[House Report 117-315]
[From the U.S. Government Publishing Office]


117th Congress    }                                  {     Report
                        HOUSE OF REPRESENTATIVES
 2d Session       }                                  {     117-315

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



 
        EMPOWERING STATES TO PROTECT SENIORS FROM BAD ACTORS ACT

                                _______
                                

  May 10, 2022.--Committed to the Committee of the Whole House on the 
              State of the Union and ordered to be printed

                                _______
                                

  Ms. Waters, from the Committee on Financial Services, submitted the 
                               following

                              R E P O R T

                        [To accompany H.R. 5914]

    The Committee on Financial Services, to whom was referred 
the bill (H.R. 5914) to amend the Investor Protection and 
Securities Reform Act of 2010 to provide grants to States for 
enhanced protection of senior investors and senior 
policyholders, and for other purposes, having considered the 
same, reports favorably thereon with an amendment and 
recommends that the bill as amended do pass.

                                CONTENTS

                                                                   Page
Purpose and Summary..............................................     3
Background and Need for Legislation..............................     4
Section-by-Section Analysis of the Legislation...................     4
Hearings.........................................................     5
Committee Consideration..........................................     5
Committee Votes..................................................     5
Committee Oversight Findings.....................................     7
Statement of Performance Goals and Objectives....................     7
New Budget Authority and C.B.O. Cost Estimate....................     7
Committee Cost Estimate..........................................     7
Federal Mandates Statement.......................................     7
Advisory Committee Statement.....................................     7
Applicability to Legislative Branch..............................     8
Congressional Earmarks, Limited Tax Benefits, and Limited Tariff 
  Benefits.......................................................     8
Duplicative Federal Programs.....................................     8

    The amendment is as follows:
  Strike all after the enacting clause and insert the 
following:

SECTION 1. SHORT TITLE.

  This Act may be cited as the ``Empowering States to Protect Seniors 
from Bad Actors Act''.

SEC. 2. GRANTS TO ELIGIBLE ENTITIES FOR ENHANCED PROTECTION OF SENIOR 
                    INVESTORS AND SENIOR POLICYHOLDERS.

  (a) In General.--Section 989A of the Investor Protection and 
Securities Reform Act of 2010 (15 U.S.C. 5537) is amended to read as 
follows:

``SEC. 989A. GRANTS TO ELIGIBLE ENTITIES FOR ENHANCED PROTECTION OF 
                    SENIOR INVESTORS AND SENIOR POLICYHOLDERS.

