II 

116TH CONGRESS 

1ST SESSION S. 667 

To impose sanctions with respect to the Democratic People’s Republic of 

Korea, and for other purposes. 

IN THE SENATE OF THE UNITED STATES 

MARCH 5, 2019 

Mr. VAN HOLLEN (for himself and Mr. TOOMEY) introduced the following bill; 

which was read twice and referred to the Committee on Banking, Housing, and Urban Affairs 

A BILL 

To impose sanctions with respect to the Democratic People’s 

Republic of Korea, and for other purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE; TABLE OF CONTENTS. 

4 (a) SHORT TITLE.—This Act may be cited as the 

5 ‘‘Otto Warmbier Banking Restrictions Involving North 

6 Korea Act of 2019’’. 

7 (b) TABLE OF CONTENTS.—The table of contents for 

8 this Act is as follows: 

Sec. 1. Short title; table of contents. 

TITLE I—SANCTIONS WITH RESPECT TO NORTH KOREA 


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Sec. 101. Findings. 

Sec. 102. Sense of Congress. 

Sec. 103. Definitions. 

Subtitle A—Expansion of Sanctions and Related Matters 

Sec. 111. Sanctions with respect to foreign financial institutions that provide 

financial services to certain sanctioned persons. 

Sec. 112. Codification of Executive orders relating to sanctions with respect to 

North Korea. 

Sec. 113. Expansion of mandatory designations under North Korea Sanctions 

and Policy Enhancement Act of 2016. 

Sec. 114. Extension of applicability period of proliferation prevention sanctions. 

Sec. 115. Sense of Congress on identification and blocking of property of North 

Korean officials. 

Sec. 116. Modification of report on implementation of United Nations Security 

Council resolutions by other governments. 

Sec. 117. Report on use by the Government of North Korea of beneficial ownership rules to access the international financial system. 

Subtitle B—Congressional Review and Oversight 

Sec. 121. Notification of termination or suspension of sanctions. 

Sec. 122. Reports on certain licensing actions. 

Sec. 123. Briefings on implementation and enforcement of sanctions. 

Sec. 124. Report on financial networks and financial methods of the Government of North Korea. 

Sec. 125. Report on countries of concern with respect to transshipment, reexportation, or diversion of certain items to North Korea. 

Subtitle C—General Matters 

Sec. 131. Rulemaking. 

Sec. 132. Authority to consolidate reports. 

Sec. 133. Waivers, exemptions, and termination. 

Sec. 134. Procedures for review of classified information. 

Sec. 135. Briefing on proliferation financing. 

TITLE II—DIVESTMENT FROM NORTH KOREA 

Sec. 201. Authority of State and local governments to divest from companies 

that invest in North Korea. 

Sec. 202. Safe harbor for changes of investment policies by asset managers. 

Sec. 203. Sense of Congress regarding certain ERISA plan investments. 

Sec. 204. Rule of construction. 

TITLE III—FINANCIAL INDUSTRY GUIDANCE TO HALT 

TRAFFICKING 

Sec. 301. Short title. 

Sec. 302. Findings. 

Sec. 303. Sense of Congress. 

Sec. 304. Coordination of human trafficking issues by the Office of Terrorism 

and Financial Intelligence. 

Sec. 305. Strengthening the role of anti-money laundering and other financial 

tools in combating human trafficking. 

Sec. 306. Sense of Congress on resources to combat human trafficking. 


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1 TITLE I—SANCTIONS WITH 

2 RESPECT TO NORTH KOREA 

3 SEC. 101. FINDINGS. 

4 Congress finds the following: 

5 (1) Since 2006, the United Nations Security 

6 Council has adopted 10 resolutions imposing sanc7 tions against North Korea under chapter VII of the 

8 United Nations Charter, which— 

9 (A) prohibit the use, development, and pro10 liferation of weapons of mass destruction by 

11 North Korea; 

12 (B) prohibit the supply, sale, or transfer of 

13 arms and related materiel to or from North 

14 Korea; 

15 (C) prohibit the transfer of luxury goods to 

16 North Korea; 

17 (D) restrict access by North Korea to fi18 nancial services that could contribute to nu19 clear, missile, or other programs related to the 

20 development of weapons of mass destruction; 

21 (E) restrict North Korean shipping, includ22 ing the registration, reflagging, or insuring of 

23 North Korean ships; 


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1 (F) prohibit, with limited exceptions, 

2 North Korean exports of coal, precious metals, 

3 iron, vanadium, and rare earth minerals; 

4 (G) prohibit the transfer to North Korea 

5 of rocket, aviation, or jet fuel, as well as gaso6 line, condensates, and natural gas liquids; 

7 (H) prohibit new work authorization for 

8 North Korean laborers and require the repatri9 ation of all North Korean laborers by December 

10 2019; 

11 (I) prohibit exports of North Korean food 

12 and agricultural products, including seafood; 

13 (J) prohibit joint ventures or cooperative 

14 commercial entities or expanding joint ventures 

15 with North Korea; 

16 (K) prohibit exports of North Korean tex17 tiles; 

18 (L) require member countries of the 

19 United Nations to seize, inspect, and impound 

20 any ship in its jurisdiction that is suspected of 

21 violating Security Council resolutions with re22 spect to North Korea and to interdict and in23 spect all cargo heading to or from North Korea 

24 by land, sea, or air; 


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1 (M) limit the transfer to North Korea of 

2 refined petroleum products and crude oil; 

3 (N) ban the sale or transfer to North 

4 Korea of industrial machinery, transportation 

5 vehicles, electronics, iron, steel, and other met6 als; 

7 (O) reduce North Korean diplomatic staff 

8 numbers in member countries of the United 

9 Nations and expel any North Korean diplomats 

10 found to be working on behalf of a person sub11 ject to sanctions or assisting in sanctions eva12 sion; 

13 (P) limit North Korean diplomatic mis14 sions abroad with respect to staff size and ac15 cess to banking privileges and prohibit com16 merce from being conducted out of North Ko17 rean consular or diplomatic offices; 

18 (Q) require member states of the United 

19 Nations to close representative offices, subsidi20 aries, and bank accounts in North Korea; 

21 (R) prohibit countries from providing or 

22 receiving military training to or from North 

23 Korea or hosting North Koreans for specialized 

24 teaching or training that could contribute to the 


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1 programs of North Korea related to the devel2 opment of weapons of mass destruction; 

3 (S) ban countries from granting landing 

4 and flyover rights to North Korean aircraft; 

5 and 

6 (T) prohibit trade in statuary of North Ko7 rean origin. 

8 (2) The Government of North Korea has 

9 threatened to carry out nuclear attacks against the 

10 United States, South Korea, and Japan. 

11 (3) The Government of North Korea tested its 

12 sixth and largest nuclear device on September 3, 

13 2017. 

14 (4) According to a report by the International 

15 Atomic Energy Agency released in August 2018, 

16 ‘‘The continuation and further development of the 

17 DPRK’s nuclear programme and related statements 

18 by the DPRK are a cause for grave concern. The 

19 DPRK’s nuclear activities, including those in rela20 tion to the Yongbyon Experimental Nuclear Power 

21 Plant (5 MW(e)) reactor, the use of the building 

22 which houses the reported centrifuge enrichment fa23 cility and the construction at the light water reactor, 

24 as well as the DPRK’s sixth nuclear test, are clear 

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1 tions, including resolution 2375 (2017) and are 

2 deeply regrettable.’’. 

3 (5) In July 2018, Secretary of State Mike 

4 Pompeo testified to the Committee on Foreign Rela5 tions of the Senate that North Korea ‘‘continue[s] to 

6 produce fissile material’’ despite public pledges by 

7 North Korean leader Kim Jong-un to denuclearize. 

8 (6) The 2019 Missile Defense Review conducted 

9 by the Department of Defense states that North 

10 Korea ‘‘continues to pose an extraordinary threat 

11 and the United States must remain vigilant. In the 

12 past, North Korea frequently issued explicit nuclear 

13 missile threats against the United States and allies, 

14 all the while working aggressively to field the capa15 bility to strike the U.S. homeland with nuclear16 armed ballistic missiles. Over the past decade, it has 

17 invested considerable resources in its nuclear and 

18 ballistic missile programs, and undertaken extensive 

19 nuclear and missile testing in order to realize the ca20 pability to threaten the U.S. homeland with missile 

21 attack. As a result, North Korea has neared the 

22 time when it could credibly do so.’’. 

