlier of the order for 
        relief or the appointment of a trustee, to the extent 
        that such fine, penalty, forfeiture, or damages are not 
        compensation for actual pecuniary loss suffered by the 
        holder of such claim;
          (5) fifth, in payment of interest at the legal rate 
        from the date of the filing of the petition, on any 
        claim paid under paragraph (1), (2), (3), or (4) of 
        this subsection; and
          (6) sixth, to the debtor.
  (b) Payment on claims of a kind specified in paragraph (1), 
(2), (3), (4), (5), (6), (7), (8), (9), or (10) of section 
507(a) of this title, or in paragraph (2), (3), (4), or (5) of 
subsection (a) of this section, shall be made pro rata among 
claims of the kind specified in each such particular paragraph, 
except that in a case that has been converted to this chapter 
under section 1112, 1208, or 1307 of this title, a claim 
allowed under section 503(b) of this title incurred under this 
chapter after such conversion has priority over a claim allowed 
under section 503(b) of this title incurred under any other 
chapter of this title or under this chapter before such 
conversion and over any expenses of a custodian superseded 
under section 543 of this title.
  (c) Notwithstanding subsections (a) and (b) of this section, 
if there is property of the kind specified in section 541(a)(2) 
of this title, or proceeds of such property, in the estate, 
such property or proceeds shall be segregated from other 
property of the estate, and such property or proceeds and other 
property of the estate shall be distributed as follows:
          (1) Claims allowed under section 503 of this title 
        shall be paid either from property of the kind 
        specified in section 541(a)(2) of this title, or from 
        other property of the estate, as the interest of 
        justice requires.
          (2) Allowed claims, other than claims allowed under 
        section 503 of this title, shall be paid in the order 
        specified in subsection (a) of this section, and, with 
        respect to claims of a kind specified in a particular 
        paragraph of section 507 of this title or subsection 
        (a) of this section, in the following order and manner:
                  (A) First, community claims against the 
                debtor or the debtor's spouse shall be paid 
                from property of the kind specified in section 
                541(a)(2) of this title, except to the extent 
                that such property is solely liable for debts 
                of the debtor.
                  (B) Second, to the extent that community 
                claims against the debtor are not paid under 
                subparagraph (A) of this paragraph, such 
                community claims shall be paid from property of 
                the kind specified in section 541(a)(2) of this 
                title that is solely liable for debts of the 
                debtor.
                  (C) Third, to the extent that all claims 
                against the debtor including community claims 
                against the debtor are not paid under 
                subparagraph (A) or (B) of this paragraph such 
                claims shall be paid from property of the 
                estate other than property of the kind 
                specified in section 541(a)(2) of this title.
                  (D) Fourth, to the extent that community 
                claims against the debtor or the debtor's 
                spouse are not paid under subparagraph (A), 
                (B), or (C) of this paragraph, such claims 
                shall be paid from all remaining property of 
                the estate.

           *       *       *       *       *       *       *


                       CHAPTER 11--REORGANIZATION


                SUBCHAPTER I--OFFICERS AND ADMINISTRATION

Sec.
1101. Definitions for this chapter.
     * * * * * * *

  Subchapter V--Liquidation, Reorganization, or Recapitalization of a 
                      Covered Financial Corporation

1181. Inapplicability of other sections.
1182. Definitions for this subchapter.
1183. Commencement of a case concerning a covered financial corporation.
1184. Regulators.
1185. Special transfer of property of the estate.
1186. Special trustee.
1187. Temporary and supplemental automatic stay; assumed debt.
1188. Treatment of qualified financial contracts and affiliate 
          contracts.
1189. Licenses, permits, and registrations.
1190. Exemption from securities laws.
1191. Inapplicability of certain avoiding powers.
1192. Consideration of financial stability.

SUBCHAPTER I--OFFICERS AND ADMINISTRATION

           *       *       *       *       *       *       *



Sec. 1112. Conversion or dismissal

  (a) The debtor may convert a case under this chapter to a 
case under chapter 7 of this title unless--
          (1) the debtor is not a debtor in possession;
          (2) the case originally was commenced as an 
        involuntary case under this chapter; or
          (3) the case was converted to a case under this 
        chapter other than on the debtor's request.
  (b)(1) Except as provided in paragraph (2) and subsection 
(c), on request of a party in interest, and after notice and a 
hearing, the court shall convert a case under this chapter to a 
case under chapter 7 or dismiss a case under this chapter, 
whichever is in the best interests of creditors and the estate, 
for cause unless the court determines that the appointment 
under section 1104(a) of a trustee or an examiner is in the 
best interests of creditors and the estate.
  (2) The court may not convert a case under this chapter to a 
case under chapter 7 or dismiss a case under this chapter if 
the court finds and specifically identifies unusual 
circumstances establishing that converting or dismissing the 
case is not in the best interests of creditors and the estate, 
and the debtor or any other party in interest establishes 
that--
          (A) there is a reasonable likelihood that a plan will 
        be confirmed within the timeframes established in 
        sections 1121(e) and 1129(e) of this title, or if such 
        sections do not apply, within a reasonable period of 
        time; and
          (B) the grounds for converting or dismissing the case 
        include an act or omission of the debtor other than 
        under paragraph (4)(A)--
                  (i) for which there exists a reasonable 
                justification for the act or omission; and
                  (ii) that will be cured within a reasonable 
                period of time fixed by the court.
  (3) The court shall commence the hearing on a motion under 
this subsection not later than 30 days after filing of the 
motion, and shall decide the motion not later than 15 days 
after commencement of such hearing, unless the movant expressly 
consents to a continuance for a specific period of time or 
compelling circumstances prevent the court from meeting the 
time limits established by this paragraph.
  (4) For purposes of this subsection, the term ``cause'' 
includes--
          (A) substantial or continuing loss to or diminution 
        of the estate and the absence of a reasonable 
        likelihood of rehabilitation;
          (B) gross mismanagement of the estate;
          (C) failure to maintain appropriate insurance that 
        poses a risk to the estate or to the public;
          (D) unauthorized use of cash collateral substantially 
        harmful to 1 or more creditors;
          (E) failure to comply with an order of the court;
          (F) unexcused failure to satisfy timely any filing or 
        reporting requirement established by this title or by 
        any rule applicable to a case under this chapter;
          (G) failure to attend the meeting of creditors 
        convened under section 341(a) or an examination ordered 
        under rule 2004 of the Federal Rules of Bankruptcy 
        Procedure without good cause shown by the debtor;
          (H) failure timely to provide information or attend 
        meetings reasonably requested by the United States 
        trustee (or the bankruptcy administrator, if any);
          (I) failure timely to pay taxes owed after the date 
        of the order for relief or to file tax returns due 
        after the date of the order for relief;
          (J) failure to file a disclosure statement, or to 
        file or confirm a plan, within the time fixed by this 
        title or by order of the court;
          (K) failure to pay any fees or charges required under 
        chapter 123 of title 28;
          (L) revocation of an order of confirmation under 
        section 1144;
          (M) inability to effectuate substantial consummation 
        of a confirmed plan;
          (N) material default by the debtor with respect to a 
        confirmed plan;
          (O) termination of a confirmed plan by reason of the 
        occurrence of a condition specified in the plan; and
          (P) failure of the debtor to pay any domestic support 
        obligation that first becomes payable after the date of 
        the filing of the petition.
  (c) The court may not convert a case under this chapter to a 
case under chapter 7 of this title if the debtor is a farmer or 
a corporation that is not a moneyed, business, or commercial 
corporation, unless the debtor requests such conversion.
  (d) The court may convert a case under this chapter to a case 
under chapter 12 or 13 of this title only if--
          (1) the debtor requests such conversion;
          (2) the debtor has not been discharged under section 
        1141(d) of this title; and
          (3) if the debtor requests conversion to chapter 12 
        of this title, such conversion is equitable.
  (e) Except as provided in subsections (c) and (f), the court, 
on request of the United States trustee, may convert a case 
under this chapter to a case under chapter 7 of this title or 
may dismiss a case under this chapter, whichever is in the best 
interest of creditors and the estate if the debtor in a 
voluntary case fails to file, within fifteen days after the 
filing of the petition commencing such case or such additional 
time as the court may allow, the information required by 
paragraph (1) of section 521(a), including a list containing 
the names and addresses of the holders of the twenty largest 
unsecured claims (or of all unsecured claims if there are fewer 
than twenty unsecured claims), and the approximate dollar 
amounts of each of such claims.
  (f) Notwithstanding any other provision of this section, a 
case may not be converted to a case under another chapter of 
this title unless the debtor may be a debtor under such 
chapter.
  (g) Notwithstanding section 109(b), the court may convert a 
case under subchapter V to a case under chapter 7 if--
          (1) a transfer approved under section 1185 has been 
        consummated;
          (2) the court has ordered the appointment of a 
        special trustee under section 1186; and
          (3) the court finds, after notice and a hearing, that 
        conversion is in the best interest of the creditors and 
        the estate.

           *       *       *       *       *       *       *


SUBCHAPTER II--THE PLAN

           *       *       *       *       *       *       *



Sec. 1129. Confirmation of plan

  (a) The court shall confirm a plan only if all of the 
following requirements are met:
          (1) The plan complies with the applicable provisions 
        of this title.
          (2) The proponent of the plan complies with the 
        applicable provisions of this title.
          (3) The plan has been proposed in good faith and not 
        by any means forbidden by law.
          (4) Any payment made or to be made by the proponent, 
        by the debtor, or by a person issuing securities or 
        acquiring property under the plan, for services or for 
        costs and expenses in or in connection with the case, 
        or in connection with the plan and incident to the 
        case, has been approved by, or is subject to the 
        approval of, the court as reasonable.
          (5)(A)(i) The proponent of the plan has disclosed the 
        identity and affiliations of any individual proposed to 
        serve, after confirmation of the plan, as a director, 
        officer, or voting trustee of the debtor, an affiliate 
        of the debtor participating in a joint plan with the 
        debtor, or a successor to the debtor under the plan; 
        and
          (ii) the appointment to, or continuance in, such 
        office of such individual, is consistent with the 
        interests of creditors and equity security holders and 
        with public policy; and
          (B) the proponent of the plan has disclosed the 
        identity of any insider that will be employed or 
        retained by the reorganized debtor, and the nature of 
        any compensation for such insider.
          (6) Any governmental regulatory commission with 
        jurisdiction, after confirmation of the plan, over the 
        rates of the debtor has approved any rate change 
        provided for in the plan, or such rate change is 
        expressly conditioned on such approval.
          (7) With respect to each impaired class of claims or 
        interests--
                  (A) each holder of a claim or interest of 
                such class--
                          (i) has accepted the plan; or
                          (ii) will receive or retain under the 
                        plan on account of such claim or 
                        interest property of a value, as of the 
                        effective date of the plan, that is not 
                        less than the amount that such holder 
                        would so receive or retain if the 
                        debtor were liquidated under chapter 7 
                        of this title on such date; or
                  (B) if section 1111(b)(2) of this title 
                applies to the claims of such class, each 
                holder of a claim of such class will receive or 
                retain under the plan on account of such claim 
                property of a value, as of the effective date 
                of the plan, that is not less than the value of 
                such holder's interest in the estate's interest 
                in the property that secures such claims.
          (8) With respect to each class of claims or 
        interests--
                  (A) such class has accepted the plan; or
                  (B) such class is not impaired under the 
                plan.
          (9) Except to the extent that the holder of a 
        particular claim has agreed to a different treatment of 
        such claim, the plan provides that--
                  (A) with respect to a claim of a kind 
                specified in section 507(a)(2) or 507(a)(3) of 
                this title, on the effective date of the plan, 
                the holder of such claim will receive on 
                account of such claim cash equal to the allowed 
                amount of such claim;
                  (B) with respect to a class of claims of a 
                kind specified in section 507(a)(1), 507(a)(4), 
                507(a)(5), 507(a)(6), or 507(a)(7) of this 
                title, each holder of a claim of such class 
                will receive--
                          (i) if such class has accepted the 
                        plan, deferred cash payments of a 
                        value, as of the effective date of the 
                        plan, equal to the allowed amount of 
                        such claim; or
                          (ii) if such class has not accepted 
                        the plan, cash on the effective date of 
                        the plan equal to the allowed amount of 
                        such claim;
                  (C) with respect to a claim of a kind 
                specified in section 507(a)(8) of this title, 
                the holder of such claim will receive on 
                account of such claim regular installment 
                payments in cash--
                          (i) of a total value, as of the 
                        effective date of the plan, equal to 
                        the allowed amount of such claim;
                          (ii) over a period ending not later 
                        than 5 years after the date of the 
                        order for relief under section 301, 
                        302, or 303; and
                          (iii) in a manner not less favorable 
                        than the most favored nonpriority 
                        unsecured claim provided for by the 
                        plan (other than cash payments made to 
                        a class of creditors under section 
                        1122(b)); and
                  (D) with respect to a secured claim which 
                would otherwise meet the description of an 
                unsecured claim of a governmental unit under 
                section 507(a)(8), but for the secured status 
                of that claim, the holder of that claim will 
                receive on account of that claim, cash 
                payments, in the same manner and over the same 
                period, as prescribed in subparagraph (C).
          (10) If a class of claims is impaired under the plan, 
        at least one class of claims that is impaired under the 
        plan has accepted the plan, determined without 
        including any acceptance of the plan by any insider.
          (11) Confirmation of the plan is not likely to be 
        followed by the liquidation, or the need for further 
        financial reorganization, of the debtor or any 
        successor to the debtor under the plan, unless such 
        liquidation or reorganization is proposed in the plan.
          (12) All fees payable under section 1930 of title 28, 
        as determined by the court at the hearing on 
        confirmation of the plan, have been paid or the plan 
        provides for the payment of all such fees on the 
        effective date of the plan.
          (13) The plan provides for the continuation after its 
        effective date of payment of all retiree benefits, as 
        that term is defined in section 1114 of this title, at 
        the level established pursuant to subsection (e)(1)(B) 
        or (g) of section 1114 of this title, at any time prior 
        to confirmation of the plan, for the duration of the 
        period the debtor has obligated itself to provide such 
        benefits.
          (14) If the debtor is required by a judicial or 
        administrative order, or by statute, to pay a domestic 
        support obligation, the debtor has paid all amounts 
        payable under such order or such statute for such 
        obligation that first become payable after the date of 
        the filing of the petition.
          (15) In a case in which the debtor is an individual 
        and in which the holder of an allowed unsecured claim 
        objects to the confirmation of the plan--
                  (A) the value, as of the effective date of 
                the plan, of the property to be distributed 
                under the plan on account of such claim is not 
                less than the amount of such claim; or
                  (B) the value of the property to be 
                distributed under the plan is not less than the 
                projected disposable income of the debtor (as 
                defined in section 1325(b)(2)) to be received 
                during the 5-year period beginning on the date 
                that the first payment is due under the plan, 
                or during the period for which the plan 
                provides payments, whichever is longer.
          (16) All transfers of property under the plan shall 
        be made in accordance with any applicable provisions of 
        nonbankruptcy law that govern the transfer of property 
        by a corporation or trust that is not a moneyed, 
        business, or commercial corporation or trust.
          (17) In a case under subchapter V, all payable fees, 
        costs, and expenses of the special trustee have been 
        paid or the plan provides for the payment of all such 
        fees, costs, and expenses on the effective date of the 
        plan.
          (18) In a case under subchapter V, confirmation of 
        the plan is not likely to cause serious adverse effects 
        on financial stability in the United States.
  (b)(1) Notwithstanding section 510(a) of this title, if all 
of the applicable requirements of subsection (a) of this 
section other than paragraph (8) are met with respect to a 
plan, the court, on request of the proponent of the plan, shall 
confirm the plan notwithstanding the requirements of such 
paragraph if the plan does not discriminate unfairly, and is 
fair and equitable, with respect to each class of claims or 
interests that is impaired under, and has not accepted, the 
plan.
  (2) For the purpose of this subsection, the condition that a 
plan be fair and equitable with respect to a class includes the 
following requirements:
          (A) With respect to a class of secured claims, the 
        plan provides--
                  (i)(I) that the holders of such claims retain 
                the liens securing such claims, whether the 
                property subject to such liens is retained by 
                the debtor or transferred to another entity, to 
                the extent of the allowed amount of such 
                claims; and
                  (II) that each holder of a claim of such 
                class receive on account of such claim deferred 
                cash payments totaling at least the allowed 
                amount of such claim, of a value, as of the 
                effective date of the plan, of at least the 
                value of such holder's interest in the estate's 
                interest in such property;
                  (ii) for the sale, subject to section 363(k) 
                of this title, of any property that is subject 
                to the liens securing such claims, free and 
                clear of such liens, with such liens to attach 
                to the proceeds of such sale, and the treatment 
                of such liens on proceeds under clause (i) or 
                (iii) of this subparagraph; or
                  (iii) for the realization by such holders of 
                the indubitable equivalent of such claims.
          (B) With respect to a class of unsecured claims--
                  (i) the plan provides that each holder of a 
                claim of such class receive or retain on 
                account of such claim property of a value, as 
                of the effective date of the plan, equal to the 
                allowed amount of such claim; or
                  (ii) the holder of any claim or interest that 
                is junior to the claims of such class will not 
                receive or retain under the plan on account of 
                such junior claim or interest any property, 
                except that in a case in which the debtor is an 
                individual, the debtor may retain property 
                included in the estate under section 1115, 
                subject to the requirements of subsection 
                (a)(14) of this section.
          (C) With respect to a class of interests--
                  (i) the plan provides that each holder of an 
                interest of such class receive or retain on 
                account of such interest property of a value, 
                as of the effective date of the plan, equal to 
                the greatest of the allowed amount of any fixed 
                liquidation preference to which such holder is 
                entitled, any fixed redemption price to which 
                such holder is entitled, or the value of such 
                interest; or
                  (ii) the holder of any interest that is 
                junior to the interests of such class will not 
                receive or retain under the plan on account of 
                such junior interest any property.
  (c) Notwithstanding subsections (a) and (b) of this section 
and except as provided in section 1127(b) of this title, the 
court may confirm only one plan, unless the order of 
confirmation in the case has been revoked under section 1144 of 
this title. If the requirements of subsections (a) and (b) of 
this section are met with respect to more than one plan, the 
court shall consider the preferences of creditors and equity 
security holders in determining which plan to confirm.
  (d) Notwithstanding any other provision of this section, on 
request of a party in interest that is a governmental unit, the 
court may not confirm a plan if the principal purpose of the 
plan is the avoidance of taxes or the avoidance of the 
application of section 5 of the Securities Act of 1933. In any 
hearing under this subsection, the governmental unit has the 
burden of proof on the issue of avoidance.
  (e) In a small business case, the court shall confirm a plan 
that complies with the applicable provisions of this title and 
that is filed in accordance with section 1121(e) not later than 
45 days after the plan is filed unless the time for 
confirmation is extended in accordance with section 1121(e)(3).

  SUBCHAPTER V--LIQUIDATION, REORGANIZATION, OR RECAPITALIZATION OF A 
                     COVERED FINANCIAL CORPORATION

Sec. 1181. Inapplicability of other sections

  Sections 303 and 321(c) do not apply in a case under this 
subchapter concerning a covered financial corporation. Section 
365 does not apply to a transfer under section 1185, 1187, or 
1188.

Sec. 1182. Definitions for this subchapter

  In this subchapter, the following definitions shall apply:
          (1) The term ``Board'' means the Board of Governors 
        of the Federal Reserve System.
          (2) The term ``bridge company'' means a newly formed 
        corporation to which property of the estate may be 
        transferred under section 1185(a) and the equity 
        securities of which may be transferred to a special 
        trustee under section 1186(a).
          (3) The term ``capital structure debt'' means all 
        unsecured debt of the debtor for borrowed money for 
        which the debtor is the primary obligor, other than a 
        qualified financial contract and other than debt 
        secured by a lien on property of the estate that is to 
        be transferred to a bridge company pursuant to an order 
        of the court under section 1185(a).
          (4) The term ``contractual right'' means a 
        contractual right of a kind defined in section 555, 
        556, 559, 560, or 561.
          (5) The term ``qualified financial contract'' means 
        any contract of a kind defined in paragraph (25), 
        (38A), (47), or (53B) of section 101, section 741(7), 
        or paragraph (4), (5), (11), or (13) of section 761.
          (6) The term ``special trustee'' means the trustee of 
        a trust formed under section 1186(a)(1).

Sec. 1183. Commencement of a case concerning a covered financial 
                    corporation

  (a) A case under this subchapter concerning a covered 
financial corporation may be commenced by the filing of a 
petition with the court by the debtor under section 301 only if 
the debtor states to the best of its knowledge under penalty of 
perjury in the petition that it is a covered financial 
corporation.
  (b) The commencement of a case under subsection (a) 
constitutes an order for relief under this subchapter.
  (c) The members of the board of directors (or body performing 
similar functions) of a covered financial company shall have no 
liability to shareholders, creditors, or other parties in 
interest for a good faith filing of a petition to commence a 
case under this subchapter, or for any reasonable action taken 
in good faith in contemplation of such a petition or a transfer 
under section 1185 or section 1186, whether prior to or after 
commencement of the case.
  (d) Counsel to the debtor shall provide, to the greatest 
extent practicable without disclosing the identity of the 
potential debtor, sufficient confidential notice to the chief 
judge of the court of appeals for the circuit embracing the 
district in which such counsel intends to file a petition to 
commence a case under this subchapter regarding the potential 
commencement of such case. The chief judge of such court shall 
randomly assign to preside over such case a bankruptcy judge 
selected from among the bankruptcy judges designated by the 
Chief Justice of the United States under section 298 of title 
28.

Sec. 1184. Regulators

  The Board, the Securities Exchange Commission, the Office of 
the Comptroller of the Currency of the Department of the 
Treasury, the Commodity Futures Trading Commission, and the 
Federal Deposit Insurance Corporation may raise and may appear 
and be heard on any issue in any case or proceeding under this 
subchapter.

Sec. 1185. Special transfer of property of the estate

  (a) On request of the trustee, and after notice and a hearing 
that shall occur not less than 24 hours after the order for 
relief, the court may order a transfer under this section of 
property of the estate, and the assignment of executory 
contracts, unexpired leases, and qualified financial contracts 
of the debtor, to a bridge company. Upon the entry of an order 
approving such transfer, any property transferred, and any 
executory contracts, unexpired leases, and qualified financial 
contracts assigned under such order shall no longer be property 
of the estate. Except as provided under this section, the 
provisions of section 363 shall apply to a transfer and 
assignment under this section.
  (b) Unless the court orders otherwise, notice of a request 
for an order under subsection (a) shall consist of electronic 
or telephonic notice of not less than 24 hours to--
          (1) the debtor;
          (2) the holders of the 20 largest secured claims 
        against the debtor;
          (3) the holders of the 20 largest unsecured claims 
        against the debtor;
          (4) counterparties to any debt, executory contract, 
        unexpired lease, and qualified financial contract 
        requested to be transferred under this section;
          (5) the Board;
          (6) the Federal Deposit Insurance Corporation;
          (7) the Secretary of the Treasury and the Office of 
        the Comptroller of the Currency of the Treasury;
          (8) the Commodity Futures Trading Commission;
          (9) the Securities and Exchange Commission;
          (10) the United States trustee or bankruptcy 
        administrator; and
          (11) each primary financial regulatory agency, as 
        defined in section 2(12) of the Dodd-Frank Wall Street 
        Reform and Consumer Protection Act, with respect to any 
        affiliate the equity securities of which are proposed 
        to be transferred under this section.
  (c) The court may not order a transfer under this section 
unless the court determines, based upon a preponderance of the 
evidence, that--
          (1) the transfer under this section is necessary to 
        prevent serious adverse effects on financial stability 
        in the United States;
          (2) the transfer does not provide for the assumption 
        of any capital structure debt by the bridge company;
          (3) the transfer does not provide for the transfer to 
        the bridge company of any property of the estate that 
        is subject to a lien securing a debt, executory 
        contract, unexpired lease or agreement (including a 
        qualified financial contract) of the debtor unless--
                  (A)(i) the bridge company assumes such debt, 
                executory contract, unexpired lease or 
                agreement (including a qualified financial 
                contract), including any claims arising in 
                respect thereof that would not be allowed 
                secured claims under section 506(a)(1) and 
                after giving effect to such transfer, such 
                property remains subject to the lien securing 
                such debt, executory contract, unexpired lease 
                or agreement (including a qualified financial 
                contract); and
                  (ii) the court has determined that assumption 
                of such debt, executory contract, unexpired 
                lease or agreement (including a qualified 
                financial contract) by the bridge company is in 
                the best interests of the estate; or
                  (B) such property is being transferred to the 
                bridge company in accordance with the 
                provisions of section 363;
          (4) the transfer does not provide for the assumption 
        by the bridge company of any debt, executory contract, 
        unexpired lease or agreement (including a qualified 
        financial contract) of the debtor secured by a lien on 
        property of the estate unless the transfer provides for 
        such property to be transferred to the bridge company 
        in accordance with paragraph (3)(A) of this subsection;
          (5) the transfer does not provide for the transfer of 
        the equity of the debtor;
          (6) the trustee has demonstrated that the bridge 
        company is not likely to fail to meet the obligations 
        of any debt, executory contract, qualified financial 
        contract, or unexpired lease assumed and assigned to 
        the bridge company;
          (7) the transfer provides for the transfer to a 
        special trustee all of the equity securities in the 
        bridge company and appointment of a special trustee in 
        accordance with section 1186;
          (8) after giving effect to the transfer, adequate 
        provision has been made for the fees, costs, and 
        expenses of the estate and special trustee; and
          (9) the bridge company will have governing documents, 
        and initial directors and senior officers, that are in 
        the best interest of creditors and the estate.
  (d) Immediately before a transfer under this section, the 
bridge company that is the recipient of the transfer shall--
          (1) not have any property, executory contracts, 
        unexpired leases, qualified financial contracts, or 
        debts, other than any property acquired or executory 
        contracts, unexpired leases, or debts assumed when 
        acting as a transferee of a transfer under this 
        section; and
          (2) have equity securities that are property of the 
        estate, which may be sold or distributed in accordance 
        with this title.

Sec. 1186. Special trustee

  (a)(1) An order approving a transfer under section 1185 shall 
require the trustee to transfer to a qualified and independent 
special trustee, who is appointed by the court, all of the 
equity securities in the bridge company that is the recipient 
of a transfer under section 1185 to hold in trust for the sole 
benefit of the estate, subject to satisfaction of the special 
trustee's fees, costs, and expenses. The trust of which the 
special trustee is the trustee shall be a newly formed trust 
governed by a trust agreement approved by the court as in the 
best interests of the estate, and shall exist for the sole 
purpose of holding and administering, and shall be permitted to 
dispose of, the equity securities of the bridge company in 
accordance with the trust agreement.
  (2) In connection with the hearing to approve a transfer 
under section 1185, the trustee shall confirm to the court that 
the Board has been consulted regarding the identity of the 
proposed special trustee and advise the court of the results of 
such consultation.
  (b) The trust agreement governing the trust shall provide--
          (1) for the payment of the fees, costs, expenses, and 
        indemnities of the special trustee from the assets of 
        the debtor's estate;
          (2) that the special trustee provide--
                  (A) quarterly reporting to the estate, which 
                shall be filed with the court; and
                  (B) information about the bridge company 
                reasonably requested by a party in interest to 
                prepare a disclosure statement for a plan 
                providing for distribution of any securities of 
                the bridge company if such information is 
                necessary to prepare such disclosure statement;
          (3) that for as long as the equity securities of the 
        bridge company are held by the trust, the special 
        trustee shall file a notice with the court in 
        connection with--
                  (A) any change in a director or senior 
                officer of the bridge company;
                  (B) any modification to the governing 
                documents of the bridge company; and
                  (C) any material corporate action of the 
                bridge company, including--
                          (i) recapitalization;
                          (ii) a material borrowing;
                          (iii) termination of an intercompany 
                        debt or guarantee;
                          (iv) a transfer of a substantial 
                        portion of the assets of the bridge 
                        company; or
                          (v) the issuance or sale of any 
                        securities of the bridge company;
          (4) that any sale of any equity securities of the 
        bridge company shall not be consummated until the 
        special trustee consults with the Federal Deposit 
        Insurance Corporation and the Board regarding such sale 
        and discloses the results of such consultation with the 
        court;
          (5) that, subject to reserves for payments permitted 
        under paragraph (1) provided for in the trust 
        agreement, the proceeds of the sale of any equity 
        securities of the bridge company by the special trustee 
        be held in trust for the benefit of or transferred to 
        the estate;
          (6) the process and guidelines for the replacement of 
        the special trustee; and
          (7) that the property held in trust by the special 
        trustee is subject to distribution in accordance with 
        subsection (c).
  (c)(1) The special trustee shall distribute the assets held 
in trust--
          (A) if the court confirms a plan in the case, in 
        accordance with the plan on the effective date of the 
        plan; or
          (B) if the case is converted to a case under chapter 
        7, as ordered by the court.
  (2) As soon as practicable after a final distribution under 
paragraph (1), the office of the special trustee shall 
terminate, except as may be necessary to wind up and conclude 
the business and financial affairs of the trust.
  (d) After a transfer to the special trustee under this 
section, the special trustee shall be subject only to 
applicable nonbankruptcy law, and the actions and conduct of 
the special trustee shall no longer be subject to approval by 
the court in the case under this subchapter.

Sec. 1187. Temporary and supplemental automatic stay; assumed debt

  (a)(1) A petition filed under section 1183 operates as a 
stay, applicable to all entities, of the termination, 
acceleration, or modification of any debt, contract, lease, or 
agreement of the kind described in paragraph (2), or of any 
right or obligation under any such debt, contract, lease, or 
agreement, solely because of--
          (A) a default by the debtor under any such debt, 
        contract, lease, or agreement; or
          (B) a provision in such debt, contract, lease, or 
        agreement, or in applicable nonbankruptcy law, that is 
        conditioned on--
                  (i) the insolvency or financial condition of 
                the debtor at any time before the closing of 
                the case;
                  (ii) the commencement of a case under this 
                title concerning the debtor;
                  (iii) the appointment of or taking possession 
                by a trustee in a case under this title 
                concerning the debtor or by a custodian before 
                the commencement of the case; or
                  (iv) a credit rating agency rating, or 
                absence or withdrawal of a credit rating agency 
                rating--
                          (I) of the debtor at any time after 
                        the commencement of the case;
                          (II) of an affiliate during the 
                        period from the commencement of the 
                        case until 48 hours after such order is 
                        entered;
                          (III) of the bridge company while the 
                        trustee or the special trustee is a 
                        direct or indirect beneficial holder of 
                        more than 50 percent of the equity 
                        securities of--
                                  (aa) the bridge company; or
                                  (bb) the affiliate, if all of 
                                the direct or indirect 
                                interests in the affiliate that 
                                are property of the estate are 
                                transferred under section 1185; 
                                or
                          (IV) of an affiliate while the 
                        trustee or the special trustee is a 
                        direct or indirect beneficial holder of 
                        more than 50 percent of the equity 
                        securities of--
                                  (aa) the bridge company; or
                                  (bb) the affiliate, if all of 
                                the direct or indirect 
                                interests in the affiliate that 
                                are property of the estate are 
                                transferred under section 1185.
  (2) A debt, contract, lease, or agreement described in this 
paragraph is--
          (A) any debt (other than capital structure debt), 
        executory contract, or unexpired lease of the debtor 
        (other than a qualified financial contract);
          (B) any agreement under which the debtor issued or is 
        obligated for debt (other than capital structure debt);
          (C) any debt, executory contract, or unexpired lease 
        of an affiliate (other than a qualified financial 
        contract); or
          (D) any agreement under which an affiliate issued or 
        is obligated for debt.
  (3) The stay under this subsection terminates--
          (A) for the benefit of the debtor, upon the earliest 
        of--
                  (i) 48 hours after the commencement of the 
                case;
                  (ii) assumption of the debt, contract, lease, 
                or agreement by the bridge company under an 
                order authorizing a transfer under section 
                1185;
                  (iii) a final order of the court denying the 
                request for a transfer under section 1185; or
                  (iv) the time the case is dismissed; and
          (B) for the benefit of an affiliate, upon the 
        earliest of--
                  (i) the entry of an order authorizing a 
                transfer under section 1185 in which the direct 
                or indirect interests in the affiliate that are 
                property of the estate are not transferred 
                under section 1185;
                  (ii) a final order by the court denying the 
                request for a transfer under section 1185;
                  (iii) 48 hours after the commencement of the 
                case if the court has not ordered a transfer 
                under section 1185; or
                  (iv) the time the case is dismissed.
  (4) Subsections (d), (e), (f), and (g) of section 362 apply 
to a stay under this subsection.
  (b) A debt, executory contract (other than a qualified 
financial contract), or unexpired lease of the debtor, or an 
agreement under which the debtor has issued or is obligated for 
any debt, may be assumed by a bridge company in a transfer 
under section 1185 notwithstanding any provision in an 
agreement or in applicable nonbankruptcy law that--
          (1) prohibits, restricts, or conditions the 
        assignment of the debt, contract, lease, or agreement; 
        or
          (2) accelerates, terminates, or modifies, or permits 
        a party other than the debtor to terminate or modify, 
        the debt, contract, lease, or agreement on account of--
                  (A) the assignment of the debt, contract, 
                lease, or agreement; or
                  (B) a change in control of any party to the 
                debt, contract, lease, or agreement.
  (c)(1) A debt, contract, lease, or agreement of the kind 
described in subparagraph (A) or (B) of subsection (a)(2) may 
not be accelerated, terminated, or modified, and any right or 
obligation under such debt, contract, lease, or agreement may 
not be accelerated, terminated, or modified, as to the bridge 
company solely because of a provision in the debt, contract, 
lease, or agreement or in applicable nonbankruptcy law--
          (A) of the kind described in subsection (a)(1)(B) as 
        applied to the debtor;
          (B) that prohibits, restricts, or conditions the 
        assignment of the debt, contract, lease, or agreement; 
        or
          (C) that accelerates, terminates, or modifies, or 
        permits a party other than the debtor to terminate or 
        modify, the debt, contract, lease or agreement on 
        account of--
                  (i) the assignment of the debt, contract, 
                lease, or agreement; or
                  (ii) a change in control of any party to the 
                debt, contract, lease, or agreement.
  (2) If there is a default by the debtor under a provision 
other than the kind described in paragraph (1) in a debt, 
contract, lease or agreement of the kind described in 
subparagraph (A) or (B) of subsection (a)(2), the bridge 
company may assume such debt, contract, lease, or agreement 
only if the bridge company--
          (A) shall cure the default;
          (B) compensates, or provides adequate assurance in 
        connection with a transfer under section 1185 that the 
        bridge company will promptly compensate, a party other 
        than the debtor to the debt, contract, lease, or 
        agreement, for any actual pecuniary loss to the party 
        resulting from the default; and
          (C) provides adequate assurance in connection with a 
        transfer under section 1185 of future performance under 
        the debt, contract, lease, or agreement, as determined 
        by the court under section 1185(c)(4).

Sec. 1188. Treatment of qualified financial contracts and affiliate 
                    contracts

  (a) Notwithstanding sections 362(b)(6), 362(b)(7), 
362(b)(17), 362(b)(27), 362(o), 555, 556, 559, 560, and 561, a 
petition filed under section 1183 operates as a stay, during 
the period specified in section 1187(a)(3)(A), applicable to 
all entities, of the exercise of a contractual right--
          (1) to cause the modification, liquidation, 
        termination, or acceleration of a qualified financial 
        contract of the debtor or an affiliate;
          (2) to offset or net out any termination value, 
        payment amount, or other transfer obligation arising 
        under or in connection with a qualified financial 
        contract of the debtor or an affiliate; or
          (3) under any security agreement or arrangement or 
        other credit enhancement forming a part of or related 
        to a qualified financial contract of the debtor or an 
        affiliate.
  (b)(1) During the period specified in section 1187(a)(3)(A), 
the trustee or the affiliate shall perform all payment and 
delivery obligations under such qualified financial contract of 
the debtor or the affiliate, as the case may be, that become 
due after the commencement of the case. The stay provided under 
subsection (a) terminates as to a qualified financial contract 
of the debtor or an affiliate immediately upon the failure of 
the trustee or the affiliate, as the case may be, to perform 
any such obligation during such period.
  (2) Any failure by a counterparty to any qualified financial 
contract of the debtor or any affiliate to perform any payment 
or delivery obligation under such qualified financial contract, 
including during the pendency of the stay provided under 
subsection (a), shall constitute a breach of such qualified 
financial contract by the counterparty.
  (c) Subject to the court's approval, a qualified financial 
contract between an entity and the debtor may be assigned to or 
assumed by the bridge company in a transfer under, and in 
accordance with, section 1185 if and only if--
          (1) all qualified financial contracts between the 
        entity and the debtor are assigned to and assumed by 
        the bridge company in the transfer under section 1185;
          (2) all claims of the entity against the debtor in 
        respect of any qualified financial contract between the 
        entity and the debtor (other than any claim that, under 
        the terms of the qualified financial contract, is 
        subordinated to the claims of general unsecured 
        creditors) are assigned to and assumed by the bridge 
        company;
          (3) all claims of the debtor against the entity under 
        any qualified financial contract between the entity and 
        the debtor are assigned to and assumed by the bridge 
        company; and
          (4) all property securing or any other credit 
        enhancement furnished by the debtor for any qualified 
        financial contract described in paragraph (1) or any 
        claim described in paragraph (2) or (3) under any 
        qualified financial contract between the entity and the 
        debtor is assigned to and assumed by the bridge 
        company.
  (d) Notwithstanding any provision of a qualified financial 
contract or of applicable nonbankruptcy law, a qualified 
financial contract of the debtor that is assumed or assigned in 
a transfer under section 1185 may not be accelerated, 
terminated, or modified, after the entry of the order approving 
a transfer under section 1185, and any right or obligation 
under the qualified financial contract may not be accelerated, 
terminated, or modified, after the entry of the order approving 
a transfer under section 1185 solely because of a condition 
described in section 1187(c)(1), other than a condition of the 
kind specified in section 1187(b) that occurs after property of 
the estate no longer includes a direct beneficial interest or 
an indirect beneficial interest through the special trustee, in 
more than 50 percent of the equity securities of the bridge 
company.
  (e) Notwithstanding any provision of any agreement or in 
applicable nonbankruptcy law, an agreement of an affiliate 
(including an executory contract, an unexpired lease, qualified 
financial contract, or an agreement under which the affiliate 
issued or is obligated for debt) and any right or obligation 
under such agreement may not be accelerated, terminated, or 
modified, solely because of a condition described in section 
1187(c)(1), other than a condition of the kind specified in 
section 1187(b) that occurs after the bridge company is no 
longer a direct or indirect beneficial holder of more than 50 
percent of the equity securities of the affiliate, at any time 
after the commencement of the case if--
          (1) all direct or indirect interests in the affiliate 
        that are property of the estate are transferred under 
        section 1185 to the bridge company within the period 
        specified in subsection (a);
          (2) the bridge company assumes--
                  (A) any guarantee or other credit enhancement 
                issued by the debtor relating to the agreement 
                of the affiliate; and
                  (B) any obligations in respect of rights of 
                setoff, netting arrangement, or debt of the 
                debtor that directly arises out of or directly 
                relates to the guarantee or credit enhancement; 
                and
          (3) any property of the estate that directly serves 
        as collateral for the guarantee or credit enhancement 
        is transferred to the bridge company.

Sec. 1189. Licenses, permits, and registrations

  (a) Notwithstanding any otherwise applicable nonbankruptcy 
law, if a request is made under section 1185 for a transfer of 
property of the estate, any Federal, State, or local license, 
permit, or registration that the debtor or an affiliate had 
immediately before the commencement of the case and that is 
proposed to be transferred under section 1185 may not be 
accelerated, terminated, or modified at any time after the 
request solely on account of--
          (1) the insolvency or financial condition of the 
        debtor at any time before the closing of the case;
          (2) the commencement of a case under this title 
        concerning the debtor;
          (3) the appointment of or taking possession by a 
        trustee in a case under this title concerning the 
        debtor or by a custodian before the commencement of the 
        case; or
          (4) a transfer under section 1185.
  (b) Notwithstanding any otherwise applicable nonbankruptcy 
law, any Federal, State, or local license, permit, or 
registration that the debtor had immediately before the 
commencement of the case that is included in a transfer under 
section 1185 shall be valid and all rights and obligations 
thereunder shall vest in the bridge company.

Sec. 1190. Exemption from securities laws

  For purposes of section 1145, a security of the bridge 
company shall be deemed to be a security of a successor to the 
debtor under a plan if the court approves the disclosure 
statement for the plan as providing adequate information (as 
defined in section 1125(a)) about the bridge company and the 
security.

Sec. 1191. Inapplicability of certain avoiding powers

  A transfer made or an obligation incurred by the debtor to an 
affiliate prior to or after the commencement of the case, 
including any obligation released by the debtor or the estate 
to or for the benefit of an affiliate, in contemplation of or 
in connection with a transfer under section 1185 is not 
avoidable under section 544, 547, 548(a)(1)(B), or 549, or 
under any similar nonbankruptcy law.

Sec. 1192. Consideration of financial stability

  The court may consider the effect that any decision in 
connection with this subchapter may have on financial stability 
in the United States.

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TITLE 28, UNITED STATES CODE

           *       *       *       *       *       *       *



PART I--ORGANIZATION OF COURTS

           *       *       *       *       *       *       *


            CHAPTER 13--ASSIGNMENT OF JUDGES TO OTHER COURTS


Sec.
291. Circuit judges.
     * * * * * * *
298. Judge for a case under subchapter V of chapter 11 of title 11.

           *       *       *       *       *       *       *


Sec. 298. Judge for a case under subchapter V of chapter 11 of title 11

  (a)(1) Notwithstanding section 295, the Chief Justice of the 
United States shall designate not fewer than 10 bankruptcy 
judges to be available to hear a case under subchapter V of 
chapter 11 of title 11. Bankruptcy judges may request to be 
considered by the Chief Justice of the United States for such 
designation.
  (2) Notwithstanding section 155, a case under subchapter V of 
chapter 11 of title 11 shall be heard under section 157 by a 
bankruptcy judge designated under paragraph (1), who shall be 
randomly assigned to hear such case by the chief judge of the 
court of appeals for the circuit embracing the district in 
which the case is pending. To the greatest extent practicable, 
the approvals required under section 155 should be obtained.
  (3) If the bankruptcy judge assigned to hear a case under 
paragraph (2) is not assigned to the district in which the case 
is pending, the bankruptcy judge shall be temporarily assigned 
to the district.
  (b) A case under subchapter V of chapter 11 of title 11, and 
all proceedings in the case, shall take place in the district 
in which the case is pending.
  (c) In this section, the term ``covered financial 
corporation'' has the meaning given that term in section 
101(9A) of title 11.

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PART IV--JURISDICTION AND VENUE

           *       *       *       *       *       *       *


CHAPTER 85--DISTRICT COURTS; JURISDICTION

           *       *       *       *       *       *       *



Sec. 1334. Bankruptcy cases and proceedings

  (a) Except as provided in subsection (b) of this section, the 
district courts shall have original and exclusive jurisdiction 
of all cases under title 11.
  (b) Except as provided in subsection (e)(2), and 
notwithstanding any Act of Congress that confers exclusive 
jurisdiction on a court or courts other than the district 
courts, the district courts shall have original but not 
exclusive jurisdiction of all civil proceedings arising under 
title 11, or arising in or related to cases under title 11.
  (c)(1) Except with respect to a case under chapter 15 of 
title 11, nothing in this section prevents a district court in 
the interest of justice, or in the interest of comity with 
State courts or respect for State law, from abstaining from 
hearing a particular proceeding arising under title 11 or 
arising in or related to a case under title 11.
          (2) Upon timely motion of a party in a proceeding 
        based upon a State law claim or State law cause of 
        action, related to a case under title 11 but not 
        arising under title 11 or arising in a case under title 
        11, with respect to which an action could not have been 
        commenced in a court of the United States absent 
        jurisdiction under this section, the district court 
        shall abstain from hearing such proceeding if an action 
        is commenced, and can be timely adjudicated, in a State 
        forum of appropriate jurisdiction.
  (d) Any decision to abstain or not to abstain made under 
subsection (c) (other than a decision not to abstain in a 
proceeding described in subsection (c)(2)) is not reviewable by 
appeal or otherwise by the court of appeals under section 
158(d), 1291, or 1292 of this title or by the Supreme Court of 
the United States under section 1254 of this title. Subsection 
(c) and this subsection shall not be construed to limit the 
applicability of the stay provided for by section 362 of title 
11, United States Code, as such section applies to an action 
affecting the property of the estate in bankruptcy.
  (e) The district court in which a case under title 11 is 
commenced or is pending shall have exclusive jurisdiction--
          (1) of all the property, wherever located, of the 
        debtor as of the commencement of such case, and of 
        property of the estate; and
          (2) over all claims or causes of action that involve 
        construction of section 327 of title 11, United States 
        Code, or rules relating to disclosure requirements 
        under section 327.
  (f) This section does not grant jurisdiction to the district 
court after a transfer pursuant to an order under section 1185 
of title 11 of any proceeding related to a special trustee 
appointed, or to a bridge company formed, in connection with a 
case under subchapter V of chapter 11 of title 11.

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TITLE 31, UNITED STATES CODE

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SUBTITLE I--GENERAL

           *       *       *       *       *       *       *


                 CHAPTER 3--DEPARTMENT OF THE TREASURY


                       SUBCHAPTER I--ORGANIZATION

Sec.
301. Department of the Treasury.
     * * * * * * *
[309. Office of Thrift Supervision.]
     * * * * * * *
[313. Federal Insurance Office.]
313. Office of the Independent Insurance Advocate.

SUBCHAPTER I--ORGANIZATION

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[Sec. 309. Office of Thrift Supervision

   [The Office of Thrift Supervision established under section 
3(a) of the Home Owners' Loan Act shall be an office in the 
Department of the Treasury.]

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[Sec. 313. Federal Insurance Office

  [(a) Establishment.--There is established within the 
Department of the Treasury the Federal Insurance Office.
  [(b) Leadership.--The Office shall be headed by a Director, 
who shall be appointed by the Secretary of the Treasury. The 
position of Director shall be a career reserved position in the 
Senior Executive Service, as that position is defined under 
section 3132 of title 5, United States Code.
  [(c) Functions.--
          [(1) Authority pursuant to direction of Secretary.--
        The Office, pursuant to the direction of the Secretary, 
        shall have the authority--
                  [(A) to monitor all aspects of the insurance 
                industry, including identifying issues or gaps 
                in the regulation of insurers that could 
                contribute to a systemic crisis in the 
                insurance industry or the United States 
                financial system;
                  [(B) to monitor the extent to which 
                traditionally underserved communities and 
                consumers, minorities (as such term is defined 
                in section 1204(c) of the Financial 
                Institutions Reform, Recovery, and Enforcement 
                Act of 1989 (12 U.S.C. 1811 note)), and low- 
                and moderate-income persons have access to 
                affordable insurance products regarding all 
                lines of insurance, except health insurance;
                  [(C) to recommend to the Financial Stability 
                Oversight Council that it designate an insurer, 
                including the affiliates of such insurer, as an 
                entity subject to regulation as a nonbank 
                financial company supervised by the Board of 
                Governors pursuant to title I of the Dodd-Frank 
                Wall Street Reform and Consumer Protection Act;
                  [(D) to assist the Secretary in administering 
                the Terrorism Insurance Program established in 
                the Department of the Treasury under the 
                Terrorism Risk Insurance Act of 2002 (15 U.S.C. 
                6701 note);
                  [(E) to coordinate Federal efforts and 
                develop Federal policy on prudential aspects of 
                international insurance matters, including 
                representing the United States, as appropriate, 
                in the International Association of Insurance 
                Supervisors (or a successor entity) and 
                assisting the Secretary in negotiating covered 
                agreements (as such term is defined in 
                subsection (r));
                  [(F) to determine, in accordance with 
                subsection (f), whether State insurance 
                measures are preempted by covered agreements;
                  [(G) to consult with the States (including 
                State insurance regulators) regarding insurance 
                matters of national importance and prudential 
                insurance matters of international importance; 
                and
                  [(H) to perform such other related duties and 
                authorities as may be assigned to the Office by 
                the Secretary.
          [(2) Advisory functions.--The Office shall advise the 
        Secretary on major domestic and prudential 
        international insurance policy issues.
          [(3) Advisory capacity on council.--The Director 
        shall serve
in an advisory capacity on the Financial Stability Oversight 
Council established under the Financial Stability Act of 2010.
  [(d) Scope.--The authority of the Office shall extend to all 
lines of insurance except--
          [(1) health insurance, as determined by the Secretary 
        in coordination with the Secretary of Health and Human 
        Services based on section 2791 of the Public Health 
        Service Act (42 U.S.C. 300gg-91);
          [(2) long-term care insurance, except long-term care 
        insurance that is included with life or annuity 
        insurance components, as determined by the Secretary in 
        coordination with the Secretary of Health and Human 
        Services, and in the case of long-term care insurance 
        that is included with such components, the Secretary 
        shall coordinate with the Secretary of Health and Human 
        Services in performing the functions of the Office; and
          [(3) crop insurance, as established by the Federal 
        Crop Insurance Act (7 U.S.C. 1501 et seq.).
  [(e) Gathering of Information.--
          [(1) In general.--In carrying out the functions 
        required under subsection (c), the Office may--
                  [(A) receive and collect data and information 
                on and from the insurance industry and 
                insurers;
                  [(B) enter into information-sharing 
                agreements;
                  [(C) analyze and disseminate data and 
                information; and
                  [(D) issue reports regarding all lines of 
                insurance except health insurance.
          [(2) Collection of information from insurers and 
        affiliates.--
                  [(A) In general.--Except as provided in 
                paragraph (3), the Office may require an 
                insurer, or any affiliate of an insurer, to 
                submit such data or information as the Office 
                may reasonably require in carrying out the 
                functions described under subsection (c).
                  [(B) Rule of construction.--Notwithstanding 
                any other provision of this section, for 
                purposes of subparagraph (A), the term 
                ``insurer'' means any entity that writes 
                insurance or reinsures risks and issues 
                contracts or policies in 1 or more States.
          [(3) Exception for small insurers.--Paragraph (2) 
        shall not apply with respect to any insurer or 
        affiliate thereof that meets a minimum size threshold 
        that the Office may establish, whether by order or 
        rule.
          [(4) Advance coordination.--Before collecting any 
        data or information under paragraph (2) from an 
        insurer, or affiliate of an insurer, the Office shall 
        coordinate with each relevant Federal agency and State 
        insurance regulator (or other relevant Federal or State 
        regulatory agency, if any, in the case of an affiliate 
        of an insurer) and any publicly available sources to 
        determine if the information to be collected is 
        available from, and may be obtained in a timely manner 
        by, such Federal agency or State insurance regulator, 
        individually or collectively, other regulatory agency, 
        or publicly available sources. If the Director 
        determines that such data or information is available, 
        and may be obtained in a timely manner, from such an 
        agency, regulator, regulatory agency, or source, the 
        Director shall obtain the data or information from such 
        agency, regulator, regulatory agency, or source. If the 
        Director determines that such data or information is 
        not so available, the Director may collect such data or 
        information from an insurer (or affiliate) only if the 
        Director complies with the requirements of subchapter I 
        of chapter 35 of title 44, United States Code (relating 
        to Federal information policy; commonly known as the 
        Paperwork Reduction Act), in collecting such data or 
        information. Notwithstanding any other provision of 
        law, each such relevant Federal agency and State 
        insurance regulator or other Federal or State 
        regulatory agency is authorized to provide to the 
        Office such data or information.
          [(5) Confidentiality.--
                  [(A) Retention of privilege.--The submission 
                of any nonpublicly available data and 
                information to the Office under this subsection 
                shall not constitute a waiver of, or otherwise 
                affect, any privilege arising under Federal or 
                State law (including the rules of any Federal 
                or State court) to which the data or 
                information is otherwise subject.
                  [(B) Continued application of prior 
                confidentiality agreements.--Any requirement 
                under Federal or State law to the extent 
                otherwise applicable, or any requirement 
                pursuant to a written agreement in effect 
                between the original source of any nonpublicly 
                available data or information and the source of 
                such data or information to the Office, 
                regarding the privacy or confidentiality of any 
                data or information in the possession of the 
                source to the Office, shall continue to apply 
                to such data or information after the data or 
                information has been provided pursuant to this 
                subsection to the Office.
                  [(C) Information-sharing agreement.--Any data 
                or information obtained by the Office may be 
                made available to State insurance regulators, 
                individually or collectively, through an 
                information-sharing agreement that--
                          [(i) shall comply with applicable 
                        Federal law; and
                          [(ii) shall not constitute a waiver 
                        of, or otherwise affect, any privilege 
                        under Federal or State law (including 
                        the rules of any Federal or State 
                        court) to which the data or information 
                        is otherwise subject.
                  [(D) Agency disclosure requirements.--Section 
                552 of title 5, United States Code, shall apply 
                to any data or information submitted to the 
                Office by an insurer or an affiliate of an 
                insurer.
          [(6) Subpoenas and enforcement.--The Director shall 
        have the power to require by subpoena the production of 
        the data or information requested under paragraph (2), 
        but only upon a written finding by the Director that 
        such data or information is required to carry out the 
        functions described under subsection (c) and that the 
        Office has coordinated with such regulator or agency as 
        required under paragraph (4). Subpoenas shall bear the 
        signature of the Director and shall be served by any 
        person or class of persons designated by the Director 
        for that purpose. In the case of contumacy or failure 
        to obey a subpoena, the subpoena shall be enforceable 
        by order of any appropriate district court of the 
        United States. Any failure to obey the order of the 
        court may be punished by the court as a contempt of 
        court.
  [(f) Preemption of State Insurance Measures.--
          [(1) Standard.--A State insurance measure shall be 
        preempted pursuant to this section or section 314 if, 
        and only to the extent that the Director determines, in 
        accordance with this subsection, that the measure--
                  [(A) results in less favorable treatment of a 
                non-United States insurer domiciled in a 
                foreign jurisdiction that is subject to a 
                covered agreement than a United States insurer 
                domiciled, licensed, or otherwise admitted in 
                that State; and
                  [(B) is inconsistent with a covered 
                agreement.
          [(2) Determination.--
                  [(A) Notice of potential inconsistency.--
                Before making any determination under paragraph 
                (1), the Director shall--
                          [(i) notify and consult with the 
                        appropriate State regarding any 
                        potential inconsistency or preemption;
                          [(ii) notify and consult with the 
                        United States Trade Representative 
                        regarding any potential inconsistency 
                        or preemption;
                          [(iii) cause to be published in the 
                        Federal Register notice of the issue 
                        regarding the potential inconsistency 
                        or preemption, including a description 
                        of each State insurance measure at 
                        issue and any applicable covered 
                        agreement;
                          [(iv) provide interested parties a 
                        reasonable opportunity to submit 
                        written comments to the Office; and
                          [(v) consider any comments received.
                  [(B) Scope of review.--For purposes of this 
                subsection, any determination of the Director 
                regarding State insurance measures, and any 
                preemption under paragraph (1) as a result of 
                such determination, shall be limited to the 
                subject matter contained within the covered 
                agreement involved and shall achieve a level of 
                protection for insurance or reinsurance 
                consumers that is substantially equivalent to 
                the level of protection achieved under State 
                insurance or reinsurance regulation.
                  [(C) Notice of determination of 
                inconsistency.--Upon making any determination 
                under paragraph (1), the Director shall--
                          [(i) notify the appropriate State of 
                        the determination and the extent of the 
                        inconsistency;
                          [(ii) establish a reasonable period 
                        of time, which shall not be less than 
                        30 days, before the determination shall 
                        become effective; and
                          [(iii) notify the Committees on 
                        Financial Services and Ways and Means 
                        of the House of Representatives and the 
                        Committees on Banking, Housing, and 
                        Urban Affairs and Finance of the 
                        Senate.
          [(3) Notice of effectiveness.--Upon the conclusion of 
        the period referred to in paragraph (2)(C)(ii), if the 
        basis for such determination still exists, the 
        determination shall become effective and the Director 
        shall--
                  [(A) cause to be published a notice in the 
                Federal Register that the preemption has become 
                effective, as well as the effective date; and
                  [(B) notify the appropriate State.
          [(4) Limitation.--No State may enforce a State 
        insurance measure to the extent that such measure has 
        been preempted under this subsection.
  [(g) Applicability of Administrative Procedures Act.--
Determinations of inconsistency made pursuant to subsection 
(f)(2) shall be subject to the applicable provisions of 
subchapter II of chapter 5 of title 5, United States Code 
(relating to administrative procedure), and chapter 7 of such 
title (relating to judicial review), except that in any action 
for judicial review of a determination of inconsistency, the 
court shall determine the matter de novo.
  [(h) Regulations, Policies, and Procedures.--The Secretary 
may issue orders, regulations, policies, and procedures to 
implement this section.
  [(i) Consultation.--The Director shall consult with State 
insurance regulators, individually or collectively, to the 
extent the Director determines appropriate, in carrying out the 
functions of the Office.
  [(j) Savings Provisions.--Nothing in this section shall--
          [(1) preempt--
                  [(A) any State insurance measure that governs 
                any insurer's rates, premiums, underwriting, or 
                sales practices;
                  [(B) any State coverage requirements for 
                insurance;
                  [(C) the application of the antitrust laws of 
                any State to the business of insurance; or
                  [(D) any State insurance measure governing 
                the capital or solvency of an insurer, except 
                to the extent that such State insurance measure 
                results in less favorable treatment of a non-
                United State insurer than a United States 
                insurer;
          [(2) be construed to alter, amend, or limit any 
        provision of
the Consumer Financial Protection Agency Act of 2010; or
          [(3) affect the preemption of any State insurance 
        measure
otherwise inconsistent with and preempted by Federal law.
  [(k) Retention of Existing State Regulatory Authority.--
Nothing in this section or section 314 shall be construed to 
establish or provide the Office or the Department of the 
Treasury with general supervisory or regulatory authority over 
the business of insurance.
  [(l) Retention of Authority of Federal Financial Regulatory 
Agencies.--Nothing in this section or section 314 shall be 
construed to limit the authority of any Federal financial 
regulatory agency, including the authority to develop and 
coordinate policy, negotiate, and enter into agreements with 
foreign governments, authorities, regulators, and multinational 
regulatory committees and to preempt State measures to affect 
uniformity with international regulatory agreements.
  [(m) Retention of Authority of United States Trade 
Representative.--Nothing in this section or section 314 shall 
be construed to affect the authority of the Office of the 
United States Trade Representative pursuant to section 141 of 
the Trade Act of 1974 (19 U.S.C. 2171) or any other provision 
of law, including authority over the development and 
coordination of United States international trade policy and 
the administration of the United States trade agreements 
program.
  [(n) Annual Reports to Congress.--
          [(1) Section 313(f) reports.--Beginning September 30, 
        2011, the Director shall submit a report on or before 
        September 30 of each calendar year to the President and 
        to the Committees on Financial Services and Ways and 
        Means of the House of Representatives and the 
        Committees on Banking, Housing, and Urban Affairs and 
        Finance of the Senate on any actions taken by the 
        Office pursuant to subsection (f) (regarding preemption 
        of inconsistent State insurance measures).
          [(2) Insurance industry.--Beginning September 30, 
        2011, the Director shall submit a report on or before 
        September 30 of each calendar year to the President and 
        to the Committee on Financial Services of the House of 
        Representatives and the Committee on Banking, Housing, 
        and Urban Affairs of the Senate on the insurance 
        industry and any other information as deemed relevant 
        by the Director or requested by such Committees.
  [(o) Reports on U.S. and Global Reinsurance Market.--The 
Director shall submit to the Committee on Financial Services of 
the House of Representatives and the Committee on Banking, 
Housing, and Urban Affairs of the Senate--
          [(1) a report received not later than September 30, 
        2012, describing the breadth and scope of the global 
        reinsurance market and the critical role such market 
        plays in supporting insurance in the United States; and
          [(2) a report received not later than January 1, 
        2013, and updated not later than January 1, 2015, 
        describing the impact of part II of the Nonadmitted and 
        Reinsurance Reform Act of 2010 on the ability of State 
        regulators to access reinsurance information for 
        regulated companies in their jurisdictions.
  [(p) Study and Report on Regulation of Insurance.--
          [(1) In general.--Not later than 18 months after the 
        date of enactment of this section, the Director shall 
        conduct a study and submit a report to Congress on how 
        to modernize and improve the system of insurance 
        regulation in the United States.
          [(2) Considerations.--The study and report required 
        under paragraph (1) shall be based on and guided by the 
        following considerations:
                  [(A) Systemic risk regulation with respect to 
                insurance.
                  [(B) Capital standards and the relationship 
                between capital allocation and liabilities, 
                including standards relating to liquidity and 
                duration risk.
                  [(C) Consumer protection for insurance 
                products and practices, including gaps in State 
                regulation.
                  [(D) The degree of national uniformity of 
                State insurance regulation.
                  [(E) The regulation of insurance companies 
                and affiliates on a consolidated basis.
                  [(F) International coordination of insurance 
                regulation.
          [(3) Additional factors.--The study and report 
        required under paragraph (1) shall also examine the 
        following factors:
                  [(A) The costs and benefits of potential 
                Federal regulation of insurance across various 
                lines of insurance (except health insurance).
                  [(B) The feasibility of regulating only 
                certain lines of insurance at the Federal 
                level, while leaving other lines of insurance 
                to be regulated at the State level.
                  [(C) The ability of any potential Federal 
                regulation or Federal regulators to eliminate 
                or minimize regulatory arbitrage.
                  [(D) The impact that developments in the 
                regulation of insurance in foreign 
                jurisdictions might have on the potential 
                Federal regulation of insurance.
                  [(E) The ability of any potential Federal 
                regulation or Federal regulator to provide 
                robust consumer protection for policyholders.
                  [(F) The potential consequences of subjecting 
                insurance companies to a Federal resolution 
                authority, including the effects of any Federal 
                resolution authority--
                          [(i) on the operation of State 
                        insurance guaranty fund systems, 
                        including the loss of guaranty fund 
                        coverage if an insurance company is 
                        subject to a Federal resolution 
                        authority;
                          [(ii) on policyholder protection, 
                        including the loss of the priority 
                        status of policyholder claims over 
                        other unsecured general creditor 
                        claims;
                          [(iii) in the case of life insurance 
                        companies, on the loss of the special 
                        status of separate account assets and 
                        separate account liabilities; and
                          [(iv) on the international 
                        competitiveness of insurance companies.
                  [(G) Such other factors as the Director 
                determines necessary or appropriate, consistent 
                with the principles set forth in paragraph (2).
          [(4) Required recommendations.--The study and report 
        required under paragraph (1) shall also contain any 
        legislative, administrative, or regulatory 
        recommendations, as the Director determines 
        appropriate, to carry out or effectuate the findings 
        set forth in such report.
          [(5) Consultation.--With respect to the study and 
        report required under paragraph (1), the Director shall 
        consult with the State insurance regulators, consumer 
        organizations, representatives of the insurance 
        industry and policyholders, and other organizations and 
        experts, as appropriate.
  [(q) Use of Existing Resources.--To carry out this section, 
the Office may employ personnel, facilities, and any other 
resource of the Department of the Treasury available to the 
Secretary and the Secretary shall dedicate specific personnel 
to the Office.
  [(r) Definitions.--In this section and section 314, the 
following definitions shall apply:
          [(1) Affiliate.--The term ``affiliate'' means, with 
        respect to an insurer, any person who controls, is 
        controlled by, or is under common control with the 
        insurer.
          [(2) Covered agreement.--The term ``covered 
        agreement'' means a written bilateral or multilateral 
        agreement regarding prudential measures with respect to 
        the business of insurance or reinsurance that--
                  [(A) is entered into between the United 
                States and one or more foreign governments, 
                authorities, or regulatory entities; and
                  [(B) relates to the recognition of prudential 
                measures with respect to the business of 
                insurance or reinsurance that achieves a level 
                of protection for insurance or reinsurance 
                consumers that is substantially equivalent to 
                the level of protection achieved under State 
                insurance or reinsurance regulation.
          [(3) Insurer.--The term ``insurer'' means any person 
        engaged in the business of insurance, including 
        reinsurance.
          [(4) Federal financial regulatory agency.--The term 
        ``Federal financial regulatory agency'' means the 
        Department of the Treasury, the Board of Governors of 
        the Federal Reserve System, the Office of the 
        Comptroller of the Currency, the Office of Thrift 
        Supervision, the Securities and Exchange Commission, 
        the Commodity Futures Trading Commission, the Federal 
        Deposit Insurance Corporation, the Federal Housing 
        Finance Agency, or the National Credit Union 
        Administration.
          [(5) Non-United States insurer.--The term ``non-
        United States insurer'' means an insurer that is 
        organized under the laws of a jurisdiction other than a 
        State, but does not include any United States branch of 
        such an insurer.
          [(6) Office.--The term ``Office'' means the Federal 
        Insurance Office established by this section.
          [(7) State insurance measure.--The term ``State 
        insurance measure'' means any State law, regulation, 
        administrative ruling, bulletin, guideline, or practice 
        relating to or affecting prudential measures applicable 
        to insurance or reinsurance.
          [(8) State insurance regulator.--The term ``State 
        insurance regulator'' means any State regulatory 
        authority responsible for the supervision of insurers.
          [(9) Substantially equivalent to the level of 
        protection achieved.--The term ``substantially 
        equivalent to the level of protection achieved'' means 
        the prudential measures of a foreign government, 
        authority, or regulatory entity achieve a similar 
        outcome in consumer protection as the outcome achieved 
        under State insurance or reinsurance regulation.
          [(10) United States insurer.--The term ``United 
        States insurer'' means--
                  [(A) an insurer that is organized under the 
                laws of a State; or
                  [(B) a United States branch of a non-United 
                States insurer.
  [(s) Authorization of Appropriations.--There are authorized 
to be appropriated for the Office for each fiscal year such 
sums as may be necessary.]

