[House Report 118-334]
[From the U.S. Government Publishing Office]


118th Congress }                                          { REPORT 
                        HOUSE OF REPRESENTATIVES
 1st Session   }                                          { 118-334

======================================================================
 
            HOLDING IRANIAN LEADERS ACCOUNTABLE ACT OF 2023

                                _______
                                

 December 19, 2023.--Committed to the Committee of the Whole House on 
            the State of the Union and ordered to be printed

                                _______
                                

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

                              R E P O R T

                        [To accompany H.R. 6245]

    The Committee on Financial Services, to whom was referred 
the bill (H.R. 6245) to require the Secretary of the Treasury 
to report on financial institutions' involvement with officials 
of the Iranian Government, and for other purposes, having 
considered the same, reports favorably thereon with an 
amendment and recommends 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.

  This Act may be cited as the ``Holding Iranian Leaders Accountable 
Act of 2023''.

SEC. 2. FINDINGS.

  The Congress finds the following:
          (1) Iran is characterized by high levels of official and 
        institutional corruption, and substantial involvement by Iran's 
        security forces, particularly the Islamic Revolutionary Guard 
        Corps (IRGC), in the economy.
          (2) The Department of Treasury in 2019 designated the Islamic 
        Republic of Iran's financial sector as a jurisdiction of 
        primary money laundering concern, concluding, ``Iran has 
        developed covert methods for accessing the international 
        financial system and pursuing its malign activities, including 
        misusing banks and exchange houses, operating procurement 
        networks that utilize front or shell companies, exploiting 
        commercial shipping, and masking illicit transactions using 
        senior officials, including those at the Central Bank of Iran 
        (CBI).''.
          (3) In June 2019, the Financial Action Task Force (FATF) 
        urged all jurisdictions to require increased supervisory 
        examination for branches and subsidiaries of financial 
        institutions based in Iran. The FATF later called upon its 
        members to introduce enhanced relevant reporting mechanisms or 
        systematic reporting of financial transactions, and require 
        increased external audit requirements, for financial groups 
        with respect to any of their branches and subsidiaries located 
        in Iran.
          (4) According to the State Department's ``Country Reports on 
        Terrorism'' in 2021, ``Iran continued to be the leading state 
        sponsor of terrorism, facilitating a wide range of terrorist 
        and other illicit activities around the world. Regionally, Iran 
        supported acts of terrorism in Bahrain, Iraq, Lebanon, Syria, 
        and Yemen through proxies and partner groups such as Hizballah 
        and Hamas.''.

SEC. 3. REPORT ON FINANCIAL INSTITUTIONS AND ASSETS CONNECTED TO 
                    CERTAIN IRANIAN OFFICIALS.