23 (7) Financial transactions and investments that 

24 provide financial resources to the Government of 

25 North Korea, and that fail to incorporate adequate 


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1 safeguards against the misuse of those financial re2 sources, pose an undue risk of contributing to— 

3 (A) weapons of mass destruction programs 

4 of that Government; and 

5 (B) efforts to evade restrictions required 

6 by the United Nations Security Council on im7 ports or exports of arms and related materiel, 

8 services, or technology by that Government. 

9 (8) The Federal Bureau of Investigation has 

10 determined that the Government of North Korea 

11 was responsible for cyberattacks against entities in 

12 the United States, South Korea, and around the 

13 world. 

14 (9) In November 2017, President Donald 

15 Trump designated the government of North Korea 

16 as a state sponsor of terrorism pursuant to authori17 ties under the Export Administration Act of 1979 

18 (50 U.S.C. App. 2401 et seq.), as continued in effect 

19 at the time under the International Emergency Eco20 nomic Powers Act (50 U.S.C. 1701 et seq.), the 

21 Foreign Assistance Act of 1961 (22 U.S.C. 2151 et 

22 seq.), and the Arms Export Control Act (22 U.S.C. 

23 2751 et seq.); 

24 (10) On February 22, 2018, the Secretary of 

25 State determined that the Government of North 


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1 Korea was responsible for the lethal nerve agent at2 tack in 2017 on Kim Jong Nam, the half-brother of 

3 North Korean leader Kim Jong-un, in Malaysia, 

4 triggering sanctions required under the Chemical 

5 and Biological Weapons Control and Warfare Elimi6 nation Act of 1991 (22 U.S.C. 5601 et seq.). 

7 (11) The strict enforcement of sanctions is es8 sential to the efforts of the international community 

9 to achieve the peaceful, complete, verifiable, and ir10 reversible dismantlement of weapons of mass de11 struction programs of the Government of North 

12 Korea. 

13 SEC. 102. SENSE OF CONGRESS. 

14 It is the sense of Congress that— 

15 (1) the United States is committed to working 

16 with its allies and partners to halt the nuclear and 

17 ballistic missile programs of North Korea through a 

18 policy of maximum pressure and diplomatic engage19 ment; 

20 (2) the imposition of sanctions, including those 

21 under this Act, should not be construed to limit the 

22 authority of the President to fully engage in diplo23 matic negotiations to further the policy objective de24 scribed in paragraph (1); 


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1 (3) the successful use of sanctions to halt the 

2 nuclear and ballistic missile programs of North 

3 Korea is part of a broader diplomatic and economic 

4 strategy that relies on effective coordination among 

5 relevant Federal agencies and officials, as well as 

6 with international partners of the United States; and 

7 (4) the coordination described in paragraph (3) 

8 should include proper vetting of external messaging 

9 and communications from all parts of the Executive 

10 branch to ensure that those communications are an 

11 intentional component of and aligned with the strat12 egy of the United States with respect to North 

13 Korea. 

14 SEC. 103. DEFINITIONS. 

15 (a) IN GENERAL.—In this title, the terms ‘‘applicable 

16 Executive order’’, ‘‘applicable United Nations Security 

17 Council resolution’’, ‘‘appropriate congressional commit18 tees’’, ‘‘Government of North Korea’’, ‘‘North Korea’’, 

19 and ‘‘North Korean financial institution’’ have the mean20 ings given those terms in section 3 of the North Korea 

21 Sanctions and Policy Enhancement Act of 2016 (22 

22 U.S.C. 9202), as amended by subsection (b). 

23 (b) AMENDMENTS TO DEFINITIONS IN NORTH

24 KOREA SANCTIONS AND POLICY ENHANCEMENT ACT OF

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1 icy Enhancement Act of 2016 (22 U.S.C. 9202) is amend2 ed— 

3 (1) in paragraph (1)(A), in the matter pre4 ceding clause (i), by striking ‘‘Executive Order No. 

5 13694’’ and all that follows through ‘‘to the extent 

6 that’’ and inserting the following: ‘‘Executive Order 

7 13694 (50 U.S.C. 1701 note; relating to blocking 

8 the property of certain persons engaging in signifi9 cant malicious cyber-enabled activities), Executive 

10 Order 13722 (50 U.S.C. 1701 note; relating to 

11 blocking the property of the Government of North 

12 Korea and the Workers’ Party of Korea, and prohib13 iting certain transactions with respect to North 

14 Korea), or Executive Order 13810 (82 Fed. Reg. 

15 44705; relating to imposing additional sanctions 

16 with respect to North Korea), to the extent that’’; 

17 and 

18 (2) in paragraph (2)(A), by striking ‘‘or 2321 

19 (2016)’’ and inserting ‘‘2321 (2016), 2356 (2017), 

20 2371 (2017), 2375 (2017), or 2397 (2017)’’. 


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1 Subtitle A—Expansion of Sanctions 

2 and Related Matters 

3 SEC. 111. SANCTIONS WITH RESPECT TO FOREIGN FINAN4 CIAL INSTITUTIONS THAT PROVIDE FINAN5 CIAL SERVICES TO CERTAIN SANCTIONED 

6 PERSONS. 

7 (a) IN GENERAL.—Title II of the North Korea Sanc8 tions and Policy Enhancement Act of 2016 (22 U.S.C. 

9 9221 et seq.) is amended by inserting after the item relat10 ing to section 201A the following: 

11 ‘‘SEC. 201B. SANCTIONS WITH RESPECT TO FOREIGN FINAN12 CIAL INSTITUTIONS THAT PROVIDE FINAN13 CIAL SERVICES TO CERTAIN SANCTIONED 

14 PERSONS. 

15 ‘‘(a) IN GENERAL.—The Secretary of the Treasury 

16 shall impose one or more of the sanctions described in sub17 section (b) with respect to a foreign financial institution 

18 that the Secretary determines, on or after the date that 

19 is 90 days after the date of the enactment of the Otto 

20 Warmbier Banking Restrictions Involving North Korea 

21 Act of 2019, knowingly provides significant financial serv22 ices to any person designated for the imposition of sanc23 tions under— 

24 ‘‘(1) subsection (a) or (b) of section 104; 

25 ‘‘(2) an applicable Executive order; or 


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1 ‘‘(3) an applicable United Nations Security 

2 Council resolution. 

3 ‘‘(b) SANCTIONS DESCRIBED.—The sanctions that 

4 may be imposed with respect to a foreign financial institu5 tion subject to subsection (a) are the following: 

6 ‘‘(1) ASSET BLOCKING.—The Secretary may 

7 block and prohibit, pursuant to the International 

8 Emergency Economic Powers Act (50 U.S.C. 1701 

9 et seq.), all transactions in all property and interests 

10 in property of the foreign financial institution if 

11 such property and interests in property are in the 

12 United States, come within the United States, or are 

13 or come within the possession or control of a United 

14 States person. 

15 ‘‘(2) RESTRICTIONS ON CORRESPONDENT AND

16 PAYABLE-THROUGH ACCOUNTS.—The Secretary may 

17 prohibit, or impose strict conditions on, the opening 

18 or maintaining in the United States of a cor19 respondent account or a payable-through account by 

20 the foreign financial institution. 

21 ‘‘(c) IMPLEMENTATION; PENALTIES.— 

22 ‘‘(1) IMPLEMENTATION.—The President may 

23 exercise all authorities provided under sections 203 

24 and 205 of the International Emergency Economic 


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1 Powers Act (50 U.S.C. 1702 and 1704) to carry out 

2 this section. 

3 ‘‘(2) PENALTIES.—A person that violates, at4 tempts to violate, conspires to violate, or causes a 

5 violation of this section or any regulation, license, or 

6 order issued to carry out this section shall be subject 

7 to the penalties set forth in subsections (b) and (c) 

8 of section 206 of the International Emergency Eco9 nomic Powers Act (50 U.S.C. 1705) to the same ex10 tent as a person that commits an unlawful act de11 scribed in subsection (a) of that section. 