Sec. 313. Office of the Independent Insurance Advocate

  (a) Establishment.--There is established in the Department of 
the Treasury a bureau to be known as the Office of the 
Independent Insurance Advocate (in this section referred to as 
the ``Office'').
  (b) Independent Insurance Advocate.--
          (1) Establishment of position.--The chief officer of 
        the Office of the Independent Insurance Advocate shall 
        be known as the Independent Insurance Advocate. The 
        Independent Insurance Advocate shall perform the duties 
        of such office under the general direction of the 
        Secretary of the Treasury.
          (2) Appointment.--The Independent Insurance Advocate 
        shall be appointed by the President, by and with the 
        advice and consent of the Senate, from among persons 
        having insurance expertise.
          (3) Term.--
                  (A) In general.--The Independent Insurance 
                Advocate shall serve a term of 6 years, unless 
                sooner removed by the President upon reasons 
                which shall be communicated to the Senate.
                  (B) Service after expiration.--If a successor 
                is not nominated and confirmed by the end of 
                the term of service of the Independent 
                Insurance Advocate, the person serving as 
                Independent Insurance Advocate shall continue 
                to serve until such time a successor is 
                appointed and confirmed.
                  (C) Vacancy.--An Independent Insurance 
                Advocate who is appointed to serve the 
                remainder of a predecessor's uncompleted term 
                shall be eligible thereafter to be appointed to 
                a full 6 year term.
                  (D) Acting official on financial stability 
                oversight council.--In the event of a vacancy 
                in the office of the Independent Insurance 
                Advocate, and pending the appointment and 
                confirmation of a successor, or during the 
                absence or disability of the Independent 
                Insurance Advocate, the Independent Member 
                shall appoint a federal official appointed by 
                the President and confirmed by the Senate from 
                a member agency of the Financial Stability 
                Oversight Council, not otherwise serving on the 
                Council, who shall serve as a member of the 
                Council and act in the place of the Independent 
                Insurance Advocate until such vacancy, absence, 
                or disability concludes.
          (4) Employment.--The Independent Insurance Advocate 
        shall be an employee of the Federal Government within 
        the definition of employee under section 2105 of title 
        5, United States Code.
  (c) Independence; Oversight.--
          (1) Independence.--The Secretary of the Treasury may 
        not delay or prevent the issuance of any rule or the 
        promulgation of any regulation by the Independent 
        Insurance Advocate, and may not intervene in any matter 
        or proceeding before the Independent Insurance 
        Advocate, unless otherwise specifically provided by 
        law.
          (2) Oversight by inspector general.--The Office of 
        the Independent Insurance Advocate shall be an office 
        in the establishment of the Department of the Treasury 
        for purposes of the Inspector General Act of 1978 (5 
        U.S.C. App.).
  (d) Retention of Existing State Regulatory Authority.--
Nothing in this section or section 314 shall be construed to 
establish or provide the Office or the Department of the 
Treasury with general supervisory or regulatory authority over 
the business of insurance.
  (e) Budget.--
          (1) Annual transmittal.--For each fiscal year, the 
        Independent Insurance Advocate shall transmit a budget 
        estimate and request to the Secretary of the Treasury, 
        which shall specify the aggregate amount of funds 
        requested for such fiscal year for the operations of 
        the Office of the Independent Insurance Advocate.
          (2) Inclusions.--In transmitting the proposed budget 
        to the President for approval, the Secretary of the 
        Treasury shall include--
                  (A) an aggregate request for the Independent 
                Insurance Advocate; and
                  (B) any comments of the Independent Insurance 
                Advocate with respect to the proposal.
          (3) President's budget.--The President shall include 
        in each budget of the United States Government 
        submitted to the Congress--
                  (A) a separate statement of the budget 
                estimate prepared in accordance with paragraph 
                (1);
                  (B) the amount requested by the President for 
                the Independent Insurance Advocate; and
                  (C) any comments of the Independent Insurance 
                Advocate with respect to the proposal if the 
                Independent Insurance Advocate concludes that 
                the budget submitted by the President would 
                substantially inhibit the Independent Insurance 
                Advocate from performing the duties of the 
                office.
  (f) Assistance.--The Secretary of the Treasury shall provide 
the Independent Insurance Advocate such services, funds, 
facilities and other support services as the Independent 
Insurance Advocate may request and as the Secretary may 
approve.
  (g) Personnel.--
          (1) Employees.--The Independent Insurance Advocate 
        may fix the number of, and appoint and direct, the 
        employees of the Office, in accordance with the 
        applicable provisions of title 5, United States Code. 
        The Independent Insurance Advocate is authorized to 
        employ attorneys, analysts, economists, and other 
        employees as may be deemed necessary to assist the 
        Independent Insurance Advocate to carry out the duties 
        and functions of the Office. Unless otherwise provided 
        expressly by law, any individual appointed under this 
        paragraph shall be an employee as defined in section 
        2105 of title 5, United States Code, and subject to the 
        provisions of such title and other laws generally 
        applicable to the employees of the Executive Branch.
          (2) Compensation.--Employees of the Office shall be 
        paid in accordance with the provisions of chapter 51 
        and subchapter III of chapter 53 of title 5, United 
        States Code, relating to classification and General 
        Schedule pay rates.
          (3) Procurement of temporary and intermittent 
        services.--The Independent Insurance Advocate may 
        procure temporary and intermittent services under 
        section 3109(b) of title 5, United States Code, at 
        rates for individuals which do not exceed the daily 
        equivalent of the annual rate of basic pay prescribed 
        for Level V of the Executive Schedule under section 
        5316 of such title.
          (4) Details.--Any employee of the Federal Government 
        may be detailed to the Office with or without 
        reimbursement, and such detail shall be without 
        interruption or loss of civil service status or 
        privilege. An employee of the Federal Government 
        detailed to the Office shall report to and be subject 
        to oversight by the Independent Insurance Advocate 
        during the assignment to the office, and may be 
        compensated by the branch, department, or agency from 
        which the employee was detailed.
          (5) Intergovernmental personnel.--The Independent 
        Insurance Advocate may enter into agreements under 
        subchapter VI of chapter 33 of title 5, United States 
        Code, with State and local governments, institutions of 
        higher education, Indian tribal governments, and other 
        eligible organizations for the assignment of 
        intermittent, part-time, and full-time personnel, on a 
        reimbursable or non-reimbursable basis.
  (h) Ethics.--
          (1) Designated ethics official.--The Legal Counsel of 
        the Financial Stability Oversight Council, or in the 
        absence of a Legal Counsel of the Council, the 
        designated ethics official of any Council member 
        agency, as chosen by the Independent Insurance 
        Advocate, shall be the ethics official for the 
        Independent Insurance Advocate.
          (2) Restriction on representation.--In addition to 
        any restriction under section 205(c) of title18, United 
        States Code, except as provided in subsections (d) 
        through (i) of section 205 of such title, the 
        Independent Insurance Advocate (except in the proper 
        discharge of official duties) shall not, with or 
        without compensation, represent anyone to or before any 
        officer or employee of--
                  (A) the Financial Stability Oversight Council 
                on any matter; or
                  (B) the Department of Justice with respect to 
                litigation involving a matter described in 
                subparagraph (A).
          (3) Compensation for services provided by another.--
        For purposes of section 203 of title 18, United States 
        Code, and if a special government employee--
                  (A) the Independent Insurance Advocate shall 
                not be subject to the restrictions of 
                subsection (a)(1) of section 203,of title 18, 
                United States Code, for sharing in compensation 
                earned by another for representations on 
                matters covered by such section; and
                  (B) a person shall not be subject to the 
                restrictions of subsection (a)(2) of such 
                section for sharing such compensation with the 
                Independent Insurance Advocate.
  (i) Advisory, Technical, and Professional Committees.--The 
Independent Insurance Advocate may appoint such special 
advisory, technical, or professional committees as may be 
useful in carrying out the functions of the Office and the 
members of such committees may be staff of the Office, or other 
persons, or both.
  (j) Mission and Functions.--
          (1) Mission.--In carrying out the functions under 
        this subsection, the mission of the Office shall be to 
        act as an independent advocate on behalf of the 
        interests of United States policyholders on prudential 
        aspects of insurance matters of importance, and to 
        provide perspective on protecting their interests, 
        separate and apart from any other Federal agency or 
        State insurance regulator.
          (2) Office.--The Office shall have the authority--
                  (A) to coordinate Federal efforts on 
                prudential aspects of international insurance 
                matters, including representing the United 
                States, as appropriate, in the International 
                Association of Insurance Supervisors (or a 
                successor entity) and assisting the Secretary 
                in negotiating covered agreements (as such term 
                is defined in subsection (q)) in coordination 
                with States (including State insurance 
                commissioners) and the United States Trade 
                Representative;
                  (B) to consult with the States (including 
                State insurance regulators) regarding insurance 
                matters of national importance and prudential 
                insurance matters of international importance;
                  (C) to assist the Secretary in administering 
                the Terrorism Insurance Program established in 
                the Department of the Treasury under the 
                Terrorism Risk Insurance Act of 2002 (15 U.S.C. 
                6701 note);
                  (D) to observe all aspects of the insurance 
                industry, including identifying issues or gaps 
                in the regulation of insurers that could 
                contribute to a systemic crisis in the 
                insurance industry or the United States 
                financial system; and
                  (E) to make determinations and exercise the 
                authority under subsection (m) with respect to 
                covered agreements and State insurance 
                measures.
          (3) Membership on financial stability oversight 
        council.--
                  (A) In general.--The Independent Insurance 
                Advocate shall serve, pursuant to section 
                111(b)(1)(J) of the Financial Stability Act of 
                2010 (12 U.S.C. 5321(b)(1)(J)), as a member on 
                the Financial Stability Oversight Council.
                  (B) Authority.--To assist the Financial 
                Stability Oversight Council with its 
                responsibilities to monitor international 
                insurance developments, advise the Congress, 
                and make recommendations, the Independent 
                Insurance Advocate shall have the authority--
                          (i) to regularly consult with 
                        international insurance supervisors and 
                        international financial stability 
                        counterparts;
                          (ii) to consult with the Board of 
                        Governors of the Federal Reserve System 
                        and the States with respect to 
                        representing the United States, as 
                        appropriate, in the International 
                        Association of Insurance Supervisors 
                        (including to become a non-voting 
                        member thereof), particularly on 
                        matters of systemic risk;
                          (iii) to participate at the Financial 
                        Stability Board of The Group of Twenty 
                        and to join with other members from the 
                        United States including on matters 
                        related to insurance; and
                          (iv) to participate with the United 
                        States delegation to the Organization 
                        for Economic Cooperation and 
                        Development and observe and participate 
                        at the Insurance and Private Pensions 
                        Committee.
          (4) Limitations on participation in supervisory 
        colleges.--The Office may not engage in any activities 
        that it is not specifically authorized to engage in 
        under this section or any other provision of law, 
        including participation in any supervisory college or 
        other meetings or fora for cooperation and 
        communication between the involved insurance 
        supervisors established for the fundamental purpose of 
        facilitating the effectiveness of supervision of 
        entities which belong to an insurance group.
  (k) Scope.--The authority of the Office as specified and 
limited in this section shall extend to all lines of insurance 
except--
          (1) health insurance, as determined by the Secretary 
        in coordination with the Secretary of Health and Human 
        Services based on section 2791 of the Public Health 
        Service Act (42 U.S.C. 300gg-91);
          (2) long-term care insurance, except long-term care 
        insurance that is included with life or annuity 
        insurance components, as determined by the Secretary in 
        coordination with the Secretary of Health and Human 
        Services, and in the case of long-term care insurance 
        that is included with such components, the Secretary 
        shall coordinate with the Secretary of Health and Human 
        Services in performing the functions of the Office; and
          (3) crop insurance, as established by the Federal 
        Crop Insurance Act (7 U.S.C. 1501 et seq.).
  (l) Access to Information.--In carrying out the functions 
required under subsection (j), the Office may coordinate with 
any relevant Federal agency and any State insurance regulator 
(or other relevant Federal or State regulatory agency, if any, 
in the case of an affiliate of an insurer) and any publicly 
available sources for the provision to the Office of publicly 
available information. Notwithstanding any other provision of 
law, each such relevant Federal agency and State insurance 
regulator or other Federal or State regulatory agency is 
authorized to provide to the Office such data or information.
  (m) Preemption Pursuant to Covered Agreements.--
          (1) Standards.--A State insurance measure shall be 
        preempted pursuant to this section or section 314 if, 
        and only to the extent that the Independent Insurance 
        Advocate determines, in accordance with this 
        subsection, that the measure--
                  (A) results in less favorable treatment of a 
                non-United States insurer domiciled in a 
                foreign jurisdiction that is subject to a 
                covered agreement than a United States insurer 
                domiciled, licensed, or otherwise admitted in 
                that State; and
                  (B) is inconsistent with a covered agreement.
          (2) Determination.--
                  (A) Notice of potential inconsistency.--
                Before making any determination under paragraph 
                (1), the Independent Insurance Advocate shall--
                          (i) notify and consult with the 
                        appropriate State regarding any 
                        potential inconsistency or preemption;
                          (ii) notify and consult with the 
                        United States Trade Representative 
                        regarding any potential inconsistency 
                        or preemption;
                          (iii) cause to be published in the 
                        Federal Register notice of the issue 
                        regarding the potential inconsistency 
                        or preemption, including a description 
                        of each State insurance measure at 
                        issue and any applicable covered 
                        agreement;
                          (iv) provide interested parties a 
                        reasonable opportunity to submit 
                        written comments to the Office; and
                          (v) consider any comments received.
                  (B) Scope of review.--For purposes of this 
                subsection, any determination of the 
                Independent Insurance Advocate regarding State 
                insurance measures, and any preemption under 
                paragraph (1) as a result of such 
                determination, shall be limited to the subject 
                matter contained within the covered agreement 
                involved and shall achieve a level of 
                protection for insurance or reinsurance 
                consumers that is substantially equivalent to 
                the level of protection achieved under State 
                insurance or reinsurance regulation.
                  (C) Notice of determination of 
                inconsistency.--Upon making any determination 
                under paragraph (1), the Director shall--
                          (i) notify the appropriate State of 
                        the determination and the extent of the 
                        inconsistency;
                          (ii) establish a reasonable period of 
                        time, which shall not be less than 30 
                        days, before the determination shall 
                        become effective; and
                          (iii) notify the Committees on 
                        Financial Services and Ways and Means 
                        of the House of Representatives and the 
                        Committees on Banking, Housing, and 
                        Urban Affairs and Finance of the 
                        Senate.
          (3) Notice of effectiveness.--Upon the conclusion of 
        the period referred to in paragraph (2)(C)(ii), if the 
        basis for such determination still exists, the 
        determination shall become effective and the 
        Independent Insurance Advocate shall--
                  (A) cause to be published a notice in the 
                Federal Register that the preemption has become 
                effective, as well as the effective date; and
                  (B) notify the appropriate State.
          (4) Limitation.--No State may enforce a State 
        insurance measure to the extent that such measure has 
        been preempted under this subsection.
          (5) Applicability of administrative procedures act.--
        Determinations of inconsistency made pursuant to 
        paragraph (2) shall be subject to the applicable 
        provisions of subchapter II of chapter 5 of title 5, 
        United States Code (relating to administrative 
        procedure), and chapter 7 of such title (relating to 
        judicial review), except that in any action for 
        judicial review of a determination of inconsistency, 
        the court shall determine the matter de novo.
  (n) Consultation.--The Independent Insurance Advocate shall 
consult with State insurance regulators, individually or 
collectively, to the extent the Independent Insurance Advocate 
determines appropriate, in carrying out the functions of the 
Office.
  (o) Notices and Requests for Comment.--In addition to the 
other functions and duties specified in this section, the 
Independent Insurance Advocate may prescribe such notices and 
requests for comment in the Federal Register as are deemed 
necessary related to and governing the manner in which the 
duties and authorities of the Independent Insurance Advocate 
are carried out;
  (p) Savings Provisions.--Nothing in this section shall--
          (1) preempt--
                  (A) any State insurance measure that governs 
                any insurer's rates, premiums, underwriting, or 
                sales practices;
                  (B) any State coverage requirements for 
                insurance;
                  (C) the application of the antitrust laws of 
                any State to the business of insurance; or
                  (D) any State insurance measure governing the 
                capital or solvency of an insurer, except to 
                the extent that such State insurance measure 
                results in less favorable treatment of a non-
                United State insurer than a United States 
                insurer; or
          (2) affect the preemption of any State insurance 
        measure otherwise inconsistent with and preempted by 
        Federal law.
  (q) Retention of Authority of Federal Financial Regulatory 
Agencies.--Nothing in this section or section 314 shall be 
construed to limit the authority of any Federal financial 
regulatory agency, including the authority to develop and 
coordinate policy, negotiate, and enter into agreements with 
foreign governments, authorities, regulators, and multinational 
regulatory committees and to preempt State measures to affect 
uniformity with international regulatory agreements.
  (r) Retention of Authority of United States Trade 
Representative.--Nothing in this section or section 314 shall 
be construed to affect the authority of the Office of the 
United States Trade Representative pursuant to section 141 of 
the Trade Act of 1974 (19 U.S.C. 2171) or any other provision 
of law, including authority over the development and 
coordination of United States international trade policy and 
the administration of the United States trade agreements 
program.
  (s) Congressional Testimony.--The Independent Insurance 
Advocate shall appear before the Committee on Financial 
Services of the House of Representatives and the Committee on 
Banking, Housing, and Urban Affairs at semi-annual hearings and 
shall provide testimony, which shall include submitting written 
testimony in advance of such appearances to such committees and 
to the Committee on Ways and Means of the House of 
Representatives and the Committee on Finance of the Senate, on 
the following matters:
          (1) Office activities.--The efforts, activities, 
        objectives, and plans of the Office.
          (2) Section 313(l) actions.--Any actions taken by the 
        Office pursuant to subsection (l) (regarding preemption 
        pursuant to covered agreements).
          (3) Insurance industry.--The state of, and 
        developments in, the insurance industry.
          (4) U.S. and global insurance and reinsurance 
        markets.--The breadth and scope of the global insurance 
        and reinsurance markets and the critical role such 
        markets plays in supporting insurance in the United 
        States and the ongoing impacts of part II of the 
        Nonadmitted and Reinsurance Reform Act of 2010 on the 
        ability of State regulators to access reinsurance 
        information for regulated companies in their 
        jurisdictions.
          (5) Other.--Any other matters as deemed relevant by 
        the Independent Insurance Advocate or requested by such 
        Committees.
  (t) Report Upon End of Term of Office.--Not later than two 
months prior to the expiration of the term of office, or 
discontinuation of service, of each individual serving as the 
Independent Insurance Advocate, the Independent Insurance 
Advocate shall submit a report to the Committees on Financial 
Services and Ways and Means of the House of Representatives and 
the Committees on Banking, Housing, and Urban Affairs and 
Finance of the Senate setting forth recommendations regarding 
the Financial Stability Oversight Council and the role, duties, 
and functions of the Independent Insurance Advocate.
  (u) Definitions.--In this section and section 314, the 
following definitions shall apply:
          (1) Affiliate.--The term ``affiliate'' means, with 
        respect to an insurer, any person who controls, is 
        controlled by, or is under common control with the 
        insurer.
          (2) Covered agreement.--The term ``covered 
        agreement'' means a written bilateral or multilateral 
        agreement regarding prudential measures with respect to 
        the business of insurance or reinsurance that--
                  (A) is entered into between the United States 
                and one or more foreign governments, 
                authorities, or regulatory entities; and
                  (B) relates to the recognition of prudential 
                measures with respect to the business of 
                insurance or reinsurance that achieves a level 
                of protection for insurance or reinsurance 
                consumers that is substantially equivalent to 
                the level of protection achieved under State 
                insurance or reinsurance regulation.
          (3) Insurer.--The term ``insurer'' means any person 
        engaged in the business of insurance, including 
        reinsurance.
          (4) Federal financial regulatory agency.--The term 
        ``Federal financial regulatory agency'' means the 
        Department of the Treasury, the Board of Governors of 
        the Federal Reserve System, the Office of the 
        Comptroller of the Currency, the Office of Thrift 
        Supervision, the Securities and Exchange Commission, 
        the Commodity Futures Trading Commission, the Federal 
        Deposit Insurance Corporation, the Federal Housing 
        Finance Agency, or the National Credit Union 
        Administration.
          (5) Financial stability oversight council.--The term 
        ``Financial Stability Oversight Council '' means the 
        Financial Stability Oversight Council established under 
        section 111(a) of the Dodd-Frank Wall Street Reform and 
        Consumer Protection Act (12 U.S.C. 5321(a)).
          (6) Member agency.--The term ``member agency'' has 
        the meaning given such term in section 111(a) of the 
        Dodd-Frank Wall Street Reform and Consumer Protection 
        Act (12 U.S.C. 5321(a)).
          (7) Non-united states insurer.--The term ``non-United 
        States insurer'' means an insurer that is organized 
        under the laws of a jurisdiction other than a State, 
        but does not include any United States branch of such 
        an insurer.
          (8) Office.--The term ``Office'' means the Office of 
        the Independent Insurance Advocate established by this 
        section.
          (9) State insurance measure.--The term ``State 
        insurance measure'' means any State law, regulation, 
        administrative ruling, bulletin, guideline, or practice 
        relating to or affecting prudential measures applicable 
        to insurance or reinsurance.
          (10) State insurance regulator.--The term ``State 
        insurance regulator'' means any State regulatory 
        authority responsible for the supervision of insurers.
          (11) Substantially equivalent to the level of 
        protection achieved.--The term ``substantially 
        equivalent to the level of protection achieved'' means 
        the prudential measures of a foreign government, 
        authority, or regulatory entity achieve a similar 
        outcome in consumer protection as the outcome achieved 
        under State insurance or reinsurance regulation.
          (12) United states insurer.--The term ``United States 
        insurer'' means--
                  (A) an insurer that is organized under the 
                laws of a State; or
                  (B) a United States branch of a non-United 
                States insurer.

Sec. 314. Covered agreements

  (a) Authority.--The Secretary and the United States Trade 
Representative are authorized, jointly, to negotiate and enter 
into covered agreements on behalf of the United States.
  (b) Requirements for Consultation With Congress.--
          (1) In general.--Before initiating negotiations to 
        enter into a covered agreement under subsection (a), 
        during such negotiations, and before entering into any 
        such agreement, the Secretary and the United States 
        Trade Representative shall jointly consult with the 
        Committee on Financial Services and the Committee on 
        Ways and Means of the House of Representatives and the 
        Committee on Banking, Housing, and Urban Affairs and 
        the Committee on Finance of the Senate.
          (2) Scope.--The consultation described in paragraph 
        (1) shall include consultation with respect to--
                  (A) the nature of the agreement;
                  (B) how and to what extent the agreement will 
                achieve the applicable purposes, policies, 
                priorities, and objectives of section 313 and 
                this section; and
                  (C) the implementation of the agreement, 
                including the general effect of the agreement 
                on existing State laws.
  (c) Submission and Layover Provisions.--A covered agreement 
under subsection (a) may enter into force with respect to the 
United States only if--
          (1) the Secretary of the Treasury and the United 
        States Trade Representative have caused to be published 
        in the Federal Register, and made available for public 
        comment for a period of not fewer than 30 days and not 
        greater than 90 days (which period may run concurrently 
        with the 90-day period for the covered agreement 
        referred to in paragraph (3)), the proposed text of the 
        covered agreement;
          [(1)] (2) the Secretary and the United States Trade 
        Representative jointly submit to the congressional 
        committees specified in subsection (b)(1), on a day on 
        which both Houses of Congress are in session, a copy of 
        the final legal text of the agreement; and
          [(2)] (3) a period of 90 calendar days beginning on 
        the date on which the copy of the final legal text of 
        the agreement is submitted to the congressional 
        committees under paragraph (1) has expired.

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SUBCHAPTER II--ADMINISTRATIVE

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Sec. 325. International affairs authorization

  (a) Under regulations prescribed by the Secretary of the 
Treasury, the Secretary may provide officers and employees of 
the Department of the Treasury carrying out international 
affairs duties and powers of the Department with allowances and 
benefits comparable to those provided under chapter 9 of title 
I of the Foreign Service Act of 1980 (22 U.S.C. 4081 et seq.).
  (b) The following amounts may be appropriated to the 
Secretary for the fiscal year ending September 30, 1982:
          (1) not more than $22,896,000 to carry out the 
        international affairs duties and powers of the 
        Department (including amounts for official functions 
        and reception and representation expenses).
          (2) not more than $1,000,000 for increases in--
                  (A) pay, under section 5382(c) and subchapter 
                I of chapter 53 of title 5 (except section 
                5305, or corresponding prior provision of such 
                title), of officers and employees carrying out 
                the duties and powers referred to in clause (1) 
                of this subsection;
                  (B) departmental contributions attributable 
                to those pay increases; and
                  (C) allowances and benefits, because of cost 
                of living increases, provided under subsection 
                (a) of this section.
  (c) Necessary amounts may be appropriated to the Secretary 
for each fiscal year beginning after September 30, 1982--
          (1) to carry out the international affairs duties and 
        powers of the Department (including amounts for 
        official functions and reception and representation 
        expenses);
          (2) for increases in--
                  (A) pay, under section 5382(c) and subchapter 
                I of chapter 53 of title 5 (except section 
                5303), of officers and employees carrying out 
                the duties and powers referred to in clause (1) 
                of this subsection;
                  (B) departmental contributions attributable 
                to those pay increases; and
                  (C) allowances and benefits, because of cost 
                of living increases, provided under subsection 
                (a) of this section.
  (d) International Processes.--
          (1) Notice of process; consultation.--At least 30 
        calendar days before the Secretary participates in a 
        process of setting financial standards as a part of any 
        foreign or multinational entity, the Secretary shall--
                  (A) issue a notice of the process, including 
                the subject matter, scope, and goals of the 
                process, to the Committee on Financial Services 
                of the House of Representatives and the 
                Committee on Banking, Housing, and Urban 
                Affairs of the Senate;
                  (B) make such notice available to the public, 
                including on the website of the Department of 
                the Treasury; and
                  (C) solicit public comment, and consult with 
                the committees described under subparagraph 
                (A), with respect to the subject matter, scope, 
                and goals of the process.
          (2) Public reports on process.--After the end of any 
        process described under paragraph (1), the Secretary 
        shall issue a public report on the topics that were 
        discussed at the process and any new or revised 
        rulemakings or policy changes that the Secretary 
        believes should be implemented as a result of the 
        process.
          (3) Notice of agreements; consultation.--At least 90 
        calendar days before the Secretary participates in a 
        process of setting financial standards as a part of any 
        foreign or multinational entity, the Secretary shall--
                  (A) issue a notice of agreement to the 
                Committee on Financial Services of the House of 
                Representatives and the Committee on Banking, 
                Housing, and Urban Affairs of the Senate;
                  (B) make such notice available to the public, 
                including on the website of the Department of 
                the Treasury; and
                  (C) consult with the committees described 
                under subparagraph (A) with respect to the 
                nature of the agreement and any anticipated 
                effects such agreement will have on the 
                economy.
          (4) Definition.--For purposes of this subsection, the 
        term ``process'' shall include any official proceeding 
        or meeting on financial regulation of a recognized 
        international organization with authority to set 
        financial standards on a global or regional level, 
        including the Financial Stability Board, the Basel 
        Committee on Banking Supervision (or a similar 
        organization), and the International Association of 
        Insurance Supervisors (or a similar organization).

           *       *       *       *       *       *       *


CHAPTER 7--GOVERNMENT ACCOUNTABILITY OFFICE

           *       *       *       *       *       *       *



SUBCHAPTER II--GENERAL DUTIES AND POWERS

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Sec. 714. Audit of Financial Institutions Examination Council, Federal 
                    Reserve Board, Federal reserve banks, Federal 
                    Deposit Insurance Corporation, and Office of 
                    Comptroller of the Currency

  (a) In this section, ``agency'' means the Financial 
Institutions Examination Council, the Board of Governors of the 
Federal Reserve System (in this section referred to as the 
``Board''), Federal reserve banks, the Federal Deposit 
Insurance Corporation, and the Office of the Comptroller of the 
Currency.
  (b) Under regulations of the Comptroller General, the 
Comptroller General shall audit an agency, but may carry out an 
onsite examination of an open insured bank or bank holding 
company only if the appropriate agency has consented in 
writing. [Audits of the Board and Federal reserve banks may not 
include--]
          [(1) transactions for or with a foreign central bank, 
        government of a foreign country, or nonprivate 
        international financing organization;
          [(2) deliberations, decisions, or actions on monetary 
        policy matters, including discount window operations, 
        reserves of member banks, securities credit, interest 
        on deposits, and open market operations;
          [(3) transactions made under the direction of the 
        Federal Open Market Committee; or
          [(4) a part of a discussion or communication among or 
        between members of the Board and officers and employees 
        of the Federal Reserve System related to clauses (1)-
        (3) of this subsection.]
  (c)(1) Except as provided in this subsection, an officer or 
employee of the Government Accountability Office may not 
disclose information identifying an open bank, an open bank 
holding company, or a customer of an open or closed bank or 
bank holding company. The Comptroller General may disclose 
information related to the affairs of a closed bank or closed 
bank holding company identifying a customer of the closed bank 
or closed bank holding company only if the Comptroller General 
believes the customer had a controlling influence in the 
management of the closed bank or closed bank holding company or 
was related to or affiliated with a person or group having a 
controlling influence.
  (2) An officer or employee of the Office may discuss a 
customer, bank, or bank holding company with an official of an 
agency and may report an apparent criminal violation to an 
appropriate law enforcement authority of the United States 
Government or a State.
  (3) Except as provided under paragraph (4), an officer or 
employee of the Government Accountability Office may not 
disclose to any person outside the Government Accountability 
Office information obtained in audits or examinations conducted 
under subsection (e) and maintained as confidential by the 
Board or the Federal reserve banks.
  (4) This subsection shall not--
          (A) authorize an officer or employee of an agency to 
        withhold information from any committee or subcommittee 
        of jurisdiction of Congress, or any member of such 
        committee or subcommittee; or
          (B) limit any disclosure by the Government 
        Accountability Office to any committee or subcommittee 
        of jurisdiction of Congress, or any member of such 
        committee or subcommittee.
  (d)(1) To carry out this section, all records and property of 
or used by an agency, including samples of reports of 
examinations of a bank or bank holding company the Comptroller 
General considers statistically meaningful and workpapers and 
correspondence related to the reports shall be made available 
to the Comptroller General. The Comptroller General shall have 
access to the officers, employees, contractors, and other 
agents and representatives of an agency and any entity 
established by an agency at any reasonable time as the 
Comptroller General may request. The Comptroller General may 
make and retain copies of such books, accounts, and other 
records as the Comptroller General determines appropriate. The 
Comptroller General shall give an agency a current list of 
officers and employees to whom, with proper identification, 
records and property may be made available, and who may make 
notes or copies necessary to carry out an audit.
  (2) The Comptroller General shall prevent unauthorized access 
to records, copies of any record, or property of or used by an 
agency or any person or entity described in paragraph (3)(A) 
that the Comptroller General obtains during an audit.
  (3)(A) For purposes of conducting audits and examinations 
under subsection (e) [or (f)], the Comptroller General shall 
have access, upon request, to any information, data, schedules, 
books, accounts, financial records, reports, files, electronic 
communications, or other papers, things or property belonging 
to or in use by--
          (i) any entity established by any action taken by the 
        Board or the Federal Reserve banks described under 
        subsection (e) [or (f)];
          (ii) any entity participating in or receiving 
        assistance from any action taken by the Board or the 
        Federal Reserve banks described under subsection (e) 
        [or (f)], to the extent that the access and request 
        relates to that assistance; and
          (iii) the officers, directors, employees, independent 
        public accountants, financial advisors and any and all 
        representatives of any entity described under clause 
        (i) or (ii); to the extent that the access and request 
        relates to that assistance;
  (B) The Comptroller General shall have access as provided 
under subparagraph (A) at such time as the Comptroller General 
may request. The Comptroller General may make and retain copies 
of books, accounts, and other records provided under 
subparagraph (A) as the Comptroller General deems appropriate. 
The Comptroller General shall provide to any person or entity 
described in subparagraph (A) a current list of officers and 
employees to whom, with proper identification, records and 
property may be made available, and who may make notes or 
copies necessary to carry out [a audit] an audit or examination 
under this subsection.
  (C) Each contract, term sheet, or other agreement between the 
Board or any Federal reserve bank (or any entity established by 
the Board or any Federal reserve bank) and an entity receiving 
assistance from any action taken by the Board described under 
subsection (e) [or (f)] shall provide for access by the 
Comptroller General in accordance with this paragraph.
  (e) Notwithstanding subsection (b), the Comptroller General 
may conduct audits, including onsite examinations when the 
Comptroller General determines such audits and examinations are 
appropriate, of any action taken by the Board under [the third 
undesignated paragraph of section 13] section 13(3) of the 
Federal Reserve Act (12 U.S.C. 343); with respect to a single 
and specific partnership or corporation.
  [(f) Audits of Credit Facilities of the Federal Reserve 
System.--
          [(1) Definitions.--In this subsection, the following 
        definitions shall apply:
                  [(A) Credit facility.--The term ``credit 
                facility'' means a program or facility, 
                including any special purpose vehicle or other 
                entity established by or on behalf of the Board 
                of Governors of the Federal Reserve System or a 
                Federal reserve bank, authorized by the Board 
                of Governors under section 13(3) of the Federal 
                Reserve Act (12 U.S.C. 343), that is not 
                subject to audit under subsection (e).
                  [(B) Covered transaction.--The term ``covered 
                transaction'' means any open market transaction 
                or discount window advance that meets the 
                definition of ``covered transaction'' in 
                section 11(s) of the Federal Reserve Act.
          [(2) Authority for audits and examinations.--Subject 
        to paragraph (3), and notwithstanding any limitation in 
        subsection (b) on the auditing and oversight of certain 
        functions of the Board of Governors of the Federal 
        Reserve System or any Federal reserve bank, the 
        Comptroller General of the United States may conduct 
        audits, including onsite examinations, of the Board of 
        Governors, a Federal reserve bank, or a credit 
        facility, if the Comptroller General determines that 
        such audits are appropriate, solely for the purposes of 
        assessing, with respect to a credit facility or a 
        covered transaction--
                  [(A) the operational integrity, accounting, 
                financial reporting, and internal controls 
                governing the credit facility or covered 
                transaction;
                  [(B) the effectiveness of the security and 
                collateral policies established for the 
                facility or covered transaction in mitigating 
                risk to the relevant Federal reserve bank and 
                taxpayers;
                  [(C) whether the credit facility or the 
                conduct of a covered transaction 
                inappropriately favors one or more specific 
                participants over other institutions eligible 
                to utilize the facility; and
                  [(D) the policies governing the use, 
                selection, or payment of third-party 
                contractors by or for any credit facility or to 
                conduct any covered transaction.
          [(3) Reports and delayed disclosure.--
                  [(A) Reports required.--A report on each 
                audit conducted under paragraph (2) shall be 
                submitted by the Comptroller General to the 
                Congress before the end of the 90-day period 
                beginning on the date on which such audit is 
                completed.
                  [(B) Contents.--The report under subparagraph 
                (A) shall include a detailed description of the 
                findings and conclusions of the Comptroller 
                General with respect to the matters described 
                in paragraph (2) that were audited and are the 
                subject of the report, together with such 
                recommendations for legislative or 
                administrative action relating to such matters 
                as the Comptroller General may determine to be 
                appropriate.
                  [(C) Delayed release of certain 
                information.--
                          [(i) In general.--The Comptroller 
                        General shall not disclose to any 
                        person or entity, including to 
                        Congress, the names or identifying 
                        details of specific participants in any 
                        credit facility or covered transaction, 
                        the amounts borrowed by or transferred 
                        by or to specific participants in any 
                        credit facility or covered transaction, 
                        or identifying details regarding assets 
                        or collateral held or transferred by, 
                        under, or in connection with any credit 
                        facility or covered transaction, and 
                        any report provided under subparagraph 
                        (A) shall be redacted to ensure that 
                        such names and details are not 
                        disclosed.
                          [(ii) Delayed release.--The 
                        nondisclosure obligation under clause 
                        (i) shall expire with respect to any 
                        participant on the date on which the 
                        Board of Governors, directly or through 
                        a Federal reserve bank, publicly 
                        discloses the identity of the subject 
                        participant or the identifying details 
                        of the subject assets, collateral, or 
                        transaction.
                          [(iii) General release.--The 
                        Comptroller General shall release a 
                        nonredacted version of any report on a 
                        credit facility 1 year after the 
                        effective date of the termination by 
                        the Board of Governors of the 
                        authorization for the credit facility. 
                        For purposes of this clause, a credit 
                        facility shall be deemed to have 
                        terminated 24 months after the date on 
                        which the credit facility ceases to 
                        make extensions of credit and loans, 
                        unless the credit facility is otherwise 
                        terminated by the Board of Governors.
                          [(iv) Exceptions.--The nondisclosure 
                        obligation under clause (i) shall not 
                        apply to the credit facilities Maiden 
                        Lane, Maiden Lane II, and Maiden Lane 
                        III.
                          [(v) Release of covered transaction 
                        information.--The Comptroller General 
                        shall release a nonredacted version of 
                        any report regarding covered 
                        transactions upon the release of the 
                        information regarding such covered 
                        transactions by the Board of Governors 
                        of the Federal Reserve System, as 
                        provided in section 11(s) of the 
                        Federal Reserve Act.]

           *       *       *       *       *       *       *


SUBTITLE IV--MONEY

           *       *       *       *       *       *       *


CHAPTER 53--MONETARY TRANSACTIONS

           *       *       *       *       *       *       *



SUBCHAPTER I--CREDIT AND MONETARY EXPANSION

           *       *       *       *       *       *       *



Sec. 5302. Stabilizing exchange rates and arrangements

  (a)(1) The Department of the Treasury has a stabilization 
fund. The fund is available to carry out this section, section 
18 of the Bretton Woods Agreement Act (22 U.S.C. 286e-3), and 
section 3 of the Special Drawing Rights Act (22 U.S.C. 286o), 
and for investing in obligations of the United States 
Government those amounts in the fund the Secretary of the 
Treasury, with the approval of the President, decides are not 
required at the time to carry out this section. Proceeds of 
sales and investments, earnings, and interest shall be paid 
into the fund and are available to carry out this section. 
However, the fund is not available to pay administrative 
expenses.
  (2) Subject to approval by the President, the fund is under 
the exclusive control of the Secretary, and may not be used in 
a way that direct control and custody pass from the President 
and the Secretary. Decisions of the Secretary are final and may 
not be reviewed by another officer or employee of the 
Government.
  (b) Consistent with the obligations of the Government in the 
International Monetary Fund on orderly exchange arrangements 
and a stable system of exchange rates, the Secretary or an 
agency designated by the Secretary, with the approval of the 
President, may deal in gold, foreign exchange, and other 
instruments of credit and securities the Secretary considers 
necessary. However, a loan or credit to a foreign entity or 
government of a foreign country may be made for more than 6 
months in any 12-month period only if the President gives 
Congress a written statement that unique or emergency 
circumstances require the loan or credit be for more than 6 
months.
  (c)(1) By the 30th day after the end of each month, the 
Secretary shall give the Committee on Banking, Finance and 
Urban Affairs of the House of Representatives and the Committee 
on Banking, Housing, and Urban Affairs of the Senate a detailed 
financial statement on the stabilization fund showing all 
agreements made or renewed, all transactions occurring during 
the month, and all projected liabilities.
  (2) The Secretary shall report each year to the President and 
Congress on the operation of the fund.
  (d) A repayment of any part of the first subscription payment 
of the Government to the International Monetary Fund, 
previously paid from the stabilization fund, shall be deposited 
in the Treasury as a miscellaneous receipt.
  (e) Amounts in the fund may not be used for the establishment 
of a guaranty program for any nongovernmental entity.

           *       *       *       *       *       *       *


SUBCHAPTER II--RECORDS AND REPORTS ON MONETARY INSTRUMENTS TRANSACTIONS

           *       *       *       *       *       *       *



Sec. 5312. Definitions and application

  (a) In this subchapter--
          (1) ``financial agency'' means a person acting for a 
        person (except for a country, a monetary or financial 
        authority acting as a monetary or financial authority, 
        or an international financial institution of which the 
        United States Government is a member) as a financial 
        institution, bailee, depository trustee, or agent, or 
        acting in a similar way related to money, credit, 
        securities, gold, or a transaction in money, credit, 
        securities, or gold.
          (2) ``financial institution'' means--
                  (A) an insured bank (as defined in section 
                3(h) of the Federal Deposit Insurance Act (12 
                U.S.C. 1813(h)));
                  (B) a commercial bank or trust company;
                  (C) a private banker;
                  (D) an agency or branch of a foreign bank in 
                the United States;
                  (E) any credit union;
                  (F) a thrift institution;
                  (G) a broker or dealer registered with the 
                Securities and Exchange Commission under the 
                Securities Exchange Act of 1934 (15 U.S.C. 78a 
                et seq.);
                  (H) a broker or dealer in securities or 
                commodities;
                  (I) an investment banker or investment 
                company;
                  (J) a currency exchange;
                  (K) an issuer, redeemer, or cashier of 
                travelers' checks, checks, money orders, or 
                similar instruments;
                  (L) an operator of a credit card system;
                  (M) an insurance company;
                  (N) a dealer in precious metals, stones, or 
                jewels;
                  (O) a pawnbroker;
                  (P) a loan or finance company;
                  (Q) a travel agency;
                  (R) a licensed sender of money or any other 
                person who engages as a business in the 
                transmission of funds, including any person who 
                engages as a business in an informal money 
                transfer system or any network of people who 
                engage as a business in facilitating the 
                transfer of money domestically or 
                internationally outside of the conventional 
                financial institutions system;
                  (S) a telegraph company;
                  (T) a business engaged in vehicle sales, 
                including automobile, airplane, and boat sales;
                  (U) persons involved in real estate closings 
                and settlements;
                  (V) the United States Postal Service;
                  (W) an agency of the United States Government 
                or of a State or local government carrying out 
                a duty or power of a business described in this 
                paragraph;
                  (X) a casino, gambling casino, or gaming 
                establishment with an annual gaming revenue of 
                more than $1,000,000 which--
                          (i) is licensed as a casino, gambling 
                        casino, or gaming establishment under 
                        the laws of any State or any political 
                        subdivision of any State; or
                          (ii) is an Indian gaming operation 
                        conducted under or pursuant to the 
                        Indian Gaming Regulatory Act other than 
                        an operation which is limited to class 
                        I gaming (as defined in section 4(6) of 
                        such Act);
                  (Y) any business or agency which engages in 
                any activity which the Secretary of the 
                Treasury determines, by regulation, to be an 
                activity which is similar to, related to, or a 
                substitute for any activity in which any 
                business described in this paragraph is 
                authorized to engage; or
                  (Z) any other business designated by the 
                Secretary whose cash transactions have a high 
                degree of usefulness in criminal, tax, or 
                regulatory matters.
          (3) ``monetary instruments'' means--
                  (A) United States coins and currency;
                  (B) as the Secretary may prescribe by 
                regulation, coins and currency of a foreign 
                country, travelers' checks, bearer negotiable 
                instruments, bearer investment securities, 
                bearer securities, stock on which title is 
                passed on delivery, and similar material; and
                  (C) as the Secretary of the Treasury shall 
                provide by regulation for purposes of sections 
                5316 and 5331, checks, drafts, notes, money 
                orders, and other similar instruments which are 
                drawn on or by a foreign financial institution 
                and are not in bearer form.
          (4) Nonfinancial trade or business.--The term 
        ``nonfinancial trade or business'' means any trade or 
        business other than a financial institution that is 
        subject to the reporting requirements of section 5313 
        and regulations prescribed under such section.
          (5) ``person'', in addition to its meaning under 
        section 1 of title 1, includes a trustee, a 
        representative of an estate and, when the Secretary 
        prescribes, a governmental entity.
          (6) ``United States'' means the States of the United 
        States, the District of Columbia, and, when the 
        Secretary prescribes by regulation, the Commonwealth of 
        Puerto Rico, the Virgin Islands, Guam, the Northern 
        Mariana Islands, American Samoa, the Trust Territory of 
        the Pacific Islands, a territory or possession of the 
        United States, or a military or diplomatic 
        establishment.
  (b) In this subchapter--
          (1) ``domestic financial agency'' and ``domestic 
        financial institution'' apply to an action in the 
        United States of a financial agency or institution.
          (2) ``foreign financial agency'' and ``foreign 
        financial institution'' apply to an action outside the 
        United States of a financial agency or institution.
  (c) Additional Definitions.--For purposes of this subchapter, 
the following definitions shall apply:
          (1)  Certain institutions included in definition.--
        The term ``financial institution'' (as defined in 
        subsection (a)) includes the following:
                  (A) Any futures commission merchant, 
                commodity trading advisor, or commodity pool 
                operator registered, or required to register, 
                under the Commodity Exchange Act.
          (2) Funding portals not included in definition.--The 
        term ``financial institution'' (as defined in 
        subsection (a)) does not include a funding portal (as 
        defined under section 3(a) of the Securities Exchange 
        Act of 1934 (15 U.S.C. 78c(a))).

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              EMERGENCY ECONOMIC STABILIZATION ACT OF 2008


DIVISION A--EMERGENCY ECONOMIC STABILIZATION

           *       *       *       *       *       *       *


                TITLE I--TROUBLED ASSETS RELIEF PROGRAM

SEC. 101. PURCHASES OF TROUBLED ASSETS.