  (a) Financial Institutions and Assets Report.--
          (1) In general.--Not later than 180 days after the date of 
        the enactment of this Act, and every 2 years thereafter, the 
        President shall submit a report to the appropriate Members of 
        Congress containing--
                  (A) the estimated total funds or assets that are 
                under direct or indirect control by each of the natural 
                persons described under subsection (b), and a 
                description of such funds or assets, except that the 
                President may limit coverage of the report to not fewer 
                than 5 of such natural persons in order to meet the 
                submission deadline described under this paragraph;
                  (B) a description of how such funds or assets were 
                acquired, and how they have been used or employed;
                  (C) a list of any non-Iranian financial institutions 
                that--
                          (i) maintain an account in connection with 
                        funds or assets described in subparagraph (A); 
                        or
                          (ii) knowingly provide significant financial 
                        services to a natural person covered by the 
                        report; and
                  (D) a description of any illicit or corrupt means 
                employed to acquire or use such funds or assets.
          (2) Exemptions.--The requirements described under paragraph 
        (1) may not be applied with respect to a natural person or a 
        financial institution, as the case may be, if the President 
        determines:
                  (A) The funds or assets described under subparagraph 
                (A) of paragraph (1) were acquired through legal or 
                noncorrupt means.
                  (B) The natural person has agreed to provide 
                significant cooperation to the United States for an 
                important national security or law enforcement purpose 
                with respect to Iran.
                  (C) A financial institution that would otherwise be 
                listed in the report required by paragraph (1) has 
                agreed to--
                          (i) no longer maintain an account described 
                        under subparagraph (C)(i) of paragraph (1);
                          (ii) no longer provide significant financial 
                        services to a natural person covered by the 
                        report; or
                          (iii) provide significant cooperation to the 
                        United States for an important national 
                        security or law enforcement purpose with 
                        respect to Iran.
          (3) Waiver.--The President may waive for up to 1 year at a 
        time any requirement under paragraph (1) with respect to a 
        natural person or a financial institution after reporting in 
        writing to the appropriate Members of Congress that the waiver 
        is in the national interest of the United States, with a 
        detailed explanation of the reasons therefor.
  (b) Persons Described.--The natural persons described in this 
subsection are the following:
          (1) The Supreme Leader of Iran.
          (2) The President of Iran.
          (3) The members of the Council of Guardians.
          (4) The members of the Expediency Council.
          (5) The Minister of Intelligence and Security.
          (6) The Commander and the Deputy Commander of the IRGC.
          (7) The Commander and the Deputy Commander of the IRGC Ground 
        Forces.
          (8) The Commander and the Deputy Commander of the IRGC 
        Aerospace Force.
          (9) The Commander and the Deputy Commander of the IRGC Navy.
          (10) The Commander of the Basij-e-Mostaz'afin.
          (11) The Commander of the Qods Force.
          (12) The Commander in Chief of the Police Force.
          (13) The head of the IRGC Joint Staff.
          (14) The Commander of the IRGC Intelligence.
          (15) The head of the IRGC Imam Hussein University.
          (16) The Supreme Leader's Representative at the IRGC.
          (17) The Chief Executive Officer and the Chairman of the IRGC 
        Cooperative Foundation.
          (18) The Commander of the Khatam-al-Anbia Construction Head 
        Quarter.
          (19) The Chief Executive Officer of the Basij Cooperative 
        Foundation.
          (20) The head of the Political Bureau of the IRGC.
          (21) The senior leadership as determined by the President of 
        the following groups:
                  (A) Hizballah.
                  (B) Hamas.
                  (C) Palestinian Islamic Jihad.
                  (D) Kata'ib Hizballah.
  (c) Form of Report; Public Availability.--
          (1) Form.--The report required under subsection (a) and any 
        waiver under subsection (a)(3) shall be submitted in 
        unclassified form but may contain a classified annex.
          (2) Public availability.--The Secretary shall make the 
        unclassified portion of such report public if the Secretary 
        notifies the appropriate Members of Congress that the 
        publication is in the national interest of the United States 
        and would substantially promote--
                  (A) deterring or sanctioning official corruption in 
                Iran;
                  (B) holding natural persons or financial institutions 
                listed in the report accountable to the people of Iran;
                  (C) combating money laundering or the financing of 
                terrorism; or
                  (D) achieving any other strategic objective with 
                respect to the Government of Iran.
          (3) Format of publicly available reports.--If the Secretary 
        makes the unclassified portion of a report public pursuant to 
        paragraph (2), the Secretary shall make it available to the 
        public on the website of the Department of the Treasury--
                  (A) in English, Farsi, Arabic, and Azeri; and
                  (B) in precompressed, easily downloadable versions 
                that are made available in all appropriate formats.

SEC. 4. RESTRICTIONS ON CERTAIN FINANCIAL INSTITUTIONS.

  (a) In General.--Not later than the date that is 90 days after 
submitting a report described under section 3(a)(1), the Secretary 
shall undertake the following with respect to a financial institution 
that is described under section 3(a)(1)(C) and listed in the report:
          (1) If the financial institution is a United States financial 
        institution, require the closure of any account described in 
        section 3(a)(1)(C)(i), and prohibit the provision of 
        significant financial services, directly or indirectly, to a 
        natural person covered by the report.
          (2) If the financial institution is a foreign financial 
        institution, actively seek the closure of any account described 
        in section 3(a)(1)(C)(i), and the cessation of significant 
        financial services to a natural person covered by the report, 
        using any existing authorities of the Secretary, as 
        appropriate.
  (b) Suspension.--The Secretary may suspend the application of 
subsection (a) with respect to a financial institution upon reporting 
to the appropriate Members of Congress that the suspension is in the 
national interest of the United States, with a detailed explanation of 
the reasons therefor.