12 ‘‘(d) REGULATIONS.—Not later than 120 days after 

13 the date of the enactment of the Otto Warmbier Banking 

14 Restrictions Involving North Korea Act of 2019, the 

15 President shall, as appropriate, prescribe regulations to 

16 carry out this section. 

17 ‘‘(e) DEFINITIONS.—In this section: 

18 ‘‘(1) ACCOUNT; CORRESPONDENT ACCOUNT; 

19 PAYABLE-THROUGH ACCOUNT.—The terms ‘ac20 count’, ‘correspondent account’, and ‘payable21 through account’ have the meanings given those 

22 terms in section 5318A of title 31, United States 

23 Code. 

24 ‘‘(2) FINANCIAL INSTITUTION.—The term ‘fi25 nancial institution’ means a financial institution 


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1 specified in subparagraph (A), (B), (C), (D), (E), 

2 (F), (G), (H), (I), (J), (M), or (Y) of section 

3 5312(a)(2) of title 31, United States Code. 

4 ‘‘(3) FOREIGN FINANCIAL INSTITUTION.—The 

5 term ‘foreign financial institution’ shall have the 

6 meaning of that term as determined by the Sec7 retary of the Treasury. 

8 ‘‘(4) KNOWINGLY.—The term ‘knowingly’, with 

9 respect to conduct, a circumstance, or a result, 

10 means that a person has actual knowledge, or should 

11 have known, of the conduct, the circumstance, or the 

12 result.’’. 

13 (b) CLERICAL AMENDMENT.—The table of contents 

14 for the North Korea Sanctions and Policy Enhancement 

15 Act of 2016 is amended by inserting after the item relat16 ing to section 201A the following: 

‘‘201B. Sanctions with respect to foreign financial institutions that provide financial services to certain sanctioned persons.’’. 

17 SEC. 112. CODIFICATION OF EXECUTIVE ORDERS RELATING 

18 TO SANCTIONS WITH RESPECT TO NORTH 

19 KOREA. 

20 (a) IN GENERAL.—Section 210 of the North Korea 

21 Sanctions and Policy Enhancement Act of 2016 (22 

22 U.S.C. 9230) is amended— 

23 (1) by striking ‘‘United States sanctions’’ and 

24 all that follows through ‘‘the date of the enactment 


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1 of this Act’’ and inserting ‘‘United States sanctions 

2 provided for in Executive Order 13687 (50 U.S.C. 

3 1701 note; relating to imposing additional sanctions 

4 with respect to North Korea), Executive Order 

5 13694 (50 U.S.C. 1701 note; relating to blocking 

6 the property of certain persons engaging in signifi7 cant malicious cyber-enabled activities), Executive 

8 Order 13722 (50 U.S.C. 1701 note; relating to 

9 blocking the property of the Government of North 

10 Korea and the Workers’ Party of Korea, and prohib11 iting certain transactions with respect to North 

12 Korea), or Executive Order 13810 (82 Fed. Reg. 

13 44705; relating to imposing additional sanctions 

14 with respect to North Korea), as such Executive Or15 ders are in effect on the day before the date of the 

16 enactment of the Otto Warmbier Banking Restric17 tions Involving North Korea Act of 2019’’; 

18 (2) by striking ‘‘the Government of North 

19 Korea, persons acting for or on behalf of that Gov20 ernment, and persons owned or controlled, directly 

21 or indirectly, by that Government or persons acting 

22 for or on behalf of that Government,’’ and inserting 

23 ‘‘persons subject to such sanctions’’; and 

24 (3) by striking ‘‘and 2094 (2013)’’ and insert25 ing ‘‘2094 (2013), 2270 (2016), 2321 (2016), 2356 


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1 (2017), 2371 (2017), 2375 (2017), and 2397 

2 (2017)’’. 

3 (b) CONFORMING AMENDMENT.—Section 210 of the 

4 North Korea Sanctions and Policy Enhancement Act of 

5 2016 (22 U.S.C. 9230) is amended in the section heading 

6 by striking ‘‘SANCTIONS WITH RESPECT TO NORTH

7 KOREAN ACTIVITIES UNDERMINING CYBERSECU8 RITY’’ and inserting ‘‘EXECUTIVE ORDERS RELATING

9 TO SANCTIONS WITH RESPECT TO NORTH KOREA’’. 

10 (c) CLERICAL AMENDMENT.—The table of contents 

11 for the North Korea Sanctions and Policy Enhancement 

12 Act of 2016 is amended by striking the item relating to 

13 section 210 and inserting the following: 

‘‘Sec. 210. Codification of Executive orders relating to sanctions with respect 

to North Korea.’’. 

14 SEC. 113. EXPANSION OF MANDATORY DESIGNATIONS 

15 UNDER NORTH KOREA SANCTIONS AND POL16 ICY ENHANCEMENT ACT OF 2016. 

17 (a) IN GENERAL.—Section 104(a) of the North 

18 Korea Sanctions and Policy Enhancement Act of 2016 (22 

19 U.S.C. 9214(a)) is amended— 

20 (1) in paragraph (14), by striking ‘‘or’’ at the 

21 end; 

22 (2) by redesignating paragraph (15) as para23 graph (24); 


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1 (3) by inserting after paragraph (14) the fol2 lowing: 

3 ‘‘(15) knowingly, directly or indirectly, pur4 chases or otherwise acquires from North Korea sig5 nificant quantities of coal, iron, or iron ore; 

6 ‘‘(16) knowingly, directly or indirectly, provides 

7 to North Korea coal, iron, or iron ore; 

8 ‘‘(17) knowingly, directly or indirectly, pur9 chases or otherwise acquires textiles from North 

10 Korea; 

11 ‘‘(18) knowingly facilitates a significant trans12 fer of funds or property from North Korea that ma13 terially contributes to any violation of an applicable 

14 United Nations Security Council resolution; 

15 ‘‘(19) knowingly, directly or indirectly, pur16 chases or otherwise acquires significant types or 

17 amounts of seafood from North Korea; 

18 ‘‘(20) knowingly, directly or indirectly, engages 

19 in, facilitates, or is responsible for the exportation of 

20 workers from North Korea; 

21 ‘‘(21) knowingly, directly or indirectly, sells or 

22 transfers vessels to North Korea, except as specifi23 cally approved by the United Nations Security Coun24 cil; 


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1 ‘‘(22) knowingly, directly or indirectly, supplies, 

2 sells, or transfers to North Korea crude oil or re3 fined petroleum products in excess of the aggregate 

4 amounts established in applicable United Nations 

5 Security Council resolutions; 

6 ‘‘(23) knowingly contributes to— 

7 ‘‘(A) the bribery of an official of the Gov8 ernment of North Korea or any person acting 

9 for or on behalf of that official; 

10 ‘‘(B) the misappropriation, theft, or em11 bezzlement of public funds by, or for the benefit 

12 of, an official of the Government of North 

13 Korea or any person acting for or on behalf of 

14 that official; or 

15 ‘‘(C) the use of any proceeds of any activ16 ity described in subparagraph (A) or (B); or’’; 

17 and 

18 (4) in paragraph (24), as redesignated by para19 graph (2), by striking ‘‘through (14)’’ and inserting 

20 ‘‘through (23)’’. 

21 (b) CONFORMING AMENDMENTS.—The North Korea 

22 Sanctions and Policy Enhancement Act of 2016 is amend23 ed— 

24 (1) in section 104(b)(1) (22 U.S.C. 

25 9214(b)(1))— 


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1 (A) by striking subparagraphs (B), (D), 

2 (E), (F), and (L); and 

3 (B) by redesignating subparagraphs (C), 

4 (G), (H), (I), (J), (K), (M), and (N) as sub5 paragraphs (B), (C), (D), (E), (F), (G), (H), 

6 and (I), respectively; and 

7 (2) in section 302(b)(3) (22 U.S.C. 

8 9241(b)(3)), by striking ‘‘section 104(b)(1)(M)’’ and 

9 inserting ‘‘section 104(a)(20)’’. 