  (a) Offices; Authority.--
          (1) Authority.--The Secretary is authorized to 
        establish the Troubled Asset Relief Program (or 
        ``TARP'') to purchase, and to make and fund commitments 
        to purchase, troubled assets from any financial 
        institution, on such terms and conditions as are 
        determined by the Secretary, and in accordance with 
        this Act and the policies and procedures developed and 
        published by the Secretary.
          (2) Commencement of program.--Establishment of the 
        policies and procedures and other similar 
        administrative requirements imposed on the Secretary by 
        this Act are not intended to delay the commencement of 
        the TARP.
          (3) Establishment of treasury office.--
                  (A) In general.--The Secretary shall 
                implement any program under paragraph (1) 
                through an Office of Financial Stability, 
                established for such purpose within the Office 
                of Domestic Finance of the Department of the 
                Treasury, which office shall be headed by an 
                Assistant Secretary of the Treasury, appointed 
                by the President, by and with the advice and 
                consent of the Senate, except that an interim 
                Assistant Secretary may be appointed by the 
                Secretary.
                  (B) Clerical amendments.--
                          (i) Title 5.--Section 5315 of title 
                        5, United States Code, is amended in 
                        the item relating to Assistant 
                        Secretaries of the Treasury, by 
                        striking ``(9)'' and inserting 
                        ``(10)''.
                          (ii) Title 31.--Section 301(e) of 
                        title 31, United States Code, is 
                        amended by striking ``9'' and inserting 
                        ``10''.
  (b) Consultation.--In exercising the authority under this 
section, the Secretary shall consult with the Board, the 
Corporation, the Comptroller of the Currency, [the Director of 
the Office of Thrift Supervision,] the Chairman of the National 
Credit Union Administration Board, and the Secretary of Housing 
and Urban Development.
  (c) Necessary Actions.--The Secretary is authorized to take 
such actions as the Secretary deems necessary to carry out the 
authorities in this Act, including, without limitation, the 
following:
          (1) The Secretary shall have direct hiring authority 
        with respect to the appointment of employees to 
        administer this Act.
          (2) Entering into contracts, including contracts for 
        services authorized by section 3109 of title 5, United 
        States Code.
          (3) Designating financial institutions as financial 
        agents of the Federal Government, and such institutions 
        shall perform all such reasonable duties related to 
        this Act as financial agents of the Federal Government 
        as may be required.
          (4) In order to provide the Secretary with the 
        flexibility to manage troubled assets in a manner 
        designed to minimize cost to the taxpayers, 
        establishing vehicles that are authorized, subject to 
        supervision by the Secretary, to purchase, hold, and 
        sell troubled assets and issue obligations.
          (5) Issuing such regulations and other guidance as 
        may be necessary or appropriate to define terms or 
        carry out the authorities or purposes of this Act.
  (d) Program Guidelines.--Before the earlier of the end of the 
2-business-day period beginning on the date of the first 
purchase of troubled assets pursuant to the authority under 
this section or the end of the 45-day period beginning on the 
date of enactment of this Act, the Secretary shall publish 
program guidelines, including the following:
          (1) Mechanisms for purchasing troubled assets.
          (2) Methods for pricing and valuing troubled assets.
          (3) Procedures for selecting asset managers.
          (4) Criteria for identifying troubled assets for 
        purchase.
  (e) Preventing Unjust Enrichment.--In making purchases under 
the authority of this Act, the Secretary shall take such steps 
as may be necessary to prevent unjust enrichment of financial 
institutions participating in a program established under this 
section, including by preventing the sale of a troubled asset 
to the Secretary at a higher price than what the seller paid to 
purchase the asset. This subsection does not apply to troubled 
assets acquired in a merger or acquisition, or a purchase of 
assets from a financial institution in conservatorship or 
receivership, or that has initiated bankruptcy proceedings 
under title 11, United States Code.

           *       *       *       *       *       *       *


SEC. 131. EXCHANGE STABILIZATION FUND REIMBURSEMENT.

  (a) Reimbursement.--The Secretary shall reimburse the 
Exchange Stabilization Fund established under section 5302 of 
title 31, United States Code, for any funds that are used for 
the Treasury Money Market Funds Guaranty Program for the United 
States money market mutual fund industry, from funds under this 
Act.
  (b) Limits on Use of Exchange Stabilization Fund.--The 
Secretary is prohibited from using the Exchange Stabilization 
Fund for the establishment of any future guaranty programs for 
the United States money market mutual fund industry, or for the 
purposes of preventing the liquidation or insolvency of any 
entity.

           *       *       *       *       *       *       *

                              ----------                              


BANK HOLDING COMPANY ACT OF 1956

           *       *       *       *       *       *       *



                  acquisition of bank shares or assets

  Sec. 3. (a) It shall be unlawful, except with the prior 
approval of the Board, (1) for any action to be taken that 
causes any company to become a bank holding company; (2) for 
any action to be taken that causes a bank to become a 
subsidiary of a bank holding company; (3) for any bank holding 
company to acquire direct or indirect ownership or control of 
any voting shares of any bank if, after such acquisition, such 
company will directly or indirectly own or control more than 5 
per centum of the voting shares of such bank; (4) for any bank 
holding company or subsidiary thereof, other than a bank, to 
acquire all or substantially all of the assets of a bank; or 
(5) for any bank holding company to merge or consolidate with 
any other bank holding company. Notwithstanding the foregoing 
this prohibition shall not apply to (A) shares acquired by a 
bank, (i) in good faith in a fiduciary capacity, except where 
such shares are held under a trust that constitutes a company 
as defined in section 2(b) and except as provided in paragraphs 
(2) and (3) of section 2(g), or (ii) in the regular course of 
securing or collecting a debt previously contracted in good 
faith, but any shares acquired after the date of enactment of 
this Act in securing or collecting any such previously 
contracted debt shall be disposed of within a period of two 
years from the date on which they were acquired; (B) additional 
shares acquired by a bank holding company in a bank in which 
such bank holding company owned or controlled a majority of the 
voting shares prior to such acquisition; or (C) the 
acquisition, by a company, of control of a bank in a 
reorganization in which a person or group of persons exchanges 
their shares of the bank for shares of a newly formed bank 
holding company and receives after the reorganization 
substantially the same proportional share interest in the 
holding company as they held in the bank except for changes in 
shareholders' interests resulting from the exercise of 
dissenting shareholders' rights under State or Federal law if--
          
                  
                          (i) immediately following the 
                        acquisition--
                                  (I) the bank holding company 
                                meets the capital and other 
                                financial standards prescribed 
                                by the Board by regulation for 
                                such a bank holding company; 
                                and
                                  (II) the bank is adequately 
                                capitalized (as defined in 
                                section 38 of the Federal 
                                Deposit Insurance Act);
                          (ii) the holding company does not 
                        engage in any activities other than 
                        those of managing and controlling banks 
                        as a result of the reorganization;
                          (iii) the company provides 30 days 
                        prior notice to the Board and the Board 
                        does not object to such transaction 
                        during such 30-day period; and
                          (iv) the holding company will not 
                        acquire control of any additional bank 
                        as a result of the reorganization..
The Board is authorized upon application by a bank to extend, 
from time to time for not more than one year at a time, the 
two-year period referred to above for disposing of any shares 
acquired by a bank in the regular course of securing or 
collecting a debt previously contracted in good faith, if, in 
the Board's judgment, such an extension would not be 
detrimental to the public interest, but no such extension shall 
in the aggregate exceed three years. For the purpose of the 
preceding sentence, bank shares acquired after the date of 
enactment of the Bank Holding Company Act Amendments of 1970 
shall not be deemed to have been acquired in good faith in a 
fiduciary capacity if the acquiring bank or company has sole 
discretionary authority to exercise voting rights with respect 
thereto, but in such instances acquisitions may be made without 
prior approval of the Board if the Board, upon application 
filed within ninety days after the shares are acquired, 
approves retention or, if retention is disapproved, the 
acquiring bank disposes of the shares or its sole discretionary 
voting rights within two years after issuance of the order of 
disapproval.
  (b)(1) Notice and Hearing Requirements.--[Upon receiving]
                  (A) In general._Upon receiving from a company 
                any application for approval under this 
                section, the Board shall give notice to the 
                Comptroller of the Currency, if the applicant 
                company or any bank the voting shares or assets 
                of which are sought to be required is a 
                national banking association, or to the 
                appropriate supervisory authority of the 
                interested State, if the applicant company or 
                any bank the voting shares or assets of which 
                are sought to be acquired is a State bank, in 
                order to provide for the submission of the 
                views and recommendations of the Comptroller of 
                the Currency or the State supervisory 
                authority, as the case may be. The views and 
                recommendations shall be submitted within 
                thirty calendar days of the date on which 
                notice is given, or within ten calendar days of 
                such date if the Board advises the Comptroller 
                of the Currency or the State supervisory 
                authority that an emergency exists requiring 
                expeditious action. If the thirty-day notice 
                period applies and if the Comptroller of the 
                Currency or the State supervisory authority so 
                notified by the Board disapproves the 
                application in writing within this period, the 
                Board shall forthwith give written notice of 
                that fact to the applicant. Within three days 
                after giving such notice to the applicant, the 
                Board shall notify in writing the applicant and 
                the disapproving authority of the date for 
                commencement of a hearing by it on such 
                application. Any such hearing shall be 
                commenced not less than ten nor more than 
                thirty days after the Board has given written 
                notice to the applicant of the action of the 
                disapproving authority. The length of any such 
                hearing shall be determined by the Board, but 
                it shall afford all interested parties a 
                reasonable opportunity to testify at such 
                hearing. At the conclusion thereof, the Board 
                shall, by order, grant or deny the application 
                on the basis of the record made at such 
                hearing. In the event of the failure of the 
                Board to act on any application for approval 
                under this section within the ninety-one-day 
                period which begins on the date of submission 
                to the Board of the complete record on that 
                application, the application shall be deemed to 
                have been granted. [Notwithstanding any other 
                provision]
                  (B) Immediate action._
                          (i) In general._Notwithstanding any 
                        other provision of this subsection, if 
                        the Board finds that it must act 
                        immediately on any application for 
                        approval under this section in order to 
                        prevent the probable failure of a bank 
                        or bank holding company involved in a 
                        proposed acquisition, merger, or 
                        consolidation transaction, the Board 
                        may dispense with the notice 
                        requirements of this subsection, and if 
                        notice is given, the Board may request 
                        that the views and recommendations of 
                        the Comptroller of the Currency or the 
                        State supervisory authority, as the 
                        case may be, be submitted immediately 
                        in any form or by any means acceptable 
                        to the Board. If the Board has found 
                        pursuant to this subsection either that 
                        an emergency exists requiring 
                        expeditious action or that it must act 
                        immediately to prevent probable 
                        failure, the Board may grant or deny 
                        any such application without a hearing 
                        not withstanding any recommended 
                        disapproval by the appropriate 
                        supervisory authority.
                          (ii) Exception.--The Board may not 
                        take any action pursuant to clause (i) 
                        on an application that would cause any 
                        company to become a bank holding 
                        company unless such application 
                        involves the company acquiring a bank 
                        that is critically undercapitalized (as 
                        such term is defined under section 
                        38(b) of the Federal Deposit Insurance 
                        Act).
  (2) Waiver in Case of Bank in Danger of Closing.--If the 
Board receives a certification described in section 13(f)(8)(D) 
of the Federal Deposit Insurance Act from the appropriate 
Federal or State chartering authority that a bank is in danger 
of closing, the Board may dispense with the notice and hearing 
requirements of paragraph (1) with respect to any application 
received by the Board relating to the acquisition of such bank, 
the bank holding company which controls such bank, or any other 
affiliated bank.
  (c) Factors for Consideration by Board.--
          (1) Competitive factors.--The Board shall not 
        approve--
          (A) any acquisition or merger or consolidation under 
        this section which would result in a monopoly, or which 
        would be in furtherance of any combination or 
        conspiracy to monopolize or to attempt to monopolize 
        the business of banking in any part of the United 
        States, or
          (B) any other proposed acquisition or merger or 
        consolidation under this section whose effect in any 
        section of the country may be substantially to lessen 
        competition, or to tend to create a monopoly, or which 
        in any other manner would be in restraint or trade, 
        unless it finds that the anticompetitive effects of the 
        proposed transaction are clearly outweighed in the 
        public interest by the probable effect of the 
        transaction in meeting the convenience and needs of the 
        community to be served.
          (2) Banking and community factors.--In every case, 
        the Board shall take into consideration the financial 
        and managerial resources and future prospects of the 
        company or companies and the banks concerned, and the 
        convenience and needs of the community to be served.
          (3) Supervisory factors.--The Board shall disapprove 
        any application under this section by any company if--
                  (A) the company fails to provide the Board 
                with adequate assurances that the company will 
                make available to the Board such information on 
                the operations or activities of the company, 
                and any affiliate of the company, as the Board 
                determines to be appropriate to determine and 
                enforce compliance with this Act; or
                  (B) in the case of an application involving a 
                foreign bank, the foreign bank is not subject 
                to comprehensive supervision or regulation on a 
                consolidated basis by the appropriate 
                authorities in the bank's home country.
          (4) Treatment of certain bank stock loans.--
        Notwithstanding any other provision of law, the Board 
        shall not follow any practice or policy in the 
        consideration of any application for the formation of a 
        one-bank holding company if following such practice or 
        policy would result in the rejection of such 
        application solely because the transaction to form such 
        one-bank holding company involves a bank stock loan 
        which is for a period of not more than twenty-five 
        years. The previous sentence shall not be construed to 
        prohibit the Board from rejecting any application 
        solely because the other financial arrangements are 
        considered unsatisfactory. The Board shall consider 
        transactions involving bank stock loans for the 
        formation of a one-bank holding company having a 
        maturity of twelve years or more on a case by case 
        basis and no such transaction shall be approved if the 
        Board believes the safety or soundness of the bank may 
        be jeopardized.
          (5) Managerial resources.--Consideration of the 
        managerial resources of a company or bank under 
        paragraph (2) shall include consideration of the 
        competence, experience, and integrity of the officers, 
        directors, and principal shareholders of the company or 
        bank.
          (6) Money laundering.--In every case, the Board shall 
        take into consideration the effectiveness of the 
        company or companies in combatting money laundering 
        activities, including in overseas branches.
          (7) Financial stability.--In every case, the Board 
        shall take into consideration the extent to which a 
        proposed acquisition, merger, or consolidation would 
        result in greater or more concentrated risks to the 
        stability of the United States banking or financial 
        system.
  (d) Interstate Banking.--
          (1) Approvals authorized.--
                  (A) Acquisition of banks.--The Board may 
                approve an application under this section by a 
                bank holding company that is well capitalized 
                and well managed to acquire control of, or 
                acquire all or substantially all of the assets 
                of, a bank located in a State other than the 
                home State of such bank holding company, 
                without regard to whether such transaction is 
                prohibited under the law of any State.
                  (B) Preservation of state age laws.--
                          (i) In general.--Notwithstanding 
                        subparagraph (A), the Board may not 
                        approve an application pursuant to such 
                        subparagraph that would have the effect 
                        of permitting an out-of-State bank 
                        holding company to acquire a bank in a 
                        host State that has not been in 
                        existence for the minimum period of 
                        time, if any, specified in the 
                        statutory law of the host State.
                          (ii) Special rule for state age laws 
                        specifying a period of more than 5 
                        years.--Notwithstanding clause (i), the 
                        Board may approve, pursuant to 
                        subparagraph (A), the acquisition of a 
                        bank that has been in existence for at 
                        least 5 years without regard to any 
                        longer minimum period of time specified 
                        in a statutory law of the host State.
                  (C) Shell banks.--For purposes of this 
                subsection, a bank that has been chartered 
                solely for the purpose of, and does not open 
                for business prior to, acquiring control of, or 
                acquiring all or substantially all of the 
                assets of, an existing bank shall be deemed to 
                have been in existence for the same period of 
                time as the bank to be acquired.
                  (D) Effect on state contingency laws.--No 
                provision of this subsection shall be construed 
                as affecting the applicability of a State law 
                that makes an acquisition of a bank contingent 
                upon a requirement to hold a portion of such 
                bank's assets available for call by a State-
                sponsored housing entity established pursuant 
                to State law, if--
                          (i) the State law does not have the 
                        effect of discriminating against out-
                        of-State banks, out-of-State bank 
                        holding companies, or subsidiaries of 
                        such banks or bank holding companies;
                          (ii) that State law was in effect as 
                        of the date of enactment of the Riegle-
                        Neal Interstate Banking and Branching 
                        Efficiency Act of 1994;
                          (iii) the Federal Deposit Insurance 
                        Corporation has not determined that 
                        compliance with such State law would 
                        result in an unacceptable risk to the 
                        Deposit Insurance Fund; and
                          (iv) the appropriate Federal banking 
                        agency for such bank has not found that 
                        compliance with such State law would 
                        place the bank in an unsafe or unsound 
                        condition.
          (2) Concentration limits.--
                  (A) Nationwide concentration limits.--The 
                Board may not approve an application pursuant 
                to paragraph (1)(A) if the applicant (including 
                all insured depository institutions which are 
                affiliates of the applicant) controls, or upon 
                consummation of the acquisition for which such 
                application is filed would control, more than 
                10 percent of the total amount of deposits of 
                insured depository institutions in the United 
                States.
                  (B) Statewide concentration limits other than 
                with respect to initial entries.--The Board may 
                not approve an application pursuant to 
                paragraph (1)(A) if--
                          (i) immediately before the 
                        consummation of the acquisition for 
                        which such application is filed, the 
                        applicant (including any insured 
                        depository institution affiliate of the 
                        applicant) controls any insured 
                        depository institution or any branch of 
                        an insured depository institution in 
                        the home State of any bank to be 
                        acquired or in any host State in which 
                        any such bank maintains a branch; and
                          (ii) the applicant (including all 
                        insured depository institutions which 
                        are affiliates of the applicant), upon 
                        consummation of the acquisition, would 
                        control 30 percent or more of the total 
                        amount of deposits of insured 
                        depository institutions in any such 
                        State.
                  (C) Effectiveness of state deposit caps.--No 
                provision of this subsection shall be construed 
                as affecting the authority of any State to 
                limit, by statute, regulation, or order, the 
                percentage of the total amount of deposits of 
                insured depository institutions in the State 
                which may be held or controlled by any bank or 
                bank holding company (including all insured 
                depository institutions which are affiliates of 
                the bank or bank holding company) to the extent 
                the application of such limitation does not 
                discriminate against out-of-State banks, out-
                of-State bank holding companies, or 
                subsidiaries of such banks or holding
                companies.
                  (D) Exceptions to subparagraph (b).--The 
                Board may approve an application pursuant to 
                paragraph (1)(A) without regard to the 
                applicability of subparagraph (B) with respect 
                to any State if--
                          (i) there is a limitation described 
                        in subparagraph (C) in a State statute, 
                        regulation, or order which has the 
                        effect of permitting a bank or bank 
                        holding company (including all insured 
                        depository institutions which are 
                        affiliates of the bank or bank holding 
                        company) to control a greater 
                        percentage of total deposits of all 
                        insured depository institutions in the 
                        State than the percentage permitted 
                        under subparagraph (B); or
                          (ii) the acquisition is approved by 
                        the appropriate State bank supervisor 
                        of such State and the standard on which 
                        such approval is based does not have 
                        the effect of discriminating against 
                        out-of-State banks, out-of-State bank 
                        holding companies, or subsidiaries of 
                        such banks or holding companies.
                  (E) Deposit defined.--For purposes of this 
                paragraph, the term ``deposit'' has the same 
                meaning as in section 3(l) of the Federal 
                Deposit Insurance Act.
          (3) Community reinvestment compliance.--In 
        determining whether to approve an application under 
        paragraph (1)(A), the Board shall--
                  (A) comply with the responsibilities of the 
                Board regarding such application under section 
                804 of the Community Reinvestment Act of 1977; 
                and
                  (B) take into account the applicant's record 
                of compliance with applicable State community 
                reinvestment laws.
          (4) Applicability of antitrust laws.--No provision of 
        this subsection shall be construed as affecting--
                  (A) the applicability of the antitrust laws; 
                or
                  (B) the applicability, if any, of any State 
                law which is similar to the antitrust laws.
          (5) Exception for banks in default or in danger of 
        default.--The Board may approve an application pursuant 
        to paragraph (1)(A) which involves--
                  (A) an acquisition of 1 or more banks in 
                default or in danger of default; or
                  (B) an acquisition with respect to which 
                assistance is provided under section 13(c) of 
                the Federal Deposit Insurance Act;
        without regard to subparagraph (B) or (D) of paragraph 
        (1) or paragraph (2) or (3).
  (e) Every bank that is a holding company and every bank that 
is a subsidiary of such a company shall become and remain an 
insured depository institution as such term is defined in 
section 3 of the Federal Deposit Insurance Act.
  (f)
  (g) Mutual Bank Holding Company.--
          (1) Establishment.--Notwithstanding any provision of 
        Federal law other than this Act, a savings bank or 
        cooperative bank operating in mutual form may 
        reorganize so as to form a holding company.
          (2) Regulations.--A bank holding company organized as 
        a mutual holding company shall be regulated on terms, 
        and shall be subject to limitations, comparable to 
        those applicable to any other bank holding company.

           *       *       *       *       *       *       *


                               penalties

  Sec. 8. (a) Criminal Penalty.--
          (1) Whoever knowingly violates any provision of this 
        Act or, being a company, violates any regulation or 
        order issued by the Board under this Act, shall be 
        imprisoned not more than 1 year, fined not more than 
        $100,000 per day for each day during which the 
        violation continues, or both.
          (2) Whoever, with the intent to deceive, defraud, or 
        profit significantly, knowingly violates any provision 
        of this Act shall be imprisoned not more than 5 years, 
        fined not more than [$1,000,000] $1,500,000 per day for 
        each day during which the violation continues, or both. 
        Every officer, director, agent, and employee of a bank 
        holding company shall be subject to the same penalties 
        for false entries in any book, report, or statement of 
        such bank holding company as are applicable to 
        officers, directors, agents, and employees of member 
        banks for false entries in any books, reports, or 
        statements of member banks under section 1005 of title 
        18, United States Code.
  (b) Civil Money Penalty.--
          (1) Penalty.--Any company which violates, and any 
        individual who participates in a violation of, any 
        provision of this Act, or any regulation or order 
        issued pursuant thereto, shall forfeit and pay a civil 
        penalty of not more than $25,000 for each day during 
        which such violation continues.
          (2) Assessment; etc.--Any penalty imposed under 
        paragraph (1) may be assessed and collected by the 
        Board in the manner provided in subparagraphs (E), (F), 
        (G), and (I) of section 8(i)(2) of the Federal Deposit 
        Insurance Act for penalties imposed (under such 
        section) and any such assessment shall be subject to 
        the provisions of such section.
          (3) Hearing.--The company or other person against 
        whom any penalty is assessed under this subsection 
        shall be afforded an agency hearing if such association 
        or person submits a request for such hearing within 20 
        days after the issuance of the notice of assessment. 
        Section 8(h) of the Federal Deposit Insurance Act shall 
        apply to any proceeding under this subsection.
          (4) Disbursement.--All penalties collected under 
        authority of this subsection shall be deposited into 
        the Treasury.
          (5) Violate defined.--For purposes of this section, 
        the term ``violate'' includes any action (alone or with 
        another or others) for or toward causing, bringing 
        about, participating in, counseling, or aiding or 
        abetting a violation.
          (6) Regulations.--The Board shall prescribe 
        regulations establishing such procedures as may be 
        necessary to carry out this subsection.
  (c) Notice Under This Section After Separation From 
Service.--The resignation, termination of employment or 
participation, or separation of an institution-affiliated party 
(within the meaning of section 3(u) of the Federal Deposit 
Insurance Act) with respect to a bank holding company 
(including a separation caused by the deregistration of such a 
company) shall not affect the jurisdiction and authority of the 
Board to issue any notice and proceed under this section 
against any such party, if such notice is served before the end 
of the 6-year period beginning on the date such party ceased to 
be such a party with respect to such holding company (whether 
such date occurs before, on, or after the date of the enactment 
of this subsection).
  (d) Penalty for Failure To Make Reports.--
          (1) First tier.--Any company which--
                  (A) maintains procedures reasonably adapted 
                to avoid any inadvertent error and, 
                unintentionally and as a result of such an 
                error--
                          (i) fails to make, submit, or publish 
                        such reports or information as may be 
                        required under this Act or under 
                        regulations prescribed by the Board 
                        pursuant to this Act, within the period 
                        of time specified by the Board; or
                          (ii) submits or publishes any false 
                        or misleading report or information; or
                  (B) inadvertently transmits or publishes any 
                report which is minimally late,
        shall be subject to a penalty of not more than $2,000 
        for each day during which such failure continues or 
        such false or misleading information is not corrected. 
        The company shall have the burden of proving that an 
        error was inadvertent and that a report was 
        inadvertently transmitted or published late.
          (2) Second tier.--Any company which--
                  (A) fails to make, submit, or publish such 
                reports or information as may be required under 
                this Act or under regulations prescribed by the 
                Board pursuant to this Act, within the period 
                of time specified by the Board; or
                  (B) submits or publishes any false or 
                misleading report or information,
        in a manner not described in paragraph (1) shall be 
        subject to a penalty of not more than $20,000 for each 
        day during which such failure continues or such false 
        or misleading information is not corrected.
          (3) Third tier.--Notwithstanding paragraph (2), if 
        any company knowingly or with reckless disregard for 
        the accuracy of any information or report described in 
        paragraph (2) submits or publishes any false or 
        misleading report or information, the Board may, in its 
        discretion, assess a penalty of not more than 
        [$1,000,000] $1,500,000 or 1 percent of total assets of 
        such company, whichever is less, per day for each day 
        during which such failure continues or such false or 
        misleading information is not corrected.
          (4) Assessment; etc.--Any penalty imposed under 
        paragraph (1), (2), or (3) shall be assessed and 
        collected by the Board in the manner provided in 
        subsection (b) (for penalties imposed under such 
        subsection) and any such assessment (including the 
        determination of the amount of the penalty) shall be 
        subject to the provisions of such subsection.
          (5) Hearing.--Any company against which any penalty 
        is assessed under this subsection shall be afforded an 
        agency hearing if such company submits a request for 
        such hearing within 20 days after the issuance of the 
        notice of assessment. Section 8(h) of the Federal 
        Deposit Insurance Act shall apply to any proceeding 
        under this subsection.

           *       *       *       *       *       *       *


SEC. 14. CONCENTRATION LIMITS ON LARGE FINANCIAL FIRMS.

  (a) Definitions.--In this section--
          (1) the term ``Council'' means the Financial 
        Stability Oversight Council;
          [(2) the term ``financial company'' means--
                  [(A) an insured depository institution;
                  [(B) a bank holding company;
                  [(C) a savings and loan holding company;
                  [(D) a company that controls an insured 
                depository institution;
                  [(E) a nonbank financial company supervised 
                by the Board under title I of the Dodd-Frank 
                Wall Street Reform and Consumer Protection Act; 
                and
                  [(F) a foreign bank or company that is 
                treated as a bank holding company for purposes 
                of this Act; and]
          (2) the term ``banking organization'' means--
                  (A) an insured depository institution;
                  (B) a bank holding company;
                  (C) a savings and loan holding company;
                  (D) a company that controls an insured 
                depository institution; and
                  (E) a foreign bank or company that is treated 
                as a bank holding company for purposes of this 
                Act; and
          (3) the term ``liabilities'' means--
                  (A) with respect to a United States 
                [financial company] banking organization--
                          (i) the total risk-weighted assets of 
                        the [financial company] banking 
                        organization, as determined under the 
                        risk-based capital rules applicable to 
                        bank holding companies, as adjusted to 
                        reflect exposures that are deducted 
                        from regulatory capital; less
                          (ii) the total regulatory capital of 
                        the [financial company] banking 
                        organization under the risk-based 
                        capital rules applicable to bank 
                        holding companies; and
                  (B) with respect to a foreign-based 
                [financial company] banking organization--
                          (i) the total risk-weighted assets of 
                        the United States operations of the 
                        [financial company] banking 
                        organization, as determined under the 
                        applicable risk-based capital rules, as 
                        adjusted to reflect exposures that are 
                        deducted from regulatory capital; less
                          (ii) the total regulatory capital of 
                        the United States operations of the 
                        [financial company] banking 
                        organization, as determined under the 
                        applicable risk-based capital rules[; 
                        and].
                  [(C) with respect to an insurance company or 
                other nonbank financial company supervised by 
                the Board, such assets of the company as the 
                Board shall specify by rule, in order to 
                provide for consistent and equitable treatment 
                of such companies.]
  (b) Concentration Limit.--Subject to the recommendations by 
the Council under subsection (e), a [financial company] banking 
organization may not merge or consolidate with, acquire all or 
substantially all of the assets of, or otherwise acquire 
control of, another company, if the total consolidated 
liabilities of the acquiring [financial company] banking 
organization upon consummation of the transaction would exceed 
10 percent of the aggregate consolidated liabilities of all 
[financial companies] banking organizations at the end of the 
calendar year preceding the transaction.
  (c) Exception to Concentration Limit.--With the prior written 
consent of the Board, the concentration limit under subsection 
(b) shall not apply to an acquisition--
          (1) of a bank in default or in danger of default;
          (2) with respect to which assistance is provided by 
        the Federal Deposit Insurance Corporation under section 
        13(c) of the Federal Deposit Insurance Act (12 U.S.C. 
        1823(c)); or
          (3) that would result only in a de minimis increase 
        in the liabilities of the [financial company] banking 
        organization.
  (d) Rulemaking and Guidance.--The Board shall issue 
regulations implementing this section in accordance with the 
recommendations of the Council under subsection (e), including 
the definition of terms, as necessary. The Board may issue 
interpretations or guidance regarding the application of this 
section to an individual [financial company] banking 
organization or to financial companies in general.
  (e) Council Study and Rulemaking.--
          (1) Study and recommendations.--Not later than 6 
        months after the date of enactment of this section, the 
        Council shall--
                  (A) complete a study of the extent to which 
                the concentration limit under this section 
                would affect financial stability, moral hazard 
                in the financial system, the efficiency and 
                competitiveness of United States financial 
                firms and financial markets, and the cost and 
                availability of credit and other financial 
                services to households and businesses in the 
                United States; and
                  (B) make recommendations regarding any 
                modifications to the concentration limit that 
                the Council determines would more effectively 
                implement this section.
          (2) Rulemaking.--Not later than 9 months after the 
        date of completion of the study under paragraph (1), 
        and notwithstanding subsections (b) and (d), the Board 
        shall issue final regulations implementing this 
        section, which shall reflect any recommendations by the 
        Council under paragraph (1)(B).
                              ----------                              


TITLE 44, UNITED STATES CODE

           *       *       *       *       *       *       *



CHAPTER 35--COORDINATION OF FEDERAL INFORMATION POLICY

           *       *       *       *       *       *       *



SUBCHAPTER I--FEDERAL INFORMATION POLICY

           *       *       *       *       *       *       *



Sec. 3502. Definitions

  As used in this subchapter--
          (1) the term ``agency'' means any executive 
        department, military department, Government 
        corporation, Government controlled corporation, or 
        other establishment in the executive branch of the 
        Government (including the Executive Office of the 
        President), or any independent regulatory agency, but 
        does not include--
                  (A) the Government Accountability Office;
                  (B) Federal Election Commission;
                  (C) the governments of the District of 
                Columbia and of the territories and possessions 
                of the United States, and their various 
                subdivisions; or
                  (D) Government-owned contractor-operated 
                facilities, including laboratories engaged in 
                national defense research and production 
                activities;
          (2) the term ``burden'' means time, effort, or 
        financial resources expended by persons to generate, 
        maintain, or provide information to or for a Federal 
        agency, including the resources expended for--
                  (A) reviewing instructions;
                  (B) acquiring, installing, and utilizing 
                technology and systems;
                  (C) adjusting the existing ways to comply 
                with any previously applicable instructions and 
                requirements;
                  (D) searching data sources;
                  (E) completing and reviewing the collection 
                of information; and
                  (F) transmitting, or otherwise disclosing the 
                information;
          (3) the term ``collection of information''--
                  (A) means the obtaining, causing to be 
                obtained, soliciting, or requiring the 
                disclosure to third parties or the public, of 
                facts or opinions by or for an agency, 
                regardless of form or format, calling for 
                either--
                          (i) answers to identical questions 
                        posed to, or identical reporting or 
                        recordkeeping requirements imposed on, 
                        ten or more persons, other than 
                        agencies, instrumentalities, or 
                        employees of the United States; or
                          (ii) answers to questions posed to 
                        agencies, instrumentalities, or 
                        employees of the United States which 
                        are to be used for general statistical 
                        purposes; and
                  (B) shall not include a collection of 
                information described under section 3518(c)(1);
          (4) the term ``Director'' means the Director of the 
        Office of Management and Budget;
          (5) the term ``independent regulatory agency'' means 
        the Board of Governors of the Federal Reserve System, 
        the Commodity Futures Trading Commission, the Consumer 
        Product Safety Commission, the Federal Communications 
        Commission, the Federal Deposit Insurance Corporation, 
        the Federal Energy Regulatory Commission, the Federal 
        Housing Finance Agency, the Federal Maritime 
        Commission, the Federal Trade Commission, the 
        Interstate Commerce Commission, the Mine Enforcement 
        Safety and Health Review Commission, the National Labor 
        Relations Board, the Nuclear Regulatory Commission, the 
        Occupational Safety and Health Review Commission, the 
        Postal Regulatory Commission, the Securities and 
        Exchange Commission, the Bureau of Consumer Financial 
        Protection, [the Office of Financial Research,] Office 
        of the Comptroller of the Currency, and any other 
        similar agency designated by statute as a Federal 
        independent regulatory agency or commission;
          (6) the term ``information resources'' means 
        information and related resources, such as personnel, 
        equipment, funds, and information technology;
          (7) the term ``information resources management'' 
        means the process of managing information resources to 
        accomplish agency missions and to improve agency 
        performance, including through the reduction of 
        information collection burdens on the public;
          (8) the term ``information system'' means a discrete 
        set of information resources organized for the 
        collection, processing, maintenance, use, sharing, 
        dissemination, or disposition of information;
          (9) the term ``information technology'' has the 
        meaning given that term in section 11101 of title 40 
        but does not include national security systems as 
        defined in section 11103 of title 40;
          (10) the term ``person'' means an individual, 
        partnership, association, corporation, business trust, 
        or legal representative, an organized group of 
        individuals, a State, territorial, tribal, or local 
        government or branch thereof, or a political 
        subdivision of a State, territory, tribal, or local 
        government or a branch of a political subdivision;
          (11) the term ``practical utility'' means the ability 
        of an agency to use information, particularly the 
        capability to process such information in a timely and 
        useful fashion;
          (12) the term ``public information'' means any 
        information, regardless of form or format, that an 
        agency discloses, disseminates, or makes available to 
        the public;
          (13) the term ``recordkeeping requirement'' means a 
        requirement imposed by or for an agency on persons to 
        maintain specified records, including a requirement 
        to--
                  (A) retain such records;
                  (B) notify third parties, the Federal 
                Government, or the public of the existence of 
                such records;
                  (C) disclose such records to third parties, 
                the Federal Government, or the public; or
                  (D) report to third parties, the Federal 
                Government, or the public regarding such 
                records; and
          (14) the term ``penalty'' includes the imposition by 
        an agency or court of a fine or other punishment; a 
        judgment for monetary damages or equitable relief; or 
        the revocation, suspension, reduction, or denial of a 
        license, privilege, right, grant, or benefit.

           *       *       *       *       *       *       *


Sec. 3513. Director review of agency activities; reporting; agency 
                    response

  (a) In consultation with the Administrator of General 
Services, the Archivist of the United States, the Director of 
the National Institute of Standards and Technology, and the 
Director of the Office of Personnel Management, the Director 
shall periodically review selected agency information resources 
management activities to ascertain the efficiency and 
effectiveness of such activities to improve agency performance 
and the accomplishment of agency missions.
  (b) Each agency having an activity reviewed under subsection 
(a) shall, within 60 days after receipt of a report on the 
review, provide a written plan to the Director describing steps 
(including milestones) to--
          (1) be taken to address information resources 
        management problems identified in the report; and
          (2) improve agency performance and the accomplishment 
        of agency missions.
  (c) Comparable Treatment.--Notwithstanding any other 
provision of law, the Director shall treat or review a rule or 
order prescribed or proposed by the Director of the [Bureau of 
Consumer Financial Protection] Consumer Law Enforcement Agency 
on the same terms and conditions as apply to any rule or order 
prescribed or proposed by the Board of Governors of the Federal 
Reserve System.

           *       *       *       *       *       *       *

                              ----------                              


                         SECURITIES ACT OF 1933


TITLE I--

           *       *       *       *       *       *       *



                              definitions

  Sec. 2. (a) Definitions.--When used in this title, unless the 
context otherwise requires--
          (1) The term ``security'' means any note, stock, 
        treasury stock, security future, security-based swap, 
        bond, debenture, evidence of indebtedness, certificate 
        of interest or participation in any profit-sharing 
        agreement, collateral-trust certificate, 
        preorganization certificate or subscription, 
        transferable share, investment contract, voting-trust 
        certificate, certificate of deposit for a security, 
        fractional undivided interest in oil, gas, or other 
        mineral rights, any put, call, straddle, option, or 
        privilege on any security, certificate of deposit, or 
        group or index of securities (including any interest 
        therein or based on the value thereof), or any put, 
        call, straddle, option, or privilege entered into on a 
        national securities exchange relating to foreign 
        currency, or, in general, any interest or instrument 
        commonly known as a ``security'', or any certificate of 
        interest or participation in, temporary or interim 
        certificate for, receipt for, guarantee of, or warrant 
        or right to subscribe to or purchase, any of the 
        foregoing.
          (2) The term ``person'' means an individual, a 
        corporation, a partnership, an association, a joint-
        stock company, a trust, any unincorporated 
        organization, or a government or political subdivision 
        thereof. As used in this paragraph the term ``trust'' 
        shall include only a trust where the interest or 
        interests of the beneficiary or beneficiaries are 
        evidenced by a security.
          (3) The term ``sale'' or ``sell'' shall include every 
        contract of sale or disposition of a security or 
        interest in a security, for value. The term ``offer to 
        sell'', ``offer for sale'', or ``offer'' shall include 
        every attempt or offer to dispose of, or solicitation 
        of an offer to buy, a security or interest in a 
        security, for value. The terms defined in this 
        paragraph and the term ``offer to buy'' as used in 
        subsection (c) of section 5 shall not include 
        preliminary negotiations or agreements between an 
        issuer (or any person directly or indirectly 
        controlling or controlled by an issuer, or under direct 
        or indirect common control with an issuer) and any 
        underwriter or among underwriters who are or are to be 
        in privity of contract with an issuer (or any person 
        directly or indirectly controlling or controlled by an 
        issuer, or under direct or indirect common control with 
        an issuer). Any security given or delivered with, or as 
        a bonus on account of, any purchase of securities or 
        any other thing, shall be conclusively presumed to 
        constitute a part of the subject of such purchase and 
        to have been offered and sold for value. The issue or 
        transfer of a right or privilege, when originally 
        issued or transferred with a security, giving the 
        holder of such security the right to convert such 
        security into another security of the same issuer or of 
        another person, or giving a right to subscribe to 
        another security of the same issuer or of another 
        person, which right cannot be exercised until some 
        future date, shall not be deemed to be an offer or sale 
        of such other security; but the issue or transfer of 
        such other security upon the exercise of such right of 
        conversion or subscription shall be deemed a sale of 
        such other security. Any offer or sale of a security 
        futures product by or on behalf of the issuer of the 
        securities underlying the security futures product, an 
        affiliate of the issuer, or an underwriter, shall 
        constitute a contract for sale of, sale of, offer for 
        sale, or offer to sell the underlying securities. Any 
        offer or sale of a security-based swap by or on behalf 
        of the issuer of the securities upon which such 
        security-based swap is based or is referenced, an 
        affiliate of the issuer, or an underwriter, shall 
        constitute a contract for sale of, sale of, offer for 
        sale, or offer to sell such securities. The publication 
        or distribution by a broker or dealer of a research 
        report about an emerging growth company that is the 
        subject of a proposed public offering of the common 
        equity securities of such emerging growth company 
        pursuant to a registration statement that the issuer 
        proposes to file, or has filed, or that is effective 
        shall be deemed for purposes of paragraph (10) of this 
        subsection and section 5(c) not to constitute an offer 
        for sale or offer to sell a security, even if the 
        broker or dealer is participating or will participate 
        in the registered offering of the securities of the 
        issuer. As used in this paragraph, the term ``research 
        report'' means a written, electronic, or oral 
        communication that includes information, opinions, or 
        recommendations with respect to securities of an issuer 
        or an analysis of a security or an issuer, whether or 
        not it provides information reasonably sufficient upon 
        which to base an investment decision.
          (4) The term ``issuer'' means every person who issues 
        or proposes to issue any security; except that with 
        respect to certificates of deposit, voting-trust 
        certificates, or collateral-trust certificates, or with 
        respect to certificates of interest or shares in an 
        unincorporated investment trust not having a board of 
        directors (or persons performing similar functions) or 
        of the fixed, restricted management, or unit type, the 
        term ``issuer'' means the person or persons performing 
        the acts and assuming the duties of depositor or 
        manager pursuant to the provisions of the trust or 
        other agreement or instrument under which such 
        securities are issued; except that in the case of an 
        unincorporated association which provides by its 
        articles for limited liability of any or all of its 
        members, or in the case of a trust, committee, or other 
        legal entity, the trustees or members thereof shall not 
        be individually liable as issuers of any security 
        issued by the association, trust, committee, or other 
        legal entity; except that with respect to equipment-
        trust certificates or like securities, the term 
        ``issuer'' means the person by whom the equipment or 
        property is or is to be used; and except that with 
        respect to fractional undivided interests in oil, gas, 
        or other mineral rights, the term ``issuer'' means the 
        owner of any such right or of any interest in such 
        right (whether whole or fractional) who creates 
        fractional interests therein for the purpose of public 
        offering.
          (5) The term ``Commission'' means the Securities and 
        Exchange Commission.
          (6) The term ``Territory'' means Puerto Rico, the 
        Virgin Islands, and the insular possessions of the 
        United States.
          (7) The term ``interstate commerce'' means trade or 
        commerce in securities or any transportation or 
        communication relating thereto among the several States 
        or between the District of Columbia or any Territory of 
        the United States and any State or other Territory, or 
        between any foreign country and any State, Territory, 
        or the District of Columbia, or within the District of 
        Columbia.
          (8) The term ``registration statement'' means the 
        statement provided for in section 6, and includes any 
        amendment thereto and any report, document, or 
        memorandum filed as part of such statement or 
        incorporated therein by reference.
          (9) The term ``write'' or ``written'' shall include 
        printed, lithographed, or any means of graphic 
        communication.
          (10) The term ``prospectus'' means any prospectus, 
        notice, circular, advertisement, letter, or 
        communication, written or by radio or television, which 
        offers any security for sale or confirms the sale of 
        any security; except that (a) a communication sent or 
        given after the effective date of the registration 
        statement (other than a prospectus permitted under 
        subsection (b) of section 10) shall not be deemed a 
        prospectus if it is proved that prior to or at the same 
        time with such communication a written prospectus 
        meeting the requirements of subsection (a) of section 
        10 at the time of such communication was sent or given 
        to the person to whom the communication was made, and 
        (b) a notice, circular, advertisement, letter, or 
        communication in respect of a security shall not be 
        deemed to be a prospectus if it states from whom a 
        written prospectus meeting the requirements of section 
        10 may be obtained and, in addition, does no more than 
        identify the security, state the price thereof, state 
        by whom orders will be executed, and contain such other 
        information as the Commission, by rules or regulations 
        deemed necessary or appropriate in the public interest 
        and for the protection of investors, and subject to 
        such terms and conditions as may be prescribed therein, 
        may permit.
          (11) The term ``underwriter'' means any person who 
        has purchased from an issuer with a view to, or offers 
        or sells for an issuer in connection with, the 
        distribution of any security, or participates or has a 
        direct or indirect participation in any such 
        undertaking, or participates or has a participation in 
        the direct or indirect underwriting of any such 
        undertaking; but such term shall not include a person 
        whose interest is limited to a commission from an 
        underwriter or dealer not in excess of the usual and 
        customary distributors' or sellers' commission. As used 
        in this paragraph the term ``issuer'' shall include, in 
        addition to an issuer, any person directly or 
        indirectly controlling or controlled by the issuer, or 
        any person under direct or indirect common control with 
        the issuer.
          (12) The term ``dealer'' means any person who engages 
        either for all or part of his time, directly or 
        indirectly, as agent, broker, or principal, in the 
        business of offering, buying, selling, or otherwise 
        dealing or trading in securities issued by another 
        person.
          (13) The term ``insurance company'' means a company 
        which is organized as an insurance company, whose 
        primary and predominant business activity is the 
        writing of insurance or the reinsuring of risks 
        underwritten by insurance companies, and which is 
        subject to supervision by the insurance commissioner, 
        or a similar official or agency, of a State or 
        territory or the District of Columbia; or any receiver 
        or similar official or any liquidating agent for such 
        company, in his capacity as such.
          (14) The term ``separate account'' means an account 
        established and maintained by an insurance company 
        pursuant to the laws of any State or territory of the 
        United States, the District of Columbia, or of Canada 
        or any province thereof, under which income, gains and 
        losses, whether or not realized, from assets allocated 
        to such account, are, in accordance with the applicable 
        contract, credited to or charged against such account 
        without regard to other income, gains, or losses of the 
        insurance company.
          (15) The term ``accredited investor'' shall mean--
                  
                  [(i)] (A) a bank as defined in section 
                3(a)(2) whether acting in its individual or 
                fiduciary capacity; an insurance company as 
                defined in paragraph (13) of this subsection; 
                an investment company registered under the 
                Investment Company Act of 1940 or a business 
                development company as defined in section 
                2(a)(48) of that Act; a Small Business 
                Investment Company licensed by the Small 
                Business Administration; or an employee benefit 
                plan, including an individual retirement 
                account, which is subject to the provisions of 
                the Employee Retirement Income Security Act of 
                1974, if the investment decision is made by a 
                plan fiduciary, as defined in section 3(21) of 
                such Act, which is either a bank, insurance 
                company, or registered investment adviser[; or] 
                ;
          (B) any natural person whose individual net worth, or 
        joint net worth with that person's spouse, exceeds 
        $1,000,000 (which amount, along with the amounts set 
        forth in subparagraph (C), shall be adjusted for 
        inflation by the Commission every 5 years to the 
        nearest $10,000 to reflect the change in the Consumer 
        Price Index for All Urban Consumers published by the 
        Bureau of Labor Statistics) where, for purposes of 
        calculating net worth under this subparagraph--
                  (i) the person's primary residence shall not 
                be included as an asset;
                  (ii) indebtedness that is secured by the 
                person's primary residence, up to the estimated 
                fair market value of the primary residence at 
                the time of the sale of securities, shall not 
                be included as a liability (except that if the 
                amount of such indebtedness outstanding at the 
                time of sale of securities exceeds the amount 
                outstanding 60 days before such time, other 
                than as a result of the acquisition of the 
                primary residence, the amount of such excess 
                shall be included as a liability); and
                  (iii) indebtedness that is secured by the 
                person's primary residence in excess of the 
                estimated fair market value of the primary 
                residence at the time of the sale of securities 
                shall be included as a liability; 
          (C) any natural person who had an individual income 
        in excess of $200,000 in each of the 2 most recent 
        years or joint income with that person's spouse in 
        excess of $300,000 in each of those years and has a 
        reasonable expectation of reaching the same income 
        level in the current year;
          (D) any natural person who, by reason of their net 
        worth or income, is an accredited investor under 
        section 230.215 of title 17, Code of Federal 
        Regulations (as in effect on the day before the date of 
        enactment of this subparagraph);
          (E) any natural person who is currently licensed or 
        registered as a broker or investment adviser by the 
        Commission, the Financial Industry Regulatory 
        Authority, or an equivalent self-regulatory 
        organization (as defined in section 3(a)(26) of the 
        Securities Exchange Act of 1934), or the securities 
        division of a State or the equivalent State division 
        responsible for licensing or registration of 
        individuals in connection with securities activities;
          (F) any natural person the Commission determines, by 
        regulation, to have demonstrable education or job 
        experience to qualify such person as having 
        professional knowledge of a subject related to a 
        particular investment, and whose education or job 
        experience is verified by the Financial Industry 
        Regulatory Authority or an equivalent self-regulatory 
        organization (as defined in section 3(a)(26) of the 
        Securities Exchange Act of 1934); or
                  [(ii)] (F) any person who, on the basis of 
                such factors as financial sophistication, net 
                worth, knowledge, and experience in financial 
                matters, or amount of assets under management 
                qualifies as an accredited investor under rules 
                and regulations which the Commission shall 
                prescribe.
          (16) The terms ``security future'', ``narrow-based 
        security index'', and ``security futures product'' have 
        the same meanings as provided in section 3(a)(55) of 
        the Securities Exchange Act of 1934.
          (17) The terms ``swap'' and ``security-based swap'' 
        have the same meanings as in section 1a of the 
        Commodity Exchange Act (7 U.S.C. 1a).
          (18) The terms ``purchase'' or ``sale'' of a 
        security-based swap shall be deemed to mean the 
        execution, termination (prior to its scheduled maturity 
        date), assignment, exchange, or similar transfer or 
        conveyance of, or extinguishing of rights or 
        obligations under, a security-based swap, as the 
        context may require.
          (19) The term ``emerging growth company'' means an 
        issuer that had total annual gross revenues of less 
        than $1,000,000,000 (as such amount is indexed for 
        inflation every 5 years by the Commission to reflect 
        the change in the Consumer Price Index for All Urban 
        Consumers published by the Bureau of Labor Statistics, 
        setting the threshold to the nearest 1,000,000) during 
        its most recently completed fiscal year. An issuer that 
        is an emerging growth company as of the first day of 
        that fiscal year shall continue to be deemed an 
        emerging growth company until the earliest of--
                  (A) the last day of the fiscal year of the 
                issuer during which it had total annual gross 
                revenues of $1,000,000,000 (as such amount is 
                indexed for inflation every 5 years by the 
                Commission to reflect the change in the 
                Consumer Price Index for All Urban Consumers 
                published by the Bureau of Labor Statistics, 
                setting the threshold to the nearest 1,000,000) 
                or more;
                  (B) the last day of the fiscal year of the 
                issuer following the fifth anniversary of the 
                date of the first sale of common equity 
                securities of the issuer pursuant to an 
                effective registration statement under this 
                title;
                  (C) the date on which such issuer has, during 
                the previous 3-year period, issued more than 
                $1,000,000,000 in non-convertible debt; or
                  (D) the date on which such issuer is deemed 
                to be a ``large accelerated filer'', as defined 
                in section 240.12b-2 of title 17, Code of 
                Federal Regulations, or any successor thereto.
  (b) Consideration of Promotion of Efficiency, Competition, 
and Capital Formation.--Whenever pursuant to this title the 
Commission is engaged in rulemaking and is required to 
consider or determine whether an action is necessary or 
appropriate in the public interest, the Commission shall also 
consider, in addition to the protection of investors, whether 
the action will promote efficiency, competition, and capital 
formation.