SEC. 5. EXCEPTIONS FOR NATIONAL SECURITY; IMPLEMENTATION AUTHORITY.

  The following activities shall be exempt from requirements under 
sections 3 and 4:
          (1) Any activity subject to the reporting requirements under 
        title V of the National Security Act of 1947 (50 U.S.C. 3091 et 
        seq.), or to any authorized intelligence activities of the 
        United States.
          (2) The admission of an alien to the United States if such 
        admission is necessary to comply with United States obligations 
        under the Agreement between the United Nations and the United 
        States of America regarding the Headquarters of the United 
        Nations, signed at Lake Success June 26, 1947, and entered into 
        force November 21, 1947, or under the Convention on Consular 
        Relations, done at Vienna April 24, 1963, and entered into 
        force March 19, 1967, or other applicable international 
        obligations of the United States.
          (3) The conduct or facilitation of a transaction for the sale 
        of agricultural commodities, food, medicine, or medical devices 
        to Iran or for the provision of humanitarian assistance to the 
        people of Iran, including engaging in a financial transaction 
        relating to humanitarian assistance or for humanitarian 
        purposes or transporting goods or services that are necessary 
        to carry out operations relating to humanitarian assistance or 
        humanitarian purposes.

SEC. 6. SUNSET.

  The provisions of this Act shall have no force or effect on the 
earlier of--
          (1) the date that is 5 years after the date of enactment of 
        this Act; or
          (2) 30 days after the Secretary reports in writing to the 
        appropriate Members of Congress that--
                  (A) Iran is not a jurisdiction of primary money 
                laundering concern; or
                  (B) the Government of Iran is providing significant 
                cooperation to the United States for the purpose of 
                preventing acts of international terrorism, or for the 
                promotion of any other strategic objective that is 
                important to the national interest of the United 
                States, as specified in the report by the Secretary.

SEC. 7. DEFINITIONS.

  For purposes of this Act:
          (1) Appropriate members of congress.--The term ``appropriate 
        Members of Congress'' means the Speaker and Minority Leader of 
        the House of Representatives, the Majority Leader and Minority 
        Leader of the Senate, the Chairman and Ranking Member of the 
        Committee on Financial Services of the House of 
        Representatives, and the Chairman and Ranking Member of the 
        Committee on Banking, Housing, and Urban Affairs of the Senate.
          (2) Financial institution.--The term ``financial 
        institution'' means a United States financial institution or a 
        foreign financial institution.
          (3) Foreign financial institution.--The term ``foreign 
        financial institution'' has the meaning given that term in 
        section 561.308 of title 31, Code of Federal Regulations.
          (4) Funds.--The term ``funds'' means--
                  (A) cash;
                  (B) equity;
                  (C) any other asset whose value is derived from a 
                contractual claim, including bank deposits, bonds, 
                stocks, a security as defined in section 2(a) of the 
                Securities Act of 1933 (15 U.S.C. 77b(a)), or a 
                security or an equity security as defined in section 
                3(a) of the Securities Exchange Act of 1934 (15 U.S.C. 
                78c(a)); and
                  (D) anything else that the Secretary determines 
                appropriate.
          (5) Knowingly.--The term ``knowingly'' with respect to 
        conduct, a circumstance, or a result, means that a person has 
        actual knowledge, or should have known, of the conduct, the 
        circumstance, or the result.
          (6) Secretary.--The term ``Secretary'' means the Secretary of 
        the Treasury.
          (7) United states financial institution.--The term ``United 
        States financial institution'' has the meaning given the term 
        ``U.S. financial institution'' under section 561.309 of title 
        31, Code of Federal Regulations.

                          PURPOSE AND SUMMARY

    Introduced on November 6, 2023, by Representative French 
Hill, H.R. 6245, the Holding Iranian Leaders Accountable Act, 
requires the President to report on the assets of certain 
Iranian government officials and terrorist leaders while also 
providing for the publication of those assets. This legislation 
further requires the Secretary of the Department of the 
Treasury (Treasury) to seek the closure of U.S. and foreign 
financial institution accounts connected with the assets.