10 SEC. 114. EXTENSION OF APPLICABILITY PERIOD OF PRO11 LIFERATION PREVENTION SANCTIONS. 

12 Section 203(b)(2) of the North Korea Sanctions and 

13 Policy Enhancement Act of 2016 (22 U.S.C. 9223(b)(2)) 

14 is amended by striking ‘‘2 years’’ and inserting ‘‘5 years’’. 

15 SEC. 115. SENSE OF CONGRESS ON IDENTIFICATION AND 

16 BLOCKING OF PROPERTY OF NORTH KOREAN 

17 OFFICIALS. 

18 It is the sense of Congress that the President 

19 should— 

20 (1) encourage international collaboration 

21 through the Financial Action Task Force and its 

22 network of Financial Action Task Force-style re23 gional bodies to apply best practices in disrupting 

24 money laundering related to kleptocracy and corrup25 tion, especially as it relates to North Korea; and 


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1 (2) prioritize multilateral efforts to identify and 

2 block— 

3 (A) any property owned or controlled by a 

4 North Korean official; and 

5 (B) any significant proceeds of kleptocracy 

6 by the Government of North Korea or a North 

7 Korean official. 

8 SEC. 116. MODIFICATION OF REPORT ON IMPLEMENTATION 

9 OF UNITED NATIONS SECURITY COUNCIL 

10 RESOLUTIONS BY OTHER GOVERNMENTS. 

11 Section 317 of the Korean Interdiction and Mod12 ernization of Sanctions Act (title III of Public Law 115– 

13 44; 131 Stat. 950) is amended— 

14 (1) in subsection (a)— 

15 (A) in the matter preceding paragraph (1), 

16 by striking ‘‘Not later than 180 days after the 

17 date of the enactment of this Act, and annually 

18 thereafter for 5 years,’’ and inserting ‘‘Not 

19 later than 180 days after the date of the enact20 ment of the Otto Warmbier Banking Restric21 tions Involving North Korea Act of 2019, and 

22 annually thereafter for 5 years,’’; 

23 (B) in paragraph (3), by striking ‘‘; or’’ 

24 and inserting a semicolon; 


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1 (C) by redesignating paragraph (4) as 

2 paragraph (8); and 

3 (D) by inserting after paragraph (3) the 

4 following: 

5 ‘‘(4) prohibit, in the territories of such coun6 tries or by persons subject to the jurisdiction of such 

7 governments, the opening of new joint ventures or 

8 cooperative entities with North Korean persons or 

9 the expansion of existing joint ventures through ad10 ditional investments, whether or not for or on behalf 

11 of the Government of North Korea, unless such joint 

12 ventures or cooperative entities have been approved 

13 by the Committee of the United Nations Security 

14 Council established by United Nations Security 

15 Council Resolution 1718 (2006); 

16 ‘‘(5) prohibit the unauthorized clearing of funds 

17 by North Korean financial institutions through fi18 nancial institutions subject to the jurisdiction of 

19 such governments; 

20 ‘‘(6) prohibit the unauthorized conduct of com21 mercial trade with North Korea that is prohibited 

22 under applicable United Nations Security Council 

23 resolutions; 

24 ‘‘(7) prevent the provision of financial services 

25 to North Korean persons or the transfer of financial 


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1 services to North Korean persons to, through, or 

2 from the territories of such countries or by persons 

3 subject to the jurisdiction of such governments; or’’; 

4 and 

5 (2) by amending subsection (c) to read as fol6 lows: 

7 ‘‘(c) DEFINITIONS.—In this section: 

8 ‘‘(1) APPROPRIATE CONGRESSIONAL COMMIT9 TEES AND LEADERSHIP.—The term ‘appropriate 

10 congressional committees and leadership’ means— 

11 ‘‘(A) the Committee on Foreign Relations, 

12 the Committee on Banking, Housing, and 

13 Urban Affairs, and the majority and minority 

14 leaders of the Senate; and 

15 ‘‘(B) the Committee on Foreign Affairs, 

16 the Committee on Financial Services, the Com17 mittee on Ways and Means, and the Speaker, 

18 the majority leader, and the minority leader of 

19 the House of Representatives. 

20 ‘‘(2) APPLICABLE UNITED NATIONS SECURITY

21 COUNCIL RESOLUTION; NORTH KOREAN FINANCIAL

22 INSTITUTION; NORTH KOREAN PERSON.—The terms 

23 ‘applicable United Nations Security Council resolu24 tion’, ‘North Korean financial institution’, and 

25 ‘North Korean person’ have the meanings given 


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1 those terms in section 3 of the North Korea Sanc2 tions and Policy Enhancement Act of 2016 (22 

3 U.S.C. 9202).’’. 

4 SEC. 117. REPORT ON USE BY THE GOVERNMENT OF 

5 NORTH KOREA OF BENEFICIAL OWNERSHIP 

6 RULES TO ACCESS THE INTERNATIONAL FI7 NANCIAL SYSTEM. 

8 (a) IN GENERAL.—Not later than 180 days after the 

9 date of the enactment of this Act, the Secretary of the 

10 Treasury shall submit to the appropriate congressional 

11 committees a report setting forth the findings of the Sec12 retary regarding how the Government of North Korea is 

13 exploiting laws with respect to the beneficial owner of an 

14 entity in order to access the international financial system. 

15 (b) ELEMENTS.—The Secretary shall include in the 

16 report required under subsection (a) proposals for such 

17 legislative and administrative action as the Secretary con18 siders appropriate to combat the abuse by the Government 

19 of North Korea of shell companies and other similar enti20 ties to avoid or evade sanctions. 

21 (c) FORM.—The report required by subsection (a) 

22 shall be submitted in unclassified form but may include 

23 a classified annex. 

24 (d) BENEFICIAL OWNER DEFINED.— 


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1 (1) IN GENERAL.—In this section, the term 

2 ‘‘beneficial owner’’— 

3 (A) means, with respect to an entity, each 

4 natural person who, directly or indirectly— 

5 (i) exercises control over the entity 

6 through ownership interests, voting rights, 

7 agreements, or otherwise; or 

8 (ii) has an interest in or receives sub9 stantial economic benefits from the assets 

10 of the entity; and 

11 (B) does not include, with respect to an 

12 entity— 

13 (i) a minor child; 

14 (ii) a person acting as a nominee, 

15 intermediary, custodian, or agent on behalf 

16 of another person; 

17 (iii) a person acting solely as an em18 ployee of the entity and whose control over 

19 or economic benefits from the entity de20 rives solely from the employment status of 

21 the person; 

22 (iv) a person whose only interest in 

23 the entity is through a right of inheritance, 

24 unless the person otherwise meets the defiVerDate Sep 11 2014 22:14 Mar 21, 2019 Jkt 089200 PO 00000 Frm 00025 Fmt 6652 Sfmt 6201 E:\BILLS\S667.IS S667

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1 nition of a beneficial owner under this sub2 section; and 

3 (v) a creditor of the entity, unless the 

4 creditor otherwise meets the definition of a 

5 beneficial owner under this subsection. 

6 (2) ANTI-ABUSE RULE.—The exceptions under 

7 paragraph (1)(B) shall not apply if used for the pur8 pose of evading, circumventing, or abusing laws de9 scribed in subsection (a). 

10 Subtitle B—Congressional Review 

11 and Oversight 

12 SEC. 121. NOTIFICATION OF TERMINATION OR SUSPENSION 

13 OF SANCTIONS. 

14 Not less than 15 days before taking any action to 

15 terminate or suspend the application of sanctions under 

16 this title or an amendment made by this title, the Presi17 dent shall notify the appropriate congressional committees 

18 of the President’s intent to take the action and the reasons 

19 for the action. 

20 SEC. 122. REPORTS ON CERTAIN LICENSING ACTIONS. 

21 (a) IN GENERAL.—Not later than 180 days after the 

22 date of the enactment of this Act, and every 180 days 

23 thereafter, the President shall submit to the appropriate 

24 congressional committees a report on the operation of the 

25 system for issuing licenses for transactions under covered 


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1 regulatory provisions during the preceding 180-day period 

2 that includes— 

3 (1) the number and types of such licenses ap4 plied for during that period; 

5 (2) the number and types of such licenses 

6 issued during that period; and 

7 (3) a summary of all general and specific li8 censes issued with respect to North Korea. 