  ``(a) Definitions.--In this section:
          ``(1) Eligible entity.--The term `eligible entity' means--
                  ``(A) the securities commission (or any agency or 
                office performing like functions) of any State; and
                  ``(B) the insurance department (or any agency or 
                office performing like functions) of any State.
          ``(2) Senior.--The term `senior' means any individual who has 
        attained the age of 62 years or older.
          ``(3) Senior financial fraud.--The term `senior financial 
        fraud' means a fraudulent or otherwise illegal, unauthorized, 
        or improper act or process of an individual, including a 
        caregiver or a fiduciary, that--
                  ``(A) uses the resources of a senior for monetary or 
                personal benefit, profit, or gain;
                  ``(B) results in depriving a senior of rightful 
                access to or use of benefits, resources, belongings, or 
                assets; or
                  ``(C) is an action described in section 1348 of title 
                18, United States Code, that is taken against a senior.
          ``(4) Task force.--The term `task force' means the task force 
        established under subsection (b)(1).
  ``(b) Grant Program.--
          ``(1) Task force.--
                  ``(A) In general.--The Commission shall establish a 
                task force to carry out the grant program under 
                paragraph (2).
                  ``(B) Membership.--The task force shall consist of 
                the following members:
                          ``(i) A Chair of the task force, who--
                                  ``(I) shall be appointed by the 
                                Chairman of the Commission, in 
                                consultation with the Commissioners of 
                                the Commission; and
                                  ``(II) may be a representative of the 
                                Office of the Investor Advocate of the 
                                Commission, the Division of Enforcement 
                                of the Commission, or such other 
                                representative as the Commission 
                                determines appropriate.
                          ``(ii) If the Chair is not a representative 
                        of the Office of the Investor Advocate of the 
                        Commission, a representative of such Office.
                          ``(iii) If the Chair is not a representative 
                        of the Division of Enforcement of the 
                        Commission, a representative of such Division.
                          ``(iv) Such other representatives as the 
                        Commission determines appropriate.
                  ``(C) Detail of executive agency employees.--Upon the 
                request of the Commission, the head of any Federal 
                agency may detail, on a reimbursable basis, any of the 
                personnel of that Federal agency to the Commission to 
                assist it in carrying out its functions under this 
                section. The detail of any such personnel shall be 
                without interruption or loss of civil service status or 
                privilege.
          ``(2) Grants.--The task force shall carry out a program under 
        which the task force shall make grants, on a competitive basis, 
        to eligible entities, which--
                  ``(A) may use the grant funds--
                          ``(i) to hire staff to identify, investigate, 
                        and prosecute (through civil, administrative, 
                        or criminal enforcement actions) cases 
                        involving senior financial fraud;
                          ``(ii) to fund technology, equipment, and 
                        training for regulators, prosecutors, and law 
                        enforcement officers, in order to identify, 
                        investigate, and prosecute cases involving 
                        senior financial fraud;
                          ``(iii) to provide educational materials and 
                        training to seniors to increase awareness and 
                        understanding of senior financial fraud;
                          ``(iv) to develop comprehensive plans to 
                        combat senior financial fraud; and
                          ``(v) to enhance provisions of State law to 
                        provide protection from senior financial fraud; 
                        and
                  ``(B) may not use the grant funds for any indirect 
                expense, such as rent, utilities, or any other general 
                administrative cost that is not directly related to the 
                purpose of the grant program.
          ``(3) Authority of task force.--In carrying out paragraph 
        (2), the task force--
                  ``(A) may consult with staff of the Commission; and
                  ``(B) shall make public all actions of the task force 
                relating to carrying out that paragraph.
  ``(c) Applications.--An eligible entity desiring a grant under this 
section shall submit an application to the task force, in such form and 
in such a manner as the task force may determine, that includes--
          ``(1) a proposal for activities to protect seniors from 
        senior financial fraud that are proposed to be funded using a 
        grant under this section, including--
                  ``(A) an identification of the scope of the problem 
                of senior financial fraud in the applicable State;
                  ``(B) a description of how the proposed activities 
                would--
                          ``(i) protect seniors from senior financial 
                        fraud, including by proactively identifying 
                        victims of senior financial fraud;
                          ``(ii) assist in the investigation and 
                        prosecution of those committing senior 
                        financial fraud; and
                          ``(iii) discourage and reduce cases of senior 
                        financial fraud; and
                  ``(C) a description of how the proposed activities 
                would be coordinated with other State efforts; and
          ``(2) any other information that the task force determines 
        appropriate.
  ``(d) Performance Objectives; Reporting Requirements; Audits.--
          ``(1) In general.--The task force--
                  ``(A) may establish such performance objectives and 
                reporting requirements for eligible entities receiving 
                a grant under this section as the task force determines 
                are necessary to carry out and assess the effectiveness 
                of the program under this section; and
                  ``(B) shall require each eligible entity that 
                receives a grant under this section to submit to the 
                task force a detailed accounting of the use of grant 
                funds, which shall be submitted at such time, in such 
                form, and containing such information as the task force 
                may require.
          ``(2) Report.--Not later than 2 years, and again not later 
        than 5 years, after the date of the enactment of the Empowering 
        States to Protect Seniors from Bad Actors Act, the task force 
        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--
                  ``(A) specifies each recipient of a grant under this 
                section;
                  ``(B) includes a description of the programs that are 
                supported by each such grant; and
                  ``(C) includes an evaluation by the task force of the 
                effectiveness of such grants.
          ``(3) Audits.--The task force shall annually conduct an audit 
        of the program under this section to ensure that eligible 
        entities to which grants are made under that program are, for 
        the year covered by the audit, using grant funds for the 
        intended purposes of those funds.
  ``(e) Maximum Amount.--The amount of a grant to an eligible entity 
under this section may not exceed $500,000, which the task force shall 
adjust annually to reflect the percentage change in the Consumer Price 
Index for All Urban Consumers published by the Bureau of Labor 
Statistics of the Department of Labor.
  ``(f) Subgrants.--An eligible entity that receives a grant under this 
section may, in consultation with the task force, make a subgrant, as 
the eligible entity determines is necessary or appropriate--
          ``(1) to carry out the activities described in subsection 
        (b)(2)(A); and
          ``(2) which may not be used for any activity described in 
        subsection (b)(2)(B).
  ``(g) Authorization of Appropriations.--There are authorized to be 
appropriated to carry out this section $10,000,000 for each of fiscal 
years 2023 through 2028.''.
  (b) Conforming 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 989A and inserting the 
following:

``Sec. 989A. Grants to eligible entities for enhanced protection of 
senior investors and senior policyholders.''.

                          Purpose and Summary

    On November 9, 2021, Representative Gottheimer introduced 
H.R. 5914, the ``Empowering States to Protect Seniors from Bad 
Actors Act'', which would move the responsibility for 
administering the Senior Investor Protection Grant Program 
established by Sec. 989A of the Dodd-Frank Wall Street Reform 
and Consumer Protection Act (Dodd-Frank Act) from the Consumer 
Financial Protection Bureau to the Securities and Exchange 
Commission. The bill would establish an interdivisional task 
force within the SEC to review grant applications and oversee 
the administration of the program. The bill would authorize $10 
million annually in appropriations for the program for the 
period of FY 2023-2028. The bill would provide that the 
entities that would be eligible to apply for grants under the 
program are state securities regulators and state insurance 
regulators, and would cap the amount of grant funding that 
could be awarded to any single ``eligible entity'' at $500,000.

                  Background and Need for Legislation

    Section 989(A) of the Dodd-Frank Act established a grant 
program within the Consumer Financial Protection Bureau (CFPB) 
to provide state regulators with funding for technology, 
equipment, and training to increase the successful prosecution 
of salespersons and advisers who target seniors for fraud. The 
grants are also permitted to be used to fund educational 
materials and training to raise awareness and understanding of 
misleading or fraudulent marketing practices among seniors.
    To date, the Senior Investor Protection Grant Program has 
not been established because it has not received an 
appropriation from Congress. By moving the Senior Investor 
Protection Grant program from the CFPB to the SEC, the 
legislation would reconstitute the program within the primary 
federal agency charged with investor protection. Moreover, 
because the SEC is funded by an annual appropriation from 
Congress, such a change would allow Congress to review the 
program and funds the grants annually, as it deems appropriate.
    The bill is strongly supported by North American Securities 
Administrators Association, Consumer Federation of America, 
Healthy Markets Association, Public Citizen, and Americans for 
Financial Reform.

                      Section-by-Section Analysis


Section 1. Short title

           This section establishes the short title of 
        the bill as ``The Empowering States to Protect Seniors 
        from Bad Actors Act of 2021.''

Section 2.