                  BACKGROUND AND NEED FOR LEGISLATION

    The Holding Iranian Leaders Accountable Act is an evolution 
of previous legislation (H.R. 5461, 114th Congress) that 
required a public report on the assets of top Iranian 
government officials. This earlier bill passed the House in 
2016 with a bipartisan majority of 282 to 143. At the time, 
Financial Services Committee Democrats had expressed concerns 
that the reporting requirements could place excessive burdens 
on Treasury. H.R. 6245 provides flexibility to ensure that 
Treasury can meet its deadline, while still exposing the 
illicit and corrupt assets of senior leaders in Iran. This 
legislation further requires Treasury to seek the closure of 
accounts connected with Iranians included in the asset report, 
both in the U.S. and abroad.

                                HEARING

    Pursuant to clause 3(c)(6) of rule XIII, the following 
hearing was used to develop H.R. 6245: The Subcommittee on 
National Security, Illicit Finance, and International Financial 
Institutions of the Committee on Financial Services held a 
hearing on October 25, 2023, titled ``How America and Its 
Allies Can Stop Hamas, Hezbollah, and Iran from Evading 
Sanctions and Financing Terror.''

                        COMMITTEE CONSIDERATION

    The Committee on Financial Services met in open session on 
November 14, 2023, and ordered H.R. 6245 to be reported 
favorably to the House as amended by a recorded vote of 49 ayes 
to 0 nays (Record vote no. FC-110), a quorum being present. 
Before the question was called to order the bill favorably 
reported, the Committee adopted an amendment in the nature of a 
substitute offered by Mr. Hill by voice vote.

                            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 order to report legislation and amendments thereto. H.R. 
6245 was ordered reported favorably to the House as amended by 
a recorded vote of 49 ayes to 0 nays (Record vote no. FC-110), 
a quorum being present.


                      COMMITTEE OVERSIGHT FINDINGS

    Pursuant to clause 3(c) 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 goal of H.R. 6245 is to require 
the President to report on the assets of certain Iranian 
government officials and terrorist leaders while also providing 
for the publication of those assets.

                 CONGRESSIONAL BUDGET OFFICE ESTIMATES

    The Committee has requested but not received a cost 
estimate from the Director of the Congressional Budget Office. 
However, pursuant to clause 3(d)(1) of House rule XIII, the 
Committee will adopt as its own the cost estimate by the 
Director of the Congressional Budget Office once it has been 
prepared.

   NEW BUDGET AUTHORITY, ENTITLEMENT AUTHORITY, AND TAX EXPENDITURES

    The Committee has requested but not received an estimate 
from the Director of the Congressional Budget Office. However, 
pursuant to clause 3(c)(2) of rule XIII of the Rules of the 
House of Representatives, once an estimate has been prepared by 
the Director of the Congressional Budget Office, as required by 
section 402 of the Congressional Budget Act of 1973, the 
Committee will adopt as its own the estimate of new budget 
authority, entitlement authority, or tax expenditures or 
revenues contained in the cost estimate.

                       FEDERAL MANDATES STATEMENT

    The Committee has requested but not received an estimate of 
the Federal mandates from the Director of the Congressional 
Budget Office, pursuant to section 423 of the Unfunded Mandates 
Reform Act. The Committee will adopt the estimate once it has 
been prepared by the Director.

                      ADVISORY COMMITTEE STATEMENT

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

                  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 section 
102(b)(3) of the Congressional Accountability Act.

                         EARMARK IDENTIFICATION

    Pursuant to clause 9 of rule XXI of the Rules of the House 
of Representatives, the Committee has carefully reviewed the 
provisions of the bill and states that the provisions of the 
bill do not contain any congressional earmarks, limited tax 
benefits, or limited tariff benefits within the meaning of the 
rule.

                    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 the bill establishes or reauthorizes a program of 
the Federal Government known to be duplicative of another 
Federal program, including any program that was included in a 
report to Congress pursuant to section 21 of the Public Law 
111-139 or the most recent Catalog of Federal Domestic 
Assistance.