9 (b) COVERED REGULATORY PROVISION DEFINED.— 

10 In this section, the term ‘‘covered regulatory provision’’ 

11 means any of the following provisions, as in effect on the 

12 day before the date of the enactment of this Act and as 

13 such provisions relate to North Korea: 

14 (1) Part 743, 744, or 746 of title 15, Code of 

15 Federal Regulations. 

16 (2) Part 510 of title 31, Code of Federal Regu17 lations. 

18 (3) Any other provision of title 31, Code of 

19 Federal Regulations. 

20 (c) FORM.—Each report required by subsection (a) 

21 shall be submitted in unclassified form but may include 

22 a classified annex. 


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1 SEC. 123. BRIEFINGS ON IMPLEMENTATION AND ENFORCE2 MENT OF SANCTIONS. 

3 Not later than 90 days after the date of the enact4 ment of this Act, and every 180 days thereafter, the Sec5 retary of the Treasury shall provide to the appropriate 

6 congressional committees a briefing on efforts relating to 

7 the implementation and enforcement of United States 

8 sanctions with respect to North Korea, including appro9 priate updates on the efforts of the Department of the 

10 Treasury to address compliance with such sanctions by 

11 foreign financial institutions. 

12 SEC. 124. REPORT ON FINANCIAL NETWORKS AND FINAN13 CIAL METHODS OF THE GOVERNMENT OF 

14 NORTH KOREA. 

15 (a) REPORT REQUIRED.— 

16 (1) IN GENERAL.—Not later than 180 days 

17 after the date of the enactment of this Act, and an18 nually thereafter through 2025, the President shall 

19 submit to the appropriate congressional committees 

20 a report on sources of external support for the Gov21 ernment of North Korea that includes— 

22 (A) a description of the methods used by 

23 the Government of North Korea to deal in, 

24 transact in, or conceal the ownership, control, 

25 or origin of goods and services exported by 

26 North Korea; 


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1 (B) an assessment of the relationship be2 tween the proliferation of weapons of mass de3 struction by the Government of North Korea 

4 and the financial industry or financial institu5 tions; 

6 (C) an assessment of the relationship be7 tween the acquisition by the Government of 

8 North Korea of military expertise, equipment, 

9 and technology and the financial industry or fi10 nancial institutions; 

11 (D) a description of the export by any per12 son to the United States of goods, services, or 

13 technology that are made with significant 

14 amounts of North Korean labor, material, or 

15 goods, including minerals, manufacturing, sea16 food, overseas labor, or other exports from 

17 North Korea; 

18 (E) an assessment of the involvement of 

19 any person in human trafficking involving citi20 zens or nationals of North Korea; 

21 (F) a description of how the President 

22 plans to address the flow of funds generated by 

23 activities described in subparagraphs (A) 

24 through (E), including through the use of sanc25 tions or other means; 


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1 (G) an assessment of the extent to which 

2 the Government of North Korea engages in 

3 criminal activities, including money laundering, 

4 to support that Government; 

5 (H) information relating to the identifica6 tion, blocking, and release of property described 

7 in section 201B(b)(1) of the North Korea Sanc8 tions and Policy Enhancement Act of 2016, as 

9 added by section 111; 

10 (I) a description of the metrics used to 

11 measure the effectiveness of law enforcement 

12 and diplomatic initiatives of Federal, State, and 

13 foreign governments to comply with the provi14 sions of applicable United Nations Security 

15 Council resolutions; and 

16 (J) an assessment of the effectiveness of 

17 programs within the financial industry to en18 sure compliance with United States sanctions, 

19 applicable United Nations Security Council res20 olutions, and applicable Executive orders. 

21 (2) FORM.—Each report required by paragraph 

22 (1) shall be submitted in unclassified form but may 

23 include a classified annex. 

24 (b) INTERAGENCY COORDINATION.—The President 

25 shall ensure that any information collected pursuant to 


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1 subsection (a) is shared among the Federal departments 

2 and agencies involved in investigations described in section 

3 102(b) of the North Korea Sanctions and Policy Enhance4 ment Act of 2016 (22 U.S.C. 9212(b)). 

5 SEC. 125. REPORT ON COUNTRIES OF CONCERN WITH RE6 SPECT TO TRANSSHIPMENT, REEXPOR7 TATION, OR DIVERSION OF CERTAIN ITEMS 

8 TO NORTH KOREA. 

9 (a) IN GENERAL.—Not later than 180 days after the 

10 date of the enactment of this Act, and annually thereafter 

11 through 2023, the Director of National Intelligence shall 

12 submit to the President, the Secretary of Defense, the Sec13 retary of Commerce, the Secretary of State, the Secretary 

14 of the Treasury, and the appropriate congressional com15 mittees a report that identifies all countries that the Di16 rector determines are of concern with respect to trans17 shipment, reexportation, or diversion of items subject to 

18 the provisions of the Export Administration Regulations 

19 under subchapter C of chapter VII of title 15, Code of 

20 Federal Regulations, to an entity owned or controlled by 

21 the Government of North Korea. 

22 (b) FORM.—Each report required by subsection (a) 

23 shall be submitted in unclassified form but may include 

24 a classified annex. 


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1 Subtitle C—General Matters 

2 SEC. 131. RULEMAKING. 

3 The President shall prescribe such rules and regula4 tions as may be necessary to carry out this title and 

5 amendments made by this title. 

6 SEC. 132. AUTHORITY TO CONSOLIDATE REPORTS. 

7 (a) IN GENERAL.—Any and all reports required to 

8 be submitted to the appropriate congressional committees 

9 under this title or an amendment made by this title that 

10 are subject to a deadline for submission consisting of the 

11 same unit of time may be consolidated into a single report 

12 that is submitted pursuant to that deadline. 

13 (b) CONTENTS.—Any reports consolidated under sub14 section (a) shall contain all information required under 

15 this title or an amendment made by this title and any 

16 other elements that may be required by existing law. 

17 SEC. 133. WAIVERS, EXEMPTIONS, AND TERMINATION. 

18 (a) APPLICATION AND MODIFICATION OF EXEMP19 TIONS AND WAIVERS FROM NORTH KOREA SANCTIONS

20 AND POLICY ENHANCEMENT ACT OF 2016.—Section 208 

21 of the North Korea Sanctions and Policy Enhancement 

22 Act of 2016 (22 U.S.C. 9228) is amended— 

23 (1) by inserting ‘‘201B,’’ after ‘‘201A,’’ each 

24 place it appears; and 


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1 (2) in subsection (c), by inserting ‘‘, not less 

2 than 15 days before the waiver takes effect,’’ after 

3 ‘‘if the President’’. 

4 (b) EXCEPTION RELATING TO IMPORTATION OF

5 GOODS.— 

6 (1) IN GENERAL.—No provision affecting sanc7 tions under this title or an amendment made by this 

8 title shall apply to sanctions on the importation of 

9 goods. 

10 (2) GOOD DEFINED.—In this subsection, the 

11 term ‘‘good’’ means any article, natural or man12 made substance, material, supply or manufactured 

13 product, including inspection and test equipment, 

14 and excluding technical data. 

15 (c) SUSPENSION.— 

16 (1) IN GENERAL.—Subject to section 121, any 

17 requirement to impose sanctions under this title or 

18 the amendments made by this title, and any sanc19 tions imposed pursuant to this title or any such 

20 amendment, may be suspended for up to one year if 

21 the President makes the certification described in 

22 section 401 of the North Korea Sanctions and Policy 

23 Enhancement Act of 2016 (22 U.S.C. 9251) to the 

24 appropriate congressional committees. 


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1 (2) RENEWAL.—A suspension under paragraph 

2 (1) may be renewed in accordance with section 

3 401(b) of the North Korea Sanctions and Policy En4 hancement Act of 2016 (22 U.S.C. 9251(b)). 

5 (d) TERMINATION.—Subject to section 121, any re6 quirement to impose sanctions under this title or the 

7 amendments made by this title, and any sanctions imposed 

8 pursuant to this title or any such amendment, shall termi9 nate on the date on which the President makes the certifi10 cation described in section 402 of the North Korea Sanc11 tions and Policy Enhancement Act of 2016 (22 U.S.C. 

12 9252). 