           *       *       *       *       *       *       *


                          exempted securities

  Sec. 3. (a) Except as hereinafter expressly provided, the 
provisions of this title shall not apply to any of the 
following classes of securities:
          (1) Reserved.
          (2) Any security issued or guaranteed by the United 
        States or any Territory thereof, or by the District of 
        Columbia, or by any State of the United States, or by 
        any political subdivision of a State or Territory, or 
        by any public instrumentality of one or more States or 
        Territories, or by any person controlled or supervised 
        by and acting as an instrumentality of the Government 
        of the United States pursuant to authority granted by 
        the Congress of the United States; or any certificate 
        of deposit for any of the foregoing; or any security 
        issued or guaranteed by any bank; or any security 
        issued by or representing an interest in or a direct 
        obligation of a Federal Reserve bank; or any interest 
        or participation in any common trust fund or similar 
        fund that is excluded from the definition of the term 
        ``investment company'' under section 3(c)(3) of the 
        Investment Company Act of 1940; or any security which 
        is an industrial development bond (as defined in 
        section 103(c)(2) of the Internal Revenue Code of 1954) 
        the interest on which is excludable from gross income 
        under section 103(a)(1) of such Code if, by reason of 
        the application of paragraph (4) or (6) of section 
        103(c) of such Code (determined as if paragraphs 
        (4)(A), (5), and (7) were not included in such section 
        103(c)), paragraph (1) of such section 103(c) does not 
        apply to such security; or any interest or 
        participation in a single trust fund, or in a 
        collective trust fund maintained by a bank, or any 
        security arising out of a contract issued by an 
        insurance company, which interest, participation, or 
        security is issued in connection with (A) a stock 
        bonus, pension, or profit-sharing plan which meets the 
        requirements for qualification under section 401 of the 
        Internal Revenue Code of 1954, (B) an annuity plan 
        which meets the requirements for the deduction of the 
        employer's contributions under section 404(a)(2) of 
        such Code, (C) a governmental plan as defined in 
        section 414(d) of such Code which has been established 
        by an employer for the exclusive benefit of its 
        employees or their beneficiaries for the purpose of 
        distributing to such employees or their beneficiaries 
        the corpus and income of the funds accumulated under 
        such plan, if under such plan it is impossible, prior 
        to the satisfaction of all liabilities with respect to 
        such employees and their beneficiaries, for any part of 
        the corpus or income to be used for, or diverted to, 
        purposes other than the exclusive benefit of such 
        employees or their beneficiaries, or (D) a church plan, 
        company, or account that is excluded from the 
        definition of an investment company under section 
        3(c)(14) of the Investment Company Act of 1940, other 
        than any plan described in subparagraph (A), (B), (C), 
        or (D) of this paragraph (i) the contributions under 
        which are held in a single trust fund or in a separate 
        account maintained by an insurance company for a single 
        employer and under which an amount in excess of the 
        employer's contribution is allocated to the purchase of 
        securities (other than interests or participations in 
        the trust or separate account itself) issued by the 
        employer or any company directly or indirectly 
        controlling, controlled by, or under common control 
        with the employer, (ii) which covers employees some or 
        all of whom are employees within the meaning of section 
        401(c)(1) of such Code (other than a person 
        participating in a church plan who is described in 
        section 414(e)(3)(B) of the Internal Revenue Code of 
        1986), or (iii) which is a plan funded by an annuity 
        contract described in section 403(b) of such Code 
        (other than a retirement income account described in 
        section 403(b)(9) of the Internal Revenue Code of 1986, 
        to the extent that the interest or participation in 
        such single trust fund or collective trust fund is 
        issued to a church, a convention or association of 
        churches, or an organization described in section 
        414(e)(3)(A) of such Code establishing or maintaining 
        the retirement income account or to a trust established 
        by any such entity in connection with the retirement 
        income account). The Commission, by rules and 
        regulations or order, shall exempt from the provisions 
        of section 5 of this title any interest or 
        participation issued in connection with a stock bonus, 
        pension, profit-sharing, or annuity plan which covers 
        employees some or all of whom are employees within the 
        meaning of section 401(c)(1) of the Internal Revenue 
        Code of 1954, if and to the extent that the Commission 
        determines this to be necessary or appropriate in the 
        public interest and consistent with the protection of 
        investors and the purposes fairly intended by the 
        policy and provisions of this title. For purposes of 
        this paragraph, a security issued or guaranteed by a 
        bank shall not include any interest or participation in 
        any collective trust fund maintained by a bank; and the 
        term ``bank'' means any national bank, or any banking 
        institution organized under the laws of any State, 
        territory, or the District of Columbia, the business of 
        which is substantially confined to banking and is 
        supervised by the State or territorial banking 
        commission or similar official; except that in the case 
        of a common trust fund or similar fund, or a collective 
        trust fund, the term ``bank'' has the same meaning as 
        in the Investment Company Act of 1940;
          (3) Any note, draft, bill of exchange, or banker's 
        acceptance which arises out of a current transaction or 
        the proceeds of which have been or are to be used for 
        current transactions, and which has a maturity at the 
        time of issuance of not exceeding nine months, 
        exclusive of days of grace, or any renewal thereof the 
        maturity of which is likewise limited;
          (4) Any security issued by a person organized and 
        operated exclusively for religious, educational, 
        benevolent, fraternal, charitable, or reformatory 
        purposes and not for pecuniary profit, and no part of 
        the net earnings of which inures to the benefit of any 
        person, private stockholder, or individual, or any 
        security of a fund that is excluded from the definition 
        of an investment company under section 3(c)(10)(B) of 
        the Investment Company Act of 1940;
          (5) Any security issued (A) by a savings and loan 
        association, building and loan association, cooperative 
        bank, homestead association, or similar institution, 
        which is supervised and examined by State or Federal 
        authority having supervision over any such institution; 
        or (B) by (i) a farmer's cooperative organization 
        exempt from tax under section 521 of the Internal 
        Revenue Code of 1954, (ii) a corporation described in 
        section 501(c)(16) of such Code and exempt from tax 
        under section 501(a) of such Code, or (iii) a 
        corporation described in section 501(c)(2) of such Code 
        which is exempt from tax under section 501(a) of such 
        Code and is organized for the exclusive purpose of 
        holding title to property, collecting income therefrom, 
        and turning over the entire amount thereof, less 
        expenses, to an organization or corporation described 
        in clause (i) or (ii);
          (6) Any interest in a railroad equipment trust. For 
        purposes of this paragraph ``interest in a railroad 
        equipment trust'' means any interest in an equipment 
        trust, lease, conditional sales contract, or other 
        similar arrangement entered into, issued, assumed, 
        guaranteed by, or for the benefit of, a common carrier 
        to finance the acquisition of rolling stock, including 
        motive power;
          (7) Certificates issued by a receiver or by a trustee 
        in bankruptcy, with the approval of the court;
          (8) Any insurance or endowment policy or annuity 
        contract or optional annuity contract, issued by a 
        corporation subject to the supervision of the insurance 
        commissioner, bank commissioner, or any agency or 
        officer performing like functions, of any State or 
        Territory of the United States or the District of 
        Columbia;
          (9) Except with respect to a security exchanged in a 
        case under title 11, any security exchanged by the 
        issuer with its existing security holders exclusively 
        where no commission or other remuneration is paid or 
        given directly or indirectly for soliciting such 
        exchange;
          (10) Except with respect to a security exchanged in a 
        case under title 11, any security which is issued in 
        exchange for one or more bona fide outstanding 
        securities, claims or property interests, or partly in 
        such exchange and partly for cash, where the terms and 
        conditions of such issuance and exchange are approved, 
        after a hearing upon the fairness of such terms and 
        conditions at which all persons to whom it is proposed 
        to issue securities in such exchange shall have the 
        right to appear, by any court, or by any official or 
        agency of the United States, or by any State or 
        Territorial banking or insurance commission or other 
        governmental authority expressly authorized by law to 
        grant such approval;
          (11) Any security which is a part of an issue offered 
        and sold only to persons resident within a single State 
        or Territory, where the issuer of such security is a 
        person resident and doing business within or, if a 
        corporation, incorporated by and doing business within, 
        such State or Territory.
          (12) Any equity security issued in connection with 
        the acquisition by a holding company of a bank under 
        section 3(a) of the Bank Holding Company Act of 1956 or 
        a savings association under section 10(e) of the Home 
        Owners' Loan Act, if--
                  (A) the acquisition occurs solely as part of 
                a reorganization in which security holders 
                exchange their shares of a bank or savings 
                association for shares of a newly formed 
                holding company with no significant assets 
                other than securities of the bank or savings 
                association and the existing subsidiaries of 
                the bank or savings association;
                  (B) the security holders receive, after that 
                reorganization, substantially the same 
                proportional share interests in the holding 
                company as they held in the bank or savings 
                association, except for nominal changes in 
                shareholders' interests resulting from lawful 
                elimination of fractional interests and the 
                exercise of dissenting shareholders' rights 
                under State or Federal law;
                  (C) the rights and interests of security 
                holders in the holding company are 
                substantially the same as those in the bank or 
                savings association prior to the transaction, 
                other than as may be required by law; and
                  (D) the holding company has substantially the 
                same assets and liabilities, on a consolidated 
                basis, as the bank or savings association had 
                prior to the transaction.
        For purposes of this paragraph, the term ``savings 
        association'' means a savings association (as defined 
        in section 3(b) of the Federal Deposit Insurance Act) 
        the deposits of which are insured by the Federal 
        Deposit Insurance Corporation.
          (13) Any security issued by or any interest or 
        participation in any church plan, company or account 
        that is excluded from the definition of an investment 
        company under section 3(c)(14) of the Investment 
        Company Act of 1940.
          (14) Any security futures product that is--
                  (A) cleared by a clearing agency registered 
                under section 17A of the Securities Exchange 
                Act of 1934 or exempt from registration under 
                subsection (b)(7) of such section 17A; and
                  (B) traded on a national securities exchange 
                or a national securities association registered 
                pursuant to section 15A(a) of the Securities 
                Exchange Act of 1934.
  (b) Additional Exemptions.--
          (1) Small issues exemptive authority.--The Commission 
        may from time to time by its rules and regulations, and 
        subject to such terms and conditions as may be 
        prescribed therein, add any class of securities to the 
        securities exempted as provided in this section, if it 
        finds that the enforcement of this title with respect 
        to such securities is not necessary in the public 
        interest and for the protection of investors by reason 
        of the small amount involved or the limited character 
        of the public offering; but no issue of securities 
        shall be exempted under this subsection where the 
        aggregate amount at which such issue is offered to the 
        public exceeds $5,000,000.
          (2) Additional issues.--The Commission shall by rule 
        or regulation add a class of securities to the 
        securities exempted pursuant to this section in 
        accordance with the following terms and conditions:
                  (A) The aggregate offering amount of all 
                securities offered and sold within the prior 
                12-month period in reliance on the exemption 
                added in accordance with this paragraph shall 
                not exceed [$50,000,000] $75,000,000, adjusted 
                for inflation by the Commission every 2 years 
                to the nearest $10,000 to reflect the change in 
                the Consumer Price Index for All Urban 
                Consumers published by the Bureau of Labor 
                Statistics.
                  (B) The securities may be offered and sold 
                publicly.
                  (C) The securities shall not be restricted 
                securities within the meaning of the Federal 
                securities laws and the regulations promulgated 
                thereunder.
                  (D) The civil liability provision in section 
                12(a)(2) shall apply to any person offering or 
                selling such securities.
                  (E) The issuer may solicit interest in the 
                offering prior to filing any offering 
                statement, on such terms and conditions as the 
                Commission may prescribe in the public interest 
                or for the protection of investors.
                  (F) The Commission shall require the issuer 
                to file audited financial statements with the 
                Commission annually.
                  (G) Such other terms, conditions, or 
                requirements as the Commission may determine 
                necessary in the public interest and for the 
                protection of investors, which may include--
                          (i) a requirement that the issuer 
                        prepare and electronically file with 
                        the Commission and distribute to 
                        prospective investors an offering 
                        statement, and any related documents, 
                        in such form and with such content as 
                        prescribed by the Commission, including 
                        audited financial statements, a 
                        description of the issuer's business 
                        operations, its financial condition, 
                        its corporate governance principles, 
                        its use of investor funds, and other 
                        appropriate matters; and
                          (ii) disqualification provisions 
                        under which the exemption shall not be 
                        available to the issuer or its 
                        predecessors, affiliates, officers, 
                        directors, underwriters, or other 
                        related persons, which shall be 
                        substantially similar to the 
                        disqualification provisions contained 
                        in the regulations adopted in 
                        accordance with section 926 of the 
                        Dodd-Frank Wall Street Reform and 
                        Consumer Protection Act (15 U.S.C. 77d 
                        note).
          (3) Limitation.--Only the following types of 
        securities may be exempted under a rule or regulation 
        adopted pursuant to paragraph (2): equity securities, 
        debt securities, and debt securities convertible or 
        exchangeable to equity interests, including any 
        guarantees of such securities.
          (4) Periodic disclosures.--Upon such terms and 
        conditions as the Commission determines necessary in 
        the public interest and for the protection of 
        investors, the Commission by rule or regulation may 
        require an issuer of a class of securities exempted 
        under paragraph (2) to make available to investors and 
        file with the Commission periodic disclosures regarding 
        the issuer, its business operations, its financial 
        condition, its corporate governance principles, its use 
        of investor funds, and other appropriate matters, and 
        also may provide for the suspension and termination of 
        such a requirement with respect to that issuer.
          (5) Adjustment.--Not later than 2 years after the 
        date of enactment of the Small Company Capital 
        Formation Act of 2011 and every 2 years thereafter, the 
        Commission shall review the offering amount limitation 
        described in paragraph (2)(A) and shall increase [such 
        amount as] such amount, in addition to the adjustment 
        for inflation provided for under such paragraph (2)(A), 
        as the Commission determines appropriate. If the 
        Commission determines not to increase [such amount, it] 
        such amount, in addition to the adjustment for 
        inflation provided for under such paragraph (2)(A), it 
        shall report to the Committee on Financial Services of 
        the House of Representatives and the Committee on 
        Banking, Housing, and Urban Affairs of the Senate on 
        its reasons for not increasing the amount.
  (c) The Commission may from time to time by its rules and 
regulations and subject to such terms and conditions as may be 
prescribed therein, add to the securities exempted as provided 
in this section any class of securities issued by a small 
business investment company under the Small Business Investment 
Act of 1958 if it finds, having regard to the purposes of that 
Act, that the enforcement of this Act with respect to such 
securities is not necessary in the public interest and for the 
protection of investors.

                         exempted transactions

  Sec. 4. (a) The provisions of section 5 shall not apply to--
          (1) transactions by any person other than an issuer, 
        underwriter, or dealer.
          (2) transactions by an issuer not involving any 
        public offering.
          (3) transactions by a dealer (including an 
        underwriter no longer acting as an underwriter in 
        respect of the security involved in such transaction), 
        except--
                  (A) transactions taking place prior to the 
                expiration of forty days after the first date 
                upon which the security was bona fide offered 
                to the public by the issuer or by or through an 
                underwriter,
                  (B) transactions in a security as to which a 
                registration statement has been filed taking 
                place prior to the expiration of forty days 
                after the effective date of such registration 
                statement or prior to the expiration of forty 
                days after the first date upon which the 
                security was bona fide offered to the public by 
                the issuer or by or through an underwriter 
                after such effective date, whichever is later 
                (excluding in the computation of such forty 
                days any time during which a stop order issued 
                under section 8 is in effect as to the 
                security), or such shorter period as the 
                Commission may specify by rules and regulations 
                or order, and
                  (C) transactions as to securities 
                constituting the whole or a part of an unsold 
                allotment to or subscription by such dealer as 
                a participant in the distribution of such 
                securities by the issuer or by or through an 
                underwriter.
        With respect to transactions referred to in clause (B), 
        if securities of the issuer have not previously been 
        sold pursuant to an earlier effective registration 
        statement the applicable period, instead of forty days, 
        shall be ninety days, or such shorter period as the 
        Commission may specify by rules and regulations or 
        order.
          (4) brokers' transactions executed upon customers' 
        orders on any exchange or in the over-the-counter 
        market but not the solicitation of such orders.
          (5) transactions involving offers or sales by an 
        issuer solely to one or more accredited investors, if 
        the aggregate offering price of an issue of securities 
        offered in reliance on this paragraph does not exceed 
        the amount allowed under section 3(b)(1) of this title, 
        if there is no advertising or public solicitation in 
        connection with the transaction by the issuer or anyone 
        acting on the issuer's behalf, and if the issuer files 
        such notice with the Commission as the Commission shall 
        prescribe.
          [(6) transactions involving the offer or sale of 
        securities by an issuer (including all entities 
        controlled by or under common control with the issuer), 
        provided that--
                  [(A) the aggregate amount sold to all 
                investors by the issuer, including any amount 
                sold in reliance on the exemption provided 
                under this paragraph during the 12-month period 
                preceding the date of such transaction, is not 
                more than $1,000,000;
                  [(B) the aggregate amount sold to any 
                investor by an issuer, including any amount 
                sold in reliance on the exemption provided 
                under this paragraph during the 12-month period 
                preceding the date of such transaction, does 
                not exceed--
                          [(i) the greater of $2,000 or 5 
                        percent of the annual income or net 
                        worth of such investor, as applicable, 
                        if either the annual income or the net 
                        worth of the investor is less than 
                        $100,000; and
                          [(ii) 10 percent of the annual income 
                        or net worth of such investor, as 
                        applicable, not to exceed a maximum 
                        aggregate amount sold of $100,000, if 
                        either the annual income or net worth 
                        of the investor is equal to or more 
                        than $100,000;
                  [(C) the transaction is conducted through a 
                broker or funding portal that complies with the 
                requirements of section 4A(a); and
                  [(D) the issuer complies with the 
                requirements of section 4A(b).]
          (6) transactions involving the offer or sale of 
        securities by an issuer, provided that--
                  (A) in the case of a transaction involving an 
                intermediary between the issuer and the 
                investor, such intermediary complies with the 
                requirements under section 4A(a); and
                  (B) in the case of a transaction not 
                involving an intermediary between the issuer 
                and the investor, the issuer complies with the 
                requirements under section 4A(b).
          (7) transactions meeting the requirements of 
        subsection (d).
          (8) transactions meeting the requirements of 
        subsection (e).
  (b) Offers and sales exempt under section 230.506 of title 
17, Code of Federal Regulations (as revised pursuant to section 
201 of the Jumpstart Our Business Startups Act) shall not be 
deemed public offerings under the Federal securities laws as a 
result of general advertising or general solicitation.
  (c)(1) With respect to securities offered and sold in 
compliance with Rule 506 of Regulation D under this Act, no 
person who meets the conditions set forth in paragraph (2) 
shall be subject to registration as a broker or dealer pursuant 
to section 15(a)(1) of this title, solely because--
                  (A) that person maintains a platform or 
                mechanism that permits the offer, sale, 
                purchase, or negotiation of or with respect to 
                securities, or permits general solicitations, 
                general advertisements, or similar or related 
                activities by issuers of such securities, 
                whether online, in person, or through any other 
                means;
                  (B) that person or any person associated with 
                that person co-invests in such securities; or
                  (C) that person or any person associated with 
                that person provides ancillary services with 
                respect to such securities.
  (2) The exemption provided in paragraph (1) shall apply to 
any person described in such paragraph if--
          (A) such person and each person associated with that 
        person receives no compensation in connection with the 
        purchase or sale of such security;
          (B) such person and each person associated with that 
        person does not have possession of customer funds or 
        securities in connection with the purchase or sale of 
        such security; and
          (C) such person is not subject to a statutory 
        disqualification as defined in section 3(a)(39) of this 
        title and does not have any person associated with that 
        person subject to such a statutory disqualification.
  (3) For the purposes of this subsection, the term ``ancillary 
services'' means--
          (A) the provision of due diligence services, in 
        connection with the offer, sale, purchase, or 
        negotiation of such security, so long as such services 
        do not include, for separate compensation, investment 
        advice or recommendations to issuers or investors; and
          (B) the provision of standardized documents to the 
        issuers and investors, so long as such person or entity 
        does not negotiate the terms of the issuance for and on 
        behalf of third parties and issuers are not required to 
        use the standardized documents as a condition of using 
        the service.
  [(d) Certain Accredited Investor Transactions.--The 
transactions referred to in subsection (a)(7) are transactions 
meeting the following requirements:
          [(1) Accredited investor requirement.--Each purchaser 
        is an accredited investor, as that term is defined in 
        section 230.501(a) of title 17, Code of Federal 
        Regulations (or any successor regulation).
          [(2) Prohibition on general solicitation or 
        advertising.--Neither the seller, nor any person acting 
        on the seller's behalf, offers or sells securities by 
        any form of general solicitation or general 
        advertising.
          [(3) Information requirement.--In the case of a 
        transaction involving the securities of an issuer that 
        is neither subject to section 13 or 15(d) of the 
        Securities Exchange Act of 1934 (15 U.S.C. 78m; 
        78o(d)), nor exempt from reporting pursuant to section 
        240.12g3-2(b) of title 17, Code of Federal Regulations, 
        nor a foreign government (as defined in section 230.405 
        of title 17, Code of Federal Regulations) eligible to 
        register securities under Schedule B, the seller and a 
        prospective purchaser designated by the seller obtain 
        from the issuer, upon request of the seller, and the 
        seller in all cases makes available to a prospective 
        purchaser, the following information (which shall be 
        reasonably current in relation to the date of resale 
        under this section):
                  [(A) The exact name of the issuer and the 
                issuer's predecessor (if any).
                  [(B) The address of the issuer's principal 
                executive offices.
                  [(C) The exact title and class of the 
                security.
                  [(D) The par or stated value of the security.
                  [(E) The number of shares or total amount of 
                the securities outstanding as of the end of the 
                issuer's most recent fiscal year.
                  [(F) The name and address of the transfer 
                agent, corporate secretary, or other person 
                responsible for transferring shares and stock 
                certificates.
                  [(G) A statement of the nature of the 
                business of the issuer and the products and 
                services it offers, which shall be presumed 
                reasonably current if the statement is as of 12 
                months before the transaction date.
                  [(H) The names of the officers and directors 
                of the issuer.
                  [(I) The names of any persons registered as a 
                broker, dealer, or agent that shall be paid or 
                given, directly or indirectly, any commission 
                or remuneration for such person's participation 
                in the offer or sale of the securities.
                  [(J) The issuer's most recent balance sheet 
                and profit and loss statement and similar 
                financial statements, which shall--
                          [(i) be for such part of the 2 
                        preceding fiscal years as the issuer 
                        has been in operation;
                          [(ii) be prepared in accordance with 
                        generally accepted accounting 
                        principles or, in the case of a foreign 
                        private issuer, be prepared in 
                        accordance with generally accepted 
                        accounting principles or the 
                        International Financial Reporting 
                        Standards issued by the International 
                        Accounting Standards Board;
                          [(iii) be presumed reasonably current 
                        if--
                                  [(I) with respect to the 
                                balance sheet, the balance 
                                sheet is as of a date less than 
                                16 months before the 
                                transaction date; and
                                  [(II) with respect to the 
                                profit and loss statement, such 
                                statement is for the 12 months 
                                preceding the date of the 
                                issuer's balance sheet; and
                          [(iv) if the balance sheet is not as 
                        of a date less than 6 months before the 
                        transaction date, be accompanied by 
                        additional statements of profit and 
                        loss for the period from the date of 
                        such balance sheet to a date less than 
                        6 months before the transaction date.
                  [(K) To the extent that the seller is a 
                control person with respect to the issuer, a 
                brief statement regarding the nature of the 
                affiliation, and a statement certified by such 
                seller that they have no reasonable grounds to 
                believe that the issuer is in violation of the 
                securities laws or regulations.
          [(4) Issuers disqualified.--The transaction is not 
        for the sale of a security where the seller is an 
        issuer or a subsidiary, either directly or indirectly, 
        of the issuer.
          [(5) Bad actor prohibition.--Neither the seller, nor 
        any person that has been or will be paid (directly or 
        indirectly) remuneration or a commission for their 
        participation in the offer or sale of the securities, 
        including solicitation of purchasers for the seller is 
        subject to an event that would disqualify an issuer or 
        other covered person under Rule 506(d)(1) of Regulation 
        D (17 CFR 230.506(d)(1)) or is subject to a statutory 
        disqualification described under section 3(a)(39) of 
        the Securities Exchange Act of 1934.
          [(6) Business requirement.--The issuer is engaged in 
        business, is not in the organizational stage or in 
        bankruptcy or receivership, and is not a blank check, 
        blind pool, or shell company that has no specific 
        business plan or purpose or has indicated that the 
        issuer's primary business plan is to engage in a merger 
        or combination of the business with, or an acquisition 
        of, an unidentified person.
          [(7) Underwriter prohibition.--The transaction is not 
        with respect to a security that constitutes the whole 
        or part of an unsold allotment to, or a subscription or 
        participation by, a broker or dealer as an underwriter 
        of the security or a redistribution.
          [(8) Outstanding class requirement.--The transaction 
        is with respect to a security of a class that has been 
        authorized and outstanding for at least 90 days prior 
        to the date of the transaction.
  [(e) Additional Requirements.--
          [(1) In general.--With respect to an exempted 
        transaction described under subsection (a)(7):
                  [(A) Securities acquired in such transaction 
                shall be deemed to have been acquired in a 
                transaction not involving any public offering.
                  [(B) Such transaction shall be deemed not to 
                be a distribution for purposes of section 
                2(a)(11).
                  [(C) Securities involved in such transaction 
                shall be deemed to be restricted securities 
                within the meaning of Rule 144 (17 CFR 
                230.144).
          [(2) Rule of construction.--The exemption provided by 
        subsection (a)(7) shall not be the exclusive means for 
        establishing an exemption from the registration 
        requirements of section 5.]
  (d)(1) The transactions referred to in subsection (a)(7) are 
transactions where--
                  (A) each purchaser is an accredited investor, 
                as that term is defined in section 230.501(a) 
                of title 17, Code of Federal Regulations (or 
                any successor thereto); and
                  (B) if any securities sold in reliance on 
                subsection (a)(7) are offered by means of any 
                general solicitation or general advertising, 
                all such sales are made through a platform 
                available only to accredited investors.
  (2) Securities sold in reliance on subsection (a)(7) shall be 
deemed to have been acquired in a transaction not involving any 
public offering.
  (3) The exemption provided by this subsection shall not be 
available for a transaction where the seller is--
          (A) an issuer, its subsidiaries or parent;
          (B) an underwriter acting on behalf of the issuer, 
        its subsidiaries or parent, which receives compensation 
        from the issuer with respect to such sale; or
          (C) a dealer.
  (4) A transaction meeting the requirements of this subsection 
shall be deemed not to be a distribution for purposes of 
section 2(a)(11).
  (e) Certain Micro-Offerings.--The transactions referred to in 
subsection (a)(8) are transactions involving the sale of 
securities by an issuer (including all entities controlled by 
or under common control with the issuer) that meet all of the 
following requirements:
          (1) Pre-existing relationship.--Each purchaser has a 
        substantive pre-existing relationship with an officer 
        of the issuer, a director of the issuer, or a 
        shareholder holding 10 percent or more of the shares of 
        the issuer.
          (2) 35 or fewer purchasers.--There are no more than, 
        or the issuer reasonably believes that there are no 
        more than, 35 purchasers of securities from the issuer 
        that are sold in reliance on the exemption provided 
        under subsection (a)(8) during the 12-month period 
        preceding such transaction.
          (3) Small offering amount.--The aggregate amount of 
        all securities sold by the issuer, including any amount 
        sold in reliance on the exemption provided under 
        subsection (a)(8), during the 12-month period preceding 
        such transaction, does not exceed $500,000.

[SEC. 4A. REQUIREMENTS WITH RESPECT TO CERTAIN SMALL TRANSACTIONS.

  [(a) Requirements on Intermediaries.--A person acting as an 
intermediary in a transaction involving the offer or sale of 
securities for the account of others pursuant to section 4(6) 
shall--
          [(1) register with the Commission as--
                  [(A) a broker; or
                  [(B) a funding portal (as defined in section 
                3(a)(80) of the Securities Exchange Act of 
                1934);
          [(2) register with any applicable self-regulatory 
        organization (as defined in section 3(a)(26) of the 
        Securities Exchange Act of 1934);
          [(3) provide such disclosures, including disclosures 
        related to risks and other investor education 
        materials, as the Commission shall, by rule, determine 
        appropriate;
          [(4) ensure that each investor--
                  [(A) reviews investor-education information, 
                in accordance with standards established by the 
                Commission, by rule;
                  [(B) positively affirms that the investor 
                understands that the investor is risking the 
                loss of the entire investment, and that the 
                investor could bear such a loss; and
                  [(C) answers questions demonstrating--
                          [(i) an understanding of the level of 
                        risk generally applicable to 
                        investments in startups, emerging 
                        businesses, and small issuers;
                          [(ii) an understanding of the risk of 
                        illiquidity; and
                          [(iii) an understanding of such other 
                        matters as the Commission determines 
                        appropriate, by rule;
          [(5) take such measures to reduce the risk of fraud 
        with respect to such transactions, as established by 
        the Commission, by rule, including obtaining a 
        background and securities enforcement regulatory 
        history check on each officer, director, and person 
        holding more than 20 percent of the outstanding equity 
        of every issuer whose securities are offered by such 
        person;
          [(6) not later than 21 days prior to the first day on 
        which securities are sold to any investor (or such 
        other period as the Commission may establish), make 
        available to the Commission and to potential investors 
        any information provided by the issuer pursuant to 
        subsection (b);
          [(7) ensure that all offering proceeds are only 
        provided to the issuer when the aggregate capital 
        raised from all investors is equal to or greater than a 
        target offering amount, and allow all investors to 
        cancel their commitments to invest, as the Commission 
        shall, by rule, determine appropriate;
          [(8) make such efforts as the Commission determines 
        appropriate, by rule, to ensure that no investor in a 
        12-month period has purchased securities offered 
        pursuant to section 4(6) that, in the aggregate, from 
        all issuers, exceed the investment limits set forth in 
        section 4(6)(B);
          [(9) take such steps to protect the privacy of 
        information collected from investors as the Commission 
        shall, by rule, determine appropriate;
          [(10) not compensate promoters, finders, or lead 
        generators for providing the broker or funding portal 
        with the personal identifying information of any 
        potential investor;
          [(11) prohibit its directors, officers, or partners 
        (or any person occupying a similar status or performing 
        a similar function) from having any financial interest 
        in an issuer using its services; and
          [(12) meet such other requirements as the Commission 
        may, by rule, prescribe, for the protection of 
        investors and in the public interest.
  [(b) Requirements for Issuers.--For purposes of section 4(6), 
an issuer who offers or sells securities shall--
          [(1) file with the Commission and provide to 
        investors and the relevant broker or funding portal, 
        and make available to potential investors--
                  [(A) the name, legal status, physical 
                address, and website address of the issuer;
                  [(B) the names of the directors and officers 
                (and any persons occupying a similar status or 
                performing a similar function), and each person 
                holding more than 20 percent of the shares of 
                the issuer;
                  [(C) a description of the business of the 
                issuer and the anticipated business plan of the 
                issuer;
                  [(D) a description of the financial condition 
                of the issuer, including, for offerings that, 
                together with all other offerings of the issuer 
                under section 4(6) within the preceding 12-
                month period, have, in the aggregate, target 
                offering amounts of--
                          [(i) $100,000 or less--
                                  [(I) the income tax returns 
                                filed by the issuer for the 
                                most recently completed year 
                                (if any); and
                                  [(II) financial statements of 
                                the issuer, which shall be 
                                certified by the principal 
                                executive officer of the issuer 
                                to be true and complete in all 
                                material respects;
                          [(ii) more than $100,000, but not 
                        more than $500,000, financial 
                        statements reviewed by a public 
                        accountant who is independent of the 
                        issuer, using professional standards 
                        and procedures for such review or 
                        standards and procedures established by 
                        the Commission, by rule, for such 
                        purpose; and
                          [(iii) more than $500,000 (or such 
                        other amount as the Commission may 
                        establish, by rule), audited financial 
                        statements;
                  [(E) a description of the stated purpose and 
                intended use of the proceeds of the offering 
                sought by the issuer with respect to the target 
                offering amount;
                  [(F) the target offering amount, the deadline 
                to reach the target offering amount, and 
                regular updates regarding the progress of the 
                issuer in meeting the target offering amount;
                  [(G) the price to the public of the 
                securities or the method for determining the 
                price, provided that, prior to sale, each 
                investor shall be provided in writing the final 
                price and all required disclosures, with a 
                reasonable opportunity to rescind the 
                commitment to purchase the securities;
                  [(H) a description of the ownership and 
                capital structure of the issuer, including--
                          [(i) terms of the securities of the 
                        issuer being offered and each other 
                        class of security of the issuer, 
                        including how such terms may be 
                        modified, and a summary of the 
                        differences between such securities, 
                        including how the rights of the 
                        securities being offered may be 
                        materially limited, diluted, or 
                        qualified by the rights of any other 
                        class of security of the issuer;
                          [(ii) a description of how the 
                        exercise of the rights held by the 
                        principal shareholders of the issuer 
                        could negatively impact the purchasers 
                        of the securities being offered;
                          [(iii) the name and ownership level 
                        of each existing shareholder who owns 
                        more than 20 percent of any class of 
                        the securities of the issuer;
                          [(iv) how the securities being 
                        offered are being valued, and examples 
                        of methods for how such securities may 
                        be valued by the issuer in the future, 
                        including during subsequent corporate 
                        actions; and
                          [(v) the risks to purchasers of the 
                        securities relating to minority 
                        ownership in the issuer, the risks 
                        associated with corporate actions, 
                        including additional issuances of 
                        shares, a sale of the issuer or of 
                        assets of the issuer, or transactions 
                        with related parties; and
                  [(I) such other information as the Commission 
                may, by rule, prescribe, for the protection of 
                investors and in the public interest;
          [(2) not advertise the terms of the offering, except 
        for notices which direct investors to the funding 
        portal or broker;
          [(3) not compensate or commit to compensate, directly 
        or indirectly, any person to promote its offerings 
        through communication channels provided by a broker or 
        funding portal, without taking such steps as the 
        Commission shall, by rule, require to ensure that such 
        person clearly discloses the receipt, past or 
        prospective, of such compensation, upon each instance 
        of such promotional communication;
          [(4) not less than annually, file with the Commission 
        and provide to investors reports of the results of 
        operations and financial statements of the issuer, as 
        the Commission shall, by rule, determine appropriate, 
        subject to such exceptions and termination dates as the 
        Commission may establish, by rule; and
          [(5) comply with such other requirements as the 
        Commission may, by rule, prescribe, for the protection 
        of investors and in the public interest.
  [(c) Liability for Material Misstatements and Omissions.--
          [(1) Actions authorized.--
                  [(A) In general.--Subject to paragraph (2), a 
                person who purchases a security in a 
                transaction exempted by the provisions of 
                section 4(6) may bring an action against an 
                issuer described in paragraph (2), either at 
                law or in equity in any court of competent 
                jurisdiction, to recover the consideration paid 
                for such security with interest thereon, less 
                the amount of any income received thereon, upon 
                the tender of such security, or for damages if 
                such person no longer owns the security.
                  [(B) Liability.--An action brought under this 
                paragraph shall be subject to the provisions of 
                section 12(b) and section 13, as if the 
                liability were created under section 12(a)(2).
          [(2) Applicability.--An issuer shall be liable in an 
        action under paragraph (1), if the issuer--
                  [(A) by the use of any means or instruments 
                of transportation or communication in 
                interstate commerce or of the mails, by any 
                means of any written or oral communication, in 
                the offering or sale of a security in a 
                transaction exempted by the provisions of 
                section 4(6), makes an untrue statement of a 
                material fact or omits to state a material fact 
                required to be stated or necessary in order to 
                make the statements, in the light of the 
                circumstances under which they were made, not 
                misleading, provided that the purchaser did not 
                know of such untruth or omission; and
                  [(B) does not sustain the burden of proof 
                that such issuer did not know, and in the 
                exercise of reasonable care could not have 
                known, of such untruth or omission.
          [(3) Definition.--As used in this subsection, the 
        term ``issuer'' includes any person who is a director 
        or partner of the issuer, and the principal executive 
        officer or officers, principal financial officer, and 
        controller or principal accounting officer of the 
        issuer (and any person occupying a similar status or 
        performing a similar function) that offers or sells a 
        security in a transaction exempted by the provisions of 
        section 4(6), and any person who offers or sells the 
        security in such offering.
  [(d) Information Available to States.--The Commission shall 
make, or shall cause to be made by the relevant broker or 
funding portal, the information described in subsection (b) and 
such other information as the Commission, by rule, determines 
appropriate, available to the securities commission (or any 
agency or office performing like functions) of each State and 
territory of the United States and the District of Columbia.
  [(e) Restrictions on Sales.--Securities issued pursuant to a 
transaction described in section 4(6)--
          [(1) may not be transferred by the purchaser of such 
        securities during the 1-year period beginning on the 
        date of purchase, unless such securities are 
        transferred--
                  [(A) to the issuer of the securities;
                  [(B) to an accredited investor;
                  [(C) as part of an offering registered with 
                the Commission; or
                  [(D) to a member of the family of the 
                purchaser or the equivalent, or in connection 
                with the death or divorce of the purchaser or 
                other similar circumstance, in the discretion 
                of the Commission; and
          [(2) shall be subject to such other limitations as 
        the Commission shall, by rule, establish.
  [(f) Applicability.--Section 4(6) shall not apply to 
transactions involving the offer or sale of securities by any 
issuer that--
          [(1) is not organized under and subject to the laws 
        of a State or territory of the United States or the 
        District of Columbia;
          [(2) is subject to the requirement to file reports 
        pursuant to section 13 or section 15(d) of the 
        Securities Exchange Act of 1934;
          [(3) is an investment company, as defined in section 
        3 of the Investment Company Act of 1940, or is excluded 
        from the definition of investment company by section 
        3(b) or section 3(c) of that Act; or
          [(4) the Commission, by rule or regulation, 
        determines appropriate.
  [(g) Rule of Construction.--Nothing in this section or 
section 4(6) shall be construed as preventing an issuer from 
raising capital through methods not described under section 
4(6).
  [(h) Certain Calculations.--
          [(1) Dollar amounts.--Dollar amounts in section 4(6) 
        and subsection (b) of this section shall be adjusted by 
        the Commission not less frequently than once every 5 
        years, by notice published in the Federal Register to 
        reflect any change in the Consumer Price Index for All 
        Urban Consumers published by the Bureau of Labor 
        Statistics.
          [(2) Income and net worth.--The income and net worth 
        of a natural person under section 4(6)(B) shall be 
        calculated in accordance with any rules of the 
        Commission under this title regarding the calculation 
        of the income and net worth, respectively, of an 
        accredited investor.]

SEC. 4A. REQUIREMENTS WITH RESPECT TO CERTAIN SMALL TRANSACTIONS.

  (a) Requirements on Intermediaries.--For purposes of section 
4(a)(6), a person acting as an intermediary in a transaction 
involving the offer or sale of securities shall comply with the 
requirements of this subsection if the intermediary--
          (1) warns investors, including on the intermediary's 
        website used for the offer and sale of such securities, 
        of the speculative nature generally applicable to 
        investments in startups, emerging businesses, and small 
        issuers, including risks in the secondary market 
        related to illiquidity;
          (2) warns investors that they are subject to the 
        restriction on sales requirement described under 
        subsection (e);
          (3) takes reasonable measures to reduce the risk of 
        fraud with respect to such transaction;
          (4) registers with the Commission and the Financial 
        Industry Regulatory Authority, including by providing 
        the Commission with the intermediary's physical 
        address, website address, and the names of the 
        intermediary and employees of the intermediary, and 
        keep such information up-to-date;
          (5) provides the Commission with continuous investor-
        level access to the intermediary's website;
          (6) requires each potential investor to answer 
        questions demonstrating--
                  (A) an understanding of the level of risk 
                generally applicable to investments in 
                startups, emerging businesses, and small 
                issuers;
                  (B) an understanding of the risk of 
                illiquidity; and
                  (C) such other areas as the Commission may 
                determine appropriate by rule or regulation, 
                including information relating to the owners' 
                and management's experience, and any related 
                party transactions and conflicts of interest;
          (7) carries out a background check on the issuer's 
        principals;
          (8) provides the Commission and potential investors 
        with notice of the offering not less than 10 days prior 
        to such offering, not later than the first day 
        securities are offered to potential investors, 
        including--
                  (A) the issuer's name, legal status, physical 
                address, and website address;
                  (B) the names of the issuer's principals;
                  (C) the stated purpose and intended use of 
                the proceeds of the offering sought by the 
                issuer; and
                  (D) the target offering amount and the 
                deadline to reach the target offering amount;
          (9) outsources cash-management functions to a 
        qualified third party custodian, such as a broker or 
        dealer registered under section 15(b)(1) of the 
        Securities Exchange Act of 1934, a trust company, or an 
        insured depository institution;
          (10) makes available on the intermediary's website a 
        method of communication that permits the issuer and 
        investors to communicate with one another;
          (11) provides the Commission with a notice upon 
        completion of the offering, which shall include the 
        aggregate offering amount and the number of purchasers; 
        and
  (b) Requirements on Issuers if No Intermediary.--For purposes 
of section 4(a)(6), an issuer who offers or sells securities 
without an intermediary shall comply with the requirements of 
this subsection if the issuer--
          (1) warns investors, including on the issuer's 
        website, of the speculative nature generally applicable 
        to investments in startups, emerging businesses, and 
        small issuers, including risks in the secondary market 
        related to illiquidity;
          (2) warns investors that they are subject to the 
        restriction on sales requirement described under 
        subsection (e);
          (3) takes reasonable measures to reduce the risk of 
        fraud with respect to such transaction;
          (4) provides the Commission with the issuer's 
        physical address, website address, and the names of the 
        principals and employees of the issuers, and keeps such 
        information up-to-date;
          (5) provides the Commission with continuous investor-
        level access to the issuer's website;
          (6) requires each potential investor to answer 
        questions demonstrating--
                  (A) an understanding of the level of risk 
                generally applicable to investments in 
                startups, emerging businesses, and small 
                issuers;
                  (B) an understanding of the risk of 
                illiquidity; and
                  (C) such other areas as the Commission may 
                determine appropriate by rule or regulation;
          (7) provides the Commission with notice of the 
        offering not less than 10 days prior to such offering, 
        not later than the first day securities are offered to 
        potential investors, including--
                  (A) the stated purpose and intended use of 
                the proceeds of the offering sought by the 
                issuer; and
                  (B) the target offering amount and the 
                deadline to reach the target offering amount;
          (8) outsources cash-management functions to a 
        qualified third party custodian, such as a broker or 
        dealer registered under section 15(b)(1) of the 
        Securities Exchange Act of 1934, a trust company, or an 
        insured depository institution;
          (9) makes available on the issuer's website a method 
        of communication that permits the issuer and investors 
        to communicate with one another;
          (10) does not offer personalized investment advice;
          (11) provides the Commission with a notice upon 
        completion of the offering, which shall include the 
        aggregate offering amount and the number of purchasers; 
        and
  (c) Verification of Income.--For purposes of section 4(a)(6), 
an issuer or intermediary may rely on certifications as to 
annual income provided by the person to whom the securities are 
sold to verify the investor's income.
  (d) Information Available to States.--The Commission shall 
make the notices described under subsections (a)(9), (a)(13), 
(b)(8), and (b)(13) and the information described under 
subsections (a)(4) and (b)(4) available to the States.
  (e) Restriction on Sales.--With respect to a transaction 
involving the issuance of securities described under section 
4(a)(6), a purchaser may not transfer such securities during 
the 1-year period beginning on the date of purchase, unless 
such securities are sold to--
          (1) the issuer of such securities; or
          (2) an accredited investor.
  (f) Construction.--
          (1) No registration as broker.--With respect to a 
        transaction described under section 4(a)(6) involving 
        an intermediary, such intermediary shall not be 
        required to register as a broker under section 15(a)(1) 
        of the Securities Exchange Act of 1934 solely by reason 
        of participation in such transaction.
          (2) No preclusion of other capital raising.--Nothing 
        in this section or section 4(a)(6) shall be construed 
        as preventing an issuer from raising capital through 
        methods not described under section 4(a)(6).

       prohibitions relating to interstate commerce and the mails

  Sec. 5. (a) Unless a registration statement is in effect as 
to a security, it shall be unlawful for any person, directly or 
indirectly--
          (1) to make use of any means or instruments of 
        transportation or communication in interstate commerce 
        or of the mails to sell such security through the use 
        or medium of any prospectus or otherwise; or
          (2) to carry or cause to be carried through the mails 
        or in interstate commerce, by any means or instruments 
        of transportation, any such security for the purpose of 
        sale or for delivery after sale.
  (b) It shall be unlawful for any person, directly or 
indirectly--
          (1) to make use of any means or instruments of 
        transportation or communication in interstate commerce 
        or of the mails to carry or transmit any prospectus 
        relating to any security with respect to which a 
        registration statement has been filed under this title, 
        unless such prospectus meets the requirements of 
        section 10; or
          (2) to carry or cause to be carried through the mails 
        or in interstate commerce any such security for the 
        purpose of sale or for delivery after sale, unless 
        accompanied or preceded by a prospectus that meets the 
        requirements of subsection (a) of section 10.
  (c) It shall be unlawful for any person, directly or 
indirectly, to make use of any means or instruments of 
transportation or communication in interstate commerce or of 
the mails to offer to sell or offer to buy through the use or 
medium of any prospectus or otherwise any security, unless a 
registration statement has been filed as to such security, or 
while the registration statement is the subject of a refusal 
order or stop order or (prior to the effective date of the 
registration statement) any public proceeding or examination 
under section 8.
  (d) Limitation.--Notwithstanding any other provision of this 
section, [an emerging growth company or any person authorized 
to act on behalf of an emerging growth company] an issuer or 
any person authorized to act on behalf of an issuer may engage 
in oral or written communications with potential investors that 
are qualified institutional buyers or institutions that are 
accredited investors, as such terms are respectively defined in 
section 230.144A and section 230.501(a) of title 17, Code of 
Federal Regulations, or any successor thereto, to determine 
whether such investors might have an interest in a contemplated 
securities offering, either prior to or following the date of 
filing of a registration statement with respect to such 
securities with the Commission, subject to the requirement of 
subsection (b)(2).
  (e) Notwithstanding the provisions of section 3 or 4, unless 
a registration statement meeting the requirements of section 
10(a) is in effect as to a security-based swap, it shall be 
unlawful for any person, directly or indirectly, to make use of 
any means or instruments of transportation or communication in 
interstate commerce or of the mails to offer to sell, offer to 
buy or purchase or sell a security-based swap to any person who 
is not an eligible contract participant as defined in section 
1a(18) of the Commodity Exchange Act (7 U.S.C. 1a(18)).

    registration of securities and signing of registration statement

  Sec. 6. (a) Any security may be registered with the 
Commission under the terms and conditions hereinafter provided, 
by filing a registration statement in triplicate, at least one 
of which shall be signed by each issuer, its principal 
executive officer or officers, its principal financial officer, 
its comptroller or principal accounting officer, and the 
majority of its board of directors or persons performing 
similar functions (or, if there is no board of directors or 
persons performing similar functions, by the majority of the 
persons or board having the power of management of the issuer), 
and in case the issuer is a foreign or Territorial person by 
its duly authorized representative in the United States; except 
that when such registration statement relates to a security 
issued by a foreign government, or political subdivision 
thereof, it need be signed only by the underwriter of such 
security. Signatures of all such persons when written on the 
said registration statements shall be presumed to have been so 
written by authority of the person whose signature is so 
affixed and the burden of proof, in the event such authority 
shall be denied, shall be upon the party denying the same. The 
affixing of any signature without the authority of the 
purported signer shall constitute a violation of this title. A 
registration statement shall be deemed effective only as to the 
securities specified therein as proposed to be offered.
  (b) Registration Fee.--
          (1) Fee payment required.--At the time of filing a 
        registration statement, the applicant shall pay to the 
        Commission a fee at a rate that shall be equal to $92 
        per $1,000,000 of the maximum aggregate price at which 
        such securities are proposed to be offered, except that 
        during fiscal year 2003 and any succeeding fiscal year 
        such fee shall be adjusted pursuant to paragraph (2).
          (2) Annual adjustment.--For each fiscal year, the 
        Commission shall by order adjust the rate required by 
        paragraph (1) for such fiscal year to a rate that, when 
        applied to the baseline estimate of the aggregate 
        maximum offering prices for such fiscal year, is 
        reasonably likely to produce aggregate fee collections 
        under this subsection that are equal to the [target fee 
        collection amount] target offsetting collection amount 
        for such fiscal year.
          (3) Pro rata application.--The rates per $1,000,000 
        required by this subsection shall be applied pro rata 
        to amounts and balances of less than $1,000,000.
          (4) Review and effective date.--In exercising its 
        authority under this subsection, the Commission shall 
        not be required to comply with the provisions of 
        section 553 of title 5, United States Code. An adjusted 
        rate prescribed under paragraph (2) and published under 
        paragraph (5) shall not be subject to judicial review. 
        [An adjusted rate prescribed under paragraph (2) shall 
        take effect on the first day of the fiscal year to 
        which such rate applies.] Subject to paragraphs (6)(B) 
        and (7), an adjusted rate prescribed under paragraph 
        (2) shall take effect on the later of--
                  (A) the first day of the fiscal year to which 
                such rate applies; or
                  (B) five days after the date on which a 
                regular appropriation to the Commission for 
                such fiscal year is enacted.
          (5) Publication.--The Commission shall publish in the 
        Federal Register notices of the rate applicable under 
        this subsection and under sections 13(e) and 14(g) of 
        the Securities Exchange Act of 1934 for each fiscal 
        year not later than August 31 of the fiscal year 
        preceding the fiscal year to which such rate applies, 
        together with any estimates or projections on which 
        such rate is based.
          (6) Offsetting collections.--Fees collected pursuant 
        to this subsection for any fiscal year--
                  (A) except as provided in section 31(i)(2) of 
                the Securities Exchange Act of 1934, shall be 
                deposited and credited as offsetting 
                collections to the account providing 
                appropriations to the Commission; and
                  (B) except as provided in paragraph (7), 
                shall not be collected for any fiscal year 
                except to the extent provided in advance in 
                appropriation Acts.
          (7) Lapse of appropriation.--If on the first day of a 
        fiscal year a regular appropriation to the Commission 
        has not been enacted, the Commission shall continue to 
        collect fees (as offsetting collections) under this 
        subsection at the rate in effect during the preceding 
        fiscal year, until 5 days after the date such a regular 
        appropriation is enacted.
          [(6)] (8) Definitions.--For purposes of this 
        subsection:
                  (A)  [Target offsetting collection amount.--] 
                Target offsetting collection amount._The 
                [target fee collection amount] target 
                offsetting collection amount for each fiscal 
                year is determined according to the following 
                table:

                                                Target [fee] offsetting 
  Fiscal year:                                         collection amount
2002....................................................   $377,000,000 
2003....................................................   $435,000,000 
2004....................................................   $467,000,000 
2005....................................................   $570,000,000 
2006....................................................   $689,000,000 
2007....................................................   $214,000,000 
2008....................................................   $234,000,000 
2009....................................................   $284,000,000 
2010....................................................   $334,000,000 
2011....................................................   $394,000,000 
2012....................................................   $425,000,000 
2013....................................................   $455,000,000 
2014....................................................   $485,000,000 
2015....................................................   $515,000,000 
2016....................................................   $550,000,000 
2017....................................................   $585,000,000 
2018....................................................   $620,000,000 
2019....................................................   $660,000,000 
2020....................................................   $705,000,000 
  2021 and each fiscAn amount that is equal to the [target fee .........
                    collection amount] target offsetting collection 
                    amount   for the prior fiscal year, adjusted by the 
                    rate of inflation.

                  (B) Baseline estimate of the aggregate 
                maximum offering prices.--The baseline estimate 
                of the aggregate maximum offering prices for 
                any fiscal year is the baseline estimate of the 
                aggregate maximum offering price at which 
                securities are proposed to be offered pursuant 
                to registration statements filed with the 
                Commission during such fiscal year as 
                determined by the Commission, after 
                consultation with the Congressional Budget 
                Office and the Office of Management and Budget, 
                using the methodology required for projections 
                pursuant to section 257 of the Balanced Budget 
                and Emergency Deficit Control Act of 1985.
  (c) The filing with the Commission of a registration 
statement, or of an amendment to a registration statement, 
shall be deemed to have taken place upon the receipt thereof, 
but the filing of a registration statement shall not be deemed 
to have taken place unless it is accompanied by a United States 
postal money order or a certified bank check or cash for the 
amount of the fee required under subsection (b).
  (d) The information contained in or filed with any 
registration statement shall be made available to the public 
under such regulations as the Commission may prescribe, and 
copies thereof, photostatic or otherwise, shall be furnished to 
every applicant at such reasonable charge as the Commission may 
prescribe.
  (e)  [Emerging Growth Companies] Draft Registration 
Statements.--
          [(1) In general.--Any emerging growth company, prior 
        to its initial public offering date, may confidentially 
        submit to the Commission a draft registration 
        statement, for confidential nonpublic review by the 
        staff of the Commission prior to public filing, 
        provided that the initial confidential submission and 
        all amendments thereto shall be publicly filed with the 
        Commission not later than 15 days before the date on 
        which the issuer conducts a road show, as such term is 
        defined in section 230.433(h)(4) of title 17, Code of 
        Federal Regulations, or any successor thereto. An 
        issuer that was an emerging growth company at the time 
        it submitted a confidential registration statement or, 
        in lieu thereof, a publicly filed registration 
        statement for review under this subsection but ceases 
        to be an emerging growth company thereafter shall 
        continue to be treated as an emerging market growth 
        company for the purposes of this subsection through the 
        earlier of the date on which the issuer consummates its 
        initial public offering pursuant to such registrations 
        statement or the end of the 1-year period beginning on 
        the date the company ceases to be an emerging growth 
        company.]
          (1) In general.--Any issuer, prior to its initial 
        public offering date, may confidentially submit to the 
        Commission a draft registration statement, for 
        confidential nonpublic review by the staff of the 
        Commission prior to public filing, provided that the 
        initial confidential submission and all amendments 
        thereto shall be publicly filed with the Commission not 
        later than 15 days before the date on which the issuer 
        conducts a road show, as such term is defined in 
        section 230.433(h)(4) of title 17, Code of Federal 
        Regulations, or any successor thereto.
          (2) Confidentiality.--Notwithstanding any other 
        provision of this title, the Commission shall not be 
        compelled to disclose any information provided to or 
        obtained by the Commission pursuant to this subsection. 
        For purposes of section 552 of title 5, United States 
        Code, this subsection shall be considered a statute 
        described in subsection (b)(3)(B) of such section 552. 
        Information described in or obtained pursuant to this 
        subsection shall be deemed to constitute confidential 
        information for purposes of section 24(b)(2) of the 
        Securities Exchange Act of 1934.

           *       *       *       *       *       *       *


    taking effect of registration statements and amendments thereto

  Sec. 8. (a) Except as hereinafter provided, the effective 
date of a registration statement shall be the twentieth day 
after the filing thereof or such earlier date as the Commission 
may determine, having due regard to the adequacy of the 
information respecting the issuer theretofore available to the 
public, to the facility with which the nature of the securities 
to be registered, their relationship to the capital structure 
of the issuer and the rights of holders thereof can be 
understood, and to the public interest and the protection of 
investors. If any amendment to any such statement is filed 
prior to the effective date of such statement, the registration 
statement shall be deemed to have been filed when such 
amendment was filed; except that an amendment filed with the 
consent of the Commission, prior to the effective date of the 
registration statement, or filed pursuant to an order of the 
Commission, shall be treated as a part of the registration 
statement.
  (b) If it appears to the Commission that a registration 
statement is on its face incomplete or inaccurate in any 
material respect, the Commission may, after notice by personal 
service or the sending of confirmed telegraphic notice not 
later than ten days after the filing of the registration 
statement, and opportunity for hearing (at a time fixed by the 
Commission) within ten days after such notice by personal 
service or the sending of such telegraphic notice, issue an 
order prior to the effective date of registration refusing to 
permit such statement to become effective until it has been 
amended in accordance with such order. When such statement has 
been amended in accordance with such order the Commission shall 
so declare and the registration shall become effective at the 
time provided in subsection (a) or upon the date of such 
declaration, whichever date is the later.
  (c) An amendment filed after the effective date of the 
registration statement, if such amendment, upon its face, 
appears to the Commission not to be incomplete or inaccurate in 
any material respect, shall become effective on such date as 
the Commission may determine, having due regard to the public 
interest and the protection of investors.
  (d) If it appears to the Commission at any time that the 
registration statement includes any untrue statement of a 
material fact or omits to state any material fact required to 
be stated therein or necessary to make the statements therein 
not misleading, the Commission may, after notice by personal 
service or the sending of confirmed telegraphic notice, and 
after opportunity for hearing (at a time fixed by the 
Commission) within fifteen days after such notice by personal 
service or the sending of such telegraphic notice, issue a stop 
order suspending the effectiveness of the registration 
statement. When such statement has been amended in accordance 
with such stop order the Commission shall so declare and 
thereupon the stop order shall cease to be effective.
  (e) The Commission is hereby empowered to make an examination 
in any case in order to determine whether a stop order should 
issue under subsection (d). In making such examination the 
Commission or any officer or officers designated by it shall 
have access to and may demand the production of any books and 
papers of, and may administer oaths and affirmations to and 
examine, the issuer, underwriter, or any other person, in 
respect of any matter relevant to the examination, and may, in 
its discretion, require the production of a balance sheet 
exhibiting the assets and liabilities of the issuer, or its 
income statement, or both, to be certified to by a public or 
certified accountant approved by the Commission. If the issuer 
or underwriter shall fail to cooperate, or shall obstruct or 
refuse to permit the making of an examination, such conduct 
shall be proper ground for the issuance of a stop order.
  (f) Any notice required under this section shall be sent to 
or served on the issuer, or, in case of a foreign government or 
political subdivision thereof, to or on the underwriter, or, in 
the case of a foreign or Territorial person, to or on its duly 
authorized representative in the United States named in the 
registration statement, properly directed in each case of 
telegraphic notice to the address given in such statement.
  (g) Procedure for Obtaining Certain Intellectual Property.--
The Commission is not authorized to compel under this title a 
person to produce or furnish source code, including algorithmic 
trading source code or similar intellectual property, to the 
Commission unless the Commission first issues a subpoena.