           Defines the universe of ``eligible 
        entities'' that may apply for grants;
           Establishes the scope of activities for 
        which the SEC may award grants;
           Establishes an interdivisional task force 
        within the SEC for purposes of carrying out the grant 
        program and specifics the authorities of the task 
        force; authorizes other federal Executive Branch 
        agencies to detail personnel to the SEC for purposes of 
        helping to administer the program;
           Establishes certain procedures for eligible 
        entities that wish to apply for the grants;
           Establishes certain performance objectives 
        and performance and auditing requirements;
           Directs the SEC ``task force'' to make 
        certain reports to Congress regarding the program;
           Provides that no eligible entity may receive 
        more than $500,000 in grant funding; and
           Authorizes to be appropriated $10 million 
        for each of the fiscal years 2023 through 2028.

                                Hearings

    For the purposes of section 3(c)(6) of House rule XIII, the 
Committee on Financial Services' Subcommittee (or Full 
Committee) held a hearing on October 5, 2021 to consider H.R. 
5914 entitled, Oversight of the U.S. Securities and Exchange 
Commission: Wall Street's Cop Is Finally Back on the Beat.

                        Committee Consideration

    The Committee on Financial Services met in open session on 
November 16, 2021 and ordered H.R. 5914 to be reported 
favorably to the House with an amendment in the nature of a 
substitute by a voice vote, a quorum being present.

                  Committee Votes and Roll Call Votes

    In compliance with clause 3(b) of rule XIII of the Rules of 
the House of Representatives, the Committee advises that the 
following roll call votes occurred during the Committee's 
consideration of H.R. 5914: An amendment in the nature of a 
substitute, no. 6, offered by Mr. Gottheimer was AGREED TO by 
voice vote.


		[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

  Statement of Oversight Findings and Recommendations of the Committee

    In compliance with clause 3(c)(1) of rule XIII and clause 
2(b)(1) of rule X of the Rules of the House of Representatives, 
the Committee's oversight findings and recommendations are 
reflected in the descriptive portions of this report.

             Statement of Performance Goals and Objectives

    Pursuant to clause (3)(c) of rule XIII of the Rules of the 
House of Representatives, the goals of H.R. 5914 would be to 
move the responsibility for administering the Senior Investor 
Protection Grant Program established by Sec. 989A of the Dodd-
Frank Wall Street Reform and Consumer Protection Act (Dodd-
Frank Act) from the Consumer Financial Protection Bureau to the 
SEC; establish an interdivisional task force within the SEC to 
review grant applications and oversee the administration of the 
program; authorize $10 million annually in appropriations for 
the program for the period of FY 2023-2028; and provide that 
the entities that would be eligible to apply for grants under 
the program are state securities regulators and state insurance 
regulators, and would cap the amount of grant funding that 
could be awarded to any single ``eligible entity'' at $500,000.

               New Budget Authority and CBO Cost Estimate

    Pursuant to clause 3(c)(2) of rule XIII of the Rules of the 
House of Representatives and section 308(a) of the 
Congressional Budget Act of 1974, and pursuant to clause 
3(c)(3) of rule XIII of the Rules of the House of 
Representatives and section 402 of the Congressional Budget Act 
of 1974, the Committee has requested an estimate from the 
Director of the Congressional Budget Office. CBO was unable to 
provide an estimate in a timely manner.

                        Committee Cost Estimate

    Clause 3(d)(1) of rule XIII of the Rules of the House of 
Representatives requires an estimate and a comparison of the 
costs that would be incurred in carrying out H.R. 5914. After 
careful review, including discussions with the Congressional 
Budget Office, the Committee estimates that H.R. 5914 would 
have an insignificant impact on spending.

                       Unfunded Mandate Statement

    Pursuant to Section 423 of the Congressional Budget and 
Impoundment Control Act (as amended by Section 101(a)(2) of the 
Unfunded Mandates Reform Act, Pub. L. 104-4), the Committee 
adopts as its own the estimate of federal mandates regarding 
H.R. 5914, as amended, prepared by the Director of the 
Congressional Budget Office.

                           Advisory Committee

    No advisory committees within the meaning of section 5(b) 
of the Federal Advisory Committee Act were created by this 
legislation.