13 SEC. 134. PROCEDURES FOR REVIEW OF CLASSIFIED IN14 FORMATION. 

15 (a) IN GENERAL.—If a finding under this title or an 

16 amendment made by this title, a prohibition, condition, or 

17 penalty imposed as a result of any such finding, or a pen18 alty imposed under this title or an amendment made by 

19 this title, is based on classified information (as defined 

20 in section 1(a) of the Classified Information Procedures 

21 Act (18 U.S.C. App.)) and a court reviews the finding or 

22 the imposition of the prohibition, condition, or penalty, the 

23 Secretary of the Treasury may submit such information 

24 to the court ex parte and in camera. 


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1 (b) RULE OF CONSTRUCTION.—Nothing in this sec2 tion shall be construed to confer or imply any right to judi3 cial review of any finding under this title or an amendment 

4 made by this title, any prohibition, condition, or penalty 

5 imposed as a result of any such finding, or any penalty 

6 imposed under this title or an amendment made by this 

7 title. 

8 SEC. 135. BRIEFING ON PROLIFERATION FINANCING. 

9 (a) IN GENERAL.—Not later than 60 days after the 

10 date of the enactment of this Act, the Secretary of the 

11 Treasury shall provide to the appropriate congressional 

12 committees a briefing on addressing proliferation finance. 

13 (b) ELEMENTS.—The briefing required by subsection 

14 (a) shall include the following: 

15 (1) The Department of the Treasury’s defini16 tion and description of an appropriate risk-based ap17 proach to combating financing of the proliferation of 

18 weapons of mass destruction. 

19 (2) An assessment of— 

20 (A) Federal financial regulatory agency 

21 oversight, including by the Financial Crimes 

22 Enforcement Network, of United States finan23 cial institutions and the adoption by their for24 eign subsidiaries, branches, and correspondent 


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1 institutions of a risk-based approach to pro2 liferation financing; and 

3 (B) whether financial institutions in for4 eign jurisdictions known by the United States 

5 intelligence and law enforcement communities 

6 to be jurisdictions through which North Korea 

7 moves substantial sums of licit and illicit fi8 nance are applying a risk-based approach to 

9 proliferation financing, and if that approach is 

10 comparable to the approach required by United 

11 States financial institution supervisors. 

12 (3) A survey of the technical assistance the Of13 fice of Technical Assistance of the Department of 

14 the Treasury, and other appropriate Executive 

15 branch offices, currently provide foreign institutions 

16 on implementing counter-proliferation financing best 

17 practices. 

18 (4) An assessment of the ability of foreign sub19 sidiaries, branches, and correspondent institutions of 

20 United States financial institutions to implement a 

21 risk-based approach to proliferation financing. 


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1 TITLE II—DIVESTMENT FROM 

2 NORTH KOREA 

3 SEC. 201. AUTHORITY OF STATE AND LOCAL GOVERN4 MENTS TO DIVEST FROM COMPANIES THAT 

5 INVEST IN NORTH KOREA. 

6 (a) SENSE OF CONGRESS.—It is the sense of Con7 gress that the United States should support the decision 

8 of any State or local government made for moral, pruden9 tial, or reputational reasons, to divest from, or prohibit 

10 the investment of assets of the State or local government 

11 in, a person that engages in investment activities described 

12 in subsection (c) if North Korea is subject to economic 

13 sanctions imposed by the United States or the United Na14 tions Security Council. 

15 (b) AUTHORITY TO DIVEST.—Notwithstanding any 

16 other provision of law, a State or local government may 

17 adopt and enforce measures that meet the requirements 

18 of subsection (d) to divest the assets of the State or local 

19 government from, or prohibit investment of the assets of 

20 the State or local government in, any person that the 

21 State or local government determines, using credible infor22 mation available to the public, engages in investment ac23 tivities described in subsection (c). 

24 (c) INVESTMENT ACTIVITIES DESCRIBED.—Invest25 ment activities described in this subsection are activities 


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1 of a value of more than $10,000 relating to an investment 

2 in North Korea or in goods or services originating in 

3 North Korea that are not conducted pursuant to a license 

4 issued by the Department of the Treasury. 

5 (d) REQUIREMENTS.—Any measure taken by a State 

6 or local government under subsection (b) shall meet the 

7 following requirements: 

8 (1) NOTICE.—The State or local government 

9 shall provide written notice to each person with re10 spect to which a measure under this section is to be 

11 applied. 

12 (2) TIMING.—The measure applied under this 

13 section shall apply to a person not earlier than the 

14 date that is 90 days after the date on which written 

15 notice under paragraph (1) is provided to the per16 son. 

17 (3) OPPORTUNITY TO DEMONSTRATE COMPLI18 ANCE.— 

19 (A) IN GENERAL.—The State or local gov20 ernment shall provide to each person with re21 spect to which a measure is to be applied under 

22 this section an opportunity to demonstrate to 

23 the State or local government that the person 

24 does not engage in investment activities de25 scribed in subsection (c). 


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1 (B) NONAPPLICATION.—If a person with 

2 respect to which a measure is to be applied 

3 under this section demonstrates to the State or 

4 local government under subparagraph (A) that 

5 the person does not engage in investment activi6 ties described in subsection (c), the measure 

7 shall not apply to that person. 

8 (4) SENSE OF CONGRESS ON AVOIDING ERRO9 NEOUS TARGETING.—It is the sense of Congress 

10 that a State or local government should not adopt 

11 a measure under subsection (b) with respect to a 

12 person unless the State or local government has— 

13 (A) made every effort to avoid erroneously 

14 targeting the person; and 

15 (B) verified that the person engages in in16 vestment activities described in subsection (c). 

17 (e) NOTICE TO DEPARTMENT OF JUSTICE.—Not 

18 later than 30 days before a State or local government ap19 plies a measure under this section, the State or local gov20 ernment shall notify the Attorney General of that meas21 ure. 

22 (f) AUTHORIZATION FOR PRIOR APPLIED MEAS23 URES.— 

24 (1) IN GENERAL.—Notwithstanding any other 

25 provision of this section or any other provision of 


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1 law, a State or local government may enforce a 

2 measure (without regard to the requirements of sub3 section (d), except as provided in paragraph (2)) ap4 plied by the State or local government before the 

5 date of the enactment of this Act that provides for 

6 the divestment of assets of the State or local govern7 ment from, or prohibits the investment of the assets 

8 of the State or local government in, any person that 

9 the State or local government determines, using 

10 credible information available to the public, engages 

11 in investment activities described in subsection (c) 

12 that are identified in that measure. 

13 (2) APPLICATION OF NOTICE REQUIRE14 MENTS.—A measure described in paragraph (1) 

15 shall be subject to the requirements of paragraphs 

16 (1), (2), and (3)(A) of subsection (d) on and after 

17 the date that is 2 years after the date of the enact18 ment of this Act. 

19 (g) NO PREEMPTION.—A measure applied by a State 

20 or local government that is consistent with subsection (b) 

21 or (f) is not preempted by any Federal law. 

22 (h) DEFINITIONS.—In this section: 

23 (1) ASSET.— 

24 (A) IN GENERAL.—Except as provided in 

25 subparagraph (B), the term ‘‘asset’’ means 


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1 public monies, and includes any pension, retire2 ment, annuity, endowment fund, or similar in3 strument, that is controlled by a State or local 

4 government. 

5 (B) EXCEPTION.—The term ‘‘asset’’ does 

6 not include employee benefit plans covered by 

7 title I of the Employee Retirement Income Se8 curity Act of 1974 (29 U.S.C. 1001 et seq.). 

9 (2) INVESTMENT.—The term ‘‘investment’’ in10 cludes— 

11 (A) a commitment or contribution of funds 

12 or property; 

13 (B) a loan or other extension of credit; and 

14 (C) the entry into or renewal of a contract 

15 for goods or services. 

16 (i) EFFECTIVE DATE.— 

17 (1) IN GENERAL.—Except as provided in para18 graph (2) and subsection (f), this section applies to 

19 measures applied by a State or local government be20 fore, on, or after the date of the enactment of this 

21 Act. 

22 (2) NOTICE REQUIREMENTS.—Except as pro23 vided in subsection (f), subsections (d) and (e) apply 

24 to measures applied by a State or local government 

25 on or after the date of the enactment of this Act. 