                      CEASE-AND-DESIST PROCEEDINGS

  Sec. 8A. (a) Authority of the Commission.--If the Commission 
finds, after notice and opportunity for hearing, that any 
person is violating, has violated, or is about to violate any 
provision of this title, or any rule or regulation thereunder, 
the Commission may publish its findings and enter an order 
requiring such person, and any other person that is, was, or 
would be a cause of the violation, due to an act or omission 
the person knew or should have known would contribute to such 
violation, to cease and desist from committing or causing such 
violation and any future violation of the same provision, rule, 
or regulation. Such order may, in addition to requiring a 
person to cease and desist from committing or causing a 
violation, require such person to comply, or to take steps to 
effect compliance, with such provision, rule, or regulation, 
upon such terms and conditions and within such time as the 
Commission may specify in such order. Any such order may, as 
the Commission deems appropriate, require future compliance or 
steps to effect future compliance, either permanently or for 
such period of time as the Commission may specify, with such 
provision, rule, or regulation with respect to any security, 
any issuer, or any other person.
  (b) Hearing.--The notice instituting proceedings pursuant to 
subsection (a) shall fix a hearing date not earlier than 30 
days nor later than 60 days after service of the notice unless 
an earlier or a later date is set by the Commission with the 
consent of any respondent so served.
  (c) Temporary Order.--
          (1) In general.--Whenever the Commission determines 
        that the alleged violation or threatened violation 
        specified in the notice instituting proceedings 
        pursuant to subsection (a), or the continuation 
        thereof, is likely to result in significant dissipation 
        or conversion of assets, significant harm to investors, 
        or substantial harm to the public interest, including, 
        but not limited to, losses to the Securities Investor 
        Protection Corporation, prior to the completion of the 
        proceedings, the Commission may enter a temporary order 
        requiring the respondent to cease and desist from the 
        violation or threatened violation and to take such 
        action to prevent the violation or threatened violation 
        and to prevent dissipation or conversion of assets, 
        significant harm to investors, or substantial harm to 
        the public interest as the Commission deems appropriate 
        pending completion of such proceeding. Such an order 
        shall be entered only after notice and opportunity for 
        a hearing, unless the Commission determines that notice 
        and hearing prior to entry would be impracticable or 
        contrary to the public interest. A temporary order 
        shall become effective upon service upon the respondent 
        and, unless set aside, limited, or suspended by the 
        Commission or a court of competent jurisdiction, shall 
        remain effective and enforceable pending the completion 
        of the proceedings.
          (2) Applicability.--This subsection shall apply only 
        to a respondent that acts, or, at the time of the 
        alleged misconduct acted, as a broker, dealer, 
        investment adviser, investment company, municipal 
        securities dealer, government securities broker, 
        government securities dealer, or transfer agent, or is, 
        or was at the time of the alleged misconduct, an 
        associated person of, or a person seeking to become 
        associated with, any of the foregoing.
  (d) Review of Temporary Orders.--
          (1) Commission review.--At any time after the 
        respondent has been served with a temporary cease-and-
        desist order pursuant to subsection (c), the respondent 
        may apply to the Commission to have the order set 
        aside, limited, or suspended. If the respondent has 
        been served with a temporary cease-and-desist order 
        entered without a prior Commission hearing, the 
        respondent may, within 10 days after the date on which 
        the order was served, request a hearing on such 
        application and the Commission shall hold a hearing and 
        render a decision on such application at the earliest 
        possible time.
          (2) Judicial review.--Within--
                  (A) 10 days after the date the respondent was 
                served with a temporary cease-and-desist order 
                entered with a prior Commission hearing, or
                  (B) 10 days after the Commission renders a 
                decision on an application and hearing under 
                paragraph (1), with respect to any temporary 
                cease-and-desist order entered without a prior 
                Commission hearing,
        the respondent may apply to the United States district 
        court for the district in which the respondent resides 
        or has its principal place of business, or for the 
        District of Columbia, for an order setting aside, 
        limiting, or suspending the effectiveness or 
        enforcement of the order, and the court shall have 
        jurisdiction to enter such an order. A respondent 
        served with a temporary cease-and-desist order entered 
        without a prior Commission hearing may not apply to the 
        court except after hearing and decision by the 
        Commission on the respondent's application under 
        paragraph (1) of this subsection.
          (3) No automatic stay of temporary order.--The 
        commencement of proceedings under paragraph (2) of this 
        subsection shall not, unless specifically ordered by 
        the court, operate as a stay of the Commission's order.
          (4) Exclusive review.--Section 9(a) of this title 
        shall not apply to a temporary order entered pursuant 
        to this section.
  (e) Authority To Enter an Order Requiring an Accounting and 
Disgorgement.--In any cease-and-desist proceeding under 
subsection (a), the Commission may enter an order requiring 
accounting and disgorgement, including reasonable interest. The 
Commission is authorized to adopt rules, regulations, and 
orders concerning payments to investors, rates of interest, 
periods of accrual, and such other matters as it deems 
appropriate to implement this subsection.
  [(f) Authority of the Commission to Prohibit Persons From 
Serving as Officers or Directors.--In any cease-and-desist 
proceeding under subsection (a), the Commission may issue an 
order to prohibit, conditionally or unconditionally, and 
permanently or for such period of time as it shall determine, 
any person who has violated section 17(a)(1) or the rules or 
regulations thereunder, from acting as an officer or director 
of any issuer that has a class of securities registered 
pursuant to section 12 of the Securities Exchange Act of 1934, 
or that is required to file reports pursuant to section 15(d) 
of that Act, if the conduct of that person demonstrates 
unfitness to serve as an officer or director of any such 
issuer.]
  (g) Authority to Impose Money Penalties.--
          (1) Grounds.--In any cease-and-desist proceeding 
        under subsection (a), the Commission may impose a civil 
        penalty on a person if the Commission finds, on the 
        record, after notice and opportunity for hearing, 
        that--
                  (A) such person--
                          (i) is violating or has violated any 
                        provision of this title, or any rule or 
                        regulation issued under this title; or
                          (ii) is or was a cause of the 
                        violation of any provision of this 
                        title, or any rule or regulation 
                        thereunder; and
                  (B) such penalty is in the public interest.
          (2) Maximum amount of penalty.--
                  (A) First tier.--The maximum amount of a 
                penalty for each act or omission described in 
                paragraph (1) shall be [$7,500] $10,000 for a 
                natural person or [$75,000] $100,000 for any 
                other person.
                  (B) Second tier.--Notwithstanding 
                subparagraph (A), the maximum amount of penalty 
                for each such act or omission shall be 
                [$75,000] $100,000 for a natural person or 
                [$375,000] $500,000 for any other person, if 
                the act or omission described in paragraph (1) 
                involved fraud, deceit, manipulation, or 
                deliberate or reckless disregard of a 
                regulatory requirement.
                  [(C) Third tier.--Notwithstanding 
                subparagraphs (A) and (B), the maximum amount 
                of penalty for each such act or omission shall 
                be $150,000 for a natural person or $725,000 
                for any other person, if--
                          [(i) the act or omission described in 
                        paragraph (1) involved fraud, deceit, 
                        manipulation, or deliberate or reckless 
                        disregard of a regulatory requirement; 
                        and
                          [(ii) such act or omission directly 
                        or indirectly resulted in--
                                  [(I) substantial losses or 
                                created a significant risk of 
                                substantial losses to other 
                                persons; or
                                  [(II) substantial pecuniary 
                                gain to the person who 
                                committed the act or omission.]
                  (C) Third tier.--
                          (i) In general.--Notwithstanding 
                        subparagraphs (A) and (B), the amount 
                        of penalty for each such act or 
                        omission shall not exceed the amount 
                        specified in clause (ii) if--
                                  (I) the act or omission 
                                described in paragraph (1) 
                                involved fraud, deceit, 
                                manipulation, or deliberate or 
                                reckless disregard of a 
                                regulatory requirement; and
                                  (II) such act or omission 
                                directly or indirectly resulted 
                                in--
                                          (aa) substantial 
                                        losses or created a 
                                        significant risk of 
                                        substantial losses to 
                                        other persons; or
                                          (bb) substantial 
                                        pecuniary gain to the 
                                        person who committed 
                                        the act or omission.
                          (ii) Maximum amount of penalty.--The 
                        amount referred to in clause (i) is the 
                        greatest of--
                                  (I) $300,000 for a natural 
                                person or $1,450,000 for any 
                                other person;
                                  (II) 3 times the gross amount 
                                of pecuniary gain to the person 
                                who committed the act or 
                                omission; or
                                  (III) the amount of losses 
                                incurred by victims as a result 
                                of the act or omission.
                  (D) Fourth tier.--Notwithstanding 
                subparagraphs (A), (B), and (C), the maximum 
                amount of penalty for each such act or omission 
                shall be 3 times the otherwise applicable 
                amount in such subparagraphs if, within the 5-
                year period preceding such act or omission, the 
                person who committed the act or omission was 
                criminally convicted for securities fraud or 
                became subject to a judgment or order imposing 
                monetary, equitable, or administrative relief 
                in any Commission action alleging fraud by that 
                person.
          (3) Evidence concerning ability to pay.--In any 
        proceeding in which the Commission may impose a penalty 
        under this section, a respondent may present evidence 
        of the ability of the respondent to pay such penalty. 
        The Commission may, in its discretion, consider such 
        evidence in determining whether such penalty is in the 
        public interest. Such evidence may relate to the extent 
        of the ability of the respondent to continue in 
        business and the collectability of a penalty, taking 
        into account any other claims of the United States or 
        third parties upon the assets of the respondent and the 
        amount of the assets of the respondent.

           *       *       *       *       *       *       *


SEC. 18. EXEMPTION FROM STATE REGULATION OF SECURITIES OFFERINGS.

  (a) Scope of Exemption.--Except as otherwise provided in this 
section, no law, rule, regulation, or order, or other 
administrative action of any State or any political subdivision 
thereof--
          (1) requiring, or with respect to, registration or 
        qualification of securities, or registration or 
        qualification of securities transactions, shall 
        directly or indirectly apply to a security that--
                  (A) is a covered security; or
                  (B) will be a covered security upon 
                completion of the transaction;
          (2) shall directly or indirectly prohibit, limit, or 
        impose any conditions upon the use of--
                  (A) with respect to a covered security 
                described in subsection (b), any offering 
                document that is prepared by or on behalf of 
                the issuer; or
                  (B) any proxy statement, report to 
                shareholders, or other disclosure document 
                relating to a covered security or the issuer 
                thereof that is required to be and is filed 
                with the Commission or any national securities 
                organization registered under section 15A of 
                the Securities Exchange Act of 1934, except 
                that this subparagraph does not apply to the 
                laws, rules, regulations, or orders, or other 
                administrative actions of the State of 
                incorporation of the issuer; or
          (3) shall directly or indirectly prohibit, limit, or 
        impose conditions, based on the merits of such offering 
        or issuer, upon the offer or sale of any security 
        described in paragraph (1).
  (b) Covered Securities.--For purposes of this section, the 
following are covered securities:
          (1) Exclusive federal registration of nationally 
        traded securities.--A security is a covered security if 
        such security is--
                  [(A) listed, or authorized for listing, on 
                the New York Stock Exchange or the American 
                Stock Exchange, or listed, or authorized for 
                listing, on the National Market System of the 
                Nasdaq Stock Market (or any successor to such 
                entities);]
                  [(B)] (A) listed, or authorized for listing, 
                on a national securities exchange (or tier or 
                segment thereof) that has listing standards 
                [that the Commission determines by rule (on its 
                own initiative or on the basis of a petition) 
                are substantially similar to the listing 
                standards applicable to securities described in 
                subparagraph (A)] that have been approved by 
                the Commission; [or]
                  [(C)] (B) a security of the same issuer that 
                is equal in seniority or that is a senior 
                security to a security described in 
                subparagraph (A) [or (B)][.]; or
                  (C) a venture security, as defined under 
                section 6(m)(5) of the Securities Exchange Act 
                of 1934.
          (2) Exclusive federal registration of investment 
        companies.--A security is a covered security if such 
        security is a security issued by an investment company 
        that is registered, or that has filed a registration 
        statement, under the Investment Company Act of 1940.
          (3) Sales to qualified purchasers.--A security is a 
        covered security with respect to the offer or sale of 
        the security to qualified purchasers, as defined by the 
        Commission by rule. In prescribing such rule, the 
        Commission may define the term ``qualified purchaser'' 
        differently with respect to different categories of 
        securities, consistent with the public interest and the 
        protection of investors.
           (4) Exemption in connection with certain exempt 
        offerings.--A security is a covered security with 
        respect to a transaction that is exempt from 
        registration under this title pursuant to--
                  (A) paragraph (1) or (3) of section 4, and 
                the issuer of such security files reports with 
                the Commission pursuant to section 13 or 15(d) 
                of the Securities Exchange Act of 1934;
                  (B) section 4(4);
                  (C) [section 4(6)] section 4(a)(6);
                  (D) a rule or regulation adopted pursuant to 
                section 3(b)(2) and such security is--
                          (i) offered or sold on a national 
                        securities exchange; or
                          (ii) offered or sold to a qualified 
                        purchaser, as defined by the Commission 
                        pursuant to paragraph (3) with respect 
                        to that purchase or sale;
                  (E) section 3(a), other than the offer or 
                sale of a security that is exempt from such 
                registration pursuant to paragraph (4), (10), 
                or (11) of such section, except that a 
                municipal security that is exempt from such 
                registration pursuant to paragraph (2) of such 
                section is not a covered security with respect 
                to the offer or sale of such security in the 
                State in which the issuer of such security is 
                located;
                  (F) Commission rules or regulations issued 
                under section 4(2), except that this 
                subparagraph does not prohibit a State from 
                imposing notice filing requirements that are 
                substantially similar to those required by rule 
                or regulation under section 4(2) that are in 
                effect on September 1, 1996; [or]
                  (G) section 4(a)(7)[.]; or
                  (H) section 4(a)(8).
  (c) Preservation of Authority.--
          (1) Fraud authority.--Consistent with this section, 
        the securities commission (or any agency or office 
        performing like functions) of any State shall retain 
        jurisdiction under the laws of such State to 
        investigate and bring enforcement actions, [in 
        connection with securities or securities transactions
                  [(A) with respect to--
                          [(i) fraud or deceit; or
                          [(ii) unlawful conduct by a broker or 
                        dealer; and
                  [(B) in connection to a transaction described 
                under section 4(6), with respect to--
                          [(i) fraud or deceit; or
                          [(ii) unlawful conduct by a broker, 
                        dealer, funding portal, or issuer.] , 
                        in connection with securities or 
                        securities transactions, with respect 
                        to--
                  (A) fraud or deceit;
                  (B) unlawful conduct by a broker or dealer; 
                and
                  (C) with respect to a transaction described 
                under section 4(a)(6), unlawful conduct by an 
                intermediary, issuer, or custodian.
          (2) Preservation of filing requirements.--
                  (A) Notice filings permitted.--Nothing in 
                this 
                section prohibits the securities commission (or 
                any agency or office performing like functions) 
                of any State from requiring the filing of any 
                document filed with the Commission pursuant to 
                this title, together with annual or periodic 
                reports of the value of securities sold or 
                offered to be sold to persons located in the 
                State (if such sales data is not included in 
                documents filed with the Commission), solely 
                for notice purposes and the assessment of any 
                fee, together with a consent to service of 
                process and any required fee.
                  (B) Preservation of fees.--
                          (i) In general.--Until otherwise 
                        provided by law, rule, regulation, or 
                        order, or other administrative action 
                        of any State or any political 
                        subdivision thereof, adopted after the 
                        date of enactment of the National 
                        Securities Markets Improvement Act of 
                        1996, filing or registration fees with 
                        respect to securities or securities 
                        transactions shall continue to be 
                        collected in amounts determined 
                        pursuant to State law as in effect on 
                        the day before such date.
                          (ii) Schedule.--The fees required by 
                        this subparagraph shall be paid, and 
                        all necessary supporting data on sales 
                        or offers for sales required under 
                        subparagraph (A), shall be reported on 
                        the same 
                        schedule as would have been applicable 
                        had the issuer not relied on the 
                        exemption provided in subsection (a).
                  (C) Availability of preemption contingent on 
                payment of fees.--
                          (i) In general.--During the period 
                        beginning on the date of enactment of 
                        the National Securities 
                        Markets Improvement Act of 1996 and 
                        ending 3 years after that date of 
                        enactment, the securities commission 
                        (or any agency or office performing 
                        like functions) of any State may 
                        require the registration of securities 
                        issued by any issuer who refuses to pay 
                        the fees required by subparagraph (B).
                          (ii) Delays.--For purposes of this 
                        subparagraph, delays in payment of fees 
                        or underpayments of fees that are 
                        promptly remedied shall not constitute 
                        a refusal to pay fees.
                  (D) Fees not permitted on listed 
                securities.--Notwithstanding subparagraphs (A), 
                (B), and (C), no filing or fee may be required 
                with respect to any security that is a covered 
                security pursuant to subsection (b)(1), or will 
                be such a covered security upon completion of 
                the transaction, or is a security of the same 
                issuer that is equal in seniority or that is a 
                senior security to a security that is a covered 
                security pursuant to subsection (b)(1).
                  (F) Fees not permitted on crowdfunded 
                securities.--Notwithstanding subparagraphs (A), 
                (B), and (C), no filing or fee may be required 
                with respect to any security that is a covered 
                security pursuant to subsection (b)(4)(B), or 
                will be such a covered security upon completion 
                of the transaction, except for the securities 
                commission (or any agency or office performing 
                like functions) of the State of the principal 
                place of business of the issuer, or any State 
                in which purchasers of 50 percent or greater of 
                the aggregate amount of the issue are 
                residents, provided that for purposes of this 
                subparagraph, the term ``State'' includes the 
                District of Columbia and the territories of the 
                United States.
          (3) Enforcement of requirements.--Nothing in this 
        section shall prohibit the securities commission (or 
        any agency or office performing like functions) of any 
        State from suspending the offer or sale of securities 
        within such State as a result of the failure to submit 
        any filing or fee required under law and permitted 
        under this section.
  (d) Definitions.--For purposes of this section, the following 
definitions shall apply:
          (1) Offering document.--The term ``offering 
        document''--
                  (A) has the meaning given the term 
                ``prospectus'' in section 2(a)(10), but without 
                regard to the provisions of subparagraphs (a) 
                and (b) of that section; and
                  (B) includes a communication that is not 
                deemed to offer a security pursuant to a rule 
                of the Commission.
          (2) Prepared by or on behalf of the issuer.--Not 
        later than 6 months after the date of enactment of the 
        National Securities Markets Improvement Act of 1996, 
        the Commission shall, by rule, define the term 
        ``prepared by or on behalf of the issuer'' for purposes 
        of this section.
          (3) State.--The term ``State'' has the same meaning 
        as in section 3 of the Securities Exchange Act of 1934.
          (4) Senior security.--The term ``senior security'' 
        means any bond, debenture, note, or similar obligation 
        or instrument constituting a security and evidencing 
        indebtedness, and any stock of a class having priority 
        over any other class as to distribution of assets or 
        payment of dividends.

           *       *       *       *       *       *       *


                injunctions and prosecution of offenses

  Sec. 20. (a) Whenever it shall appear to the Commission, 
either upon complaint or otherwise, that the provisions of this 
title, or of any rule or regulation prescribed under authority 
thereof, have been or are about to be violated, it may, in its 
discretion, either require or permit such person to file with 
it a statement in writing, under oath, or otherwise, as to all 
the facts and circumstances concerning the subject matter which 
it believes to be in the public interest to investigate, and 
may investigate such facts.
  (b) Whenever it shall appear to the Commission that any 
person is engaged or about to engage in any acts or practices 
which constitute or will constitute a violation of the 
provisions of this title, or of any rule or regulation 
prescribed under authority thereof, the Commission may, in its 
discretion, bring an action in any district court of the United 
States, or United States court of any Territory, to enjoin such 
acts or practices, and upon a proper showing, a permanent or 
temporary injunction or restraining order shall be granted 
without bond. The Commission may transmit such evidence as may 
be available concerning such acts or practices to the Attorney 
General who may, in his discretion, institute the necessary 
criminal proceedings under this title. Any such criminal 
proceeding may be brought either in the district wherein the 
transmittal of the prospectus or security complained of begins, 
or in the district wherein such prospectus or security is 
received.
  (c) Upon application of the Commission, the district courts 
of the United States and the United States courts of any 
Territory shall have jurisdiction to issue writs of mandamus 
commanding any person to comply with the provisions of this 
title or any order of the Commission made in pursuance thereof.
  (d) Money Penalties in Civil Actions.--
          (1) Authority of commission.--Whenever it shall 
        appear to the Commission that any person has violated 
        any provision of this title, the rules or regulations 
        thereunder, a Federal court injunction or a bar 
        obtained or entered by the Commission under this title, 
        or a cease-and-desist order entered by the Commission 
        pursuant to section 8A of this title, other than by 
        committing a violation subject to a penalty pursuant to 
        section 21A of the Securities Exchange Act of 1934, the 
        Commission may bring an action in a United States 
        district court to seek, and the court shall have 
        jurisdiction to impose, upon a proper showing, a civil 
        penalty to be paid by the person who committed such 
        violation.
          (2) Amount of penalty.--
                  (A) First tier.--The amount of the penalty 
                shall be determined by the court in light of 
                the facts and circumstances. For each 
                violation, the amount of the penalty shall not 
                exceed the greater of (i) [$5,000] $10,000 for 
                a natural person or [$50,000] $100,000 for any 
                other person, or (ii) the gross amount of 
                pecuniary gain to such defendant as a result of 
                the violation.
                  (B) Second tier.--Notwithstanding 
                subparagraph (A), the amount of penalty for 
                each such violation shall not exceed the 
                greater of (i) [$50,000] $100,000 for a natural 
                person or [$250,000] $500,000 for any other 
                person, or (ii) the gross amount of pecuniary 
                gain to such defendant as a result of the 
                violation, if the violation described in 
                paragraph (1) involved fraud, deceit, 
                manipulation, or deliberate or reckless 
                disregard of a regulatory requirement.
                  [(C) Third tier.--Notwithstanding 
                subparagraphs (A) and (B), the amount of 
                penalty for each such violation shall not 
                exceed the greater of (i) $100,000 for a 
                natural person or $500,000 for any other 
                person, or (ii) the gross amount of pecuniary 
                gain to such defendant as a result of the 
                violation, if--
                          [(I) the violation described in 
                        paragraph (1) involved fraud, deceit, 
                        manipulation, or deliberate or reckless 
                        disregard of a regulatory requirement; 
                        and
                          [(II) such violation directly or 
                        indirectly resulted in substantial 
                        losses or created a significant risk of 
                        substantial losses to other persons.]
                  (C) Third tier.--
                          (i) In general.--Notwithstanding 
                        subparagraphs (A) and (B), the amount 
                        of penalty for each such violation 
                        shall not exceed the amount specified 
                        in clause (ii) if--
                                  (I) the violation described 
                                in paragraph (1) involved 
                                fraud, deceit, manipulation, or 
                                deliberate or reckless 
                                disregard of a regulatory 
                                requirement; and
                                  (II) such violation directly 
                                or indirectly resulted in 
                                substantial losses or created a 
                                significant risk of substantial 
                                losses to other persons.
                          (ii) Maximum amount of penalty.--The 
                        amount referred to in clause (i) is the 
                        greatest of--
                                  (I) $300,000 for a natural 
                                person or $1,450,000 for any 
                                other person;
                                  (II) 3 times the gross amount 
                                of pecuniary gain to such 
                                defendant as a result of the 
                                violation; or
                                  (III) the amount of losses 
                                incurred by victims as a result 
                                of the violation.
                  (D) Fourth tier.--Notwithstanding 
                subparagraphs (A), (B), and (C), the maximum 
                amount of penalty for each such violation shall 
                be 3 times the otherwise applicable amount in 
                such subparagraphs if, within the 5-year period 
                preceding such violation, the defendant was 
                criminally convicted for securities fraud or 
                became subject to a judgment or order imposing 
                monetary, equitable, or administrative relief 
                in any Commission action alleging fraud by that 
                defendant.
          (3) Procedures for collection.--
                  (A) Payment of penalty to treasury.--A 
                penalty imposed under this section shall be 
                payable into the Treasury of the United States, 
                except as otherwise provided in section 308 of 
                the Sarbanes-Oxley Act of 2002 and section 21F 
                of the Securities Exchange Act of 1934.
                  (B) Collection of penalties.--If a person 
                upon whom such a penalty is imposed shall fail 
                to pay such penalty within the time prescribed 
                in the court's order, the Commission may refer 
                the matter to the Attorney General who shall 
                recover such penalty by action in the 
                appropriate United States district court.
                  (C) Remedy not exclusive.--The actions 
                authorized by this subsection may be brought in 
                addition to any other action that the 
                Commission or the Attorney General is entitled 
                to bring.
                  (D) Jurisdiction and venue.--For purposes of 
                section 22 of this title, actions under this 
                section shall be actions to enforce a liability 
                or a duty created by this title.
          [(4) Special provisions relating to a violation of a 
        cease-and-desist order.--In an action to enforce a 
        cease-and-desist order entered by the Commission 
        pursuant to section 8A, each separate violation of such 
        order shall be a separate offense, except that in the 
        case of a violation through a continuing failure to 
        comply with such an order, each day of the failure to 
        comply with the order shall be deemed a separate 
        offense.]
          (4) Special provisions relating to a violation of an 
        injunction or certain orders.--
                  (A) In general.--Each separate violation of 
                an injunction or order described in 
                subparagraph (B) shall be a separate offense, 
                except that in the case of a violation through 
                a continuing failure to comply with such 
                injunction or order, each day of the failure to 
                comply with the injunction or order shall be 
                deemed a separate offense.
                  (B) Injunctions and orders.--Subparagraph (A) 
                shall apply with respect to any action to 
                enforce--
                          (i) a Federal court injunction 
                        obtained pursuant to this title;
                          (ii) an order entered or obtained by 
                        the Commission pursuant to this title 
                        that bars, suspends, places limitations 
                        on the activities or functions of, or 
                        prohibits the activities of, a person; 
                        or
                          (iii) a cease-and-desist order 
                        entered by the Commission pursuant to 
                        section 8A.
  (e) Authority of a Court To Prohibit Persons From Serving as 
Officers and Directors.--In any proceeding under subsection 
(b), the court may prohibit, conditionally or unconditionally, 
and permanently or for such period of time as it shall 
determine, any person who violated section 17(a)(1) of this 
title from acting as an officer or director of any issuer that 
has a class of securities registered pursuant to section 12 of 
the Securities Exchange Act of 1934 or that is required to file 
reports pursuant to section 15(d) of such Act if the person's 
conduct demonstrates unfitness to serve as an officer or 
director of any such issuer.
  (f) Prohibition of Attorneys' Fees Paid From Commission 
Disgorgement Funds.--Except as otherwise ordered by the court 
upon motion by the Commission, or, in the case of an 
administrative action, as otherwise ordered by the Commission, 
funds disgorged as the result of an action brought by the 
Commission in Federal court, or as a result of any Commission 
administrative action, shall not be distributed as payment for 
attorneys' fees or expenses incurred by private parties seeking 
distribution of the disgorged funds.
  (g) Authority of a Court To Prohibit Persons From 
Participating in an Offering of Penny Stock.--
          (1) In general.--In any proceeding under subsection 
        (a) against any person participating in, or, at the 
        time of the alleged misconduct, who was participating 
        in, an offering of penny stock, the court may prohibit 
        that person from participating in an offering of penny 
        stock, conditionally or unconditionally, and 
        permanently or for such period of time as the court 
        shall determine.
          (2) Definition.--For purposes of this subsection, the 
        term ``person participating in an offering of penny 
        stock'' includes any person engaging in activities with 
        a broker, dealer, or issuer for purposes of issuing, 
        trading, or inducing or attempting to induce the 
        purchase or sale of, any penny stock. The Commission 
        may, by rule or regulation, define such term to include 
        other activities, and may, by rule, regulation, or 
        order, exempt any person or class of persons, in whole 
        or in part, conditionally or unconditionally, from 
        inclusion in such term.