              Application of Law to the Legislative Branch

    Pursuant to section 102(b)(3) of the Congressional 
Accountability Act, Pub. L. No. 104-1, H.R. 5914, as amended, 
does not apply to terms and conditions of employment or to 
access to public services or accommodations within the 
legislative branch.

                           Earmark Statement

    In accordance with clause 9 of rule XXI of the Rules of the 
House of Representatives, H.R. 5914 does not contain any 
congressional earmarks, limited tax benefits, or limited tariff 
benefits as described in clauses 9(e), 9(f), and 9(g) of rule 
XXI.

                    Duplication of Federal Programs

    Pursuant to clause 3(c)(5) of rule XIII of the Rules of the 
House of Representatives, the Committee states that no 
provision of H.R. 5914 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.

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

     * * * * * * *

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

     * * * * * * *
[Sec. 989A. Senior investor protections.]
Sec.989A. Grants to eligible entities for enhanced protection of senior 
          investors and senior policyholders.

           *       *       *       *       *       *       *


 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''.

           *       *       *       *       *       *       *


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

           *       *       *       *       *       *       *


[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. 989A. GRANTS TO ELIGIBLE ENTITIES FOR ENHANCED PROTECTION OF 
                    SENIOR INVESTORS AND SENIOR POLICYHOLDERS.