             SECTION-BY-SECTION ANALYSIS OF THE LEGISLATION

Section 1. Short title

    This Act may be cited as the ``Holding Iranian Leaders 
Accountable Act of 2023''.

Section 2. Findings

    The Congress finds the following:
          (1) Iran is characterized by high levels of official 
        and institutional corruption, and substantial 
        involvement by Iran's security forces, particularly the 
        Islamic Revolutionary Guard Corps (IRGC), in the 
        economy.
          (2) The Department of Treasury in 2019 designated the 
        Islamic Republic of Iran's financial sector as a 
        jurisdiction of primary money laundering concern, 
        concluding, ``Iran has developed covert methods for 
        accessing the international financial system and 
        pursuing its malign activities, including misusing 
        banks and exchange houses, operating procurement 
        networks that utilize front or shell companies, 
        exploiting commercial shipping, and masking illicit 
        transactions using senior officials, including those at 
        the Central Bank of Iran (CBI).''
          (3) In June 2019, the Financial Action Task Force 
        (FATF) urged all jurisdictions to require increased 
        supervisory examination for branches and subsidiaries 
        of financial institutions based in Iran. The FATF later 
        called upon its members to introduce enhanced relevant 
        reporting mechanisms or systematic reporting of 
        financial transactions, and require increased external 
        audit requirements, for financial groups with respect 
        to any of their branches and subsidiaries located in 
        Iran.
          (4) According to the State Department's ``Country 
        Reports on Terrorism'' in 2021, ``Iran continued to be 
        the leading state sponsor of terrorism, facilitating a 
        wide range of terrorist and other illicit activities 
        around the world. Regionally, Iran supported acts of 
        terrorism in Bahrain, Iraq, Lebanon, Syria, and Yemen 
        through proxies and partner groups such as Hizballah 
        and Hamas.''

Section 3. Report on financial institutions and assets connected to 
        certain Iranian officials

    This section requires the President to report on the assets 
of certain Iranian government officials and terrorist leaders 
while also providing for the publication of those assets.

Section 4. Restrictions on certain financial institutions

    This section requires the Secretary of the Treasury to seek 
the closure of the U.S. and foreign financial institution 
accounts connected with the assets in the President's report.

Section 5. Exceptions for national security; implementation authority

    The following activities shall be exempt from requirements 
under sections 3 and 4:
          1. Any activity subject to the reporting requirements 
        under title V of the National Security Act of 1947 (50 
        U.S.C. 3091 et seq.), or to any authorized intelligence 
        activities of the United States.
          2. The admission of an alien to the United States if 
        such admission is necessary to comply with United 
        States obligations under the Agreement between the 
        United Nations and the United States of America 
        regarding the Headquarters of the United Nations, 
        signed at Lake Success June 26, 1947, and entered into 
        force November 21, 1947, or under the Convention on 
        Consular Relations, done at Vienna April 24, 1963, and 
        entered into force March 19, 1967, or other applicable 
        international obligations of the United States.
          3. The conduct or facilitation of a transaction for 
        the sale of agricultural commodities, food, medicine, 
        or medical devices to Iran or for the provision of 
        humanitarian assistance to the people of Iran, 
        including engaging in a financial transaction relating 
        to humanitarian assistance or for humanitarian purposes 
        or transporting goods or services that are necessary to 
        carry out operations relating to humanitarian 
        assistance or humanitarian purposes.

Section 6. Sunset

    The provisions of this Act shall have no force or effect on 
the earlier of--
          1. the date that is 5 years after the date of 
        enactment of this Act; or
          2. 30 days after the Secretary of the Treasury 
        reports in writing to the appropriate Members of 
        Congress the following:
                  i. Iran is not a jurisdiction of primary 
                money laundering concern; or
                  ii. the Government of Iran is providing 
                significant cooperation to the United States 
                for the purpose of preventing acts of 
                international terrorism, or for the promotion 
                of any other strategic objective that is 
                important to the national interest of the 
                United States, as specified in the report by 
                the Secretary.

Section 7. Definitions

    This section contains various definitions for the bill.

                                  [all]