           *       *       *       *       *       *       *

                              ----------                              


                    SECURITIES EXCHANGE ACT OF 1934


TITLE I--REGULATION OF SECURITIES EXCHANGES

           *       *       *       *       *       *       *



                  definitions and application of title

  Sec. 3. (a) When used in this title, unless the context 
otherwise requires--
          (1) The term ``exchange'' means any organization, 
        association, or group of persons, whether incorporated 
        or unincorporated, which constitutes, maintains, or 
        provides a market place or facilities for bringing 
        together purchasers and sellers of securities or for 
        otherwise performing with respect to securities the 
        functions commonly performed by a stock exchange as 
        that term is generally understood, and includes the 
        market place and the market facilities maintained by 
        such exchange.
          (2) The term ``facility'' when used with respect to 
        an exchange includes its premises, tangible or 
        intangible property whether on the premises or not, any 
        right to the use of such premises or property or any 
        service thereof for the purpose of effecting or 
        reporting a transaction on an exchange (including, 
        among other things, any system of communication to or 
        from the exchange, by ticker or otherwise, maintained 
        by or with the consent of the exchange), and any right 
        of the exchange to the use of any property or service.
          (3)(A) The term ``member'' when used with respect to 
        a national securities exchange means (i) any natural 
        person permitted to effect transactions on the floor of 
        the exchange without the services of another person 
        acting as broker, (ii) any registered broker or dealer 
        with which such a natural person is associated, (iii) 
        any registered broker or dealer permitted to designate 
        as a representative such a natural person, and (iv) any 
        other registered broker or dealer which agrees to be 
        regulated by such exchange and with respect to which 
        the exchange undertakes to enforce compliance with the 
        provisions of this title, the rules and regulations 
        thereunder, and its own rules. For purposes of sections 
        6(b)(1), 6(b)(4), 6(b)(6), 6(b)(7), 6(d), 17(d), 19(d), 
        19(e), 19(g), 19(h), and 21 of this title, the term 
        ``member'' when used with respect to a national 
        securities exchange also means, to the extent of the 
        rules of the exchange specified by the Commission, any 
        person required by the Commission to comply with such 
        rules pursuant to section 6(f) of this title.
          (B) The term ``member'' when used with respect to a 
        registered securities association means any broker or 
        dealer who agrees to be regulated by such association 
        and with respect to whom the association undertakes to 
        enforce compliance with the provisions of this title, 
        the rules and regulations thereunder, and its own 
        rules.
          (4) Broker.--
                  (A) In general.--The term ``broker'' means 
                any person engaged in the business of effecting 
                transactions in securities for the account of 
                others.
                  (B) Exception for certain bank activities.--A 
                bank shall not be considered to be a broker 
                because the bank engages in any one or more of 
                the following activities under the conditions 
                described:
                          (i) Third party brokerage 
                        arrangements.--The bank enters into a 
                        contractual or other written 
                        arrangement with a broker or dealer 
                        registered under this title under which 
                        the broker or dealer offers brokerage 
                        services on or off the premises of the 
                        bank if--
                                  (I) such broker or dealer is 
                                clearly identified as the 
                                person performing the brokerage 
                                services;
                                  (II) the broker or dealer 
                                performs brokerage services in 
                                an area that is clearly marked 
                                and, to the extent practicable, 
                                physically separate from the 
                                routine deposit-taking 
                                activities of the bank;
                                  (III) any materials used by 
                                the bank to advertise or 
                                promote generally the 
                                availability of brokerage 
                                services under the arrangement 
                                clearly indicate that the 
                                brokerage services are being 
                                provided by the broker or 
                                dealer and not by the bank;
                                  (IV) any materials used by 
                                the bank to advertise or 
                                promote generally the 
                                availability of brokerage 
                                services under the arrangement 
                                are in compliance with the 
                                Federal securities laws before 
                                distribution;
                                  (V) bank employees (other 
                                than associated persons of a 
                                broker or dealer who are 
                                qualified pursuant to the rules 
                                of a self-regulatory 
                                organization) perform only 
                                clerical or ministerial 
                                functions in connection with 
                                brokerage transactions 
                                including scheduling 
                                appointments with the 
                                associated persons of a broker 
                                or dealer, except that bank 
                                employees may forward customer 
                                funds or securities and may 
                                describe in general terms the 
                                types of investment vehicles 
                                available from the bank and the 
                                broker or dealer under the 
                                arrangement;
                                  (VI) bank employees do not 
                                receive incentive compensation 
                                for any brokerage transaction 
                                unless such employees are 
                                associated persons of a broker 
                                or dealer and are qualified 
                                pursuant to the rules of a 
                                self-regulatory organization, 
                                except that the bank employees 
                                may receive compensation for 
                                the referral of any customer if 
                                the compensation is a nominal 
                                one-time cash fee of a fixed 
                                dollar amount and the payment 
                                of the fee is not contingent on 
                                whether the referral results in 
                                a transaction;
                                  (VII) such services are 
                                provided by the broker or 
                                dealer on a basis in which all 
                                customers that receive any 
                                services are fully disclosed to 
                                the broker or dealer;
                                  (VIII) the bank does not 
                                carry a securities account of 
                                the customer except as 
                                permitted under clause (ii) or 
                                (viii) of this subparagraph; 
                                and
                                  (IX) the bank, broker, or 
                                dealer informs each customer 
                                that the brokerage services are 
                                provided by the broker or 
                                dealer and not by the bank and 
                                that the securities are not 
                                deposits or other obligations 
                                of the bank, are not guaranteed 
                                by the bank, and are not 
                                insured by the Federal Deposit 
                                Insurance Corporation.
                          (ii) Trust activities.--The bank 
                        effects transactions in a trustee 
                        capacity, or effects transactions in a 
                        fiduciary capacity in its trust 
                        department or other department that is 
                        regularly examined by bank examiners 
                        for compliance with fiduciary 
                        principles and standards, and--
                                  (I) is chiefly compensated 
                                for such transactions, 
                                consistent with fiduciary 
                                principles and standards, on 
                                the basis of an administration 
                                or annual fee (payable on a 
                                monthly, quarterly, or other 
                                basis), a percentage of assets 
                                under management, or a flat or 
                                capped per order processing fee 
                                equal to not more than the cost 
                                incurred by the bank in 
                                connection with executing 
                                securities transactions for 
                                trustee and fiduciary 
                                customers, or any combination 
                                of such fees; and
                                  (II) does not publicly 
                                solicit brokerage business, 
                                other than by advertising that 
                                it effects transactions in 
                                securities in conjunction with 
                                advertising its other trust 
                                activities.
                          (iii) Permissible securities 
                        transactions.--The bank effects 
                        transactions in--
                                  (I) commercial paper, bankers 
                                acceptances, or commercial 
                                bills;
                                  (II) exempted securities;
                                  (III) qualified Canadian 
                                government obligations as 
                                defined in section 5136 of the 
                                Revised Statutes, in conformity 
                                with section 15C of this title 
                                and the rules and regulations 
                                thereunder, or obligations of 
                                the North American Development 
                                Bank; or
                                  (IV) any standardized, credit 
                                enhanced debt security issued 
                                by a foreign government 
                                pursuant to the March 1989 plan 
                                of then Secretary of the 
                                Treasury Brady, used by such 
                                foreign government to retire 
                                outstanding commercial bank 
                                loans.
                          (iv) Certain stock purchase plans.--
                                  (I) Employee benefit plans.--
                                The bank effects transactions, 
                                as part of its transfer agency 
                                activities, in the securities 
                                of an issuer as part of any 
                                pension, retirement, profit-
                                sharing, bonus, thrift, 
                                savings, incentive, or other 
                                similar benefit plan for the 
                                employees of that issuer or its 
                                affiliates (as defined in 
                                section 2 of the Bank Holding 
                                Company Act of 1956), if the 
                                bank does not solicit 
                                transactions or provide 
                                investment advice with respect 
                                to the purchase or sale of 
                                securities in connection with 
                                the plan.
                                  (II) Dividend reinvestment 
                                plans.--The bank effects 
                                transactions, as part of its 
                                transfer agency activities, in 
                                the securities of an issuer as 
                                part of that issuer's dividend 
                                reinvestment plan, if--
                                          (aa) the bank does 
                                        not solicit 
                                        transactions or provide 
                                        investment advice with 
                                        respect to the purchase 
                                        or sale of securities 
                                        in connection with the 
                                        plan; and
                                          (bb) the bank does 
                                        not net shareholders' 
                                        buy and sell orders, 
                                        other than for programs 
                                        for odd-lot holders or 
                                        plans registered with 
                                        the Commission.
                                  (III) Issuer plans.--The bank 
                                effects transactions, as part 
                                of its transfer agency 
                                activities, in the securities 
                                of an issuer as part of a plan 
                                or program for the purchase or 
                                sale of that issuer's shares, 
                                if--
                                          (aa) the bank does 
                                        not solicit 
                                        transactions or provide 
                                        investment advice with 
                                        respect to the purchase 
                                        or sale of securities 
                                        in connection with the 
                                        plan or program; and
                                          (bb) the bank does 
                                        not net shareholders' 
                                        buy and sell orders, 
                                        other than for programs 
                                        for odd-lot holders or 
                                        plans registered with 
                                        the Commission.
                                  (IV) Permissible delivery of 
                                materials.--The exception to 
                                being considered a broker for a 
                                bank engaged in activities 
                                described in subclauses (I), 
                                (II), and (III) will not be 
                                affected by delivery of written 
                                or electronic plan materials by 
                                a bank to employees of the 
                                issuer, shareholders of the 
                                issuer, or members of affinity 
                                groups of the issuer, so long 
                                as such materials are--
                                          (aa) comparable in 
                                        scope or nature to that 
                                        permitted by the 
                                        Commission as of the 
                                        date of the enactment 
                                        of the Gramm-Leach-
                                        Bliley Act; or
                                          (bb) otherwise 
                                        permitted by the 
                                        Commission.
                          (v) Sweep accounts.--The bank effects 
                        transactions as part of a program for 
                        the investment or reinvestment of 
                        deposit funds into any no-load, open-
                        end management investment company 
                        registered under the Investment Company 
                        Act of 1940 that holds itself out as a 
                        money market fund.
                          (vi) Affiliate transactions.--The 
                        bank effects transactions for the 
                        account of any affiliate of the bank 
                        (as defined in section 2 of the Bank 
                        Holding Company Act of 1956) other 
                        than--
                                  (I) a registered broker or 
                                dealer; or
                                  (II) an affiliate that is 
                                engaged in merchant banking, as 
                                described in section 4(k)(4)(H) 
                                of the Bank Holding Company Act 
                                of 1956.
                          (vii) Private securities offerings.--
                        The bank--
                                  (I) effects sales as part of 
                                a primary offering of 
                                securities not involving a 
                                public offering, pursuant to 
                                section 3(b), 4(2), or 4(5) of 
                                the Securities Act of 1933 or 
                                the rules and regulations 
                                issued thereunder;
                                  (II) at any time after the 
                                date that is 1 year after the 
                                date of the enactment of the 
                                Gramm-Leach-Bliley Act, is not 
                                affiliated with a broker or 
                                dealer that has been registered 
                                for more than 1 year in 
                                accordance with this Act, and 
                                engages in dealing, market 
                                making, or underwriting 
                                activities, other than with 
                                respect to exempted securities; 
                                and
                                  (III) if the bank is not 
                                affiliated with a broker or 
                                dealer, does not effect any 
                                primary offering described in 
                                subclause (I) the aggregate 
                                amount of which exceeds 25 
                                percent of the capital of the 
                                bank, except that the 
                                limitation of this subclause 
                                shall not apply with respect to 
                                any sale of government 
                                securities or municipal 
                                securities.
                          (viii) Safekeeping and custody 
                        activities.--
                                  (I) In general.--The bank, as 
                                part of customary banking 
                                activities--
                                          (aa) provides 
                                        safekeeping or custody 
                                        services with respect 
                                        to securities, 
                                        including the exercise 
                                        of warrants and other 
                                        rights on behalf of 
                                        customers;
                                          (bb) facilitates the 
                                        transfer of funds or 
                                        securities, as a 
                                        custodian or a clearing 
                                        agency, in connection 
                                        with the clearance and 
                                        settlement of its 
                                        customers' transactions 
                                        in securities;
                                          (cc) effects 
                                        securities lending or 
                                        borrowing transactions 
                                        with or on behalf of 
                                        customers as part of 
                                        services provided to 
                                        customers pursuant to 
                                        division (aa) or (bb) 
                                        or invests cash 
                                        collateral pledged in 
                                        connection with such 
                                        transactions;
                                          (dd) holds securities 
                                        pledged by a customer 
                                        to another person or 
                                        securities subject to 
                                        purchase or resale 
                                        agreements involving a 
                                        customer, or 
                                        facilitates the 
                                        pledging or transfer of 
                                        such securities by book 
                                        entry or as otherwise 
                                        provided under 
                                        applicable law, if the 
                                        bank maintains records 
                                        separately identifying 
                                        the securities and the 
                                        customer; or
                                          (ee) serves as a 
                                        custodian or provider 
                                        of other related 
                                        administrative services 
                                        to any individual 
                                        retirement account, 
                                        pension, retirement, 
                                        profit sharing, bonus, 
                                        thrift savings, 
                                        incentive, or other 
                                        similar benefit plan.
                                  (II) Exception for carrying 
                                broker activities.--The 
                                exception to being considered a 
                                broker for a bank engaged in 
                                activities described in 
                                subclause (I) shall not apply 
                                if the bank, in connection with 
                                such activities, acts in the 
                                United States as a carrying 
                                broker (as such term, and 
                                different formulations thereof, 
                                are used in section 15(c)(3) of 
                                this title and the rules and 
                                regulations thereunder) for any 
                                broker or dealer, unless such 
                                carrying broker activities are 
                                engaged in with respect to 
                                government securities (as 
                                defined in paragraph (42) of 
                                this subsection).
                          (ix) Identified banking products.--
                        The bank effects transactions in 
                        identified banking products as defined 
                        in section 206 of the Gramm-Leach-
                        Bliley Act.
                          (x) Municipal securities.--The bank 
                        effects transactions in municipal 
                        securities.
                          (xi) De minimis exception.--The bank 
                        effects, other than in transactions 
                        referred to in clauses (i) through (x), 
                        not more than 500 transactions in 
                        securities in any calendar year, and 
                        such transactions are not effected by 
                        an employee of the bank who is also an 
                        employee of a broker or dealer.
                  (C) Execution by broker or dealer.--The 
                exception to being considered a broker for a 
                bank engaged in activities described in clauses 
                (ii), (iv), and (viii) of subparagraph (B) 
                shall not apply if the activities described in 
                such provisions result in the trade in the 
                United States of any security that is a 
                publicly traded security in the United States, 
                unless--
                          (i) the bank directs such trade to a 
                        registered broker or dealer for 
                        execution;
                          (ii) the trade is a cross trade or 
                        other substantially similar trade of a 
                        security that--
                                  (I) is made by the bank or 
                                between the bank and an 
                                affiliated fiduciary; and
                                  (II) is not in contravention 
                                of fiduciary principles 
                                established under applicable 
                                Federal or State law; or
                          (iii) the trade is conducted in some 
                        other manner permitted under rules, 
                        regulations, or orders as the 
                        Commission may prescribe or issue.
                  (D) Fiduciary capacity.--For purposes of 
                subparagraph (B)(ii), the term ``fiduciary 
                capacity'' means--
                          (i) in the capacity as trustee, 
                        executor, administrator, registrar of 
                        stocks and bonds, transfer agent, 
                        guardian, assignee, receiver, or 
                        custodian under a uniform gift to minor 
                        act, or as an investment adviser if the 
                        bank receives a fee for its investment 
                        advice;
                          (ii) in any capacity in which the 
                        bank possesses investment discretion on 
                        behalf of another; or
                          (iii) in any other similar capacity.
                  (E) Exception for entities subject to section 
                15(e).--The term ``broker'' does not include a 
                bank that--
                          (i) was, on the day before the date 
                        of enactment of the Gramm-Leach-Bliley 
                        Act, subject to section 15(e); and
                          (ii) is subject to such restrictions 
                        and requirements as the Commission 
                        considers appropriate.
                  (F) Joint rulemaking required.--The 
                Commission and the Board of Governors of the 
                Federal Reserve System shall jointly adopt a 
                single set of rules or regulations to implement 
                the exceptions in subparagraph (B).
          (5) Dealer.--
                  (A) In general.--The term ``dealer'' means 
                any person engaged in the business of buying 
                and selling securities (not including security-
                based swaps, other than security-based swaps 
                with or for persons that are not eligible 
                contract participants) for such person's own 
                account through a broker or otherwise.
                  (B) Exception for person not engaged in the 
                business of dealing.--The term ``dealer'' does 
                not include a person that buys or sells 
                securities (not including security-based swaps, 
                other than security-based swaps with or for 
                persons that are not eligible contract 
                participants) for such person's own account, 
                either individually or in a fiduciary capacity, 
                but not as a part of a regular business.
                  (C) Exception for certain bank activities.--A 
                bank shall not be considered to be a dealer 
                because the bank engages in any of the 
                following activities under the conditions 
                described:
                          (i) Permissible securities 
                        transactions.--The bank buys or sells--
                                  (I) commercial paper, bankers 
                                acceptances, or commercial 
                                bills;
                                  (II) exempted securities;
                                  (III) qualified Canadian 
                                government obligations as 
                                defined in section 5136 of the 
                                Revised Statutes of the United 
                                States, in conformity with 
                                section 15C of this title and 
                                the rules and regulations 
                                thereunder, or obligations of 
                                the North American Development 
                                Bank; or
                                  (IV) any standardized, credit 
                                enhanced debt security issued 
                                by a foreign government 
                                pursuant to the March 1989 plan 
                                of then Secretary of the 
                                Treasury Brady, used by such 
                                foreign government to retire 
                                outstanding commercial bank 
                                loans.
                          (ii) Investment, trustee, and 
                        fiduciary transactions.--The bank buys 
                        or sells securities for investment 
                        purposes--
                                  (I) for the bank; or
                                  (II) for accounts for which 
                                the bank acts as a trustee or 
                                fiduciary.
                          (iii) Asset-backed transactions.--The 
                        bank engages in the issuance or sale to 
                        qualified investors, through a grantor 
                        trust or other separate entity, of 
                        securities backed by or representing an 
                        interest in notes, drafts, acceptances, 
                        loans, leases, receivables, other 
                        obligations (other than securities of 
                        which the bank is not the issuer), or 
                        pools of any such obligations 
                        predominantly originated by--
                                  (I) the bank;
                                  (II) an affiliate of any such 
                                bank other than a broker or 
                                dealer; or
                                  (III) a syndicate of banks of 
                                which the bank is a member, if 
                                the obligations or pool of 
                                obligations consists of 
                                mortgage obligations or 
                                consumer-related receivables.
                          (iv) Identified banking products.--
                        The bank buys or sells identified 
                        banking products, as defined in section 
                        206 of the Gramm-Leach-Bliley Act.
          (6) The term ``bank'' means (A) a banking institution 
        organized under the laws of the United States or a 
        Federal savings association, as defined in section 2(5) 
        of the Home Owners' Loan Act, (B) a member bank of the 
        Federal Reserve System, (C) any other banking 
        institution or savings association, as defined in 
        section 2(4) of the Home Owners' Loan Act, whether 
        incorporated or not, doing business under the laws of 
        any State or of the United States, a substantial 
        portion of the business of which consists of receiving 
        deposits or exercising fiduciary powers similar to 
        those permitted to national banks under the authority 
        of the Comptroller of the Currency pursuant to the 
        first section of Public Law 87-722 (12 U.S.C. 92a), and 
        which is supervised and examined by State or Federal 
        authority having supervision over banks or savings 
        associations, and which is not operated for the purpose 
        of evading the provisions of this title, and (D) a 
        receiver, conservator, or other liquidating agent of 
        any institution or firm included in clauses (A), (B), 
        or (C) of this paragraph.
          (7) The term ``director'' means any director of a 
        corporation or any person performing similar functions 
        with respect to any organization, whether incorporated 
        or unincorporated.
          (8) The term ``issuer'' means any person who issues 
        or proposes to issue any security; except that with 
        respect to certificates of deposit for securities, 
        voting-trust certificates, or collateral-trust 
        certificates, or with respect to certificates of 
        interest or shares in an unincorporated investment 
        trust not having a board of directors or of the fixed, 
        restricted management, or unit type, the term 
        ``issuer'' means the person or persons performing the 
        acts and assuming the duties of depositor or manager 
        pursuant to the provisions of the trust or other 
        agreement or instrument under which such securities are 
        issued; and except that with respect to equipment-trust 
        certificates or like securities, the term ``issuer'' 
        means the person by whom the equipment or property is, 
        or is to be, used.
          (9) The term ``person'' means a natural person, 
        company, government, or political subdivision, agency, 
        or instrumentality of a government.
          (10) The term ``security'' means any note, stock, 
        treasury stock, security future, security-based 
        swap,bond, debenture, certificate of interest or 
        participation in any profit-sharing agreement or in any 
        oil, gas, or other mineral royalty or lease, any 
        collateral-trust certificate, preorganization 
        certificate or subscription, transferable share, 
        investment contract, voting-trust certificate, 
        certificate of deposit for a security, any put, call, 
        straddle, option, or privilege on any security, 
        certificate of deposit, or group or index of securities 
        (including any interest therein or based on the value 
        thereof), or any put, call, straddle, option, or 
        privilege entered into on a national securities 
        exchange relating to foreign currency, or in general, 
        any instrument commonly known as a ``security''; or any 
        certificate of interest or participation in, temporary 
        or interim certificate for, receipt for, or warrant or 
        right to subscribe to or purchase, any of the 
        foregoing; but shall not include currency or any note, 
        draft, bill of exchange, or banker's acceptance which 
        has a maturity at the time of issuance of not exceeding 
        nine months, exclusive of days of grace, or any renewal 
        thereof the maturity of which is likewise limited.
          (11) The term ``equity security'' means any stock or 
        similar security; or any security future on any such 
        security; or any security convertible, with or without 
        consideration, into such a security, or carrying any 
        warrant or right to subscribe to or purchase such a 
        security; or any such warrant or right; or any other 
        security which the Commission shall deem to be of 
        similar nature and consider necessary or appropriate, 
        by such rules and regulations as it may prescribe in 
        the public interest or for the protection of investors, 
        to treat as an equity security.
          (12)(A) The term ``exempted security'' or ``exempted 
        securities'' includes--
                  (i) government securities, as defined in 
                paragraph (42) of this subsection;
                  (ii) municipal securities, as defined in 
                paragraph (29) of this subsection;
                  (iii) any interest or participation in any 
                common trust fund or similar fund that is 
                excluded from the definition of the term 
                ``investment company'' under section 3(c)(3) of 
                the Investment Company Act of 1940;
                  (iv) any interest or participation in a 
                single trust fund, or a collective trust fund 
                maintained by a bank, or any security arising 
                out of a contract issued by an insurance 
                company, which interest, participation, or 
                security is issued in connection with a 
                qualified plan as defined in subparagraph (C) 
                of this paragraph;
                  (v) any security issued by or any interest or 
                participation in any pooled income fund, 
                collective trust fund, collective investment 
                fund, or similar fund that is excluded from the 
                definition of an investment company under 
                section 3(c)(10)(B) of the Investment Company 
                Act of 1940;
                  (vi) solely for purposes of sections 12, 13, 
                14, and 16 of this title, any security issued 
                by or any interest or participation in any 
                church plan, company, or account that is 
                excluded from the definition of an investment 
                company under section 3(c)(14) of the 
                Investment Company Act of 1940; and
                  (vii) such other securities (which may 
                include, among others, unregistered securities, 
                the market in which is predominantly 
                intrastate) as the Commission may, by such 
                rules and regulations as it deems consistent 
                with the public interest and the protection of 
                investors, either unconditionally or upon 
                specified terms and conditions or for stated 
                periods, exempt from the operation of any one 
                or more provisions of this title which by their 
                terms do not apply to an ``exempted security'' 
                or to ``exempted securities''.
          (B)(i) Notwithstanding subparagraph (A)(i) of this 
        paragraph, government securities shall not be deemed to 
        be ``exempted securities'' for the purposes of section 
        17A of this title.
          (ii) Notwithstanding subparagraph (A)(ii) of this 
        paragraph, municipal securities shall not be deemed to 
        be ``exempted securities'' for the purposes of sections 
        15 and 17A of this title.
          (C) For purposes of subparagraph (A)(iv) of this 
        paragraph, the term ``qualified plan'' means (i) a 
        stock bonus, pension, or profit-sharing plan which 
        meets the requirements for qualification under section 
        401 of the Internal Revenue Code of 1954, (ii) an 
        annuity plan which meets the requirements for the 
        deduction of the employer's contribution under section 
        404(a)(2) of such Code, (iii) a governmental plan as 
        defined in section 414(d) of such Code which has been 
        established by an employer for the exclusive benefit of 
        its employees or their beneficiaries for the purpose of 
        distributing to such employees or their beneficiaries 
        the corpus and income of the funds accumulated under 
        such plan, if under such plan it is impossible, prior 
        to the satisfaction of all liabilities with respect to 
        such employees and their beneficiaries, for any part of 
        the corpus or income to be used for, or diverted to, 
        purposes other than the exclusive benefit of such 
        employees or their beneficiaries, or (iv) a church 
        plan, company, or account that is excluded from the 
        definition of an investment company under section 
        3(c)(14) of the Investment Company Act of 1940, other 
        than any plan described in clause (i), (ii), or (iii) 
        of this subparagraph which (I) covers employees some or 
        all of whom are employees within the meaning of section 
        401(c) of such Code, or (II) is a plan funded by an 
        annuity contract described in section 403(b) of such 
        Code.
          (13) The terms ``buy'' and ``purchase'' each include 
        any contract to buy, purchase, or otherwise acquire. 
        For security futures products, such term includes any 
        contract, agreement, or transaction for future 
        delivery. For security-based swaps, such terms include 
        the execution, termination (prior to its scheduled 
        maturity date), assignment, exchange, or similar 
        transfer or conveyance of, or extinguishing of rights 
        or obligations under, a security-based swap, as the 
        context may require.
          (14) The terms ``sale'' and ``sell'' each include any 
        contract to sell or otherwise dispose of. For security 
        futures products, such term includes any contract, 
        agreement, or transaction for future delivery. For 
        security-based swaps, such terms include the execution, 
        termination (prior to its scheduled maturity date), 
        assignment, exchange, or similar transfer or conveyance 
        of, or extinguishing of rights or obligations under, a 
        security-based swap, as the context may require.
          (15) The term ``Commission'' means the Securities and 
        Exchange Commission established by section 4 of this 
        title.
          (16) The term ``State'' means any State of the United 
        States, the District of Columbia, Puerto Rico, the 
        Virgin Islands, or any other possession of the United 
        States.
          (17) The term ``interstate commerce'' means trade, 
        commerce, transportation, or communication among the 
        several States, or between any foreign country and any 
        State, or between any State and any place or ship 
        outside thereof. The term also includes intrastate use 
        of (A) any facility of a national securities exchange 
        or of a telephone or other interstate means of 
        communication, or (B) any other interstate 
        instrumentality.
          (18) The term ``person associated with a broker or 
        dealer'' or ``associated person of a broker or dealer'' 
        means any partner, officer, director, or branch manager 
        of such broker or dealer (or any person occupying a 
        similar status or performing similar functions), any 
        person directly or indirectly controlling, controlled 
        by, or under common control with such broker or dealer, 
        or any employee of such broker or dealer, except that 
        any person associated with a broker or dealer whose 
        functions are solely clerical or ministerial shall not 
        be included in the meaning of such term for purposes of 
        section 15(b) of this title (other than paragraph (6) 
        thereof).
          (19) The terms ``investment company,''``affiliated 
        person,''``insurance company,''``separate account,'' 
        and ``company'' have the same meanings as in the 
        Investment Company Act of 1940.
          (20) The terms ``investment adviser'' and 
        ``underwriter'' have the same meanings as in the 
        Investment Advisers Act of 1940.
          (21) The term ``persons associated with a member'' or 
        ``associated person of a member'' when used with 
        respect to a member of a national securities exchange 
        or registered securities association means any partner, 
        officer, director, or branch manager of such member (or 
        any person occupying a similar status or performing 
        similar functions), any person directly or indirectly 
        controlling, controlled by, or under common control 
        with such member, or any employee of such member.
          (22)(A) The term ``securities information processor'' 
        means any person engaged in the business of (i) 
        collecting, processing, or preparing for distribution 
        or publication, or assisting, participating in, or 
        coordinating the distribution or publication of, 
        information with respect to transactions in or 
        quotations for any security (other than an exempted 
        security) or (ii) distributing or publishing (whether 
        by means of a ticker tape, a communications network, a 
        terminal display device, or otherwise) on a current and 
        continuing basis, information with respect to such 
        transactions or quotations. The term ``securities 
        information processor'' does not include any bona fide 
        newspaper, news magazine, or business or financial 
        publication of general and regular circulation, any 
        self-regulatory organization, any bank, broker, dealer, 
        building and loan, savings and loan, or homestead 
        association, or cooperative bank, if such bank, broker, 
        dealer, association, or cooperative bank would be 
        deemed to be a securities information processor solely 
        by reason of functions performed by such institutions 
        as part of customary banking, brokerage, dealing, 
        association, or cooperative bank activities, or any 
        common carrier, as defined in section 3 of the 
        Communications Act of 1934, subject to the jurisdiction 
        of the Federal Communications Commission or a State 
        commission, as defined in section 3 of that Act, unless 
        the Commission determines that such carrier is engaged 
        in the business of collecting, processing, or preparing 
        for distribution or publication, information with 
        respect to transactions in or quotations for any 
        security.
          (B) The term ``exclusive processor'' means any 
        securities information processor or self-regulatory 
        organization which, directly or indirectly, engages on 
        an exclusive basis on behalf of any national securities 
        exchange or registered securities association, or any 
        national securities exchange or registered securities 
        association which engages on an exclusive basis on its 
        own behalf, in collecting, processing, or preparing for 
        distribution or publication any information with 
        respect to (i) transactions or quotations on or 
        effected or made by means of any facility of such 
        exchange or (ii) quotations distributed or published by 
        means of any electronic system operated or controlled 
        by such association.
          (23)(A) The term ``clearing agency'' means any person 
        who acts as an intermediary in making payments or 
        deliveries or both in connection with transactions in 
        securities or who provides facilities for comparison of 
        data respecting the terms of settlement of securities 
        transactions, to reduce the number of settlements of 
        securities transactions, or for the allocation of 
        securities settlement responsibilities. Such term also 
        means any person, such as a securities depository, who 
        (i) acts as a custodian of securities in connection 
        with a system for the central handling of securities 
        whereby all securities of a particular class or series 
        of any issuer deposited within the system are treated 
        as fungible and may be transferred, loaned, or pledged 
        by bookkeeping entry without physical delivery of 
        securities certificates, or (ii) otherwise permits or 
        facilitates the settlement of securities transactions 
        or the hypothecation or lending of securities without 
        physical delivery of securities certificates.
          (B) The term ``clearing agency'' does not include (i) 
        any Federal Reserve bank, Federal home loan bank, or 
        Federal land bank; (ii) any national securities 
        exchange or registered securities association solely by 
        reason of its providing facilities for comparison of 
        data respecting the terms of settlement of securities 
        transactions effected on such exchange or by means of 
        any electronic system operated or controlled by such 
        association; (iii) any bank, broker, dealer, building 
        and loan, savings and loan, or homestead association, 
        or cooperative bank if such bank, broker, dealer, 
        association, or cooperative bank would be deemed to be 
        a clearing agency solely by reason of functions 
        performed by such institution as part of customary 
        banking, brokerage, dealing, association, or 
        cooperative banking activities, or solely by reason of 
        acting on behalf of a clearing agency or a participant 
        therein in connection with the furnishing by the 
        clearing agency of services to its participants or the 
        use of services of the clearing agency by its 
        participants, unless the Commission, by rule, otherwise 
        provides as necessary or appropriate to assure the 
        prompt and accurate clearance and settlement of 
        securities transactions or to prevent evasion of this 
        title; (iv) any life insurance company, its registered 
        separate accounts, or a subsidiary of such insurance 
        company solely by reason of functions commonly 
        performed by such entities in connection with variable 
        annuity contracts or variable life policies issued by 
        such insurance company or its separate accounts; (v) 
        any registered open-end investment company or unit 
        investment trust solely by reason of functions commonly 
        performed by it in connection with shares in such 
        registered open-end investment company or unit 
        investment trust, or (vi) any person solely by reason 
        of its performing functions described in paragraph 
        25(E) of this subsection.
          (24) The term ``participant'' when used with respect 
        to a clearing agency means any person who uses a 
        clearing agency to clear or settle securities 
        transactions or to transfer, pledge, lend, or 
        hypothecate securities. Such term does not include a 
        person whose only use of a clearing agency is (A) 
        through another person who is a participant or (B) as a 
        pledgee of securities.
          (25) The term ``transfer agent'' means any person who 
        engages on behalf of an issuer of securities or on 
        behalf of itself as an issuer of securities in (A) 
        countersigning such securities upon issuance; (B) 
        monitoring the issuance of such securities with a view 
        to preventing unauthorized issuance, a function 
        commonly performed by a person called a registrar; (C) 
        registering the transfer of such securities; (D) 
        exchanging or converting such securities; or (E) 
        transferring record ownership of securities by 
        bookkeeping entry without physical issuance of 
        securities certificates. The term ``transfer agent'' 
        does not include any insurance company or separate 
        account which performs such functions solely with 
        respect to variable annuity contracts or variable life 
        policies which it issues or any registered clearing 
        agency which performs such functions solely with 
        respect to options contracts which it issues.
          (26) The term ``self-regulatory organization'' means 
        any national securities exchange, registered securities 
        association, or registered clearing agency, or (solely 
        for purposes of sections 19(b), 19(c), and 23(b) of 
        this title) the Municipal Securities Rulemaking Board 
        established by section 15B of this title.
          (27) The term ``rules of an exchange'', ``rules of an 
        association'', or ``rules of a clearing agency'' means 
        the constitution, articles of incorporation, bylaws, 
        and rules, or instruments corresponding to the 
        foregoing, of an exchange, association of brokers and 
        dealers, or clearing agency, respectively, and such of 
        the stated policies, practices, and interpretations of 
        such exchange, association, or clearing agency as the 
        Commission, by rule, may determine to be necessary or 
        appropriate in the public interest or for the 
        protection of investors to be deemed to be rules of 
        such exchange, association, or clearing agency.
          (28) The term ``rules of a self-regulatory 
        organization'' means the rules of an exchange which is 
        a national securities exchange, the rules of an 
        association of brokers and dealers which is a 
        registered securities association, the rules of a 
        clearing agency which is a registered clearing agency, 
        or the rules of the Municipal Securities Rulemaking 
        Board.
          (29) The term ``municipal securities'' means 
        securities which are direct obligations of, or 
        obligations guaranteed as to principal or interest by, 
        a State or any political subdivision thereof, or any 
        agency or instrumentality of a State or any political 
        subdivision thereof, or any municipal corporate 
        instrumentality of one or more States, or any security 
        which is an industrial development bond (as defined in 
        section 103(c)(2) of the Internal Revenue Code of 1954) 
        the interest on which is excludable from gross income 
        under section 103(a)(1) of such Code if, by reason of 
        the application of paragraph (4) or (6) of section 
        103(c) of such Code (determined as if paragraphs 
        (4)(A), (5), and (7) were not included in such section 
        103(c)), paragraph (1) of such section 103(c) does not 
        apply to such security.
          (30) The term ``municipal securities dealer'' means 
        any person (including a separately identifiable 
        department or division of a bank) engaged in the 
        business of buying and selling municipal securities for 
        his own account, through a broker or otherwise, but 
        does not include--
                  (A) any person insofar as he buys or sells 
                such securities for his own account, either 
                individually or in some fiduciary capacity, but 
                not as a part of a regular business; or
                  (B) a bank, unless the bank is engaged in the 
                business of buying and selling municipal 
                securities for its own account other than in a 
                fiduciary capacity, through a broker or 
                otherwise; Provided, however, That if the bank 
                is engaged in such business through a 
                separately identifiable department or division 
                (as defined by the Municipal Securities 
                Rulemaking Board in accordance with section 
                15B(b)(2)(H) of this title), the department or 
                division and not the bank itself shall be 
                deemed to be the municipal securities dealer.
          (31) The term ``municipal securities broker'' means a 
        broker engaged in the business of effecting 
        transactions in municipal securities for the account of 
        others.
          (32) The term ``person associated with a municipal 
        securities dealer'' when used with respect to a 
        municipal securities dealer which is a bank or a 
        division or department of a bank means any person 
        directly engaged in the management, direction, 
        supervision, or performance of any of the municipal 
        securities dealer's activities with respect to 
        municipal securities, and any person directly or 
        indirectly controlling such activities or controlled by 
        the municipal securities dealer in connection with such 
        activities.
          (33) The term ``municipal securities investment 
        portfolio'' means all municipal securities held for 
        investment and not for sale as part of a regular 
        business by a municipal securities dealer or by a 
        person, directly or indirectly, controlling, controlled 
        by, or under common control with a municipal securities 
        dealer.
          (34) The term ``appropriate regulatory agency'' 
        means--
                  (A) When used with respect to a municipal 
                securities dealer:
                          (i) the Comptroller of the Currency, 
                        in the case of a national bank, a 
                        subsidiary or a department or division 
                        of any such bank, a Federal savings 
                        association (as defined in section 
                        3(b)(2) of the Federal Deposit 
                        Insurance Act (12 U.S.C. 1813(b)(2))), 
                        the deposits of which are insured by 
                        the Federal Deposit Insurance 
                        Corporation, or a subsidiary or 
                        department or division of any such 
                        Federal savings association;
                          (ii) the Board of Governors of the 
                        Federal Reserve System, in the case of 
                        a State member bank of the Federal 
                        Reserve System, a subsidiary or a 
                        department or division thereof, a bank 
                        holding company, a subsidiary of a bank 
                        holding company which is a bank other 
                        than a bank specified in clause (i), 
                        (iii), or (iv) of this subparagraph, a 
                        subsidiary or a department or division 
                        of such subsidiary, or a savings and 
                        loan holding company;
                          (iii) the Federal Deposit Insurance 
                        Corporation, in the case of a bank 
                        insured by the Federal Deposit 
                        Insurance Corporation (other than a 
                        member of the Federal Reserve System), 
                        a subsidiary or department or division 
                        of any such bank, a State savings 
                        association (as defined in section 
                        3(b)(3) of the Federal Deposit 
                        Insurance Act (12 U.S.C. 1813(b)(3))), 
                        the deposits of which are insured by 
                        the Federal Deposit Insurance 
                        Corporation, or a subsidiary or a 
                        department or division of any such 
                        State savings association; and
                          (iv) the Commission in the case of 
                        all other municipal securities dealers.
                  (B) When used with respect to a clearing 
                agency or transfer agent:
                          (i) the Comptroller of the Currency, 
                        in the case of a national bank, a 
                        subsidiary of any such bank, a Federal 
                        savings association (as defined in 
                        section 3(b)(2) of the Federal Deposit 
                        Insurance Act (12 U.S.C. 1813(b)(2))), 
                        the deposits of which are insured by 
                        the Federal Deposit Insurance 
                        Corporation, or a subsidiary of any 
                        such Federal savings association;
                          (ii) the Board of Governors of the 
                        Federal Reserve System, in the case of 
                        a State member bank of the Federal 
                        Reserve System, a subsidiary thereof, a 
                        bank holding company, a subsidiary of a 
                        bank holding company that is a bank 
                        other than a bank specified in clause 
                        (i) or (iii) of this subparagraph, or a 
                        savings and loan holding company;
                          (iii) the Federal Deposit Insurance 
                        Corporation, in the case of a bank 
                        insured by the Federal Deposit 
                        Insurance Corporation (other than a 
                        member of the Federal Reserve System), 
                        a subsidiary of any such bank, a State 
                        savings association (as defined in 
                        section 3(b)(3) of the Federal Deposit 
                        Insurance Act (12 U.S.C. 1813(b)(3))), 
                        the deposits of which are insured by 
                        the Federal Deposit Insurance 
                        Corporation, or a subsidiary of any 
                        such State savings association; and
                          (iv) the Commission in the case of 
                        all other clearing agencies and 
                        transfer agents.
                  (C) When used with respect to a participant 
                or applicant to become a participant in a 
                clearing agency or a person requesting or 
                having access to services offered by a clearing 
                agency:
                          (i) the Comptroller of the Currency, 
                        in the case of a national bank or a 
                        Federal savings association (as defined 
                        in section 3(b)(2) of the Federal 
                        Deposit Insurance Act (12 U.S.C. 
                        1813(b)(2))), the deposits of which are 
                        insured by the Federal Deposit 
                        Insurance Corporation when the 
                        appropriate regulatory agency for such 
                        clearing agency is not the Commission;
                          (ii) the Board of Governors of the 
                        Federal Reserve System in the case of a 
                        State member bank of the Federal 
                        Reserve System, a bank holding company, 
                        or a subsidiary of a bank holding 
                        company, a subsidiary of a bank holding 
                        company that is a bank other than a 
                        bank specified in clause (i) or (iii) 
                        of this subparagraph, or a savings and 
                        loan holding company when the 
                        appropriate regulatory agency for such 
                        clearing agency is not the Commission;
                          (iii) the Federal Deposit Insurance 
                        Corporation, in the case of a bank 
                        insured by the Federal Deposit 
                        Insurance Corporation (other than a 
                        member of the Federal Reserve System) 
                        or a State savings association (as 
                        defined in section 3(b)(3) of the 
                        Federal Deposit Insurance Act (12 
                        U.S.C. 1813(b)(3))), the deposits of 
                        which are insured by the Federal 
                        Deposit Insurance Corporation; and when 
                        the appropriate regulatory agency for 
                        such clearing agency is not the 
                        Commission;
                          (iv) the Commission in all other 
                        cases.
                  (D) When used with respect to an 
                institutional investment manager which is a 
                bank the deposits of which are insured in 
                accordance with the Federal Deposit Insurance 
                Act:
                          (i) the Comptroller of the Currency, 
                        in the case of a national bank or a 
                        Federal savings association (as defined 
                        in section 3(b)(2) of the Federal 
                        Deposit Insurance Act (12 U.S.C. 
                        1813(b)(2))), the deposits of which are 
                        insured by the Federal Deposit 
                        Insurance Corporation;
                          (ii) the Board of Governors of the 
                        Federal Reserve System, in the case of 
                        any other member bank of the Federal 
                        Reserve System; and
                          (iii) the Federal Deposit Insurance 
                        Corporation, in the case of any other 
                        insured bank or a State savings 
                        association (as defined in section 
                        3(b)(3) of the Federal Deposit 
                        Insurance Act (12 U.S.C. 1813(b)(3))), 
                        the deposits of which are insured by 
                        the Federal Deposit Insurance 
                        Corporation.
                  (E) When used with respect to a national 
                securities exchange or registered securities 
                association, member thereof, person associated 
                with a member thereof, applicant to become a 
                member thereof or to become associated with a 
                member thereof, or person requesting or having 
                access to services offered by such exchange or 
                association or member thereof, or the Municipal 
                Securities Rulemaking Board, the Commission.
                  (F) When used with respect to a person 
                exercising investment discretion with respect 
                to an account:
                          (i) the Comptroller of the Currency, 
                        in the case of a national bank or a 
                        Federal savings association (as defined 
                        in section 3(b)(2) of the Federal 
                        Deposit Insurance Act (12 U.S.C. 
                        1813(b)(2))), the deposits of which are 
                        insured by the Federal Deposit 
                        Insurance Corporation;
                          (ii) the Board of Governors of the 
                        Federal Reserve System in the case of 
                        any other member bank of the Federal 
                        Reserve System;
                          (iii) the Federal Deposit Insurance 
                        Corporation, in the case of any other 
                        bank the deposits of which are insured 
                        in accordance with the Federal Deposit 
                        Insurance Act or a State savings 
                        association (as defined in section 
                        3(b)(3) of the Federal Deposit 
                        Insurance Act (12 U.S.C. 1813(b)(3))), 
                        the deposits of which are insured by 
                        the Federal Deposit Insurance 
                        Corporation; and
                          (iv) the Commission in the case of 
                        all other such persons.
                  (G) When used with respect to a government 
                securities broker or government securities 
                dealer, or person associated with a government 
                securities broker or government securities 
                dealer:
                          (i) the Comptroller of the Currency, 
                        in the case of a national bank, a 
                        Federal savings association (as defined 
                        in section 3(b)(2) of the Federal 
                        Deposit Insurance Act), the deposits of 
                        which are insured by the Federal 
                        Deposit Insurance Corporation, or a 
                        Federal branch or Federal agency of a 
                        foreign bank (as such terms are used in 
                        the International Banking Act of 1978);
                          (ii) the Board of Governors of the 
                        Federal Reserve System, in the case of 
                        a State member bank of the Federal 
                        Reserve System, a foreign bank, an 
                        uninsured State branch or State agency 
                        of a foreign bank, a commercial lending 
                        company owned or controlled by a 
                        foreign bank (as such terms are used in 
                        the International Banking Act of 1978), 
                        or a corporation organized or having an 
                        agreement with the Board of Governors 
                        of the Federal Reserve System pursuant 
                        to section 25 or section 25A of the 
                        Federal Reserve Act;
                          (iii) the Federal Deposit Insurance 
                        Corporation, in the case of a bank 
                        insured by the Federal Deposit 
                        Insurance Corporation (other than a 
                        member of the Federal Reserve System or 
                        a Federal savings bank), a State 
                        savings association (as defined in 
                        section 3(b)(3) of the Federal Deposit 
                        Insurance Act), the deposits of which 
                        are insured by the Federal Deposit 
                        Insurance Corporation, or an insured 
                        State branch of a foreign bank (as such 
                        terms are used in the International 
                        Banking Act of 1978); and
                          (iv) the Commission, in the case of 
                        all other government securities brokers 
                        and government securities dealers.
                  (H) When used with respect to an institution 
                described in subparagraph (D), (F), or (G) of 
                section 2(c)(2), or held under section 4(f), of 
                the Bank Holding Company Act of 1956--
                          (i) the Comptroller of the Currency, 
                        in the case of a national bank;
                          (ii) the Board of Governors of the 
                        Federal Reserve System, in the case of 
                        a State member bank of the Federal 
                        Reserve System or any corporation 
                        chartered under section 25A of the 
                        Federal Reserve Act;
                          (iii) the Federal Deposit Insurance 
                        Corporation, in the case of any other 
                        bank the deposits of which are insured 
                        in accordance with the Federal Deposit 
                        Insurance Act; or
                          (iv) the Commission in the case of 
                        all other such institutions.
        As used in this paragraph, the terms ``bank holding 
        company'' and ``subsidiary of a bank holding company'' 
        have the meanings given them in section 2 of the Bank 
        Holding Company Act of 1956. As used in this paragraph, 
        the term ``savings and loan holding company'' has the 
        same meaning as in section 10(a) of the Home Owners' 
        Loan Act (12 U.S.C. 1467a(a)).
          (35) A person exercises ``investment discretion'' 
        with respect to an account if, directly or indirectly, 
        such person (A) is authorized to determine what 
        securities or other property shall be purchased or sold 
        by or for the account, (B) makes decisions as to what 
        securities or other property shall be purchased or sold 
        by or for the account even though some other person may 
        have responsibility for such investment decisions, or 
        (C) otherwise exercises such influence with respect to 
        the purchase and sale of securities or other property 
        by or for the account as the Commission, by rule, 
        determines, in the public interest or for the 
        protection of investors, should be subject to the 
        operation of the provisions of this title and rules and 
        regulations thereunder.
          (36) A class of persons or markets is subject to 
        ``equal regulation'' if no member of the class has a 
        competitive advantage over any other member thereof 
        resulting from a disparity in their regulation under 
        this title which the Commission determines is unfair 
        and not necessary or appropriate in furtherance of the 
        purposes of this title.
          (37) The term ``records'' means accounts, 
        correspondence, memorandums, tapes, discs, papers, 
        books, and other documents or transcribed information 
        of any type, whether expressed in ordinary or machine 
        language.
          (38) The term ``market maker'' means any specialist 
        permitted to act as a dealer, any dealer acting in the 
        capacity of block positioner, and any dealer who, with 
        respect to a security, holds himself out (by entering 
        quotations in an inter-dealer communications system or 
        otherwise) as being willing to buy and sell such 
        security for his own account on a regular or continuous 
        basis.
          (39) A person is subject to a ``statutory 
        disqualification'' with respect to membership or 
        participation in, or association with a member of, a 
        self-regulatory organization, if such person--
                  (A) has been and is expelled or suspended 
                from membership or participation in, or barred 
                or suspended from being associated with a 
                member of, any self-regulatory organization, 
                foreign equivalent of a self-regulatory 
                organization, foreign or international 
                securities exchange, contract market designated 
                pursuant to section 5 of the Commodity Exchange 
                Act (7 U.S.C. 7), or any substantially 
                equivalent foreign statute or regulation, or 
                futures association registered under section 17 
                of such Act (7 U.S.C. 21), or any substantially 
                equivalent foreign statute or regulation, or 
                has been and is denied trading privileges on 
                any such contract market or foreign equivalent;
          (B) is subject to--
                  (i) an order of the Commission, other 
                appropriate regulatory agency, or foreign 
                financial regulatory authority--
                          (I) denying, suspending for a period 
                        not exceeding 12 months, or revoking 
                        his registration as a broker, dealer, 
                        municipal securities dealer, government 
                        securities broker, government 
                        securities dealer, security-based swap 
                        dealer, or major security-based swap 
                        participant or limiting his activities 
                        as a foreign person performing a 
                        function substantially equivalent to 
                        any of the above; or
                          (II) barring or suspending for a 
                        period not exceeding 12 months his 
                        being associated with a broker, dealer, 
                        municipal securities dealer, government 
                        securities broker, government 
                        securities dealer, security-based swap 
                        dealer, major security-based swap 
                        participant, or foreign person 
                        performing a function substantially 
                        equivalent to any of the above;
                  (ii) an order of the Commodity Futures 
                Trading Commission denying, suspending, or 
                revoking his registration under the Commodity 
                Exchange Act (7 U.S.C. 1 et seq.); or
                  (iii) an order by a foreign financial 
                regulatory authority denying, suspending, or 
                revoking the person's authority to engage in 
                transactions in contracts of sale of a 
                commodity for future delivery or other 
                instruments traded on or subject to the rules 
                of a contract market, board of trade, or 
                foreign equivalent thereof;
                  (C) by his conduct while associated with a 
                broker, dealer, municipal securities dealer, 
                government securities broker, government 
                securities dealer, security-based swap dealer, 
                or major security-based swap participant, or 
                while associated with an entity or person 
                required to be registered under the Commodity 
                Exchange Act, has been found to be a cause of 
                any effective suspension, expulsion, or order 
                of the character described in subparagraph (A) 
                or (B) of this paragraph, and in entering such 
                a suspension, expulsion, or order, the 
                Commission, an appropriate regulatory agency, 
                or any such self-regulatory organization shall 
                have jurisdiction to find whether or not any 
                person was a cause thereof;
                  (D) by his conduct while associated with any 
                broker, dealer, municipal securities dealer, 
                government securities broker, government 
                securities dealer, security-based swap dealer, 
                major security-based swap participant, or any 
                other entity engaged in transactions in 
                securities, or while associated with an entity 
                engaged in transactions in contracts of sale of 
                a commodity for future delivery or other 
                instruments traded on or subject to the rules 
                of a contract market, board of trade, or 
                foreign equivalent thereof, has been found to 
                be a cause of any effective suspension, 
                expulsion, or order by a foreign or 
                international securities exchange or foreign 
                financial regulatory authority empowered by a 
                foreign government to administer or enforce its 
                laws relating to financial transactions as 
                described in subparagraph (A) or (B) of this 
                paragraph;
                  (E) has associated with him any person who is 
                known, or in the exercise of reasonable care 
                should be known, to him to be a person 
                described by subparagraph (A), (B), (C), or (D) 
                of this paragraph; or
                  (F) has committed or omitted any act, or is 
                subject to an order or finding, enumerated in 
                subparagraph (D), (E), (H), or (G) of paragraph 
                (4) of section 15(b) of this title, has been 
                convicted of any offense specified in 
                subparagraph (B) of such paragraph (4) or any 
                other felony within ten years of the date of 
                the filing of an application for membership or 
                participation in, or to become associated with 
                a member of, such self-regulatory organization, 
                is enjoined from any action, conduct, or 
                practice specified in subparagraph (C) of such 
                paragraph (4), has willfully made or caused to 
                be made in any application for membership or 
                participation in, or to become associated with 
                a member of, a self-regulatory organization, 
                report required to be filed with a self-
                regulatory organization, or proceeding before a 
                self-regulatory organization, any statement 
                which was at the time, and in the light of the 
                circumstances under which it was made, false or 
                misleading with respect to any material fact, 
                or has omitted to state in any such 
                application, report, or proceeding any material 
                fact which is required to be stated therein.
          (40) The term ``financial responsibility rules'' 
        means the rules and regulations of the Commission or 
        the rules and regulations prescribed by any self-
        regulatory organization relating to financial 
        responsibility and related practices which are 
        designated by the Commission, by rule or regulation, to 
        be financial responsibility rules.
          (41) The term ``mortgage related security'' means a 
        security that meets standards of credit-worthiness as 
        established by the Commission, and either:
                  (A) represents ownership of one or more 
                promissory notes or certificates of interest or 
                participation in such notes (including any 
                rights designed to assure servicing of, or the 
                receipt or timeliness of receipt by the holders 
                of such notes, certificates, or participations 
                of amounts payable under, such notes, 
                certificates, or participations), which notes:
                          (i) are directly secured by a first 
                        lien on a single parcel of real estate, 
                        including stock allocated to a dwelling 
                        unit in a residential cooperative 
                        housing corporation, upon which is 
                        located a dwelling or mixed residential 
                        and commercial structure, on a 
                        residential manufactured home as 
                        defined in section 603(6) of the 
                        National Manufactured Housing 
                        Construction and Safety Standards Act 
                        of 1974, whether such manufactured home 
                        is considered real or personal property 
                        under the laws of the State in which it 
                        is to be located, or on one or more 
                        parcels of real estate upon which is 
                        located one or more commercial 
                        structures; and
                          (ii) were originated by a savings and 
                        loan association, savings bank, 
                        commercial bank, credit union, 
                        insurance company, or similar 
                        institution which is supervised and 
                        examined by a Federal or State 
                        authority, or by a mortgage approved by 
                        the Secretary of Housing and Urban 
                        Development pursuant to sections 203 
                        and 211 of the National Housing Act, 
                        or, where such notes involve a lien on 
                        the manufactured home, by any such 
                        institution or by any financial 
                        institution approved for insurance by 
                        the Secretary of Housing and Urban 
                        Development pursuant to section 2 of 
                        the National Housing Act; or
                  (B) is secured by one or more promissory 
                notes or certificates of interest or 
                participations in such notes (with or without 
                recourse to the issuer thereof) and, by its 
                terms, provides for payments of principal in 
                relation to payments, or reasonable projections 
                of payments, on notes meeting the requirements 
                of subparagraphs (A) (i) and (ii) or 
                certificates of interest or participations in 
                promissory notes meeting such requirements.
        For the purpose of this paragraph, the term 
        ``promissory note'', when used in connection with a 
        manufactured home, shall also include a loan, advance, 
        or credit sale as evidence by a retail installment 
        sales contract or other instrument.
          (42) The term ``government securities'' means--
                  (A) securities which are direct obligations 
                of, or obligations guaranteed as to principal 
                or interest by, the United States;
                  (B) securities which are issued or guaranteed 
                by the Tennessee Valley Authority or by 
                corporations in which the United States has a 
                direct or indirect interest and which are 
                designated by the Secretary of the Treasury for 
                exemption as necessary or appropriate in the 
                public interest or for the protection of 
                investors;
                  (C) securities issued or guaranteed as to 
                principal or interest by any corporation the 
                securities of which are designated, by statute 
                specifically naming such corporation, to 
                constitute exempt securities within the meaning 
                of the laws administered by the Commission;
                  (D) for purposes of sections 15C and 17A, any 
                put, call, straddle, option, or privilege on a 
                security described in subparagraph (A), (B), or 
                (C) other than a put, call, straddle, option, 
                or privilege--
                          (i) that is traded on one or more 
                        national securities exchanges; or
                          (ii) for which quotations are 
                        disseminated through an automated 
                        quotation system operated by a 
                        registered securities association; or
                  (E) for purposes of sections 15, 15C, and 17A 
                as applied to a bank, a qualified Canadian 
                government obligation as defined in section 
                5136 of the Revised Statutes of the United 
                States.
          (43) The term ``government securities broker'' means 
        any person regularly engaged in the business of 
        effecting transactions in government securities for the 
        account of others, but does not include--
                  (A) any corporation the securities of which 
                are government securities under subparagraph 
                (B) or (C) of paragraph (42) of this 
                subsection; or
                  (B) any person registered with the Commodity 
                Futures Trading Commission, any contract market 
                designated by the Commodity Futures Trading 
                Commission, such contract market's affiliated 
                clearing organization, or any floor trader on 
                such contract market, solely because such 
                person effects transactions in government 
                securities that the Commission, after 
                consultation with the Commodity Futures Trading 
                Commission, has determined by rule or order to 
                be incidental to such person's futures-related 
                business.
          (44) The term ``government securities dealer'' means 
        any person engaged in the business of buying and 
        selling government securities for his own account, 
        through a broker or otherwise, but does not include--
                  (A) any person insofar as he buys or sells 
                such securities for his own account, either 
                individually or in some fiduciary capacity, but 
                not as a part of a regular business;
                  (B) any corporation the securities of which 
                are government securities under subparagraph 
                (B) or (C) of paragraph (42) of this 
                subsection;
                  (C) any bank, unless the bank is engaged in 
                the business of buying and selling government 
                securities for its own account other than in a 
                fiduciary capacity, through a broker or 
                otherwise; or
                  (D) any person registered with the Commodity 
                Futures Trading Commission, any contract market 
                designated by the Commodity Futures Trading 
                Commission, such contract market's affiliated 
                clearing organization, or any floor trader on 
                such contract market, solely because such 
                person effects transactions in government 
                securities that the Commission, after 
                consultation with the Commodity Futures Trading 
                Commission, has determined by rule or order to 
                be incidental to such person's futures-related 
                business.
          (45) The term ``person associated with a government 
        securities broker or government securities dealer'' 
        means any partner, officer, director, or branch manager 
        of such government securities broker or government 
        securities dealer (or any person occupying a similar 
        status or performing similar functions), and any other 
        employee of such government securities broker or 
        government securities dealer who is engaged in the 
        management, direction, supervision, or performance of 
        any activities relating to government securities, and 
        any person directly or indirectly controlling, 
        controlled by, or under common control with such 
        government securities broker or government securities 
        dealer.
          (46) The term ``financial institution'' means--
                  (A) a bank (as defined in paragraph (6) of 
                this subsection);
                  (B) a foreign bank (as such term is used in 
                the International Banking Act of 1978); and
                  (C) a savings association (as defined in 
                section 3(b) of the Federal Deposit Insurance 
                Act) the deposits of which are insured by the 
                Federal Deposit Insurance Corporation.
          (47) The term ``securities laws'' means the 
        Securities Act of 1933 (15 U.S.C. 78a et seq.), the 
        Securities Exchange Act of 1934 (15 U.S.C. 78a et 
        seq.), the Sarbanes-Oxley Act of 2002, the Trust 
        Indenture Act of 1939 (15 U.S.C. 77aaa et seq.), the 
        Investment Company Act of 1940 (15 U.S.C. 80a-1 et 
        seq.), the Investment Advisers Act of 1940 (15 U.S.C. 
        80b et seq.), and the Securities Investor Protection 
        Act of 1970 (15 U.S.C. 78aaa et seq.).
          (48) The term ``registered broker or dealer'' means a 
        broker or dealer registered or required to register 
        pursuant to section 15 or 15B of this title, except 
        that in paragraph (3) of this subsection and sections 6 
        and 15A the term means such a broker or dealer and a 
        government securities broker or government securities 
        dealer registered or required to register pursuant to 
        section 15C(a)(1)(A) of this title.
          (49) The terms ``person associated with a transfer 
        agent'' and ``associated person of a transfer agent'' 
        mean any person (except an employee whose functions are 
        solely clerical or ministerial) directly engaged in the 
        management, direction, supervision, or performance of 
        any of the transfer agent's activities with respect to 
        transfer agent functions, and any person directly or 
        indirectly controlling such activities or controlled by 
        the transfer agent in connection with such activities.
          (50) The term ``foreign securities authority'' means 
        any foreign government, or any governmental body or 
        regulatory organization empowered by a foreign 
        government to administer or enforce its laws as they 
        relate to securities matters.
          (51)(A) The term ``penny stock'' means any equity 
        security other than a security that is--
                  (i) registered or approved for registration 
                and traded on a national securities exchange 
                that meets such criteria as the Commission 
                shall prescribe by rule or regulation for 
                purposes of this paragraph;
                  (ii) authorized for quotation on an automated 
                quotation system sponsored by a registered 
                securities association, if such system (I) was 
                established and in operation before January 1, 
                1990, and (II) meets such criteria as the 
                Commission shall prescribe by rule or 
                regulation for purposes of this paragraph;
                  (iii) issued by an investment company 
                registered under the Investment Company Act of 
                1940;
                  (iv) excluded, on the basis of exceeding a 
                minimum price, net tangible assets of the 
                issuer, or other relevant criteria, from the 
                definition of such term by rule or regulation 
                which the Commission shall prescribe for 
                purposes of this paragraph; or
                  (v) exempted, in whole or in part, 
                conditionally or unconditionally, from the 
                definition of such term by rule, regulation, or 
                order prescribed by the Commission.
          (B) The Commission may, by rule, regulation, or 
        order, designate any equity security or class of equity 
        securities described in clause (i) or (ii) of 
        subparagraph (A) as within the meaning of the term 
        ``penny stock'' if such security or class of securities 
        is traded other than on a national securities exchange 
        or through an automated quotation system described in 
        clause (ii) of subparagraph (A).
          (C) In exercising its authority under this paragraph 
        to prescribe rules, regulations, and orders, the 
        Commission shall determine that such rule, regulation, 
        or order is consistent with the public interest and the 
        protection of investors.
          (52) The term ``foreign financial regulatory 
        authority'' means any (A) foreign securities authority, 
        (B) other governmental body or foreign equivalent of a 
        self-regulatory organization empowered by a foreign 
        government to administer or enforce its laws relating 
        to the regulation of fiduciaries, trusts, commercial 
        lending, insurance, trading in contracts of sale of a 
        commodity for future delivery, or other instruments 
        traded on or subject to the rules of a contract market, 
        board of trade, or foreign equivalent, or other 
        financial activities, or (C) membership organization a 
        function of which is to regulate participation of its 
        members in activities listed above.
          (53)(A) The term ``small business related security'' 
        means a security that meets standards of credit-
        worthiness as established by the Commission, and 
        either--
                  (i) represents an interest in 1 or more 
                promissory notes or leases of personal property 
                evidencing the obligation of a small business 
                concern and originated by an insured depository 
                institution, insured credit union, insurance 
                company, or similar institution which is 
                supervised and examined by a Federal or State 
                authority, or a finance company or leasing 
                company; or
                  (ii) is secured by an interest in 1 or more 
                promissory notes or leases of personal property 
                (with or without recourse to the issuer or 
                lessee) and provides for payments of principal 
                in relation to payments, or reasonable 
                projections of payments, on notes or leases 
                described in clause (i).
          (B) For purposes of this paragraph--
                  (i) an ``interest in a promissory note or a 
                lease of personal property'' includes ownership 
                rights, certificates of interest or 
                participation in such notes or leases, and 
                rights designed to assure servicing of such 
                notes or leases, or the receipt or timely 
                receipt of amounts payable under such notes or 
                leases;
                  (ii) the term ``small business concern'' 
                means a business that meets the criteria for a 
                small business concern established by the Small 
                Business Administration under section 3(a) of 
                the Small Business Act;
                  (iii) the term ``insured depository 
                institution'' has the same meaning as in 
                section 3 of the Federal Deposit Insurance Act; 
                and
                  (iv) the term ``insured credit union'' has 
                the same meaning as in section 101 of the 
                Federal Credit Union Act.
          (54) Qualified investor.--
                  (A) Definition.--Except as provided in 
                subparagraph (B), for purposes of this title, 
                the term ``qualified investor'' means--
                          (i) any investment company registered 
                        with the Commission under section 8 of 
                        the Investment Company Act of 1940;
                          (ii) any issuer eligible for an 
                        exclusion from the definition of 
                        investment company pursuant to section 
                        3(c)(7) of the Investment Company Act 
                        of 1940;
                          (iii) any bank (as defined in 
                        paragraph (6) of this subsection), 
                        savings association (as defined in 
                        section 3(b) of the Federal Deposit 
                        Insurance Act), broker, dealer, 
                        insurance company (as defined in 
                        section 2(a)(13) of the Securities Act 
                        of 1933), or business development 
                        company (as defined in section 2(a)(48) 
                        of the Investment Company Act of 1940);
                          (iv) any small business investment 
                        company licensed by the United States 
                        Small Business Administration under 
                        section 301 (c) or (d) of the Small 
                        Business Investment Act of 1958;
                          (v) any State sponsored employee 
                        benefit plan, or any other employee 
                        benefit plan, within the meaning of the 
                        Employee Retirement Income Security Act 
                        of 1974, other than an individual 
                        retirement account, if the investment 
                        decisions are made by a plan fiduciary, 
                        as defined in section 3(21) of that 
                        Act, which is either a bank, savings 
                        and loan association, insurance 
                        company, or registered investment 
                        adviser;
                          (vi) any trust whose purchases of 
                        securities are directed by a person 
                        described in clauses (i) through (v) of 
                        this subparagraph;
                          (vii) any market intermediary exempt 
                        under section 3(c)(2) of the Investment 
                        Company Act of 1940;
                          (viii) any associated person of a 
                        broker or dealer other than a natural 
                        person;
                          (ix) any foreign bank (as defined in 
                        section 1(b)(7) of the International 
                        Banking Act of 1978);
                          (x) the government of any foreign 
                        country;
                          (xi) any corporation, company, or 
                        partnership that owns and invests on a 
                        discretionary basis, not less than 
                        $25,000,000 in investments;
                          (xii) any natural person who owns and 
                        invests on a discretionary basis, not 
                        less than $25,000,000 in investments;
                          (xiii) any government or political 
                        subdivision, agency, or instrumentality 
                        of a government who owns and invests on 
                        a discretionary basis not less than 
                        $50,000,000 in investments; or
                          (xiv) any multinational or 
                        supranational entity or any agency or 
                        instrumentality thereof.
                  (B) Altered thresholds for asset-backed 
                securities and loan participations.--For 
                purposes of section 3(a)(5)(C)(iii) of this 
                title and section 206(a)(5) of the Gramm-Leach-
                Bliley Act, the term ``qualified investor'' has 
                the meaning given such term by subparagraph (A) 
                of this paragraph except that clauses (xi) and 
                (xii) shall be applied by substituting 
                ``$10,000,000'' for ``$25,000,000''.
                  (C) Additional authority.--The Commission 
                may, by rule or order, define a ``qualified 
                investor'' as any other person, taking into 
                consideration such factors as the financial 
                sophistication of the person, net worth, and 
                knowledge and experience in financial matters.
          (55)(A) The term ``security future'' means a contract 
        of sale for future delivery of a single security or of 
        a narrow-based security index, including any interest 
        therein or based on the value thereof, except an 
        exempted security under section 3(a)(12) of this title 
        as in effect on the date of the enactment of the 
        Futures Trading Act of 1982 (other than any municipal 
        security as defined in section 3(a)(29) as in effect on 
        the date of the enactment of the Futures Trading Act of 
        1982). The term ``security future'' does not include 
        any agreement, contract, or transaction excluded from 
        the Commodity Exchange Act under section 2(c), 2(d), 
        2(f), or 2(g) of the Commodity Exchange Act (as in 
        effect on the date of the enactment of the Commodity 
        Futures Modernization Act of 2000) or title IV of the 
        Commodity Futures Modernization Act of 2000.
          (B) The term ``narrow-based security index'' means an 
        index--
                  (i) that has 9 or fewer component securities;
                  (ii) in which a component security comprises 
                more than 30 percent of the index's weighting;
                  (iii) in which the five highest weighted 
                component securities in the aggregate comprise 
                more than 60 percent of the index's weighting; 
                or
                  (iv) in which the lowest weighted component 
                securities comprising, in the aggregate, 25 
                percent of the index's weighting have an 
                aggregate dollar value of average daily trading 
                volume of less than $50,000,000 (or in the case 
                of an index with 15 or more component 
                securities, $30,000,000), except that if there 
                are two or more securities with equal weighting 
                that could be included in the calculation of 
                the lowest weighted component securities 
                comprising, in the aggregate, 25 percent of the 
                index's weighting, such securities shall be 
                ranked from lowest to highest dollar value of 
                average daily trading volume and shall be 
                included in the calculation based on their 
                ranking starting with the lowest ranked 
                security.
          (C) Notwithstanding subparagraph (B), an index is not 
        a narrow-based security index if--
                  (i)(I) it has at least nine component 
                securities;
                  (II) no component security comprises more 
                than 30 percent of the index's weighting; and
                  (III) each component security is--
                          (aa) registered pursuant to section 
                        12 of the Securities Exchange Act of 
                        1934;
                          (bb) one of 750 securities with the 
                        largest market capitalization; and
                          (cc) one of 675 securities with the 
                        largest dollar value of average daily 
                        trading volume;
                  (ii) a board of trade was designated as a 
                contract market by the Commodity Futures 
                Trading Commission with respect to a contract 
                of sale for future delivery on the index, 
                before the date of the enactment of the 
                Commodity Futures Modernization Act of 2000;
                  (iii)(I) a contract of sale for future 
                delivery on the index traded on a designated 
                contract market or registered derivatives 
                transaction execution facility for at least 30 
                days as a contract of sale for future delivery 
                on an index that was not a narrow-based 
                security index; and
                  (II) it has been a narrow-based security 
                index for no more than 45 business days over 3 
                consecutive calendar months;
                  (iv) a contract of sale for future delivery 
                on the index is traded on or subject to the 
                rules of a foreign board of trade and meets 
                such requirements as are jointly established by 
                rule or regulation by the Commission and the 
                Commodity Futures Trading Commission;
                  (v) no more than 18 months have passed since 
                the date of the enactment of the Commodity 
                Futures Modernization Act of 2000 and--
                          (I) it is traded on or subject to the 
                        rules of a foreign board of trade;
                          (II) the offer and sale in the United 
                        States of a contract of sale for future 
                        delivery on the index was authorized 
                        before the date of the enactment of the 
                        Commodity Futures Modernization Act of 
                        2000; and
                          (III) the conditions of such 
                        authorization continue to be met; or
                  (vi) a contract of sale for future delivery 
                on the index is traded on or subject to the 
                rules of a board of trade and meets such 
                requirements as are jointly established by 
                rule, regulation, or order by the Commission 
                and the Commodity Futures Trading Commission.
          (D) Within 1 year after the enactment of the 
        Commodity Futures Modernization Act of 2000, the 
        Commission and the Commodity Futures Trading Commission 
        jointly shall adopt rules or regulations that set forth 
        the requirements under clause (iv) of subparagraph (C).
          (E) An index that is a narrow-based security index 
        solely because it was a narrow-based security index for 
        more than 45 business days over 3 consecutive calendar 
        months pursuant to clause (iii) of subparagraph (C) 
        shall not be a narrow-based security index for the 3 
        following calendar months.
          (F) For purposes of subparagraphs (B) and (C) of this 
        paragraph--
                  (i) the dollar value of average daily trading 
                volume and the market capitalization shall be 
                calculated as of the preceding 6 full calendar 
                months; and
                  (ii) the Commission and the Commodity Futures 
                Trading Commission shall, by rule or 
                regulation, jointly specify the method to be 
                used to determine market capitalization and 
                dollar value of average daily trading volume.
          (56) The term ``security futures product'' means a 
        security future or any put, call, straddle, option, or 
        privilege on any security future.
          (57)(A) The term ``margin'', when used with respect 
        to a security futures product, means the amount, type, 
        and form of collateral required to secure any extension 
        or maintenance of credit, or the amount, type, and form 
        of collateral required as a performance bond related to 
        the purchase, sale, or carrying of a security futures 
        product.
          (B) The terms ``margin level'' and ``level of 
        margin'', when used with respect to a security futures 
        product, mean the amount of margin required to secure 
        any extension or maintenance of credit, or the amount 
        of margin required as a performance bond related to the 
        purchase, sale, or carrying of a security futures 
        product.
          (C) The terms ``higher margin level'' and ``higher 
        level of margin'', when used with respect to a security 
        futures product, mean a margin level established by a 
        national securities exchange registered pursuant to 
        section 6(g) that is higher than the minimum amount 
        established and in effect pursuant to section 
        7(c)(2)(B).
          (58) Audit committee.--The term ``audit committee'' 
        means--
                  (A) a committee (or equivalent body) 
                established by and amongst the board of 
                directors of an issuer for the purpose of 
                overseeing the accounting and financial 
                reporting processes of the issuer and audits of 
                the financial statements of the issuer; and
                  (B) if no such committee exists with respect 
                to an issuer, the entire board of directors of 
                the issuer.
          (59) Registered public accounting firm.--The term 
        ``registered public accounting firm'' has the same 
        meaning as in section 2 of the Sarbanes-Oxley Act of 
        2002.
          (60) Credit rating.--The term ``credit rating'' means 
        an assessment of the creditworthiness of an obligor as 
        an entity or with respect to specific securities or 
        money market instruments.
          (61) Credit rating agency.--The term ``credit rating 
        agency'' means any person--
                  (A) engaged in the business of issuing credit 
                ratings on the Internet or through another 
                readily accessible means, for free or for a 
                reasonable fee, but does not include a 
                commercial credit reporting company;
                  (B) employing either a quantitative or 
                qualitative model, or both, to determine credit 
                ratings; and
                  (C) receiving fees from either issuers, 
                investors, or other market participants, or a 
                combination thereof.
          (62) Nationally recognized statistical rating 
        organization.--The term ``nationally recognized 
        statistical rating organization'' means a credit rating 
        agency that--
                  (A) issues credit ratings certified by 
                qualified institutional buyers, in accordance 
                with section 15E(a)(1)(B)(ix), with respect 
                to--
                          (i) financial institutions, brokers, 
                        or dealers;
                          (ii) insurance companies;
                          (iii) corporate issuers;
                          (iv) issuers of asset-backed 
                        securities (as that term is defined in 
                        section 1101(c) of part 229 of title 
                        17, Code of Federal Regulations, as in 
                        effect on the date of enactment of this 
                        paragraph);
                          (v) issuers of government securities, 
                        municipal securities, or securities 
                        issued by a foreign government; or
                          (vi) a combination of one or more 
                        categories of obligors described in any 
                        of clauses (i) through (v); and
                  (B) is registered under section 15E.
          (63) Person associated with a nationally recognized 
        statistical rating organization.--The term ``person 
        associated with'' a nationally recognized statistical 
        rating organization means any partner, officer, 
        director, or branch manager of a nationally recognized 
        statistical rating organization (or any person 
        occupying a similar status or performing similar 
        functions), any person directly or indirectly 
        controlling, controlled by, or under common control 
        with a nationally recognized statistical rating 
        organization, or any employee of a nationally 
        recognized statistical rating organization.
          (64) Qualified institutional buyer.--The term 
        ``qualified institutional buyer'' has the meaning given 
        such term in section 230.144A(a) of title 17, Code of 
        Federal Regulations, or any successor thereto.
           (79) Asset-backed security.--The term ``asset-backed 
        security''--
                  (A) means a fixed-income or other security 
                collateralized by any type of self-liquidating 
                financial asset (including a loan, a lease, a 
                mortgage, or a secured or unsecured receivable) 
                that allows the holder of the security to 
                receive payments that depend primarily on cash 
                flow from the asset, including--
                          (i) a collateralized mortgage 
                        obligation;
                          (ii) a collateralized debt 
                        obligation;
                          (iii) a collateralized bond 
                        obligation;
                          (iv) a collateralized debt obligation 
                        of asset-backed securities;
                          (v) a collateralized debt obligation 
                        of collateralized debt obligations; and
                          (vi) a security that the Commission, 
                        by rule, determines to be an asset-
                        backed security for purposes of this 
                        section; and
                  (B) does not include a security issued by a 
                finance subsidiary held by the parent company 
                or a company controlled by the parent company, 
                if none of the securities issued by the finance 
                subsidiary are held by an entity that is not 
                controlled by the parent company.
          (65) Eligible contract participant.--The term 
        ``eligible contract participant'' has the same meaning 
        as in section 1a of the Commodity Exchange Act (7 
        U.S.C. 1a).
          (66) Major swap participant.--The term ``major swap 
        participant'' has the same meaning as in section 1a of 
        the Commodity Exchange Act (7 U.S.C. 1a).
          (67) Major security-based swap participant.--
                  (A) In general.--The term ``major security-
                based swap participant'' means any person--
                          (i) who is not a security-based swap 
                        dealer; and
                          (ii)(I) who maintains a substantial 
                        position in security-based swaps for 
                        any of the major security-based swap 
                        categories, as such categories are 
                        determined by the Commission, excluding 
                        both positions held for hedging or 
                        mitigating commercial risk and 
                        positions maintained by any employee 
                        benefit plan (or any contract held by 
                        such a plan) as defined in paragraphs 
                        (3) and (32) of section 3 of the 
                        Employee Retirement Income Security Act 
                        of 1974 (29 U.S.C. 1002) for the 
                        primary purpose of hedging or 
                        mitigating any risk directly associated 
                        with the operation of the plan;
                          (II) whose outstanding security-based 
                        swaps create substantial counterparty 
                        exposure that could have serious 
                        adverse effects on the financial 
                        stability of the United States banking 
                        system or financial markets; or
                          (III) that is a financial entity 
                        that--
                                  (aa) is highly leveraged 
                                relative to the amount of 
                                capital such entity holds and 
                                that is not subject to capital 
                                requirements established by an 
                                appropriate Federal banking 
                                agency; and
                                  (bb) maintains a substantial 
                                position in outstanding 
                                security-based swaps in any 
                                major security-based swap 
                                category, as such categories 
                                are determined by the 
                                Commission.
                  (B) Definition of substantial position.--For 
                purposes of subparagraph (A), the Commission 
                shall define, by rule or regulation, the term 
                ``substantial position'' at the threshold that 
                the Commission determines to be prudent for the 
                effective monitoring, management, and oversight 
                of entities that are systemically important or 
                can significantly impact the financial system 
                of the United States. In setting the definition 
                under this subparagraph, the Commission shall 
                consider the person's relative position in 
                uncleared as opposed to cleared security-based 
                swaps and may take into consideration the value 
                and quality of collateral held against 
                counterparty exposures.
                  (C) Scope of designation.--For purposes of 
                subparagraph (A), a person may be designated as 
                a major security-based swap participant for 1 
                or more categories of security-based swaps 
                without being classified as a major security-
                based swap participant for all classes of 
                security-based swaps.
          (68) Security-based swap.--
                  (A) In general.--Except as provided in 
                subparagraph (B), the term ``security-based 
                swap'' means any agreement, contract, or 
                transaction that--
                          (i) is a swap, as that term is 
                        defined under section 1a of the 
                        Commodity Exchange Act (without regard 
                        to paragraph (47)(B)(x) of such 
                        section); and
                          (ii) is based on--
                                  (I) an index that is a 
                                narrow-based security index, 
                                including any interest therein 
                                or on the value thereof;
                                  (II) a single security or 
                                loan, including any interest 
                                therein or on the value 
                                thereof; or
                                  (III) the occurrence, 
                                nonoccurrence, or extent of the 
                                occurrence of an event relating 
                                to a single issuer of a 
                                security or the issuers of 
                                securities in a narrow-based 
                                security index, provided that 
                                such event directly affects the 
                                financial statements, financial 
                                condition, or financial 
                                obligations of the issuer.
                  (B) Rule of construction regarding master 
                agreements.--The term ``security-based swap'' 
                shall be construed to include a master 
                agreement that provides for an agreement, 
                contract, or transaction that is a security-
                based swap pursuant to subparagraph (A), 
                together with all supplements to any such 
                master agreement, without regard to whether the 
                master agreement contains an agreement, 
                contract, or transaction that is not a 
                security-based swap pursuant to subparagraph 
                (A), except that the master agreement shall be 
                considered to be a security-based swap only 
                with respect to each agreement, contract, or 
                transaction under the master agreement that is 
                a security-based swap pursuant to subparagraph 
                (A).
                  (C) Exclusions.--The term ``security-based 
                swap'' does not include any agreement, 
                contract, or transaction that meets the 
                definition of a security-based swap only 
                because such agreement, contract, or 
                transaction references, is based upon, or 
                settles through the transfer, delivery, or 
                receipt of an exempted security under paragraph 
                (12), as in effect on the date of enactment of 
                the Futures Trading Act of 1982 (other than any 
                municipal security as defined in paragraph (29) 
                as in effect on the date of enactment of the 
                Futures Trading Act of 1982), unless such 
                agreement, contract, or transaction is of the 
                character of, or is commonly known in the trade 
                as, a put, call, or other option.
                  (D) Mixed swap.--The term ``security-based 
                swap'' includes any agreement, contract, or 
                transaction that is as described in 
                subparagraph (A) and also is based on the value 
                of 1 or more interest or other rates, 
                currencies, commodities, instruments of 
                indebtedness, indices, quantitative measures, 
                other financial or economic interest or 
                property of any kind (other than a single 
                security or a narrow-based security index), or 
                the occurrence, non-occurrence, or the extent 
                of the occurrence of an event or contingency 
                associated with a potential financial, 
                economic, or commercial consequence (other than 
                an event described in subparagraph 
                (A)(ii)(III)).
                  (E) Rule of construction regarding use of the 
                term index.--The term ``index'' means an index 
                or group of securities, including any interest 
                therein or based on the value thereof.
                  (F) Treatment of security-based swap 
                transactions between affiliates.--
                          (i) Exemption from security-based 
                        swap rules.--Except as provided under 
                        clause (ii), the Commission may not 
                        regulate a security-based swap under 
                        this Act if all of the following apply 
                        to such security-based swap:
                                  (I) Affiliation.--One 
                                counterparty, directly or 
                                indirectly, holds a majority 
                                ownership interest in the other 
                                counterparty, or a third party, 
                                directly or indirectly, holds a 
                                majority ownership interest in 
                                both counterparties.
                                  (II) Financial statements.--
                                The affiliated counterparty 
                                that holds the majority 
                                interest in the other 
                                counterparty or the third party 
                                that, directly or indirectly, 
                                holds the majority interests in 
                                both affiliated counterparties, 
                                reports its financial 
                                statements on a consolidated 
                                basis under generally accepted 
                                accounting principles or 
                                International Financial 
                                Reporting Standards, or other 
                                similar standards, and the 
                                financial statements include 
                                the financial results of the 
                                majority-owned affiliated 
                                counterparty or counterparties.
                          (ii) Requirements for exempted 
                        security-based swaps.--With respect to 
                        a security-based swap described under 
                        clause (i):
                                  (I) Reporting requirement.--
                                If at least one counterparty is 
                                a security-based swap dealer or 
                                major security-based swap 
                                participant, that counterparty 
                                shall report the security-based 
                                swap pursuant to section 13A, 
                                within such time period as the 
                                Commission may by rule or 
                                regulation prescribe--
                                          (aa) to a security-
                                        based swap data 
                                        repository; or
                                          (bb) if there is no 
                                        security-based swap 
                                        data repository that 
                                        would accept the 
                                        agreement, contract or 
                                        transaction, to the 
                                        Commission.
                                  (II) Risk management 
                                requirement.--If at least one 
                                counterparty is a security-
                                based swap dealer or major 
                                security-based swap 
                                participant, the security-based 
                                swap shall be subject to a 
                                centralized risk management 
                                program pursuant to section 
                                15F(j) that is reasonably 
                                designed to monitor and to 
                                manage the risks associated 
                                with the security-based swap.
                                  (III) Anti-evasion 
                                requirement.--The security-
                                based swap shall not be 
                                structured to evade the Dodd-
                                Frank Wall Street Reform and 
                                Consumer Protection Act in 
                                violation of any rule 
                                promulgated by the Commission 
                                pursuant to section 761(b)(3) 
                                of such Act.
          (69) Swap.--The term ``swap'' has the same meaning as 
        in section 1a of the Commodity Exchange Act (7 U.S.C. 
        1a).
          (70) Person associated with a security-based swap 
        dealer or major security-based swap participant.--
                  (A) In general.--The term ``person associated 
                with a security-based swap dealer or major 
                security-based swap participant'' or 
                ``associated person of a security-based swap 
                dealer or major security-based swap 
                participant'' means--
                          (i) any partner, officer, director, 
                        or branch manager of such security-
                        based swap dealer or major security-
                        based swap participant (or any person 
                        occupying a similar status or 
                        performing similar functions);
                          (ii) any person directly or 
                        indirectly controlling, controlled by, 
                        or under common control with such 
                        security-based swap dealer or major 
                        security-based swap participant; or
                          (iii) any employee of such security-
                        based swap dealer or major security-
                        based swap participant.
                  (B) Exclusion.--Other than for purposes of 
                section 15F(l)(2), the term ``person associated 
                with a security-based swap dealer or major 
                security-based swap participant'' or 
                ``associated person of a security-based swap 
                dealer or major security-based swap 
                participant'' does not include any person 
                associated with a security-based swap dealer or 
                major security-based swap participant whose 
                functions are solely clerical or ministerial.
          (71) Security-based swap dealer.--
                  (A) In general.--The term ``security-based 
                swap dealer'' means any person who--
                          (i) holds themself out as a dealer in 
                        security-based swaps;
                          (ii) makes a market in security-based 
                        swaps;
                          (iii) regularly enters into security-
                        based swaps with counterparties as an 
                        ordinary course of business for its own 
                        account; or
                          (iv) engages in any activity causing 
                        it to be commonly known in the trade as 
                        a dealer or market maker in security-
                        based swaps.
                  (B) Designation by type or class.--A person 
                may be designated as a security-based swap 
                dealer for a single type or single class or 
                category of security-based swap or activities 
                and considered not to be a security-based swap 
                dealer for other types, classes, or categories 
                of security-based swaps or activities.
                  (C) Exception.--The term ``security-based 
                swap dealer'' does not include a person that 
                enters into security-based swaps for such 
                person's own account, either individually or in 
                a fiduciary capacity, but not as a part of 
                regular business.
                  (D) De minimis exception.--The Commission 
                shall exempt from designation as a security-
                based swap dealer an entity that engages in a 
                de minimis quantity of security-based swap 
                dealing in connection with transactions with or 
                on behalf of its customers. The Commission 
                shall promulgate regulations to establish 
                factors with respect to the making of any 
                determination to exempt.
          (72) Appropriate federal banking agency.--The term 
        ``appropriate Federal banking agency'' has the same 
        meaning as in section 3(q) of the Federal Deposit 
        Insurance Act (12 U.S.C. 1813(q)).
          (73) Board.--The term ``Board'' means the Board of 
        Governors of the Federal Reserve System.
          (74) Prudential regulator.--The term ``prudential 
        regulator'' has the same meaning as in section 1a of 
        the Commodity Exchange Act (7 U.S.C. 1a).
          (75) Security-based swap data repository.--The term 
        ``security-based swap data repository'' means any 
        person that collects and maintains information or 
        records with respect to transactions or positions in, 
        or the terms and conditions of, security-based swaps 
        entered into by third parties for the purpose of 
        providing a centralized recordkeeping facility for 
        security-based swaps.
          (76) Swap dealer.--The term ``swap dealer'' has the 
        same meaning as in section 1a of the Commodity Exchange 
        Act (7 U.S.C. 1a).
          (77) Security-based swap execution facility.--The 
        term ``security-based swap execution facility'' means a 
        trading system or platform in which multiple 
        participants have the ability to execute or trade 
        security-based swaps by accepting bids and offers made 
        by multiple participants in the facility or system, 
        through any means of interstate commerce, including any 
        trading facility, that--
                  (A) facilitates the execution of security-
                based swaps between persons; and
                  (B) is not a national securities exchange.
          (78) Security-based swap agreement.--
                  (A) In general.--For purposes of sections 9, 
                10, 16, 20, and 21A of this Act, and section 17 
                of the Securities Act of 1933 (15 U.S.C. 77q), 
                the term ``security-based swap agreement'' 
                means a swap agreement as defined in section 
                206A of the Gramm-Leach-Bliley Act (15 U.S.C. 
                78c note) of which a material term is based on 
                the price, yield, value, or volatility of any 
                security or any group or index of securities, 
                or any interest therein.
                  (B) Exclusions.--The term ``security-based 
                swap agreement'' does not include any security-
                based swap.
          (80) Emerging growth company.--The term ``emerging 
        growth company'' means an issuer that had total annual 
        gross revenues of less than $1,000,000,000 (as such 
        amount is indexed for inflation every 5 years by the 
        Commission to reflect the change in the Consumer Price 
        Index for All Urban Consumers published by the Bureau 
        of Labor Statistics, setting the threshold to the 
        nearest 1,000,000) during its most recently completed 
        fiscal year. An issuer that is an emerging growth 
        company as of the first day of that fiscal year shall 
        continue to be deemed an emerging growth company until 
        the earliest of--
                  (A) the last day of the fiscal year of the 
                issuer during which it had total annual gross 
                revenues of $1,000,000,000 (as such amount is 
                indexed for inflation every 5 years by the 
                Commission to reflect the change in the 
                Consumer Price Index for All Urban Consumers 
                published by the Bureau of Labor Statistics, 
                setting the threshold to the nearest 1,000,000) 
                or more;
                  (B) the last day of the fiscal year of the 
                issuer following the fifth anniversary of the 
                date of the first sale of common equity 
                securities of the issuer pursuant to an 
                effective registration statement under the 
                Securities Act of 1933;
                  (C) the date on which such issuer has, during 
                the previous 3-year period, issued more than 
                $1,000,000,000 in non-convertible debt; or
                  (D) the date on which such issuer is deemed 
                to be a ``large accelerated filer'', as defined 
                in section 240.12b-2 of title 17, Code of 
                Federal Regulations, or any successor thereto.
          [(80)] (81) Funding portal.--The term ``funding 
        portal'' means any person acting as an intermediary in 
        a transaction involving the offer or sale of securities 
        for the account of others, solely pursuant to section 
        4(6) of the Securities Act of 1933 (15 U.S.C. 77d(6)), 
        that does not--
                  (A) offer investment advice or 
                recommendations;
                  (B) solicit purchases, sales, or offers to 
                buy the securities offered or displayed on its 
                website or portal;
                  (C) compensate employees, agents, or other 
                persons for such solicitation or based on the 
                sale of securities displayed or referenced on 
                its website or portal;
                  (D) hold, manage, possess, or otherwise 
                handle investor funds or securities; or
                  (E) engage in such other activities as the 
                Commission, by rule, determines appropriate.
          (82) Chief economist.--The term ``Chief Economist'' 
        means the Director of the Division of Economic and Risk 
        Analysis, or an employee of the Commission with 
        comparable authority, as determined by the Commission.
          (83) Proxy advisory firm.--The term ``proxy advisory 
        firm'' means any person who is primarily engaged in the 
        business of providing proxy voting research, analysis, 
        or recommendations to clients, which conduct 
        constitutes a solicitation within the meaning of 
        section 14 and the Commission's rules and regulations 
        thereunder, except to the extent that the person is 
        exempted by such rules and regulations from 
        requirements otherwise applicable to persons engaged in 
        a solicitation.
          (84) Person associated with a proxy advisory firm.--
        The term ``person associated with'' a proxy advisory 
        firm means any partner, officer, or director of a proxy 
        advisory firm (or any person occupying a similar status 
        or performing similar functions), any person directly 
        or indirectly controlling, controlled by, or under 
        common control with a proxy advisory firm, or any 
        employee of a proxy advisory firm, except that persons 
        associated with a proxy advisory firm whose functions 
        are clerical or ministerial shall not be included in 
        the meaning of such term. The Commission may by rules 
        and regulations classify, for purposes or any portion 
        or portions of this Act, persons, including employees 
        controlled by a proxy advisory firm.
  (b) The Commission and the Board of Governors of the Federal 
Reserve System, as to matters within their respective 
jurisdictions, shall have power by rules and regulations to 
define technical, trade, accounting, and other terms used in 
this title, consistently with the provisions and purposes of 
this title.
  (c) No provision of this title shall apply to, or be deemed 
to include, any executive department or independent 
establishment of the United States, or any lending agency which 
is wholly owned, directly or indirectly, by the United States, 
or any officer, agent, or employee of any such department, 
establishment, or agency, acting in the course of his official 
duty as such, unless such provision makes specific reference to 
such department, establishment, or agency.
  (d) No issuer of municipal securities or officer or employee 
thereof acting in the course of his official duties as such 
shall be deemed to be a ``broker'', ``dealer'', or ``municipal 
securities dealer'' solely by reason of buying, selling, or 
effecting transactions in the issuer's securities.
  (e) Charitable Organizations.--
          (1) Exemption.--Notwithstanding any other provision 
        of this title, but subject to paragraph (2) of this 
        subsection, a charitable organization, as defined in 
        section 3(c)(10)(D) of the Investment Company Act of 
        1940, or any trustee, director, officer, employee, or 
        volunteer of such a charitable organization acting 
        within the scope of such person's employment or duties 
        with such organization, shall not be deemed to be a 
        ``broker'', ``dealer'', ``municipal securities 
        broker'', ``municipal securities dealer'', ``government 
        securities broker'', or ``government securities 
        dealer'' for purposes of this title solely because such 
        organization or person buys, holds, sells, or trades in 
        securities for its own account in its capacity as 
        trustee or administrator of, or otherwise on behalf of 
        or for the account of--
                  (A) such a charitable organization;
                  (B) a fund that is excluded from the 
                definition of an investment company under 
                section 3(c)(10)(B) of the Investment Company 
                Act of 1940; or
                  (C) a trust or other donative instrument 
                described in section 3(c)(10)(B) of the 
                Investment Company Act of 1940, or the settlors 
                (or potential settlors) or beneficiaries of any 
                such trust or other instrument.
          (2) Limitation on compensation.--The exemption 
        provided under paragraph (1) shall not be available to 
        any charitable organization, or any trustee, director, 
        officer, employee, or volunteer of such a charitable 
        organization, unless each person who, on or after 90 
        days after the date of enactment of this subsection, 
        solicits donations on behalf of such charitable 
        organization from any donor to a fund that is excluded 
        from the definition of an investment company under 
        section 3(c)(10)(B) of the Investment Company Act of 
        1940, is either a volunteer or is engaged in the 
        overall fund raising activities of a charitable 
        organization and receives no commission or other 
        special compensation based on the number or the value 
        of donations collected for the fund.
  (f) Consideration of Promotion of Efficiency, Competition, 
and Capital Formation.--Whenever pursuant to this title the 
Commission is engaged in rulemaking, or in the review of a rule 
of a self-regulatory organization, and is required to consider 
or determine whether an action is necessary or appropriate in 
the public interest, the Commission shall also consider, in 
addition to the protection of investors, whether the action 
will promote efficiency, competition, and capital formation.
  (g) Church Plans.--No church plan described in section 414(e) 
of the Internal Revenue Code of 1986, no person or entity 
eligible to establish and maintain such a plan under the 
Internal Revenue Code of 1986, no company or account that is 
excluded from the definition of an investment company under 
section 3(c)(14) of the Investment Company Act of 1940, and no 
trustee, director, officer or employee of or volunteer for such 
plan, company, account, person, or entity, acting within the 
scope of that person's employment or activities with respect to 
such plan, shall be deemed to be a ``broker'', ``dealer'', 
``municipal securities broker'', ``municipal securities 
dealer'', ``government securities broker'', ``government 
securities dealer'', ``clearing agency'', or ``transfer agent'' 
for purposes of this title--
          (1) solely because such plan, company, person, or 
        entity buys, holds, sells, trades in, or transfers 
        securities or acts as an intermediary in making 
        payments in connection with transactions in securities 
        for its own account in its capacity as trustee or 
        administrator of, or otherwise on behalf of, or for the 
        account of, any church plan, company, or account that 
        is excluded from the definition of an investment 
        company under section 3(c)(14) of the Investment 
        Company Act of 1940; and
          (2) if no such person or entity receives a commission 
        or other transaction-related sales compensation in 
        connection with any activities conducted in reliance on 
        the exemption provided by this subsection.
  (h) Limited Exemption for Funding Portals.--
          (1) In general.--The Commission shall, by rule, 
        exempt, conditionally or unconditionally, a registered 
        funding portal from the requirement to register as a 
        broker or dealer under section 15(a)(1), provided that 
        such funding portal--
                  (A) remains subject to the examination, 
                enforcement, and other rulemaking authority of 
                the Commission;
                  (B) is a member of a national securities 
                association registered under section 15A; and
                  (C) is subject to such other requirements 
                under this title as the Commission determines 
                appropriate under such rule.
          (2) National securities association membership.--For 
        purposes of sections 15(b)(8) and 15A, the term 
        ``broker or dealer'' includes a funding portal and the 
        term ``registered broker or dealer'' includes a 
        registered funding portal, except to the extent that 
        the Commission, by rule, determines otherwise, provided 
        that a national securities association shall only 
        examine for and enforce against a registered funding 
        portal rules of such national securities association 
        written specifically for registered funding portals.