  (a) Definitions.--In this section:
          (1) Eligible entity.--The term ``eligible entity'' 
        means--
                  (A) the securities commission (or any agency 
                or office performing like functions) of any 
                State; and
                  (B) the insurance department (or any agency 
                or office performing like functions) of any 
                State.
          (2) Senior.--The term ``senior'' means any individual 
        who has attained the age of 62 years or older.
          (3) Senior financial fraud.--The term ``senior 
        financial fraud'' means a fraudulent or otherwise 
        illegal, unauthorized, or improper act or process of an 
        individual, including a caregiver or a fiduciary, 
        that--
                  (A) uses the resources of a senior for 
                monetary or personal benefit, profit, or gain;
                  (B) results in depriving a senior of rightful 
                access to or use of benefits, resources, 
                belongings, or assets; or
                  (C) is an action described in section 1348 of 
                title 18, United States Code, that is taken 
                against a senior.
          (4) Task force.--The term ``task force'' means the 
        task force established under subsection (b)(1).
  (b) Grant Program.--
          (1) Task force.--
                  (A) In general.--The Commission shall 
                establish a task force to carry out the grant 
                program under paragraph (2).
                  (B) Membership.--The task force shall consist 
                of the following members:
                          (i) A Chair of the task force, who--
                                  (I) shall be appointed by the 
                                Chairman of the Commission, in 
                                consultation with the 
                                Commissioners of the 
                                Commission; and
                                  (II) may be a representative 
                                of the Office of the Investor 
                                Advocate of the Commission, the 
                                Division of Enforcement of the 
                                Commission, or such other 
                                representative as the 
                                Commission determines 
                                appropriate.
                          (ii) If the Chair is not a 
                        representative of the Office of the 
                        Investor Advocate of the Commission, a 
                        representative of such Office.
                          (iii) If the Chair is not a 
                        representative of the Division of 
                        Enforcement of the Commission, a 
                        representative of such Division.
                          (iv) Such other representatives as 
                        the Commission determines appropriate.
                  (C) Detail of executive agency employees.--
                Upon the request of the Commission, the head of 
                any Federal agency may detail, on a 
                reimbursable basis, any of the personnel of 
                that Federal agency to the Commission to assist 
                it in carrying out its functions under this 
                section. The detail of any such personnel shall 
                be without interruption or loss of civil 
                service status or privilege.
          (2) Grants.--The task force shall carry out a program 
        under which the task force shall make grants, on a 
        competitive basis, to eligible entities, which--
                  (A) may use the grant funds--
                          (i) to hire staff to identify, 
                        investigate, and prosecute (through 
                        civil, administrative, or criminal 
                        enforcement actions) cases involving 
                        senior financial fraud;
                          (ii) to fund technology, equipment, 
                        and training for regulators, 
                        prosecutors, and law enforcement 
                        officers, in order to identify, 
                        investigate, and prosecute cases 
                        involving senior financial fraud;
                          (iii) to provide educational 
                        materials and training to seniors to 
                        increase awareness and understanding of 
                        senior financial fraud;
                          (iv) to develop comprehensive plans 
                        to combat senior financial fraud; and
                          (v) to enhance provisions of State 
                        law to provide protection from senior 
                        financial fraud; and
                  (B) may not use the grant funds for any 
                indirect expense, such as rent, utilities, or 
                any other general administrative cost that is 
                not directly related to the purpose of the 
                grant program.
          (3) Authority of task force.--In carrying out 
        paragraph (2), the task force--
                  (A) may consult with staff of the Commission; 
                and
                  (B) shall make public all actions of the task 
                force relating to carrying out that paragraph.
  (c) Applications.--An eligible entity desiring a grant under 
this section shall submit an application to the task force, in 
such form and in such a manner as the task force may determine, 
that includes--
          (1) a proposal for activities to protect seniors from 
        senior financial fraud that are proposed to be funded 
        using a grant under this section, including--
                  (A) an identification of the scope of the 
                problem of senior financial fraud in the 
                applicable State;
                  (B) a description of how the proposed 
                activities would--
                          (i) protect seniors from senior 
                        financial fraud, including by 
                        proactively identifying victims of 
                        senior financial fraud;
                          (ii) assist in the investigation and 
                        prosecution of those committing senior 
                        financial fraud; and
                          (iii) discourage and reduce cases of 
                        senior financial fraud; and
                  (C) a description of how the proposed 
                activities would be coordinated with other 
                State efforts; and
          (2) any other information that the task force 
        determines appropriate.
  (d) Performance Objectives; Reporting Requirements; Audits.--
          (1) In general.--The task force--
                  (A) may establish such performance objectives 
                and reporting requirements for eligible 
                entities receiving a grant under this section 
                as the task force determines are necessary to 
                carry out and assess the effectiveness of the 
                program under this section; and
                  (B) shall require each eligible entity that 
                receives a grant under this section to submit 
                to the task force a detailed accounting of the 
                use of grant funds, which shall be submitted at 
                such time, in such form, and containing such 
                information as the task force may require.
          (2) Report.--Not later than 2 years, and again not 
        later than 5 years, after the date of the enactment of 
        the Empowering States to Protect Seniors from Bad 
        Actors Act, the task force 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--
                  (A) specifies each recipient of a grant under 
                this section;
                  (B) includes a description of the programs 
                that are supported by each such grant; and
                  (C) includes an evaluation by the task force 
                of the effectiveness of such grants.
          (3) Audits.--The task force shall annually conduct an 
        audit of the program under this section to ensure that 
        eligible entities to which grants are made under that 
        program are, for the year covered by the audit, using 
        grant funds for the intended purposes of those funds.
  (e) Maximum Amount.--The amount of a grant to an eligible 
entity under this section may not exceed $500,000, which the 
task force shall adjust annually to reflect the percentage 
change in the Consumer Price Index for All Urban Consumers 
published by the Bureau of Labor Statistics of the Department 
of Labor.
  (f) Subgrants.--An eligible entity that receives a grant 
under this section may, in consultation with the task force, 
make a subgrant, as the eligible entity determines is necessary 
or appropriate--
          (1) to carry out the activities described in 
        subsection (b)(2)(A); and
          (2) which may not be used for any activity described 
        in subsection (b)(2)(B).
  (g) Authorization of Appropriations.--There are authorized to 
be appropriated to carry out this section $10,000,000 for each 
of fiscal years 2023 through 2028.

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