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1 SEC. 202. SAFE HARBOR FOR CHANGES OF INVESTMENT 

2 POLICIES BY ASSET MANAGERS. 

3 Section 13(c)(1) of the Investment Company Act of 

4 1940 (15 U.S.C. 80a–13(c)(1)) is amended— 

5 (1) in subparagraph (A), by striking ‘‘or’’ at 

6 the end; 

7 (2) in subparagraph (B), by striking the period 

8 and inserting ‘‘; or’’; and 

9 (3) by adding at the end the following: 

10 ‘‘(C) engage in investment activities de11 scribed in section 201(c) of the Otto Warmbier 

12 Banking Restrictions Involving North Korea 

13 Act of 2019.’’. 

14 SEC. 203. SENSE OF CONGRESS REGARDING CERTAIN 

15 ERISA PLAN INVESTMENTS. 

16 It is the sense of Congress that— 

17 (1) a fiduciary of an employee benefit plan, as 

18 defined in section 3(3) of the Employee Retirement 

19 Income Security Act of 1974 (29 U.S.C. 1002(3)), 

20 may divest plan assets from, or avoid investing plan 

21 assets in, any person the fiduciary determines en22 gages in investment activities described in section 

23 201(c), if— 

24 (A) the fiduciary makes that determination 

25 using credible information that is available to 

26 the public; and 


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1 (B) the fiduciary prudently determines 

2 that the result of that divestment or avoidance 

3 of investment would not be expected to provide 

4 the employee benefit plan with— 

5 (i) a lower rate of return than alter6 native investments with commensurate de7 grees of risk; or 

8 (ii) a higher degree of risk than alter9 native investments with commensurate 

10 rates of return; and 

11 (2) by divesting assets or avoiding the invest12 ment of assets as described in paragraph (1), the fi13 duciary is not breaching the responsibilities, obliga14 tions, or duties imposed upon the fiduciary by sub15 paragraph (A) or (B) of section 404(a)(1) of the 

16 Employee Retirement Income Security Act of 1974 

17 (29 U.S.C. 1104(a)(1)). 

18 SEC. 204. RULE OF CONSTRUCTION. 

19 Nothing in this title, an amendment made by this 

20 title, or any other provision of law authorizing sanctions 

21 with respect to North Korea shall be construed to affect 

22 or displace— 

23 (1) the authority of a State or local government 

24 to issue and enforce rules governing the safety, 


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1 soundness, and solvency of a financial institution 

2 subject to its jurisdiction; or 

3 (2) the regulation and taxation by the several 

4 States of the business of insurance, pursuant to the 

5 Act of March 9, 1945 (59 Stat. 33, chapter 20; 15 

6 U.S.C. 1011 et seq.) (commonly known as the 

7 ‘‘McCarran-Ferguson Act’’). 

8 TITLE III—FINANCIAL INDUSTRY 

9 GUIDANCE TO HALT TRAF10 FICKING 

11 SEC. 301. SHORT TITLE. 

12 This title may be cited as the ‘‘Financial Industry 

13 Guidance to Halt Trafficking Act’’ or the ‘‘FIGHT Act’’. 

14 SEC. 302. FINDINGS. 

15 Congress finds the following: 

16 (1) The terms ‘‘human trafficking’’ and ‘‘traf17 ficking in persons’’ are used interchangeably to de18 scribe crimes involving the exploitation of a person 

19 for the purposes of compelled labor or commercial 

20 sex through the use of force, fraud, or coercion. 

21 (2) According to the International Labour Or22 ganization, there are an estimated 24,900,000 peo23 ple worldwide who are victims of forced labor, in24 cluding human trafficking victims in the United 

25 States. 


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1 (3) Human trafficking is perpetrated for finan2 cial gain. 

3 (4) According to the International Labour Or4 ganization, of the estimated $150,000,000,000 or 

5 more in global profits generated annually from 

6 human trafficking— 

(A) approximately 2 7 ⁄3 are generated by 

8 commercial sexual exploitation, exacted by 

9 fraud or by force; and 

(B) approximately 1 10 ⁄3 are generated by 

11 forced labor. 

12 (5) Most purchases of commercial sex acts are 

13 paid for with cash, making trafficking proceeds dif14 ficult to identify in the financial system. Nonethe15 less, traffickers rely heavily on access to financial in16 stitutions as destinations for trafficking proceeds 

17 and as conduits to finance every step of the traf18 ficking process. 

19 (6) Under section 1956 of title 18, United 

20 States Code (relating to money laundering), human 

21 trafficking is a ‘‘specified unlawful activity’’ and 

22 transactions conducted with proceeds earned from 

23 trafficking people, or used to further trafficking op24 erations, can be prosecuted as money laundering of25 fenses. 


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1 SEC. 303. SENSE OF CONGRESS. 

2 It is the sense of Congress that— 

3 (1) the President should aggressively apply, as 

4 appropriate, existing sanctions for human trafficking 

5 authorized under section 111 of the Trafficking Vic6 tims Protection Act of 2000 (22 U.S.C. 7108); 

7 (2) the Financial Crimes Enforcement Network 

8 of the Department of the Treasury should con9 tinue— 

10 (A) to monitor reporting required under 

11 subchapter II of chapter 53 of title 31, United 

12 States Code (commonly known as the ‘‘Bank 

13 Secrecy Act’’) and to update advisories, as war14 ranted; 

15 (B) to periodically review its advisories to 

16 provide covered financial institutions, as appro17 priate, with a list of new ‘‘red flags’’ for identi18 fying activities of concern, particularly human 

19 trafficking; 

20 (C) to encourage entities covered by the 

21 advisories described in subparagraph (B) to in22 corporate relevant elements provided in the 

23 advisories into their current transaction and ac24 count monitoring systems or in policies, proce25 dures, and training on human trafficking to enVerDate Sep 11 2014 22:14 Mar 21, 2019 Jkt 089200 PO 00000 Frm 00046 Fmt 6652 Sfmt 6201 E:\BILLS\S667.IS S667

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1 able financial institutions to maintain ongoing 

2 efforts to examine transactions and accounts; 

3 (D) to use geographic targeting orders, as 

4 appropriate, to impose additional reporting and 

5 recordkeeping requirements under section 

6 5326(a) of title 31, United States Code, to 

7 carry out the purposes of, and prevent evasions 

8 of the Bank Secrecy Act; and 

9 (E) to utilize the Bank Secrecy Act Advi10 sory Group and other relevant entities to iden11 tify opportunities for nongovernmental organi12 zations to share relevant actionable information 

13 on human traffickers’ use of the financial sector 

14 for nefarious purposes; 

15 (3) Federal banking regulators, the Department 

16 of the Treasury, relevant law enforcement agencies, 

17 and the Human Smuggling and Trafficking Center, 

18 in partnership with representatives from the United 

19 States financial community, should adopt regular 

20 forms of sharing information to disrupt human traf21 ficking, including developing protocols and proce22 dures to share actionable information between and 

23 amongst covered institutions, law enforcement, and 

24 the United States intelligence community; 


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1 (4) training front line bank and money service 

2 business employees, school teachers, law enforcement 

3 officers, foreign service officers, counselors, and the 

4 general public is an important factor in identifying 

5 trafficking victims; 

6 (5) the Department of Homeland Security’s 

7 Blue Campaign, training by the BEST Employers 

8 Alliance, and similar efforts by industry, human 

9 rights, and nongovernmental organizations focused 

10 on human trafficking provide good examples of cur11 rent efforts to educate employees of critical sectors 

12 to save victims and disrupt trafficking networks; 

13 (6) the President should intensify diplomatic ef14 forts, bilaterally and in appropriate international 

15 fora, such as the United Nations, to develop and im16 plement a coordinated, consistent, multilateral strat17 egy for addressing the international financial net18 works supporting human trafficking; and 

19 (7) in deliberations between the United States 

20 Government and any foreign country, including 

21 through participation in the Egmont Group of Fi22 nancial Intelligence Units, regarding money laun23 dering, corruption, and transnational crimes, the 

24 United States Government should— 


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1 (A) encourage cooperation by foreign gov2 ernments and relevant international fora in 

3 identifying the extent to which the proceeds 

4 from human trafficking are being used to facili5 tate terrorist financing, corruption, or other il6 licit financial crimes; 

7 (B) encourage cooperation by foreign gov8 ernments and relevant international fora in 

9 identifying the nexus between human traf10 ficking and money laundering; 

11 (C) advance policies that promote the co12 operation of foreign governments, through in13 formation sharing, training, or other measures, 

14 in the enforcement of this title; 

15 (D) encourage the Financial Action Task 

16 Force to update its July 2011 typology reports 

17 entitled, ‘‘Laundering the Proceeds of Corrup18 tion’’ and ‘‘Money Laundering Risks Arising 

19 from Trafficking in Human Beings and Smug20 gling of Migrants’’, to identify the money laun21 dering risk arising from the trafficking of 

22 human beings; and 

23 (E) encourage the Egmont Group of Fi24 nancial Intelligence Units to study the extent to 

25 which human trafficking operations are being 


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1 used for money laundering, terrorist financing, 

2 or other illicit financial purposes. 