           *       *       *       *       *       *       *


SEC. 3C. CLEARING FOR SECURITY-BASED SWAPS.

  (a) In General.--
          (1) Standard for clearing.--It shall be unlawful for 
        any person to engage in a security-based swap unless 
        that person submits such security-based swap for 
        clearing to a clearing agency that is registered under 
        this Act or a clearing agency that is exempt from 
        registration under this Act if the security-based swap 
        is required to be cleared.
          (2) Open access.--The rules of a clearing agency 
        described in paragraph (1) shall--
                  (A) prescribe that all security-based swaps 
                submitted to the clearing agency with the same 
                terms and conditions are economically 
                equivalent within the clearing agency and may 
                be offset with each other within the clearing 
                agency; and
                  (B) provide for non-discriminatory clearing 
                of a security-based swap executed bilaterally 
                or on or through the rules of an unaffiliated 
                national securities exchange or security-based 
                swap execution facility.
  (b) Commission Review.--
          (1) Commission-initiated review.--
                  (A) The Commission on an ongoing basis shall 
                review each security-based swap, or any group, 
                category, type, or class of security-based 
                swaps to make a determination that such 
                security-based swap, or group, category, type, 
                or class of security-based swaps should be 
                required to be cleared.
                  (B) The Commission shall provide at least a 
                30-day public comment period regarding any 
                determination under subparagraph (A).
          (2) Swap submissions.--
                  (A) A clearing agency shall submit to the 
                Commission each security-based swap, or any 
                group, category, type, or class of security-
                based swaps that it plans to accept for 
                clearing and provide notice to its members (in 
                a manner to be determined by the Commission) of 
                such submission.
                  (B) Any security-based swap or group, 
                category, type, or class of security-based 
                swaps listed for clearing by a clearing agency 
                as of the date of enactment of this subsection 
                shall be considered submitted to the 
                Commission.
                  (C) The Commission shall--
                          (i) make available to the public any 
                        submission received under subparagraphs 
                        (A) and (B);
                          (ii) review each submission made 
                        under subparagraphs (A) and (B), and 
                        determine whether the security-based 
                        swap, or group, category, type, or 
                        class of security-based swaps, 
                        described in the submission is required 
                        to be cleared; and
                          (iii) provide at least a 30-day 
                        public comment period regarding its 
                        determination whether the clearing 
                        requirement under subsection (a)(1) 
                        shall apply to the submission.
          (3) Deadline.--The Commission shall make its 
        determination under paragraph (2)(C) not later than 90 
        days after receiving a submission made under paragraphs 
        (2)(A) and (2)(B), unless the submitting clearing 
        agency agrees to an extension for the time limitation 
        established under this paragraph.
          (4) Determination.--
                  (A) In reviewing a submission made under 
                paragraph (2), the Commission shall review 
                whether the submission is consistent with 
                section 17A.
                  (B) In reviewing a security-based swap, group 
                of security-based swaps or class of security-
                based swaps pursuant to paragraph (1) or a 
                submission made under paragraph (2), the 
                Commission shall take into account the 
                following factors:
                          (i) The existence of significant 
                        outstanding notional exposures, trading 
                        liquidity and adequate pricing data.
                          (ii) The availability of rule 
                        framework, capacity, operational 
                        expertise and resources, and credit 
                        support infrastructure to clear the 
                        contract on terms that are consistent 
                        with the material terms and trading 
                        conventions on which the contract is 
                        then traded.
                          (iii) The effect on the mitigation of 
                        systemic risk, taking into account the 
                        size of the market for such contract 
                        and the resources of the clearing 
                        agency available to clear the contract.
                          (iv) The effect on competition, 
                        including appropriate fees and charges 
                        applied to clearing.
                          (v) The existence of reasonable legal 
                        certainty in the event of the 
                        insolvency of the relevant clearing 
                        agency or 1 or more of its clearing 
                        members with regard to the treatment of 
                        customer and security-based swap 
                        counterparty positions, funds, and 
                        property.
                  (C) In making a determination under 
                subsection (b)(1) or paragraph (2)(C) that the 
                clearing requirement shall apply, the 
                Commission may require such terms and 
                conditions to the requirement as the Commission 
                determines to be appropriate.
          (5) Rules.--Not later than 1 year after the date of 
        the enactment of this section, the Commission shall 
        adopt rules for a clearing agency's submission for 
        review, pursuant to this subsection, of a security-
        based swap, or a group, category, type, or class of 
        security-based swaps, that it seeks to accept for 
        clearing. Nothing in this paragraph limits the 
        Commission from making a determination under paragraph 
        (2)(C) for security-based swaps described in paragraph 
        (2)(B).
  (c) Stay of Clearing Requirement.--
          (1) In general.--After making a determination 
        pursuant to subsection (b)(2), the Commission, on 
        application of a counterparty to a security-based swap 
        or on its own initiative, may stay the clearing 
        requirement of subsection (a)(1) until the Commission 
        completes a review of the terms of the security-based 
        swap (or the group, category, type, or class of 
        security-based swaps) and the clearing arrangement.
          (2) Deadline.--The Commission shall complete a review 
        undertaken pursuant to paragraph (1) not later than 90 
        days after issuance of the stay, unless the clearing 
        agency that clears the security-based swap, or group, 
        category, type, or class of security-based swaps, 
        agrees to an extension of the time limitation 
        established under this paragraph.
          (3) Determination.--Upon completion of the review 
        undertaken pursuant to paragraph (1), the Commission 
        may--
                  (A) determine, unconditionally or subject to 
                such terms and conditions as the Commission 
                determines to be appropriate, that the 
                security-based swap, or group, category, type, 
                or class of security-based swaps, must be 
                cleared pursuant to this subsection if it finds 
                that such clearing is consistent with 
                subsection (b)(4); or
                  (B) determine that the clearing requirement 
                of subsection (a)(1) shall not apply to the 
                security-based swap, or group, category, type, 
                or class of security-based swaps.
          (4) Rules.--Not later than 1 year after the date of 
        the enactment of this section, the Commission shall 
        adopt rules for reviewing, pursuant to this subsection, 
        a clearing agency's clearing of a security-based swap, 
        or a group, category, type, or class of security-based 
        swaps, that it has accepted for clearing.
  (d) Prevention of Evasion.--
          (1) In general.--The Commission shall prescribe rules 
        under this section (and issue interpretations of rules 
        prescribed under this section), as determined by the 
        Commission to be necessary to prevent evasions of the 
        mandatory clearing requirements under this Act.
          (2) Duty of commission to investigate and take 
        certain actions.--To the extent the Commission finds 
        that a particular security-based swap or any group, 
        category, type, or class of security-based swaps that 
        would otherwise be subject to mandatory clearing but no 
        clearing agency has listed the security-based swap or 
        the group, category, type, or class of security-based 
        swaps for clearing, the Commission shall--
                  (A) investigate the relevant facts and 
                circumstances;
                  (B) within 30 days issue a public report 
                containing the results of the investigation; 
                and
                  (C) take such actions as the Commission 
                determines to be necessary and in the public 
                interest, which may include requiring the 
                retaining of adequate margin or capital by 
                parties to the security-based swap or the 
                group, category, type, or class of security-
                based swaps.
          (3) Effect on authority.--Nothing in this 
        subsection--
                  (A) authorizes the Commission to adopt rules 
                requiring a clearing agency to list for 
                clearing a security-based swap or any group, 
                category, type, or class of security-based 
                swaps if the clearing of the security-based 
                swap or the group, category, type, or class of 
                security-based swaps would threaten the 
                financial integrity of the clearing agency; and
                  (B) affects the authority of the Commission 
                to enforce the open access provisions of 
                subsection (a)(2) with respect to a security-
                based swap or the group, category, type, or 
                class of security-based swaps that is listed 
                for clearing by a clearing agency.
  (e) Reporting Transition Rules.--Rules adopted by the 
Commission under this section shall provide for the reporting 
of data, as follows:
          (1) Security-based swaps entered into before the date 
        of the enactment of this section shall be reported to a 
        registered security-based swap data repository or the 
        Commission no later than 180 days after the effective 
        date of this section.
          (2) Security-based swaps entered into on or after 
        such date of enactment shall be reported to a 
        registered security-based swap data repository or the 
        Commission no later than the later of--
                  (A) 90 days after such effective date; or
                  (B) such other time after entering into the 
                security-based swap as the Commission may 
                prescribe by rule or regulation.
  (f) Clearing Transition Rules.--
          (1) Security-based swaps entered into before the date 
        of the enactment of this section are exempt from the 
        clearing requirements of this subsection if reported 
        pursuant to subsection (e)(1).
          (2) Security-based swaps entered into before 
        application of the clearing requirement pursuant to 
        this section are exempt from the clearing requirements 
        of this section if reported pursuant to subsection 
        (e)(2).
  (g) Exceptions.--
          (1) In general.--The requirements of subsection 
        (a)(1) shall not apply to a security-based swap if 1 of 
        the counterparties to the security-based swap--
                  (A) is not a financial entity;
                  (B) is using security-based swaps to hedge or 
                mitigate commercial risk; and
                  (C) notifies the Commission, in a manner set 
                forth by the Commission, how it generally meets 
                its financial obligations associated with 
                entering into non-cleared security-based swaps.
          (2) Option to clear.--The application of the clearing 
        exception in paragraph (1) is solely at the discretion 
        of the counterparty to the security-based swap that 
        meets the conditions of subparagraphs (A) through (C) 
        of paragraph (1).
          (3) Financial entity definition.--
                  (A) In general.--For the purposes of this 
                subsection, the term ``financial entity'' 
                means--
                          (i) a swap dealer;
                          (ii) a security-based swap dealer;
                          (iii) a major swap participant;
                          (iv) a major security-based swap 
                        participant;
                          (v) a commodity pool as defined in 
                        section 1a(10) of the Commodity 
                        Exchange Act;
                          (vi) a private fund as defined in 
                        section 202(a) of the Investment 
                        Advisers Act of 1940 (15 U.S.C. 80-b-
                        2(a));
                          (vii) an employee benefit plan as 
                        defined in paragraphs (3) and (32) of 
                        section 3 of the Employee Retirement 
                        Income Security Act of 1974 (29 U.S.C. 
                        1002);
                          (viii) a person predominantly engaged 
                        in activities that are in the business 
                        of banking or financial in nature, as 
                        defined in section 4(k) of the Bank 
                        Holding Company Act of 1956.
                  (B) Exclusion.--The Commission shall consider 
                whether to exempt small banks, savings 
                associations, farm credit system institutions, 
                and credit unions, including--
                          (i) depository institutions with 
                        total assets of $10,000,000,000 or 
                        less;
                          (ii) farm credit system institutions 
                        with total assets of $10,000,000,000 or 
                        less; or
                          (iii) credit unions with total assets 
                        of $10,000,000,000 or less.
          (4) Treatment of affiliates.--
                  (A) In general.--An affiliate of a person 
                that qualifies for an exception under this 
                subsection (including affiliate entities 
                predominantly engaged in providing financing 
                for the purchase of the merchandise or 
                manufactured goods of the person) may qualify 
                for the exception only if the affiliate--
                          (i) enters into the security-based 
                        swap to hedge or mitigate the 
                        commercial risk of the person or other 
                        affiliate of the person that is not a 
                        financial entity, and the commercial 
                        risk that the affiliate is hedging or 
                        mitigating has been transferred to the 
                        affiliate;
                          (ii) is directly and wholly-owned by 
                        another affiliate qualified for the 
                        exception under this paragraph or an 
                        entity that is not a financial entity;
                          (iii) is not indirectly majority-
                        owned by a financial entity;
                          (iv) is not ultimately owned by a 
                        parent company that is a financial 
                        entity; and
                          (v) does not provide any services, 
                        financial or otherwise, to any 
                        affiliate that is a nonbank financial 
                        company supervised by the Board of 
                        Governors (as defined under section 102 
                        of the Financial Stability Act of 
                        2010).
                  (B) Limitation on qualifying affiliates.--The 
                exception in subparagraph (A) shall not apply 
                if the affiliate is--
                          (i) a swap dealer;
                          (ii) a security-based swap dealer;
                          (iii) a major swap participant;
                          (iv) a major security-based swap 
                        participant;
                          (v) a commodity pool;
                          (vi) a bank holding company;
                          (vii) a private fund, as defined in 
                        section 202(a) of the Investment 
                        Advisers Act of 1940 (15 U.S.C. 80-b-
                        2(a));
                          (viii) an employee benefit plan or 
                        government plan, as defined in 
                        paragraphs (3) and (32) of section 3 of 
                        the Employee Retirement Income Security 
                        Act of 1974 (29 U.S.C. 1002);
                          (ix) an insured depository 
                        institution;
                          (x) a farm credit system institution;
                          (xi) a credit union;
                          (xii) a nonbank financial company 
                        supervised by the Board of Governors 
                        (as defined under section 102 of the 
                        Financial Stability Act of 2010); or
                          (xiii) an entity engaged in the 
                        business of insurance and subject to 
                        capital requirements established by an 
                        insurance governmental authority of a 
                        State, a territory of the United 
                        States, the District of Columbia, a 
                        country other than the United States, 
                        or a political subdivision of a country 
                        other than the United States that is 
                        engaged in the supervision of insurance 
                        companies under insurance law.
                  (C) Limitation on affiliates' affiliates.--
                Unless the Commission determines, by order, 
                rule, or regulation, that it is in the public 
                interest, the exception in subparagraph (A) 
                shall not apply with respect to an affiliate if 
                such affiliate is itself affiliated with--
                          (i) a major security-based swap 
                        participant;
                          (ii) a security-based swap dealer;
                          (iii) a major swap participant; or
                          (iv) a swap dealer.
                  (D) Conditions on transactions.--With respect 
                to an affiliate that qualifies for the 
                exception in subparagraph (A)--
                          (i) such affiliate may not enter into 
                        any security-based swap other than for 
                        the purpose of hedging or mitigating 
                        commercial risk; and
                          (ii) neither such affiliate nor any 
                        person affiliated with such affiliate 
                        that is not a financial entity may 
                        enter into a security-based swap with 
                        or on behalf of any affiliate that is a 
                        financial entity or otherwise assume, 
                        net, combine, or consolidate the risk 
                        of security-based swaps entered into by 
                        any such financial entity, except one 
                        that is an affiliate that qualifies for 
                        the exception under subparagraph (A).
                  (E) Transition rule for affiliates.--An 
                affiliate, subsidiary, or a wholly owned entity 
                of a person that qualifies for an exception 
                under subparagraph (A) and is predominantly 
                engaged in providing financing for the purchase 
                or lease of merchandise or manufactured goods 
                of the person shall be exempt from the margin 
                requirement described in section 15F(e) and the 
                clearing requirement described in subsection 
                (a) with regard to security-based swaps entered 
                into to mitigate the risk of the financing 
                activities for not less than a 2-year period 
                beginning on the date of enactment of this 
                subparagraph.
                  (F) Risk management program.--Any security-
                based swap entered into by an affiliate that 
                qualifies for the exception in subparagraph (A) 
                shall be subject to a centralized risk 
                management program of the affiliate, which is 
                reasonably designed both to monitor and manage 
                the risks associated with the security-based 
                swap and to identify each of the affiliates on 
                whose behalf a security-based swap was entered 
                into.
          (5) Election of counterparty.--
                  (A) Security-based swaps required to be 
                cleared.--With respect to any security-based 
                swap that is subject to the mandatory clearing 
                requirement under subsection (a) and entered 
                into by a security-based swap dealer or a major 
                security-based swap participant with a 
                counterparty that is not a swap dealer, major 
                swap participant, security-based swap dealer, 
                or major security-based swap participant, the 
                counterparty shall have the sole right to 
                select the clearing agency at which the 
                security-based swap will be cleared.
                  (B) Security-based swaps not required to be 
                cleared.--With respect to any security-based 
                swap that is not subject to the mandatory 
                clearing requirement under subsection (a) and 
                entered into by a security-based swap dealer or 
                a major security-based swap participant with a 
                counterparty that is not a swap dealer, major 
                swap participant, security-based swap dealer, 
                or major security-based swap participant, the 
                counterparty--
                          (i) may elect to require clearing of 
                        the security-based swap; and
                          (ii) shall have the sole right to 
                        select the clearing agency at which the 
                        security-based swap will be cleared.
          (6) Abuse of exception.--The Commission may prescribe 
        such rules or issue interpretations of the rules as the 
        Commission determines to be necessary to prevent abuse 
        of the exceptions described in this subsection. The 
        Commission may also request information from those 
        persons claiming the clearing exception as necessary to 
        prevent abuse of the exceptions described in this 
        subsection.
  (h) Trade Execution.--
          (1) In general.--With respect to transactions 
        involving security-based swaps subject to the clearing 
        requirement of subsection (a)(1), counterparties 
        shall--
                  (A) execute the transaction on an exchange; 
                or
                  (B) execute the transaction on a security-
                based swap execution facility registered under 
                section 3D or a security-based swap execution 
                facility that is exempt from registration under 
                section 3D(e).
          (2) Exception.--The requirements of subparagraphs (A) 
        and (B) of paragraph (1) shall not apply if no exchange 
        or security-based swap execution facility makes the 
        security-based swap available to trade or for security-
        based swap transactions subject to the clearing 
        exception under subsection (g).
  (i) Board Approval.--Exemptions from the requirements of this 
section to clear a security-based swap or execute a security-
based swap through a national securities exchange or security-
based swap execution facility shall be available to a 
counterparty that is an issuer of securities that are 
registered under section 12 or that is required to file reports 
pursuant to section 15(d), only if an appropriate committee of 
the issuer's board or governing body has reviewed and approved 
the issuer's decision to enter into security-based swaps that 
are subject to such exemptions.
  (j) Designation of Chief Compliance Officer.--
          (1) In general.--Each registered clearing agency 
        shall designate an individual to serve as a chief 
        compliance officer.
          (2) Duties.--The chief compliance officer shall--
                  (A) report directly to the board or to the 
                senior officer of the clearing agency;
                  (B) in consultation with its board, a body 
                performing a function similar thereto, or the 
                senior officer of the registered clearing 
                agency, resolve any conflicts of interest that 
                may arise;
                  (C) be responsible for administering each 
                policy and procedure that is required to be 
                established pursuant to this section;
                  (D) ensure compliance with this title 
                (including regulations issued under this title) 
                relating to agreements, contracts, or 
                transactions, including each rule prescribed by 
                the Commission under this section;
                  (E) establish procedures for the remediation 
                of noncompliance issues identified by the 
                compliance officer through any--
                          (i) compliance office review;
                          (ii) look-back;
                          (iii) internal or external audit 
                        finding;
                          (iv) self-reported error; or
                          (v) validated complaint; and
                  (F) establish and follow appropriate 
                procedures for the handling, management 
                response, remediation, retesting, and closing 
                of noncompliance issues.
          (3) Annual reports.--
                  (A) In general.--In accordance with rules 
                prescribed by the Commission, the chief 
                compliance officer shall annually prepare and 
                sign a report that contains a description of--
                          (i) the compliance of the registered 
                        clearing agency or security-based swap 
                        execution facility of the compliance 
                        officer with respect to this title 
                        (including regulations under this 
                        title); and
                          (ii) each policy and procedure of the 
                        registered clearing agency of the 
                        compliance officer (including the code 
                        of ethics and conflict of interest 
                        policies of the registered clearing 
                        agency).
                  (B) Requirements.--A compliance report under 
                subparagraph (A) shall--
                          (i) accompany each appropriate 
                        financial report of the registered 
                        clearing agency that is required to be 
                        furnished to the Commission pursuant to 
                        this section; and
                          (ii) include a certification that, 
                        under penalty of law, the compliance 
                        report is accurate and complete.

SEC. 3D. SECURITY-BASED SWAP EXECUTION FACILITIES.

  (a) Registration.--
          (1) In general.--No person may operate a facility for 
        the trading or processing of security-based swaps, 
        unless the facility is registered as a security-based 
        swap execution facility or as a national securities 
        exchange under this section.
          (2) Dual registration.--Any person that is registered 
        as a security-based swap execution facility under this 
        section shall register with the Commission regardless 
        of whether the person also is registered with the 
        Commodity Futures Trading Commission as a swap 
        execution facility.
  (b) Trading and Trade Processing.--A security-based swap 
execution facility that is registered under subsection (a) 
may--
          (1) make available for trading any security-based 
        swap; and
          (2) facilitate trade processing of any security-based 
        swap.
  (c) Identification of Facility Used To Trade Security-based 
Swaps by National Securities Exchanges.--A national securities 
exchange shall, to the extent that the exchange also operates a 
security-based swap execution facility and uses the same 
electronic trade execution system for listing and executing 
trades of security-based swaps on or through the exchange and 
the facility, identify whether electronic trading of such 
security-based swaps is taking place on or through the national 
securities exchange or the security-based swap execution 
facility.
  (d) Core Principles for Security-based Swap Execution 
Facilities.--
          (1) Compliance with core principles.--
                  (A) In general.--To be registered, and 
                maintain registration, as a security-based swap 
                execution facility, the security-based swap 
                execution facility shall comply with--
                          (i) the core principles described in 
                        this subsection; and
                          (ii) any requirement that the 
                        Commission may impose by rule or 
                        regulation.
                  (B) Reasonable discretion of security-based 
                swap execution facility.--Unless otherwise 
                determined by the Commission, by rule or 
                regulation, a security-based swap execution 
                facility described in subparagraph (A) shall 
                have reasonable discretion in establishing the 
                manner in which it complies with the core 
                principles described in this subsection.
          (2) Compliance with rules.--A security-based swap 
        execution facility shall--
                  (A) establish and enforce compliance with any 
                rule established by such security-based swap 
                execution facility, including--
                          (i) the terms and conditions of the 
                        security-based swaps traded or 
                        processed on or through the facility; 
                        and
                          (ii) any limitation on access to the 
                        facility;
                  (B) establish and enforce trading, trade 
                processing, and participation rules that will 
                deter abuses and have the capacity to detect, 
                investigate, and enforce those rules, including 
                means--
                          (i) to provide market participants 
                        with impartial access to the market; 
                        and
                          (ii) to capture information that may 
                        be used in establishing whether rule 
                        violations have occurred; and
                  (C) establish rules governing the operation 
                of the facility, including rules specifying 
                trading procedures to be used in entering and 
                executing orders traded or posted on the 
                facility, including block trades.
          (3) Security-based swaps not readily susceptible to 
        manipulation.--The security-based swap execution 
        facility shall permit trading only in security-based 
        swaps that are not readily susceptible to manipulation.
          (4) Monitoring of trading and trade processing.--The 
        security-based swap execution facility shall--
                  (A) establish and enforce rules or terms and 
                conditions defining, or specifications 
                detailing--
                          (i) trading procedures to be used in 
                        entering and executing orders traded on 
                        or through the facilities of the 
                        security-based swap execution facility; 
                        and
                          (ii) procedures for trade processing 
                        of security-based swaps on or through 
                        the facilities of the security-based 
                        swap execution facility; and
                  (B) monitor trading in security-based swaps 
                to prevent manipulation, price distortion, and 
                disruptions of the delivery or cash settlement 
                process through surveillance, compliance, and 
                disciplinary practices and procedures, 
                including methods for conducting real-time 
                monitoring of trading and comprehensive and 
                accurate trade reconstructions.
          (5) Ability to obtain information.--The security-
        based swap execution facility shall--
                  (A) establish and enforce rules that will 
                allow the facility to obtain any necessary 
                information to perform any of the functions 
                described in this subsection;
                  (B) provide the information to the Commission 
                on request; and
                  (C) have the capacity to carry out such 
                international information-sharing agreements as 
                the Commission may require.
          (6) Financial integrity of transactions.--The 
        security-based swap execution facility shall establish 
        and enforce rules and procedures for ensuring the 
        financial integrity of security-based swaps entered on 
        or through the facilities of the security-based swap 
        execution facility, including the clearance and 
        settlement of security-based swaps pursuant to section 
        3C(a)(1).
          (7) Emergency authority.--The security-based swap 
        execution facility shall adopt rules to provide for the 
        exercise of emergency authority, in consultation or 
        cooperation with the Commission, as is necessary and 
        appropriate, including the authority to liquidate or 
        transfer open positions in any security-based swap or 
        to suspend or curtail trading in a security-based swap.
          (8) Timely publication of trading information.--
                  (A) In general.--The security-based swap 
                execution facility shall make public timely 
                information on price, trading volume, and other 
                trading data on security-based swaps to the 
                extent prescribed by the Commission.
                  (B) Capacity of security-based swap execution 
                facility.--The security-based swap execution 
                facility shall be required to have the capacity 
                to electronically capture and transmit and 
                disseminate trade information with respect to 
                transactions executed on or through the 
                facility.
          (9) Recordkeeping and reporting.--
                  (A) In general.--A security-based swap 
                execution facility shall--
                          (i) maintain records of all 
                        activities relating to the business of 
                        the facility, including a complete 
                        audit trail, in a form and manner 
                        acceptable to the Commission for a 
                        period of 5 years; and
                          (ii) report to the Commission, in a 
                        form and manner acceptable to the 
                        Commission, such information as the 
                        Commission determines to be necessary 
                        or appropriate for the Commission to 
                        perform the duties of the Commission 
                        under this title.
                  (B) Requirements.--The Commission shall adopt 
                data collection and reporting requirements for 
                security-based swap execution facilities that 
                are comparable to corresponding requirements 
                for clearing agencies and security-based swap 
                data repositories.
          (10) Antitrust considerations.--Unless necessary or 
        appropriate to achieve the purposes of this title, the 
        security-based swap execution facility shall not--
                  (A) adopt any rules or [taking] take any 
                actions that result in any unreasonable 
                restraint of trade; or
                  (B) impose any material anticompetitive 
                burden on trading or clearing.
          (11) Conflicts of interest.--The security-based swap 
        execution facility shall--
                  (A) establish and enforce rules to minimize 
                conflicts of interest in its decision-making 
                process; and
                  (B) establish a process for resolving the 
                conflicts of interest.
          (12) Financial resources.--
                  (A) In general.--The security-based swap 
                execution facility shall have adequate 
                financial, operational, and managerial 
                resources to discharge each responsibility of 
                the security-based swap execution facility, as 
                determined by the Commission.
                  (B) Determination of resource adequacy.--The 
                financial resources of a security-based swap 
                execution facility shall be considered to be 
                adequate if the value of the financial 
                resources--
                          (i) enables the organization to meet 
                        its financial obligations to its 
                        members and participants 
                        notwithstanding a default by the member 
                        or participant creating the largest 
                        financial exposure for that 
                        organization in extreme but plausible 
                        market conditions; and
                          (ii) exceeds the total amount that 
                        would enable the security-based swap 
                        execution facility to cover the 
                        operating costs of the security-based 
                        swap execution facility for a 1-year 
                        period, as calculated on a rolling 
                        basis.
          (13) System safeguards.--The security-based swap 
        execution facility shall--
                  (A) establish and maintain a program of risk 
                analysis and oversight to identify and minimize 
                sources of operational risk, through the 
                development of appropriate controls and 
                procedures, and automated systems, that--
                          (i) are reliable and secure; and
                          (ii) have adequate scalable capacity;
                  (B) establish and maintain emergency 
                procedures, backup facilities, and a plan for 
                disaster recovery that allow for--
                          (i) the timely recovery and 
                        resumption of operations; and
                          (ii) the fulfillment of the 
                        responsibilities and obligations of the 
                        security-based swap execution facility; 
                        and
                  (C) periodically conduct tests to verify that 
                the backup resources of the security-based swap 
                execution facility are sufficient to ensure 
                continued--
                          (i) order processing and trade 
                        matching;
                          (ii) price reporting;
                          (iii) market surveillance; and
                          (iv) maintenance of a comprehensive 
                        and accurate audit trail.
          (14) Designation of chief compliance officer.--
                  (A) In general.--Each security-based swap 
                execution facility shall designate an 
                individual to serve as a chief compliance 
                officer.
                  (B) Duties.--The chief compliance officer 
                shall--
                          (i) report directly to the board or 
                        to the senior officer of the facility;
                          (ii) review compliance with the core 
                        principles in this subsection;
                          (iii) in consultation with the board 
                        of the facility, a body performing a 
                        function similar to that of a board, or 
                        the senior officer of the facility, 
                        resolve any conflicts of interest that 
                        may arise;
                          (iv) be responsible for establishing 
                        and administering the policies and 
                        procedures required to be established 
                        pursuant to this section;
                          (v) ensure compliance with this title 
                        and the rules and regulations issued 
                        under this title, including rules 
                        prescribed by the Commission pursuant 
                        to this section;
                          (vi) establish procedures for the 
                        remediation of noncompliance issues 
                        found during--
                                  (I) compliance office 
                                reviews;
                                  (II) look backs;
                                  (III) internal or external 
                                audit findings;
                                  (IV) self-reported errors; or
                                  (V) through validated 
                                complaints; and
                          (vii) establish and follow 
                        appropriate procedures for the 
                        handling, management response, 
                        remediation, retesting, and closing of 
                        noncompliance issues.
                  (C) Annual reports.--
                          (i) In general.--In accordance with 
                        rules prescribed by the Commission, the 
                        chief compliance officer shall annually 
                        prepare and sign a report that contains 
                        a description of--
                                  (I) the compliance of the 
                                security-based swap execution 
                                facility with this title; and
                                  (II) the policies and 
                                procedures, including the code 
                                of ethics and conflict of 
                                interest policies, of the 
                                security-based security-based 
                                swap execution facility.
                          (ii) Requirements.--The chief 
                        compliance officer shall--
                                  (I) submit each report 
                                described in clause (i) with 
                                the appropriate financial 
                                report of the security-based 
                                swap execution facility that is 
                                required to be submitted to the 
                                Commission pursuant to this 
                                section; and
                                  (II) include in the report a 
                                certification that, under 
                                penalty of law, the report is 
                                accurate and complete.
  (e) Exemptions.--The Commission may exempt, conditionally or 
unconditionally, a security-based swap execution facility from 
registration under this section if the Commission finds that 
the facility is subject to comparable, comprehensive 
supervision and regulation on a consolidated basis by the 
Commodity Futures Trading Commission.
  (f) Rules.--The Commission shall prescribe rules governing 
the regulation of security-based swap execution facilities 
under this section.

SEC. 3E. SEGREGATION OF ASSETS HELD AS COLLATERAL IN SECURITY-BASED 
                    SWAP TRANSACTIONS.

  (a) Registration Requirement.--It shall be unlawful for any 
person to accept any money, securities, or property (or to 
extend any credit in lieu of money, securities, or property) 
from, for, or on behalf of a security-based swaps customer to 
margin, guarantee, or secure a security-based swap cleared by 
or through a clearing agency (including money, securities, or 
property accruing to the customer as the result of such a 
security-based swap), unless the person shall have registered 
under this title with the Commission as a broker, dealer, or 
security-based swap dealer, and the registration shall not have 
expired nor been suspended nor revoked.
  (b) Cleared Security-based Swaps.--
          (1) Segregation required.--A broker, dealer, or 
        security-based swap dealer shall treat and deal with 
        all money, securities, and property of any security-
        based swaps customer received to margin, guarantee, or 
        secure a security-based swap cleared by or [though] 
        through a clearing agency (including money, securities, 
        or property accruing to the security-based swaps 
        customer as the result of such a security-based swap) 
        as belonging to the security-based swaps customer.
          (2) Commingling prohibited.--Money, securities, and 
        property of a security-based swaps customer described 
        in paragraph (1) shall be separately accounted for and 
        shall not be commingled with the funds of the broker, 
        dealer, or security-based swap dealer or be used to 
        margin, secure, or guarantee any trades or contracts of 
        any security-based swaps customer or person other than 
        the person for whom the same are held.
  (c) Exceptions.--
          (1) Use of funds.--
                  (A) In general.--Notwithstanding subsection 
                (b), money, securities, and property of a 
                security-based swaps customer of a broker, 
                dealer, or security-based swap dealer described 
                in subsection (b) may, for convenience, be 
                commingled and deposited in the same 1 or more 
                accounts with any bank or trust company or with 
                a clearing agency.
                  (B) Withdrawal.--Notwithstanding subsection 
                (b), such share of the money, securities, and 
                property described in subparagraph (A) as in 
                the normal course of business shall be 
                necessary to margin, guarantee, secure, 
                transfer, adjust, or settle a cleared security-
                based swap with a clearing agency, or with any 
                member of the clearing agency, may be withdrawn 
                and applied to such purposes, including the 
                payment of commissions, brokerage, interest, 
                taxes, storage, and other charges, lawfully 
                accruing in connection with the cleared 
                security-based swap.
          (2) Commission action.--Notwithstanding subsection 
        (b), in accordance with such terms and conditions as 
        the Commission may prescribe by rule, regulation, or 
        order, any money, securities, or property of the 
        security-based swaps customer of a broker, dealer, or 
        security-based swap dealer described in subsection (b) 
        may be commingled and deposited as provided in this 
        section with any other money, securities, or property 
        received by the broker, dealer, or security-based swap 
        dealer and required by the Commission to be separately 
        accounted for and treated and dealt with as belonging 
        to the security-based swaps customer of the broker, 
        dealer, or security-based swap dealer.
  (d) Permitted Investments.--Money described in subsection (b) 
may be invested in obligations of the United States, in general 
obligations of any State or of any political subdivision of a 
State, and in obligations fully guaranteed as to principal and 
interest by the United States, or in any other investment that 
the Commission may by rule or regulation prescribe, and such 
investments shall be made in accordance with such rules and 
regulations and subject to such conditions as the Commission 
may prescribe.
  (e) Prohibition.--It shall be unlawful for any person, 
including any clearing agency and any depository institution, 
that has received any money, securities, or property for 
deposit in a separate account or accounts as provided in 
subsection (b) to hold, dispose of, or use any such money, 
securities, or property as belonging to the depositing broker, 
dealer, or security-based swap dealer or any person other than 
the swaps customer of the broker, dealer, or security-based 
swap dealer.
  (f) Segregation Requirements for Uncleared Security-based 
Swaps.--
          (1) Segregation of assets held as collateral in 
        uncleared security-based swap transactions.--
                  (A) Notification.--A security-based swap 
                dealer or major security-based swap participant 
                shall be required to notify the counterparty of 
                the security-based swap dealer or major 
                security-based swap participant at the 
                beginning of a security-based swap transaction 
                that the counterparty has the right to require 
                segregation of the funds of other property 
                supplied to margin, guarantee, or secure the 
                obligations of the counterparty.
                  (B) Segregation and maintenance of funds.--At 
                the request of a counterparty to a security-
                based swap that provides funds or other 
                property to a security-based swap dealer or 
                major security-based swap participant to 
                margin, guarantee, or secure the obligations of 
                the counterparty, the security-based swap 
                dealer or major security-based swap participant 
                shall--
                          (i) segregate the funds or other 
                        property for the benefit of the 
                        counterparty; and
                          (ii) in accordance with such rules 
                        and regulations as the Commission may 
                        promulgate, maintain the funds or other 
                        property in a segregated account 
                        separate from the assets and other 
                        interests of the security-based swap 
                        dealer or major security-based swap 
                        participant.
          (2) Applicability.--The requirements described in 
        paragraph (1) shall--
                  (A) apply only to a security-based swap 
                between a counterparty and a security-based 
                swap dealer or major security-based swap 
                participant that is not submitted for clearing 
                to a clearing agency; and
                  (B)(i) not apply to variation margin 
                payments; or
                  (ii) not preclude any commercial arrangement 
                regarding--
                          (I) the investment of segregated 
                        funds or other property that may only 
                        be invested in such investments as the 
                        Commission may permit by rule or 
                        regulation; and
                          (II) the related allocation of gains 
                        and losses resulting from any 
                        investment of the segregated funds or 
                        other property.
          (3) Use of independent third-party custodians.--The 
        segregated account described in paragraph (1) shall 
        be--
                  (A) carried by an independent third-party 
                custodian; and
                  (B) designated as a segregated account for 
                and on behalf of the counterparty.
          (4) Reporting requirement.--If the counterparty does 
        not choose to require segregation of the funds or other 
        property supplied to margin, guarantee, or secure the 
        obligations of the counterparty, the security-based 
        swap dealer or major security-based swap participant 
        shall report to the counterparty of the security-based 
        swap dealer or major security-based swap participant on 
        a quarterly basis that the back office procedures of 
        the security-based swap dealer or major security-based 
        swap participant relating to margin and collateral 
        requirements are in compliance with the agreement of 
        the counterparties.
  (g) Bankruptcy.--A security-based swap, as defined in section 
3(a)(68) shall be considered to be a security as such term is 
used in section 101(53A)(B) and subchapter III of title 11, 
United States Code. An account that holds a security-based 
swap, other than a portfolio margining account referred to in 
section 15(c)(3)(C) shall be considered to be a securities 
account, as that term is defined in section 741 of title 11, 
United States Code. The definitions of the terms ``purchase'' 
and ``sale'' in section 3(a)(13) and (14) shall be applied to 
the terms ``purchase'' and ``sale'', as used in section 741 of 
title 11, United States Code. The term ``customer'', as defined 
in section 741 of title 11, United States Code, excludes any 
person, to the extent that such person has a claim based on any 
open repurchase agreement, open reverse repurchase agreement, 
stock borrowed agreement, non-cleared option, or non-cleared 
security-based swap except to the extent of any margin 
delivered to or by the customer with respect to which there is 
a customer protection requirement under section 15(c)(3) or a 
segregation requirement.

                   securities and exchange commission

  Sec. 4. (a) There is hereby established a Securities and 
Exchange Commission (hereinafter referred to as the 
``Commission'') to be composed of five commissioners to be 
appointed by the President by and with the advice and consent 
of the Senate. Not more than three of such commissioners shall 
be members of the same political party, and in making 
appointments members of different political parties shall be 
appointed alternately as nearly as may be practicable. No 
commissioner shall engage in any other business, vocation, or 
employment than that of serving as commissioner, nor shall any 
commissioner participate, directly or indirectly, in any stock-
market operations or transactions of a character subject to 
regulation by the Commission pursuant to this title. Each 
commissioner shall hold office for a term of five years and 
until his successor is appointed and has qualified, except that 
he shall not so continue to serve beyond the expiration of the 
next session of Congress subsequent to the expiration of said 
fixed term of office, and except (1) any commissioner appointed 
to fill a vacancy occurring prior to the expiration of the term 
for which his predecessor was appointed shall be appointed for 
the remainder of such term, and (2) the terms of office of the 
commissioners first taking office after the enactment of this 
title shall expire as designated by the President at the time 
of nomination, one at the end of one year, one at the end of 
two years, one at the end of three years, one at the end of 
four years, and one at the end of five years, after the date of 
the enactment of this title.
  (b) Appointment and Compensation of Staff and Leasing 
Authority.--
          (1) Appointment and compensation.--The Commission 
        shall appoint and compensate officers, attorneys, 
        economists, examiners, and other employees in 
        accordance with section 4802 of title 5, United States 
        Code.
          (2) Reporting of information.--In establishing and 
        adjusting schedules of compensation and benefits for 
        officers, attorneys, economists, examiners, and other 
        employees of the Commission under applicable provisions 
        of law, the Commission shall inform the heads of the 
        agencies referred to under section 1206 of the 
        Financial Institutions Reform, Recovery, and 
        Enforcement Act of 1989 (12 U.S.C. 1833b) and Congress 
        of such compensation and benefits and shall seek to 
        maintain comparability with such agencies regarding 
        compensation and benefits.
          (3) Leasing authority.--Nothwithstanding any other 
        provision of law, the Commission is authorized to enter 
        directly into leases for real property for office, 
        meeting, storage, and such other space as is necessary 
        to carry out its functions, and shall be exempt from 
        any General Services Administration space management 
        regulations or directives.
  (c) Notwithstanding any other provision of law, in accordance 
with regulations which the Commission shall prescribe to 
prevent conflicts of interest, the Commission may accept 
payment and reimbursement, in cash or in kind, from non-Federal 
agencies, organizations, and individuals for travel, 
subsistence, and other necessary expenses incurred by 
Commission members and employees in attending meetings and 
conferences concerning the functions or activities of the 
Commission. Any payment or reimbursement accepted shall be 
credited to the appropriated funds of the Commission. The 
amount of travel, subsistence, and other necessary expenses for 
members and employees paid or reimbursed under this subsection 
may exceed per diem amounts established in official travel 
regulations, but the Commission may include in its regulations 
under this subsection a limitation on such amounts.
  (d) Notwithstanding any other provision of law, former 
employers of participants in the Commission's professional 
fellows programs may pay such participants their actual 
expenses for relocation to Washington, District of Columbia, to 
facilitate their participation in such programs, and program 
participants may accept such payments.
  (e) Notwithstanding any other provision of law, whenever any 
fee is required to be paid to the Commission pursuant to any 
provision of the securities laws or any other law, the 
Commission may provide by rule that such fee shall be paid in a 
manner other than in cash and the Commission may also specify 
the time that such fee shall be determined and paid relative to 
the filing of any statement or document with the Commission.
  (f) Reimbursement of Expenses for Assisting Foreign 
Securities Authorities.--Notwithstanding any other provision of 
law, the Commission may accept payment and reimbursement, in 
cash or in kind, from a foreign securities authority, or made 
on behalf of such authority, for necessary expenses incurred by 
the Commission, its members, and employees in carrying out any 
investigation pursuant to section 21(a)(2) of this title or in 
providing any other assistance to a foreign securities 
authority. Any payment or reimbursement accepted shall be 
considered a reimbursement to the appropriated funds of the 
Commission.
  (g) Office of the Investor Advocate.--
          (1) Office established.--There is established within 
        the Commission the Office of the Investor Advocate (in 
        this subsection referred to as the ``Office'').
          (2) Investor advocate.--
                  (A) In general.--The head of the Office shall 
                be the Investor Advocate, who shall--
                          (i) report directly to the Chairman; 
                        and
                          (ii) be appointed by the Chairman, in 
                        consultation with the Commission, from 
                        among individuals having experience in 
                        advocating for the interests of 
                        investors in securities and investor 
                        protection issues, from the perspective 
                        of investors.
                  (B) Compensation.--The annual rate of pay for 
                the Investor Advocate shall be equal to the 
                highest rate of annual pay for other senior 
                executives who report to the Chairman of the 
                Commission.
                  (C) Limitation on service.--An individual who 
                serves as the Investor Advocate may not be 
                employed by the Commission--
                          (i) during the 2-year period ending 
                        on the date of appointment as Investor 
                        Advocate; or
                          (ii) during the 5-year period 
                        beginning on the date on which the 
                        person ceases to serve as the Investor 
                        Advocate.
          (3) Staff of office.--The Investor Advocate, after 
        consultation with the Chairman of the Commission, may 
        retain or employ independent counsel, research staff, 
        and service staff, as the Investor Advocate deems 
        necessary to carry out the functions, powers, and 
        duties of the Office.
          (4) Functions of the investor advocate.--The Investor 
        Advocate shall--
                  (A) assist retail investors in resolving 
                significant problems such investors may have 
                with the Commission or with self-regulatory 
                organizations;
                  (B) identify areas in which investors would 
                benefit from changes in the regulations of the 
                Commission or the rules of self-regulatory 
                organizations;
                  (C) identify problems that investors have 
                with financial service providers and investment 
                products;
                  (D) analyze the potential impact on investors 
                of--
                          (i) proposed regulations of the 
                        Commission; and
                          (ii) proposed rules of self-
                        regulatory organizations registered 
                        under this title; [and]
                  (E) to the extent practicable, propose to the 
                Commission changes in the regulations or orders 
                of the Commission and to Congress any 
                legislative, administrative, or personnel 
                changes that may be appropriate to mitigate 
                problems identified under this paragraph and to 
                promote the interests of investors[.];
                  (F) not take a position on any legislation 
                pending before Congress other than a 
                legislative change proposed by the Investor 
                Advocate pursuant to subparagraph (E);
                  (G) consult with the Advocate for Small 
                Business Capital Formation on proposed 
                recommendations made under subparagraph (E); 
                and
                  (H) advise the Advocate for Small Business 
                Capital Formation on issues related to small 
                business investors.
          (5) Access to documents.--The Commission shall ensure 
        that the Investor Advocate has full access to the 
        documents of the Commission and any self-regulatory 
        organization, as necessary to carry out the functions 
        of the Office.
          (6) Annual reports.--
                  (A) Report on objectives.--
                          (i) In general.--Not later than June 
                        30 of each year after 2010, the 
                        Investor Advocate shall submit to the 
                        Committee on Banking, Housing, and 
                        Urban Affairs of the Senate and the 
                        Committee on Financial Services of the 
                        House of Representatives a report on 
                        the objectives of the Investor Advocate 
                        for the following fiscal year.
                          (ii) Contents.--Each report required 
                        under clause (i) shall contain full and 
                        substantive analysis and explanation.
                  (B) Report on activities.--
                          (i) In general.--Not later than 
                        December 31 of each year after 2010, 
                        the Investor Advocate shall submit to 
                        the Committee on Banking, Housing, and 
                        Urban Affairs of the Senate and the 
                        Committee on Financial Services of the 
                        House of Representatives a report on 
                        the activities of the Investor Advocate 
                        during the immediately preceding fiscal 
                        year.
                          (ii) Contents.--Each report required 
                        under clause (i) shall include--
                                  (I) appropriate statistical 
                                information and full and 
                                substantive analysis;
                                  (II) information on steps 
                                that the Investor Advocate has 
                                taken during the reporting 
                                period to improve investor 
                                services and the responsiveness 
                                of the Commission and self-
                                regulatory organizations to 
                                investor concerns;
                                  (III) a summary of the most 
                                serious problems encountered by 
                                investors during the reporting 
                                period;
                                  (IV) an inventory of the 
                                items described in subclause 
                                (III) that includes--
                                          (aa) identification 
                                        of any action taken by 
                                        the Commission or the 
                                        self-regulatory 
                                        organization and the 
                                        result of such action;
                                          (bb) the length of 
                                        time that each item has 
                                        remained on such 
                                        inventory; and
                                          (cc) for items on 
                                        which no action has 
                                        been taken, the reasons 
                                        for inaction, and an 
                                        identification of any 
                                        official who is 
                                        responsible for such 
                                        action;
                                  (V) recommendations for such 
                                administrative and legislative 
                                actions as may be appropriate 
                                to resolve problems encountered 
                                by investors; and
                                  (VI) any other information, 
                                as determined appropriate by 
                                the Investor Advocate.
                          (iii) Independence.--Each report 
                        required under this paragraph shall be 
                        provided directly to the Committees 
                        listed in clause (i) without any prior 
                        review or comment from the Commission, 
                        any commissioner, any other officer or 
                        employee of the Commission, or the 
                        Office of Management and Budget.
                          (iv) Confidentiality.--No report 
                        required under clause (i) may contain 
                        confidential information.
          (7) Regulations.--The Commission shall, by 
        regulation, establish procedures requiring a formal 
        response to all recommendations submitted to the 
        Commission by the Investor Advocate, not later than 3 
        months after the date of such submission.
          (8) Ombudsman.--
                  (A) Appointment.--Not later than 180 days 
                after the date on which the first Investor 
                Advocate is appointed under paragraph 
                [(2)(A)(i)] (2)(A)(ii), [the Investor Advocate 
                shall appoint an Ombudsman, who shall report 
                directly to the Investor Advocate] the Chairman 
                shall appoint an Ombudsman, who shall report to 
                the Commission.
                  (B) Duties.--The Ombudsman appointed under 
                subparagraph (A) shall--
                          (i) act as a liaison between the 
                        Commission and any retail investor in 
                        resolving problems that retail 
                        investors may have with the Commission 
                        or with self-regulatory organizations;
                          (ii) review and make recommendations 
                        regarding policies and procedures to 
                        encourage persons to present questions 
                        to the Investor Advocate regarding 
                        compliance with the securities laws; 
                        and
                          (iii) establish safeguards to 
                        maintain the confidentiality of 
                        communications between the persons 
                        described in clause (ii) and the 
                        Ombudsman.
                  (C) Limitation.--In carrying out the duties 
                of the Ombudsman under subparagraph (B), the 
                Ombudsman shall utilize personnel of the 
                Commission to the extent practicable. Nothing 
                in this paragraph shall be construed as 
                replacing, altering, or diminishing the 
                activities of any ombudsman or similar office 
                of any other agency.
                  (D) Report.--The Ombudsman shall submit a 
                semiannual [report to the Investor Advocate] 
                report to the Commission that describes the 
                activities and evaluates the effectiveness of 
                the Ombudsman during the preceding year. [The 
                Investor Advocate shall include the reports 
                required under this section in the reports 
                required to be submitted by the Inspector 
                Advocate under paragraph (6).]
  (h) Examiners.--
          (1) Division of trading and markets.--The Division of 
        Trading and Markets of the Commission, or any successor 
        organizational unit, shall have a staff of examiners 
        who shall--
                  (A) perform compliance inspections and 
                examinations of entities under the jurisdiction 
                of that Division; and
                  (B) report to the Director of that Division.
          (2) Division of investment management.--The Division 
        of Investment Management of the Commission, or any 
        successor organizational unit, shall have a staff of 
        examiners who shall--
                  (A) perform compliance inspections and 
                examinations of entities under the jurisdiction 
                of that Division; and
                  (B) report to the Director of that Division.
  [(i) Securities and Exchange Commission Reserve Fund.--
          [(1) Reserve fund established.--There is established 
        in the Treasury of the United States a separate fund, 
        to be known as the ``Securities and Exchange Commission 
        Reserve Fund'' (referred to in this subsection as the 
        ``Reserve Fund'').
          [(2) Reserve fund amounts.--
                  [(A) In general.--Except as provided in 
                subparagraph (B), any registration fees 
                collected by the Commission under section 6(b) 
                of the Securities Act of 1933 (15 U.S.C. 
                77f(b)) or section 24(f) of the Investment 
                Company Act of 1940 (15 U.S.C. 80a-24(f)) shall 
                be deposited into the Reserve Fund.
                  [(B) Limitations.--For any 1 fiscal year--
                          [(i) the amount deposited in the Fund 
                        may not exceed $50,000,000; and
                          [(ii) the balance in the Fund may not 
                        exceed $100,000,000.
                  [(C) Excess fees.--Any amounts in excess of 
                the limitations described in subparagraph (B) 
                that the Commission collects from registration 
                fees under section 6(b) of the Securities Act 
                of 1933 (15 U.S.C. 77f(b)) or section 24(f) of 
                the Investment Company Act of 1940 (15 U.S.C. 
                80a-24(f)) shall be deposited in the General 
                Fund of the Treasury of the United States and 
                shall not be available for obligation by the 
                Commission.
          [(3) Use of amounts in reserve fund.--The Commission 
        may obligate amounts in the Reserve Fund, not to exceed 
        a total of $100,000,000 in any 1 fiscal year, as the 
        Commission determines is necessary to carry out the 
        functions of the Commission. Any amounts in the reserve 
        fund shall remain available until expended. Not later 
        than 10 days after the date on which the Commission 
        obligates amounts under this paragraph, the Commission 
        shall notify Congress of the date, amount, and purpose 
        of the obligation.
          [(4) Rule of construction.--Amounts collected and 
        deposited in the Reserve Fund shall not be construed to 
        be Government funds or appropriated monies and shall 
        not be subject to apportionment for the purpose of 
        chapter 15 of title 31, United States Code, or under 
        any other authority.
  (i) Enforcement Ombudsman.--
          (1) Establishment.--The Commission shall have an 
        Enforcement Ombudsman, who shall be appointed by and 
        report directly to the Commission.
          (2) Duties.--The Enforcement Ombudsman shall--
                  (A) act as a liaison between the Commission 
                and any person who is the subject of an 
                investigation (including a preliminary or 
                informal investigation) by the Commission or an 
                administrative or judicial action brought by 
                the Commission in resolving problems that such 
                persons may have with the Commission or the 
                conduct of Commission staff; and
                  (B) establish safeguards to maintain the 
                confidentiality of communications between the 
                persons described in subparagraph (A) and the 
                Enforcement Ombudsman.
          (3) Limitation.--In carrying out the duties of the 
        Enforcement Ombudsman under paragraph (2), the 
        Enforcement Ombudsman shall utilize personnel of the 
        Commission to the extent practicable. Nothing in this 
        subsection shall be construed as replacing, altering, 
        or diminishing the activities of any ombudsman or 
        similar office of any other agency.
          (4) Report.--The Enforcement Ombudsman shall submit 
        to the Commission and to the Committee on Financial 
        Services of the House of Representatives and the 
        Committee on Banking, Housing, and Urban Affairs of the 
        Senate an annual report that describes the activities 
        and evaluates the effectiveness of the Enforcement 
        Ombudsman during the preceding year.
  (j) Office of the Advocate for Small Business Capital 
Formation.--
          (1) Office established.--There is established within 
        the Commission the Office of the Advocate for Small 
        Business Capital Formation (hereafter in this 
        subsection referred to as the ``Office'').
          (2) Advocate for small business capital formation.--
                  (A) In general.--The head of the Office shall 
                be the Advocate for Small Business Capital 
                Formation, who shall--
                          (i) report directly to the 
                        Commission; and
                          (ii) be appointed by the Commission, 
                        from among individuals having 
                        experience in advocating for the 
                        interests of small businesses and 
                        encouraging small business capital 
                        formation.
                  (B) Compensation.--The annual rate of pay for 
                the Advocate for Small Business Capital 
                Formation shall be equal to the highest rate of 
                annual pay for other senior executives who 
                report directly to the Commission.
                  (C) No current employee of the commission.--
                An individual may not be appointed as the 
                Advocate for Small Business Capital Formation 
                if the individual is currently employed by the 
                Commission.
          (3) Staff of office.--The Advocate for Small Business 
        Capital Formation, after consultation with the 
        Commission, may retain or employ independent counsel, 
        research staff, and service staff, as the Advocate for 
        Small Business Capital Formation determines to be 
        necessary to carry out the functions of the Office.
          (4) Functions of the advocate for small business 
        capital formation.--The Advocate for Small Business 
        Capital Formation shall--
                  (A) assist small businesses and small 
                business investors in resolving significant 
                problems such businesses and investors may have 
                with the Commission or with self-regulatory 
                organizations;
                  (B) identify areas in which small businesses 
                and small business investors would benefit from 
                changes in the regulations of the Commission or 
                the rules of self-regulatory organizations;
                  (C) identify problems that small businesses 
                have with securing access to capital, including 
                any unique challenges to minority-owned and 
                women-owned small businesses;
                  (D) analyze the potential impact on small 
                businesses and small business investors of--
                          (i) proposed regulations of the 
                        Commission that are likely to have a 
                        significant economic impact on small 
                        businesses and small business capital 
                        formation; and
                          (ii) proposed rules that are likely 
                        to have a significant economic impact 
                        on small businesses and small business 
                        capital formation of self-regulatory 
                        organizations registered under this 
                        title;
                  (E) conduct outreach to small businesses and 
                small business investors, including through 
                regional roundtables, in order to solicit views 
                on relevant capital formation issues;
                  (F) to the extent practicable, propose to the 
                Commission changes in the regulations or orders 
                of the Commission and to Congress any 
                legislative, administrative, or personnel 
                changes that may be appropriate to mitigate 
                problems identified under this paragraph and to 
                promote the interests of small businesses and 
                small business investors;
                  (G) consult with the Investor Advocate on 
                proposed recommendations made under 
                subparagraph (F); and
                  (H) advise the Investor Advocate on issues 
                related to small businesses and small business 
                investors.
          (5) Access to documents.--The Commission shall ensure 
        that the Advocate for Small Business Capital Formation 
        has full access to the documents and information of the 
        Commission and any self-regulatory organization, as 
        necessary to carry out the functions of the Office.
          (6) Annual report on activities.--
                  (A) In general.--Not later than December 31 
                of each year after 2015, the Advocate for Small 
                Business Capital Formation shall submit to the 
                Committee on Banking, Housing, and Urban 
                Affairs of the Senate and the Committee on 
                Financial Services of the House of 
                Representatives a report on the activities of 
                the Advocate for Small Business Capital 
                Formation during the immediately preceding 
                fiscal year.
                  (B) Contents.--Each report required under 
                subparagraph (A) shall include--
                          (i) appropriate statistical 
                        information and full and substantive 
                        analysis;
                          (ii) information on steps that the 
                        Advocate for Small Business Capital 
                        Formation has taken during the 
                        reporting period to improve small 
                        business services and the 
                        responsiveness of the Commission and 
                        self-regulatory organizations to small 
                        business and small business investor 
                        concerns;
                          (iii) a summary of the most serious 
                        issues encountered by small businesses 
                        and small business investors, including 
                        any unique issues encountered by 
                        minority-owned and women-owned small 
                        businesses and their investors, during 
                        the reporting period;
                          (iv) an inventory of the items 
                        summarized under clause (iii) 
                        (including items summarized under such 
                        clause for any prior reporting period 
                        on which no action has been taken or 
                        that have not been resolved to the 
                        satisfaction of the Advocate for Small 
                        Business Capital Formation as of the 
                        beginning of the reporting period 
                        covered by the report) that includes--
                                  (I) identification of any 
                                action taken by the Commission 
                                or the self-regulatory 
                                organization and the result of 
                                such action;
                                  (II) the length of time that 
                                each item has remained on such 
                                inventory; and
                                  (III) for items on which no 
                                action has been taken, the 
                                reasons for inaction, and an 
                                identification of any official 
                                who is responsible for such 
                                action;
                          (v) recommendations for such changes 
                        to the regulations, guidance and orders 
                        of the Commission and such legislative 
                        actions as may be appropriate to 
                        resolve problems with the Commission 
                        and self-regulatory organizations 
                        encountered by small businesses and 
                        small business investors and to 
                        encourage small business capital 
                        formation; and
                          (vi) any other information, as 
                        determined appropriate by the Advocate 
                        for Small Business Capital Formation.
                  (C) Confidentiality.--No report required by 
                subparagraph (A) may contain confidential 
                information.
                  (D) Independence.--Each report required under 
                subparagraph (A) shall be provided directly to 
                the committees of Congress listed in such 
                subparagraph without any prior review or 
                comment from the Commission, any commissioner, 
                any other officer or employee of the 
                Commission, or the Office of Management and 
                Budget.
          (7) Regulations.--The Commission shall establish 
        procedures requiring a formal response to all 
        recommendations submitted to the Commission by the 
        Advocate for Small Business Capital Formation, not 
        later than 3 months after the date of such submission.
          (8) Government-business forum on small business 
        capital formation.--The Advocate for Small Business 
        Capital Formation shall be responsible for planning, 
        organizing, and executing the annual Government-
        Business Forum on Small Business Capital Formation 
        described in section 503 of the Small Business 
        Investment Incentive Act of 1980 (15 U.S.C. 80c-1).
          (9) Rule of construction.--Nothing in this subsection 
        may be construed as replacing or reducing the 
        responsibilities of the Investor Advocate with respect 
        to small business investors.
  (j) International Processes.--
          (1) Notice of process; consultation.--At least 30 
        calendar days before the Commission participates in a 
        process of setting financial standards as a part of any 
        foreign or multinational entity, the Commission shall--
                  (A) issue a notice of the process, including 
                the subject matter, scope, and goals of the 
                process, to the Committee on Financial Services 
                of the House of Representatives and the 
                Committee on Banking, Housing, and Urban 
                Affairs of the Senate;
                  (B) make such notice available to the public, 
                including on the website of the Commission; and
                  (C) solicit public comment, and consult with 
                the committees described under subparagraph 
                (A), with respect to the subject matter, scope, 
                and goals of the process.
          (2) Public reports on process.--After the end of any 
        process described under paragraph (1), the Commission 
        shall issue a public report on the topics that were 
        discussed at the process and any new or revised 
        rulemakings or policy changes that the Commission 
        believes should be implemented as a result of the 
        process.
          (3) Notice of agreements; consultation.--At least 90 
        calendar days before the Commission participates in a 
        process of setting financial standards as a part of any 
        foreign or multinational entity, the Commission shall--
                  (A) issue a notice of agreement to the 
                Committee on Financial Services of the House of 
                Representatives and the Committee on Banking, 
                Housing, and Urban Affairs of the Senate;
                  (B) make such notice available to the public, 
                including on the website of the Commission; and
                  (C) consult with the committees described 
                under subparagraph (A) with respect to the 
                nature of the agreement and any anticipated 
                effects such agreement will have on the 
                economy.
          (4) Definition.--For purposes of this subsection, the 
        term ``process'' shall include any official proceeding 
        or meeting on financial regulation of a recognized 
        international organization with authority to set 
        financial standards on a global or regional level, 
        including the Financial Stability Board, the Basel 
        Committee on Banking Supervision (or a similar 
        organization), and the International Association of 
        Insurance Supervisors (or a similar organization).
  (k) Limitation on Pilot Programs.--
          (1) In general.--Any pilot program established by 
        self-regulatory organizations, either individually or 
        jointly, and filed with the Commission, including under 
        section 11A or 19, shall terminate after the end of the 
        5-year period beginning on the date that the Commission 
        approved such program, unless the Commission issues a 
        rule to permanently continue such program or approves 
        such program on a permanent basis.
          (2) Extension.--With respect to a particular pilot 
        program described under paragraph (1), the Commission 
        may extend the 5-year period described under such 
        paragraph for an additional 3 years if the Commission 
        determines such extension is necessary or appropriate 
        in the public interest or for the protection of 
        investors.
          (3) Lack of statutory authority.--If, with respect to 
        a pilot program described under paragraph (1), the 
        Commission determines that the pilot program should 
        continue permanently, but the Commission lacks 
        sufficient statutory authority to permanently continue 
        the program, the Commission shall, not later than 1 
        year before such pilot program is scheduled to 
        terminate pursuant to paragraph (1), notify the 
        Committee on Financial Services of the House of 
        Representatives and the Committee on Banking, Housing, 
        and Urban Affairs of the Senate that the Commission 
        believes the program should continue permanently but 
        does not have sufficient statutory authority to 
        continue the program.

           *       *       *       *       *       *       *


SEC. 4F. CERTAIN FINDINGS REQUIRED TO APPROVE CIVIL MONEY PENALTIES 
                    AGAINST ISSUERS.

  The Commission may not seek against or impose on an issuer a 
civil money penalty for violation of the securities laws unless 
the publicly available text of the order approving the seeking 
or imposition of such penalty contains findings, supported by 
an analysis by the Division of Economic and Risk Analysis and 
certified by the Chief Economist, of whether--
          (1) the alleged violation resulted in direct economic 
        benefit to the issuer; and
          (2) the penalty will harm the shareholders of the 
        issuer.

SEC. 4G. ELIMINATION OF AUTOMATIC DISQUALIFICATIONS.

  (a) In General.--Notwithstanding any other provision of law, 
a non-natural person may not be disqualified or otherwise made 
ineligible to use an exemption or registration provision, 
engage in an activity, or qualify for any similar treatment 
under a provision of the securities laws or the rules issued by 
the Commission under the securities laws by reason of having, 
or a person described in subsection (b) having, been convicted 
of any felony or misdemeanor or made the subject of any 
judicial or administrative order, judgment, or decree arising 
out of a governmental action (including an order, judgment, or 
decree agreed to in a settlement), or having, or a person 
described in subsection (b) having, been suspended or expelled 
from membership in, or suspended or barred from association 
with a member of, a registered national securities exchange or 
a registered national or affiliated securities association for 
any act or omission to act constituting conduct inconsistent 
with just and equitable principles of trade, unless the 
Commission, by order, on the record after notice and an 
opportunity for hearing, makes a determination that such non-
natural person should be so disqualified or otherwise made 
ineligible for purposes of such provision.
  (b) Person Described.--A person is described in this 
subsection if the person is--
          (1) a natural person who is a director, officer, 
        employee, partner, member, or shareholder of the non-
        natural person referred to in subsection (a) or is 
        otherwise associated or affiliated with such non-
        natural person in any way; or
          (2) a non-natural person who is associated or 
        affiliated with the non-natural person referred to in 
        subsection (a) in any way.
  (c) Rule of Construction.--Nothing in this section shall be 
construed to limit any authority of the Commission, by order, 
on the record after notice and an opportunity for hearing, to 
prohibit a person from using an exemption or registration 
provision, engaging in an activity, or qualifying for any 
similar treatment under a provision of the securities laws, or 
the rules issued by the Commission under the securities laws, 
by reason of a circumstance referred to in subsection (a) or 
any similar circumstance.

SEC. 4H. INTERNAL RISK CONTROLS.

  (a) In General.--Each of the following entities, in 
consultation with the Chief Economist, shall develop 
comprehensive internal risk control mechanisms to safeguard and 
govern the storage of all market data by such entity, all 
market data sharing agreements of such entity, and all academic 
research performed at such entity using market data:
          (1) The Commission.
          (2) Each national security association required to 
        register under section 15A.
  (b) Consolidated Audit Trail.--The Commission may not approve 
a national market system plan pursuant to part 242.613 of title 
17, Code of Federal Regulations (or any successor regulation), 
unless the operator of the consolidated audit trail created by 
such plan has developed, in consultation with the Chief 
Economist, comprehensive internal risk control mechanisms to 
safeguard and govern the storage of all market data by such 
operator, all market data sharing agreements of such operator, 
and all academic research performed at such operator using 
market data.

SEC. 4I. APPLICABILITY OF NOTICE AND COMMENT REQUIREMENTS OF THE 
                    ADMINISTRATIVE PROCEDURE ACT TO GUIDANCE VOTED ON 
                    BY THE COMMISSION.

  The notice and comment requirements of section 553 of title 
5, United States Code, shall also apply with respect to any 
Commission statement or guidance, including interpretive rules, 
general statements of policy, or rules of Commission 
organization, procedure, or practice, that has the effect of 
implementing, interpreting, or prescribing law or policy and 
that is voted on by the Commission.

           *       *       *       *       *       *       *


                     national securities exchanges

  Sec. 6. (a) An exchange may be registered as a national 
securities exchange under the terms and conditions hereinafter 
provided in this section and in accordance with the provisions 
of section 19(a) of this title, by filing with the Commission 
an application for registration in such form as the Commission, 
by rule, may prescribe containing the rules of the exchange and 
such other information and documents as the Commission, by 
rule, may prescribe as necessary or appropriate in the public 
interest or for the protection of investors.
  (b) An exchange shall not be registered as a national 
securities exchange unless the Commission determines that--
          (1) Such exchange is so organized and has the 
        capacity to be able to carry out the purposes of this 
        title and to comply, and (subject to any rule or order 
        of the Commission pursuant to section 17(d) or 19(g)(2) 
        of this title) to enforce compliance by its members and 
        persons associated with its members, with the 
        provisions of this title, the rules and regulations 
        thereunder, and the rules of the exchange.
          (2) Subject to the provisions of subsection (c) of 
        this section, the rules of the exchange provide that 
        any registered broker or dealer or natural person 
        associated with a registered broker or dealer may 
        become a member of such exchange and any person may 
        become associated with a member thereof.
          (3) The rules of the exchange assure a fair 
        representation of its members in the selection of its 
        directors and administration of its affairs and provide 
        that one or more directors shall be representative of 
        issuers and investors and not be associated with a 
        member of the exchange, broker, or dealer.
          (4) The rules of the exchange provide for the 
        equitable allocation of reasonable dues, fees, and 
        other charges among its members and issuers and other 
        persons using its facilities.
          (5) The rules of the exchange are designed to prevent 
        fraudulent and manipulative acts and practices, to 
        promote just and equitable principles of trade, to 
        foster cooperation and coordination with persons 
        engaged in regulating, clearing, settling, processing 
        information with respect to, and facilitating 
        transactions in securities, to remove impediments to 
        and perfect the mechanism of a free and open market and 
        a national market system, and, in general, to protect 
        investors and the public interest; and are not designed 
        to permit unfair discrimination between customers, 
        issuers, brokers, or dealers, or to regulate by virtue 
        of any authority conferred by this title matters not 
        related to the purposes of this title or the 
        administration of the exchange.
          (6) The rules of the exchange provide that (subject 
        to any rule or order of the Commission pursuant to 
        section 17(d) or 19(g)(2) of this title) its members 
        and persons associated with its members shall be 
        appropriately disciplined for violation of the 
        provisions of this title, the rules or regulations 
        thereunder, or the rules of the exchange, by expulsion, 
        suspension, limitation of activities, functions, and 
        operations, fine, censure, being suspended or barred 
        from being associated with a member, or any other 
        fitting sanction.
          (7) The rules of the exchange are in accordance with 
        the provisions of subsection (d) of this section, and 
        in general, provide a fair procedure for the 
        disciplining of members and persons associated with 
        members, the denial of membership to any person seeking 
        membership therein, the barring of any person from 
        becoming associated with a member thereof, and the 
        prohibition or limitation by the exchange of any person 
        with respect to access to services offered by the 
        exchange or a member thereof.
          (8) The rules of the exchange do not impose any 
        burden on competition not necessary or appropriate in 
        furtherance of the purposes of this title.
          (9)(A) The rules of the exchange prohibit the listing 
        of any security issued in a limited partnership rollup 
        transaction (as such term is defined in paragraphs (4) 
        and (5) of section 14(h)), unless such transaction was 
        conducted in accordance with procedures designed to 
        protect the rights of limited partners, including--
                  (i) the right of dissenting limited partners 
                to one of the following:
                          (I) an appraisal and compensation;
                          (II) retention of a security under 
                        substantially the same terms and 
                        conditions as the original issue;
                          (III) approval of the limited 
                        partnership rollup transaction by not 
                        less than 75 percent of the outstanding 
                        securities of each of the participating 
                        limited partnerships;
                          (IV) the use of a committee of 
                        limited partners that is independent, 
                        as determined in accordance with rules 
                        prescribed by the exchange, of the 
                        general partner or sponsor, that has 
                        been approved by a majority of the 
                        outstanding units of each of the 
                        participating limited partnerships, and 
                        that has such authority as is necessary 
                        to protect the interest of limited 
                        partners, including the authority to 
                        hire independent advisors, to negotiate 
                        with the general partner or sponsor on 
                        behalf of the limited partners, and to 
                        make a recommendation to the limited 
                        partners with respect to the proposed 
                        transaction; or
                          (V) other comparable rights that are 
                        prescribed by rule by the exchange and 
                        that are designed to protect dissenting 
                        limited partners;
                  (ii) the right not to have their voting power 
                unfairly reduced or abridged;
                  (iii) the right not to bear an unfair portion 
                of the costs of a proposed limited partnership 
                rollup transaction that is rejected; and
                  (iv) restrictions on the conversion of 
                contingent interests or fees into non-
                contingent interests or fees and restrictions 
                on the receipt of a non-contingent equity 
                interest in exchange for fees for services 
                which have not yet been provided.
          (B) As used in this paragraph, the term ``dissenting 
        limited partner'' means a person who, on the date on 
        which soliciting material is mailed to investors, is a 
        holder of a beneficial interest in a limited 
        partnership that is the subject of a limited 
        partnership rollup transaction, and who casts a vote 
        against the transaction and complies with procedures 
        established by the exchange, except that for purposes 
        of an exchange or tender offer, such person shall file 
        an objection in writing under the rules of the exchange 
        during the period during which the offer is 
        outstanding.
          (10)(A) The rules of the exchange prohibit any member 
        that is not the beneficial owner of a security 
        registered under section 12 from granting a proxy to 
        vote the security in connection with a shareholder vote 
        described in subparagraph (B), unless the beneficial 
        owner of the security has instructed the member to vote 
        the proxy in accordance with the voting instructions of 
        the beneficial owner.
          (B) A shareholder vote described in this subparagraph 
        is a shareholder vote with respect to the election of a 
        member of the board of directors of an issuer, 
        executive compensation, or any other significant 
        matter, as determined by the Commission, by rule, and 
        does not include a vote with respect to the uncontested 
        election of a member of the board of directors of any 
        investment company registered under the Investment 
        Company Act of 1940 (15 U.S.C. 80b-1 et seq.).
          (C) Nothing in this paragraph shall be construed to 
        prohibit a national securities exchange from 
        prohibiting a member that is not the beneficial owner 
        of a security registered under section 12 from granting 
        a proxy to vote the security in connection with a 
        shareholder vote not described in subparagraph (A).
  (c)(1) A national securities exchange shall deny membership 
to (A) any person, other than a natural person, which is not a 
registered broker or dealer or (B) any natural person who is 
not, or is not associated with, a registered broker or dealer.
  (2) A national securities exchange may, and in cases in which 
the Commission, by order, directs as necessary or appropriate 
in the public interest or for the protection of investors 
shall, deny membership to any registered broker or dealer or 
natural person associated with a registered broker or dealer, 
and bar from becoming associated with a member any person, who 
is subject to a statutory disqualification. A national 
securities exchange shall file notice with the Commission not 
less than thirty days prior to admitting any person to 
membership or permitting any person to become associated with a 
member, if the exchange knew, or in the exercise of reasonable 
care should have known, that such person was subject to a 
statutory disqualification. The notice shall be in such form 
and contain such information as the Commission, by rule, may 
prescribe as necessary or appropriate in the public interest or 
for the protection of investors.
  (3)(A) A national securities exchange may deny membership to, 
or condition the membership of, a registered broker or dealer 
if (i) such broker or dealer does not meet such standards of 
financial responsibility or operational capability or such 
broker or dealer or any natural person associated with such 
broker or dealer does not meet such standards of training, 
experience, and competence as are prescribed by the rules of 
the exchange or (ii) such broker or dealer or person associated 
with such broker or dealer has engaged and there is a 
reasonable likelihood he may again engage in acts or practices 
inconsistent with just and equitable principles of trade. A 
national securities exchange may examine and verify the 
qualifications of an applicant to become a member and the 
natural persons associated with such an applicant in accordance 
with procedures established by the rules of the exchange.
  (B) A national securities exchange may bar a natural person 
from becoming a member or associated with a member, or 
condition the membership of a natural person or association of 
a natural person with a member, if such natural person (i) does 
not meet such standards of training, experience, and competence 
as are prescribed by the rules of the exchange or (ii) has 
engaged and there is a reasonable likelihood he may again 
engage in acts or practices inconsistent with just and 
equitable principles of trade. A national securities exchange 
may examine and verify the qualifications of an applicant to 
become a person associated with a member in accordance with 
procedures established by the rules of the exchange and require 
any person associated with a member, or any class of such 
persons, to be registered with the exchange in accordance with 
procedures so established.
  (C) A national securities exchange may bar any person from 
becoming associated with a member if such person does not agree 
(i) to supply the exchange with such information with respect 
to its relationship and dealings with the member as may be 
specified in the rules of the exchange and (ii) to permit the 
examination of its books and records to verify the accuracy of 
any information so supplied.
  (4) A national securities exchange may limit (A) the number 
of members of the exchange and (B) the number of members and 
designated representatives of members permitted to effect 
transactions on the floor of the exchange without the services 
of another person acting as broker: Provided, however, That no 
national securities exchange shall have the authority to 
decrease the number of memberships in such exchange, or the 
number of members and designated representatives of members 
permitted to effect transactions on the floor of such exchange 
without the services of another person acting as broker, below 
such number in effect on May 1, 1975, or the date such exchange 
was registered with the Commission, whichever is later: And 
provided further, That the Commission, in accordance with the 
provisions of section 19(c) of this title, may amend the rules 
of any national securities exchange to increase (but not to 
decrease) or to remove any limitation on the number of 
memberships in such exchange or the number of members or 
designated representatives of members permitted to effect 
transactions on the floor of the exchange without the services 
of another person acting as broker, if the Commission finds 
that such limitation imposes a burden on competition not 
necessary or appropriate in furtherance of the purposes of this 
title.
  (d)(1) In any proceeding by a national securities exchange to 
determine whether a member or person associated with a member 
should be disciplined (other than a summary proceeding pursuant 
to paragraph (3) of this subsection), the exchange shall bring 
specific charges, notify such member or person of, and give him 
an opportunity to defend against, such charges, and keep a 
record. A determination by the exchange to impose a 
disciplinary sanction shall be supported by a statement setting 
forth--
          (A) any act or practice in which such member or 
        person associated with a member has been found to have 
        engaged, or which such member or person has been found 
        to have omitted;
          (B) the specific provision of this title, the rules 
        or regulations thereunder, or the rules of the exchange 
        which any such act or practice, or omission to act, is 
        deemed to violate; and
          (C) the sanction imposed and the reasons therefor.
  (2) In any proceeding by a national securities exchange to 
determine whether a person shall be denied membership, barred 
from becoming associated with a member, or prohibited or 
limited with respect to access to services offered by the 
exchange or a member thereof (other than a summary proceeding 
pursuant to paragraph (3) of this subsection), the exchange 
shall notify such person of, and give him an opportunity to be 
heard upon, the specific grounds for denial, bar, or 
prohibition or limitation under consideration and keep a 
record. A determination by the exchange to deny membership, bar 
a person from becoming associated with a member, or prohibit or 
limit a person with respect to access to services offered by 
the exchange or a member thereof shall be supported by a 
statement setting forth the specific grounds on which the 
denial, bar, or prohibition or limitation is based.
  (3) A national securities exchange may summarily (A) suspend 
a member or person associated with a member who has been and is 
expelled or suspended from any self-regulatory organization or 
barred or suspended from being associated with a member of any 
self-regulatory organization, (B) suspend a member who is in 
such financial or operating difficulty that the exchange 
determines and so notifies the Commission that the member 
cannot be permitted to continue to do business as a member with 
safety to investors, creditors, other members, or the exchange, 
or (C) limit or prohibit any person with respect to access to 
services offered by the exchange if subparagraph (A) or (B) of 
this paragraph is applicable to such person or, in the case of 
a person who is not a member, if the exchange determines that 
such person does not meet the qualification requirements or 
other prerequisites for such access and such person cannot be 
permitted to continue to have such access with safety to 
investors, creditors, members, or the exchange. Any person 
aggrieved by any such summary action shall be promptly afforded 
an opportunity for a hearing by the exchange in accordance with 
the provisions of paragraph (1) or (2) of this subsection. The 
Commission, by order, may stay any such summary action on its 
own motion or upon application by any person aggrieved thereby, 
if the Commission determines summarily or after notice and 
opportunity for hearing (which hearing may consist solely of 
the submission of affidavits or presentation of oral arguments) 
that such stay is consistent with the public interest and the 
protection of investors.
  (e)(1) On and after the date of enactment of the Securities 
Acts Amendments of 1975, no national securities exchange may 
impose any schedule or fix rates of commissions, allowances, 
discounts, or other fees to be charged by its members: 
Provided, however, That until May 1, 1976, the preceding 
provisions of this paragraph shall not prohibit any such 
exchange from imposing or fixing any schedule of commissions, 
allowances, discounts, or other fees to be charged by its 
members for acting as broker on the floor of the exchange or as 
odd-lot dealer: And provided further, That the Commission, in 
accordance with the provisions of section 19(b) of this title 
as modified by the provisions of paragraph (3) of this 
subsection, may--
          (A) permit a national securities exchange, by rule, 
        to impose a reasonable schedule or fix reasonable rates 
        of commissions, allowances, discounts, or other fees to 
        be charged by its members for effecting transactions on 
        such exchange prior to November 1, 1976, if the 
        Commission finds that such schedule or fixed rates of 
        commissions, allowances, discounts, or other fees are 
        in the public interest; and
          (B) permit a national securities exchange, by rule, 
        to impose a schedule or fix rates of commissions, 
        allowances, discounts, or other fees to be charged by 
        its members for effecting transactions on such exchange 
        after November 1, 1976, if the Commission finds that 
        such schedule or fixed rates of commissions, 
        allowances, discounts, or other fees (i) are reasonable 
        in relation to the costs of providing the service for 
        which such fees are charged (and the Commission 
        publishes the standards employed in adjudging 
        reasonableness) and (ii) do not impose any burden on 
        competition not necessary or appropriate in furtherance 
        of the purposes of this title, taking into 
        consideration the competitive effects of permitting 
        such schedule or fixed rates weighed against the 
        competitive effects of other lawful actions which the 
        Commission is authorized to take under this title.
  (2) Notwithstanding the provisions of section 19(c) of this 
title, the Commission, by rule, may abrogate any exchange rule 
which imposes a schedule or fixes rates of commissions, 
allowances, discounts, or other fees, if the Commission 
determines that such schedule or fixed rates are no longer 
reasonable, in the public interest, or necessary to accomplish 
the purposes of this title.
  (3)(A) Before approving or disapproving any proposed rule 
change submitted by a national securities exchange which would 
impose a schedule or fix rates of commissions, allowances, 
discounts, or other fees to be charged by its members for 
effecting transactions on such exchange, the Commission shall 
afford interested persons (i) an opportunity for oral 
presentation of data, views, and arguments and (ii) with 
respect to any such rule concerning transactions effected after 
November 1, 1976, if the Commission determines there are 
disputed issues of material fact, to present such rebuttal 
submissions and to conduct (or have conducted under 
subparagraph (B) of this paragraph) such cross-examination as 
the Commission determines to be appropriate and required for 
full disclosure and proper resolution of such disputed issues 
of material fact.
  (B) The Commission shall prescribe rules and make rulings 
concerning any proceeding in accordance with subparagraph (A) 
of this paragraph designed to avoid unnecessary costs or delay. 
Such rules or rulings may (i) impose reasonable time limits on 
each interested person's oral presentations, and (ii) require 
any cross-examination to which a person may be entitled under 
subparagraph (A) of this paragraph to be conducted by the 
Commission on behalf of that person in such manner as the 
Commission determines to be appropriate and required for full 
disclosure and proper resolution of disputed issues of material 
fact.
  (C)(i) If any class of persons, the members of which are 
entitled to conduct (or have conducted) cross-examination under 
subparagraphs (A) and (B) of this paragraph and which have, in 
the view of the Commission, the same or similar interests in 
the proceeding, cannot agree upon a single representative of 
such interests for purposes of cross-examination, the 
Commission may make rules and rulings specifying the manner in 
which such interests shall be represented and such cross-
examination conducted.
  (ii) No member of any class of persons with respect to which 
the Commission has specified the manner in which its interests 
shall be represented pursuant to clause (i) of this 
subparagraph shall be denied, pursuant to such clause (i), the 
opportunity to conduct (or have conducted) cross-examination as 
to issues affecting his particular interests if he satisfies 
the Commission that he has made a reasonable and good faith 
effort to reach agreement upon group representation and there 
are substantial and relevant issues which would not be 
presented adequately by group representation.
  (D) A transcript shall be kept of any oral presentation and 
cross-examination.
  (E) In addition to the bases specified in subsection 25(a), a 
reviewing Court may set aside an order of the Commission under 
section 19(b) approving an exchange rule imposing a schedule or 
fixing rates of commissions, allowances, discounts, or other 
fees, if the Court finds--
          (1) a Commission determination under subparagraph (A) 
        of this paragraph that an interested person is not 
        entitled to conduct cross-examination or make rebuttal 
        submissions, or
          (2) a Commission rule or ruling under subparagraph 
        (B) of this paragraph limiting the petitioner's cross-
        examination or rebuttal submissions,
                                has precluded full disclosure 
                                and proper resolution of 
                                disputed issues of material 
                                fact which were necessary for 
                                fair determination by the 
                                Commission.
  (f) The Commission, by rule or order, as it deems necessary 
or appropriate in the public interest and for the protection of 
investors, to maintain fair and orderly markets, or to assure 
equal regulation, may require--
          (1) any person not a member or a designated 
        representative of a member of a national securities 
        exchange effecting transactions on such exchange 
        without the services of another person acting as a 
        broker, or
          (2) any broker or dealer not a member of a national 
        securities exchange effecting transactions on such 
        exchange on a regular basis,
to comply with such rules of such exchange as the Commission 
may specify.
  (g) Notice Registration of Security Futures Product 
Exchanges.--
          (1) Registration required.--An exchange that lists or 
        trades security futures products may register as a 
        national securities exchange solely for the purposes of 
        trading security futures products if--
                  (A) the exchange is a board of trade, as that 
                term is defined by the Commodity Exchange Act 
                (7 U.S.C. 1a(2)), that has been designated a 
                contract market by the Commodity Futures 
                Trading Commission and such designation is not 
                suspended by order of the Commodity Futures 
                Trading Commission; and
                  (B) such exchange does not serve as a market 
                place for transactions in securities other 
                than--
                          (i) security futures products; or
                          (ii) futures on exempted securities 
                        or groups or indexes of securities or 
                        options thereon that have been 
                        authorized under section 2(a)(1)(C) of 
                        the Commodity Exchange Act.
          (2) Registration by notice filing.--
                  (A) Form and content.--An exchange required 
                to register only because such exchange lists or 
                trades security futures products may register 
                for purposes of this section by filing with the 
                Commission a written notice in such form as the 
                Commission, by rule, may prescribe containing 
                the rules of the exchange and such other 
                information and documents concerning such 
                exchange, comparable to the information and 
                documents required for national securities 
                exchanges under section 6(a), as the 
                Commission, by rule, may prescribe as necessary 
                or appropriate in the public interest or for 
                the protection of investors. If such exchange 
                has filed documents with the Commodity Futures 
                Trading Commission, to the extent that such 
                documents contain information satisfying the 
                Commission's informational requirements, copies 
                of such documents may be filed with the 
                Commission in lieu of the required written 
                notice.
                  (B) Immediate effectiveness.--Such 
                registration shall be effective 
                contemporaneously with the submission of 
                notice, in written or electronic form, to the 
                Commission, except that such registration shall 
                not be effective if such registration would be 
                subject to suspension or revocation.
                  (C) Termination.--Such registration shall be 
                terminated immediately if any of the conditions 
                for registration set forth in this subsection 
                are no longer satisfied.
          (3) Public availability.--The Commission shall 
        promptly publish in the Federal Register an 
        acknowledgment of receipt of all notices the Commission 
        receives under this subsection and shall make all such 
        notices available to the public.
          (4) Exemption of exchanges from specified 
        provisions.--
                  (A) Transaction exemptions.--An exchange that 
                is registered under paragraph (1) of this 
                subsection shall be exempt from, and shall not 
                be required to enforce compliance by its 
                members with, and its members shall not, solely 
                with respect to those transactions effected on 
                such exchange in security futures products, be 
                required to comply with, the following 
                provisions of this title and the rules 
                thereunder:
                          (i) Subsections (b)(2), (b)(3), 
                        (b)(4), (b)(7), (b)(9), (c), (d), and 
                        (e) of this section.
                          (ii) Section 8.
                          (iii) Section 11.
                          (iv) Subsections (d), (f), and (k) of 
                        section 17.
                          (v) Subsections (a), (f), and (h) of 
                        section 19.
                  (B) Rule change exemptions.--An exchange that 
                registered under paragraph (1) of this 
                subsection shall also be exempt from submitting 
                proposed rule changes pursuant to section 19(b) 
                of this title, except that--
                          (i) such exchange shall file proposed 
                        rule changes related to higher margin 
                        levels, fraud or manipulation, 
                        recordkeeping, reporting, listing 
                        standards, or decimal pricing for 
                        security futures products, sales 
                        practices for security futures products 
                        for persons who effect transactions in 
                        security futures products, or rules 
                        effectuating such exchange's obligation 
                        to enforce the securities laws pursuant 
                        to section 19(b)(7);
                          (ii) such exchange shall file 
                        pursuant to sections 19(b)(1) and 
                        19(b)(2) proposed rule changes related 
                        to margin, except for changes resulting 
                        in higher margin levels; and
                          (iii) such exchange shall file 
                        pursuant to section 19(b)(1) proposed 
                        rule changes that have been abrogated 
                        by the Commission pursuant to section 
                        19(b)(7)(C).
          (5) Trading in security futures products.--
                  (A) In general.--Subject to subparagraph (B), 
                it shall be unlawful for any person to execute 
                or trade a security futures product until the 
                later of--
                          (i) 1 year after the date of the 
                        enactment of the Commodity Futures 
                        Modernization Act of 2000; or
                          (ii) such date that a futures 
                        association registered under section 17 
                        of the Commodity Exchange Act has met 
                        the requirements set forth in section 
                        15A(k)(2) of this title.
                  (B) Principal-to-principal transactions.--
                Notwithstanding subparagraph (A), a person may 
                execute or trade a security futures product 
                transaction if--
                          (i) the transaction is entered into--
                                  (I) on a principal-to-
                                principal basis between parties 
                                trading for their own accounts 
                                or as described in section 
                                1a(18)(B)(ii) of the Commodity 
                                Exchange Act; and
                                  (II) only between eligible 
                                contract participants (as 
                                defined in subparagraphs (A), 
                                (B)(ii), and (C) of such 
                                section 1a(18)) at the time at 
                                which the persons enter into 
                                the agreement, contract, or 
                                transaction; and
                          (ii) the transaction is entered into 
                        on or after the later of--
                                  (I) 8 months after the date 
                                of the enactment of the 
                                Commodity Futures Modernization 
                                Act of 2000; or
                                  (II) such date that a futures 
                                association registered under 
                                section 17 of the Commodity 
                                Exchange Act has met the 
                                requirements set forth in 
                                section 15A(k)(2) of this 
                                title.
  (h) Trading in Security Futures Products.--
          (1) Trading on exchange or association required.--It 
        shall be unlawful for any person to effect transactions 
        in security futures products that are not listed on a 
        national securities exchange or a national securities 
        association registered pursuant to section 15A(a).
          (2) Listing standards required.--Except as otherwise 
        provided in paragraph (7), a national securities 
        exchange or a national securities association 
        registered pursuant to section 15A(a) may trade only 
        security futures products that (A) conform with listing 
        standards that such exchange or association files with 
        the Commission under section 19(b) and (B) meet the 
        criteria specified in section 2(a)(1)(D)(i) of the 
        Commodity Exchange Act.
          (3) Requirements for listing standards and conditions 
        for trading.--Such listing standards shall--
                  (A) except as otherwise provided in a rule, 
                regulation, or order issued pursuant to 
                paragraph (4), require that any security 
                underlying the security future, including each 
                component security of a narrow-based security 
                index, be registered pursuant to section 12 of 
                this title;
                  (B) require that if the security futures 
                product is not cash settled, the market on 
                which the security futures product is traded 
                have arrangements in place with a registered 
                clearing agency for the payment and delivery of 
                the securities underlying the security futures 
                product;
                  (C) be no less restrictive than comparable 
                listing standards for options traded on a 
                national securities exchange or national 
                securities association registered pursuant to 
                section 15A(a) of this title;
                  (D) except as otherwise provided in a rule, 
                regulation, or order issued pursuant to 
                paragraph (4), require that the security future 
                be based upon common stock and such other 
                equity securities as the Commission and the 
                Commodity Futures Trading Commission jointly 
                determine appropriate;
                  (E) require that the security futures product 
                is cleared by a clearing agency that has in 
                place provisions for linked and coordinated 
                clearing with other clearing agencies that 
                clear security futures products, which permits 
                the security futures product to be purchased on 
                one market and offset on another market that 
                trades such product;
                  (F) require that only a broker or dealer 
                subject to suitability rules comparable to 
                those of a national securities association 
                registered pursuant to section 15A(a) effect 
                transactions in the security futures product;
                  (G) require that the security futures product 
                be subject to the prohibition against dual 
                trading in section 4j of the Commodity Exchange 
                Act (7 U.S.C. 6j) and the rules and regulations 
                thereunder or the provisions of section 11(a) 
                of this title and the rules and regulations 
                thereunder, except to the extent otherwise 
                permitted under this title and the rules and 
                regulations thereunder;
                  (H) require that trading in the security 
                futures product not be readily susceptible to 
                manipulation of the price of such security 
                futures product, nor to causing or being used 
                in the manipulation of the price of any 
                underlying security, option on such security, 
                or option on a group or index including such 
                securities;
                  (I) require that procedures be in place for 
                coordinated surveillance among the market on 
                which the security futures product is traded, 
                any market on which any security underlying the 
                security futures product is traded, and other 
                markets on which any related security is traded 
                to detect manipulation and insider trading;
                  (J) require that the market on which the 
                security futures product is traded has in place 
                audit trails necessary or appropriate to 
                facilitate the coordinated surveillance 
                required in subparagraph (I);
                  (K) require that the market on which the 
                security futures product is traded has in place 
                procedures to coordinate trading halts between 
                such market and any market on which any 
                security underlying the security futures 
                product is traded and other markets on which 
                any related security is traded; and
                  (L) require that the margin requirements for 
                a security futures product comply with the 
                regulations prescribed pursuant to section 
                7(c)(2)(B), except that nothing in this 
                subparagraph shall be construed to prevent a 
                national securities exchange or national 
                securities association from requiring higher 
                margin levels for a security futures product 
                when it deems such action to be necessary or 
                appropriate.
          (4) Authority to modify certain listing standard 
        requirements.--
                  (A) Authority to modify.--The Commission and 
                the Commodity Futures Trading Commission, by 
                rule, regulation, or order, may jointly modify 
                the listing standard requirements specified in 
                subparagraph (A) or (D) of paragraph (3) to the 
                extent such modification fosters the 
                development of fair and orderly markets in 
                security futures products, is necessary or 
                appropriate in the public interest, and is 
                consistent with the protection of investors.
                  (B) Authority to grant exemptions.--The 
                Commission and the Commodity Futures Trading 
                Commission, by order, may jointly exempt any 
                person from compliance with the listing 
                standard requirement specified in subparagraph 
                (E) of paragraph (3) to the extent such 
                exemption fosters the development of fair and 
                orderly markets in security futures products, 
                is necessary or appropriate in the public 
                interest, and is consistent with the protection 
                of investors.
          (5) Requirements for other persons trading security 
        future products.--It shall be unlawful for any person 
        (other than a national securities exchange or a 
        national securities association registered pursuant to 
        section 15A(a)) to constitute, maintain, or provide a 
        marketplace or facilities for bringing together 
        purchasers and sellers of security future products or 
        to otherwise perform with respect to security future 
        products the functions commonly performed by a stock 
        exchange as that term is generally understood, unless a 
        national securities association registered pursuant to 
        section 15A(a) or a national securities exchange of 
        which such person is a member--
                  (A) has in place procedures for coordinated 
                surveillance among such person, the market 
                trading the securities underlying the security 
                future products, and other markets trading 
                related securities to detect manipulation and 
                insider trading;
                  (B) has rules to require audit trails 
                necessary or appropriate to facilitate the 
                coordinated surveillance required in 
                subparagraph (A); and
                  (C) has rules to require such person to 
                coordinate trading halts with markets trading 
                the securities underlying the security future 
                products and other markets trading related 
                securities.
          (6) Deferral of options on security futures 
        trading.--No person shall offer to enter into, enter 
        into, or confirm the execution of any put, call, 
        straddle, option, or privilege on a security future, 
        except that, after 3 years after the date of the 
        enactment of this subsection, the Commission and the 
        Commodity Futures Trading Commission may by order 
        jointly determine to permit trading of puts, calls, 
        straddles, options, or privileges on any security 
        future authorized to be traded under the provisions of 
        this Act and the Commodity Exchange Act.
          (7) Deferral of linked and coordinated clearing.--
                  (A) Notwithstanding paragraph (2), until the 
                compliance date, a national securities exchange 
                or national securities association registered 
                pursuant to section 15A(a) may trade a security 
                futures product that does not--
                          (i) conform with any listing standard 
                        promulgated to meet the requirement 
                        specified in subparagraph (E) of 
                        paragraph (3); or
                          (ii) meet the criterion specified in 
                        section 2(a)(1)(D)(i)(IV) of the 
                        Commodity Exchange Act.
                  (B) The Commission and the Commodity Futures 
                Trading Commission shall jointly publish in the 
                Federal Register a notice of the compliance 
                date no later than 165 days before the 
                compliance date.
                  (C) For purposes of this paragraph, the term 
                ``compliance date'' means the later of--
                          (i) 180 days after the end of the 
                        first full calendar month period in 
                        which the average aggregate comparable 
                        share volume for all security futures 
                        products based on single equity 
                        securities traded on all national 
                        securities exchanges, any national 
                        securities associations registered 
                        pursuant to section 15A(a), and all 
                        other persons equals or exceeds 10 
                        percent of the average aggregate 
                        comparable share volume of options on 
                        single equity securities traded on all 
                        national securities exchanges and any 
                        national securities associations 
                        registered pursuant to section 15A(a); 
                        or
                          (ii) 2 years after the date on which 
                        trading in any security futures product 
                        commences under this title.
  (i) Consistent with this title, each national securities 
exchange registered pursuant to subsection (a) of this section 
shall issue such rules as are necessary to avoid duplicative or 
conflicting rules applicable to any broker or dealer registered 
with the Commission pursuant to section 15(b) (except paragraph 
(11) thereof), that is also registered with the Commodity 
Futures Trading Commission pursuant to section 4f(a) of the 
Commodity Exchange Act (except paragraph (2) thereof), with 
respect to the application of--
          (1) rules of such national securities exchange of the 
        type specified in section 15(c)(3)(B) involving 
        security futures products; and
          (2) similar rules of national securities exchanges 
        registered pursuant to section 6(g) and national 
        securities associations registered pursuant to section 
        15A(k) involving security futures products.
  (j) Procedures and Rules for Security Future Products.--A 
national securities exchange registered pursuant to subsection 
(a) shall implement the procedures specified in section 
6(h)(5)(A) of this title and adopt the rules specified in 
subparagraphs (B) and (C) of section 6(h)(5) of this title not 
later than 8 months after the date of receipt of a request from 
an alternative trading system for such implementation and 
rules.
  (k)(1) To the extent necessary or appropriate in the public 
interest, to promote fair competition, and consistent with the 
promotion of market efficiency, innovation, and expansion of 
investment opportunities, the protection of investors, and the 
maintenance of fair and orderly markets, the Commission and the 
Commodity Futures Trading Commission shall jointly issue such 
rules, regulations, or orders as are necessary and appropriate 
to permit the offer and sale of a security futures product 
traded on or subject to the rules of a foreign board of trade 
to United States persons.
  (2) The rules, regulations, or orders adopted under paragraph 
(1) shall take into account, as appropriate, the nature and 
size of the markets that the securities underlying the security 
futures product reflect.
  (l) Security-based Swaps.--It shall be unlawful for any 
person to effect a transaction in a security-based swap with or 
for a person that is not an eligible contract participant, 
unless such transaction is effected on a national securities 
exchange registered pursuant to subsection (b).
  (m) Venture Exchange.--
          (1) Registration.--
                  (A) In general.--A national securities 
                exchange may elect to be treated (or for a 
                listing tier of such exchange to be treated) as 
                a venture exchange by notifying the Commission 
                of such election, either at the time the 
                exchange applies to be registered as a national 
                securities exchange or after registering as a 
                national securities exchange.
                  (B) Determination time period.--With respect 
                to a securities exchange electing to be treated 
                (or for a listing tier of such exchange to be 
                treated) as a venture exchange--
                          (i) at the time the exchange applies 
                        to be registered as a national 
                        securities exchange, such application 
                        and election shall be deemed to have 
                        been approved by the Commission unless 
                        the Commission denies such application 
                        before the end of the 6-month period 
                        beginning on the date the Commission 
                        received such application; and
                          (ii) after registering as a national 
                        securities exchange, such election 
                        shall be deemed to have been approved 
                        by the Commission unless the Commission 
                        denies such approval before the end of 
                        the 6-month period beginning on the 
                        date the Commission received 
                        notification of such election.
          (2) Powers and restrictions.--A venture exchange--
                  (A) may only constitute, maintain, or provide 
                a market place or facilities for bringing 
                together purchasers and sellers of venture 
                securities;
                  (B) may determine the increment to be used 
                for quoting and trading venture securities on 
                the exchange;
                  (C) shall disseminate last sale and quotation 
                information on terms that are fair and 
                reasonable and not unreasonably discriminatory;
                  (D) may choose to carry out periodic auctions 
                for the sale of a venture security instead of 
                providing continuous trading of the venture 
                security; and
                  (E) may not extend unlisted trading 
                privileges to any venture security.
          (3) Exemptions from certain national security 
        exchange regulations.--A venture exchange shall not be 
        required to--
                  (A) comply with any of sections 242.600 
                through 242.612 of title 17, Code of Federal 
                Regulations;
                  (B) comply with any of sections 242.300 
                through 242.303 of title 17, Code of Federal 
                Regulations;
                  (C) submit any data to a securities 
                information processor; or
                  (D) use decimal pricing.
          (4) Treatment of certain exempted securities.--A 
        security that is exempt from registration pursuant to 
        section 3(b) of the Securities Act of 1933 shall be 
        exempt from section 12(a) of this title with respect to 
        the trading of such security on a venture exchange, if 
        the issuer of such security is in compliance with all 
        disclosure obligations of such section 3(b) and the 
        regulations issued under such section.
          (5) Definitions.--For purposes of this subsection:
                  (A) Early-stage, growth company.--
                          (i) In general.--The term ``early-
                        stage, growth company'' means an 
                        issuer--
                                  (I) that has not made an 
                                initial public offering of any 
                                securities of the issuer; and
                                  (II) with a market 
                                capitalization of 
                                $1,000,000,000 (as such amount 
                                is indexed for inflation every 
                                5 years by the Commission to 
                                reflect the change in the 
                                Consumer Price Index for All 
                                Urban Consumers published by 
                                the Bureau of Labor Statistics, 
                                setting the threshold to the 
                                nearest $1,000,000) or less.
                          (ii) Treatment when market 
                        capitalization exceeds threshold.--
                                  (I) In general.--In the case 
                                of an issuer that is an early-
                                stage, growth company the 
                                securities of which are traded 
                                on a venture exchange, such 
                                issuer shall not cease to be an 
                                early-stage, growth company by 
                                reason of the market 
                                capitalization of such issuer 
                                exceeding the threshold 
                                specified in clause (i)(II) 
                                until the end of the period of 
                                24 consecutive months during 
                                which the market capitalization 
                                of such issuer exceeds 
                                $2,000,000,000 (as such amount 
                                is indexed for inflation every 
                                5 years by the Commission to 
                                reflect the change in the 
                                Consumer Price Index for All 
                                Urban Consumers published by 
                                the Bureau of Labor Statistics, 
                                setting the threshold to the 
                                nearest $1,000,000).
                                  (II) Exemptions.--If an 
                                issuer would cease to be an 
                                early-stage, growth company 
                                under subclause (I), the 
                                venture exchange may, at the 
                                request of the issuer, exempt 
                                the issuer from the market 
                                capitalization requirements of 
                                this subparagraph for the 1-
                                year period that begins on the 
                                day after the end of the 24-
                                month period described in such 
                                subclause. The venture exchange 
                                may, at the request of the 
                                issuer, extend the exemption 
                                for 1 additional year.
                  (B) Venture security.--The term ``venture 
                security'' means--
                          (i) securities of an early-stage, 
                        growth company that are exempt from 
                        registration pursuant to section 3(b) 
                        of the Securities Act of 1933; and
                          (ii) securities of an emerging growth 
                        company.

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               FOR CONTINUATION OF HOUSE REPORT 115-153, 
                           PART 1--SEE BOOK 2


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