3 SEC. 304. COORDINATION OF HUMAN TRAFFICKING ISSUES 

4 BY THE OFFICE OF TERRORISM AND FINAN5 CIAL INTELLIGENCE. 

6 (a) FUNCTIONS.—Section 312(a)(4) of title 31, 

7 United States Code, is amended— 

8 (1) by redesignating subparagraphs (E), (F), 

9 and (G) as subparagraphs (F), (G), and (H), respec10 tively; and 

11 (2) by inserting after subparagraph (D) the fol12 lowing: 

13 ‘‘(E) combating illicit financing relating to 

14 human trafficking;’’. 

15 (b) INTERAGENCY COORDINATION.—Section 312(a) 

16 of such title is amended by adding at the end the fol17 lowing: 

18 ‘‘(8) INTERAGENCY COORDINATION.—The Sec19 retary of the Treasury, after consultation with the 

20 Undersecretary for Terrorism and Financial Crimes, 

21 shall designate an office within the OTFI that shall 

22 coordinate efforts to combat the illicit financing of 

23 human trafficking with— 

24 ‘‘(A) other offices of the Department of the 

25 Treasury; 


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1 ‘‘(B) other Federal agencies, including— 

2 ‘‘(i) the Office to Monitor and Combat 

3 Trafficking in Persons of the Department 

4 of State; and 

5 ‘‘(ii) the Interagency Task Force to 

6 Monitor and Combat Trafficking; 

7 ‘‘(C) State and local law enforcement agen8 cies; and 

9 ‘‘(D) foreign governments.’’. 

10 SEC. 305. STRENGTHENING THE ROLE OF ANTI-MONEY 

11 LAUNDERING AND OTHER FINANCIAL TOOLS 

12 IN COMBATING HUMAN TRAFFICKING. 

13 (a) INTERAGENCY TASK FORCE RECOMMENDATIONS

14 TARGETING MONEY LAUNDERING RELATED TO HUMAN

15 TRAFFICKING.— 

16 (1) IN GENERAL.—Not later than 270 days 

17 after the date of the enactment of this Act, the 

18 Interagency Task Force to Monitor and Combat 

19 Trafficking shall submit to the Committee on Bank20 ing, Housing, and Urban Affairs, the Committee on 

21 Foreign Relations, and the Committee on the Judici22 ary of the Senate, the Committee on Financial Serv23 ices, the Committee on Foreign Affairs, and the 

24 Committee on the Judiciary of the House of RepVerDate Sep 11 2014 22:14 Mar 21, 2019 Jkt 089200 PO 00000 Frm 00051 Fmt 6652 Sfmt 6201 E:\BILLS\S667.IS S667

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1 resentatives, the Secretary of the Treasury, and each 

2 appropriate Federal banking agency— 

3 (A) an analysis of anti-money laundering 

4 efforts of the United States Government, 

5 United States financial institutions, and multi6 lateral development banks related to human 

7 trafficking; and 

8 (B) appropriate legislative, administrative, 

9 and other recommendations to strengthen ef10 forts against money laundering relating to 

11 human trafficking. 

12 (2) REQUIRED RECOMMENDATIONS.—The rec13 ommendations under paragraph (1) shall include— 

14 (A) best practices based on successful anti15 human trafficking programs currently in place 

16 at domestic and international financial institu17 tions that are suitable for broader adoption; 

18 (B) feedback from stakeholders, including 

19 victims of severe trafficking in persons, advo20 cates of persons at risk of becoming victims of 

21 severe forms of trafficking in persons, the 

22 United States Advisory Council on Human 

23 Trafficking, civil society organizations, and fi24 nancial institutions on policy proposals derived 

25 from the analysis conducted by the task force 


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1 referred to in paragraph (1) that would enhance 

2 the efforts and programs of financial institu3 tions to detect and deter money laundering re4 lated to human trafficking, including any rec5 ommended changes to internal policies, proce6 dures, and controls related to human traf7 ficking; 

8 (C) any recommended changes to training 

9 programs at financial institutions to better 

10 equip employees to deter and detect money 

11 laundering related to human trafficking; and 

12 (D) any recommended changes to expand 

13 human trafficking-related information sharing 

14 among financial institutions and between such 

15 financial institutions, appropriate law enforce16 ment agencies, and appropriate Federal agen17 cies. 

18 (b) ADDITIONAL REPORTING REQUIREMENT.—Sec19 tion 105(d)(7) of the Trafficking Victims Protection Act 

20 of 2000 (22 U.S.C. 7103(d)(7)) is amended— 

21 (1) in the matter preceding subparagraph (A)— 

22 (A) by inserting ‘‘the Committee on Finan23 cial Services,’’ after ‘‘the Committee on Foreign 

24 Affairs’’; and 


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1 (B) by inserting ‘‘the Committee on Bank2 ing, Housing, and Urban Affairs,’’ after ‘‘the 

3 Committee on Foreign Relations,’’; 

4 (2) in subparagraph (Q)(vii), by striking ‘‘; 

5 and’’ and inserting a semicolon; 

6 (3) in subparagraph (R), by striking the period 

7 at the end and inserting ‘‘; and’’; and 

8 (4) by adding at the end the following: 

9 ‘‘(S) the efforts of the United States to 

10 eliminate money laundering related to human 

11 trafficking and the number of investigations, 

12 arrests, indictments, and convictions in money 

13 laundering cases with a nexus to human traf14 ficking.’’. 

15 (c) REQUIRED REVIEW OF PROCEDURES.—Not later 

16 than 180 days after the date of the enactment of this Act, 

17 the Federal Financial Institutions Examination Council, 

18 in consultation with the Secretary of the Treasury, victims 

19 of severe forms of trafficking in persons, advocates of per20 sons at risk of becoming victims of severe forms of traf21 ficking in persons, the United States Advisory Council on 

22 Trafficking, civil society organizations, the private sector, 

23 and appropriate law enforcement agencies, shall— 

24 (1) review and enhance training and examina25 tions procedures to improve the surveillance capabiliVerDate Sep 11 2014 22:14 Mar 21, 2019 Jkt 089200 PO 00000 Frm 00054 Fmt 6652 Sfmt 6201 E:\BILLS\S667.IS S667

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1 ties of anti-money laundering and countering the fi2 nancing of terrorism programs to detect human traf3 ficking-related financial transactions; 

4 (2) review and enhance procedures for referring 

5 potential human trafficking cases to the appropriate 

6 law enforcement agency; and 

7 (3) determine, as appropriate, whether require8 ments for financial institutions and covered financial 

9 institutions are sufficient to detect and deter money 

10 laundering related to human trafficking. 

11 (d) LIMITATIONS.—Nothing in this section shall be 

12 construed to— 

13 (1) grant rulemaking authority to the Inter14 agency Task Force to Monitor and Combat Traf15 ficking; or 

16 (2) authorize financial institutions to deny serv17 ices to or violate the privacy of victims of trafficking, 

18 victims of severe forms of trafficking, or individuals 

19 not responsible for promoting severe forms of traf20 ficking in persons. 

21 SEC. 306. SENSE OF CONGRESS ON RESOURCES TO COMBAT 

22 HUMAN TRAFFICKING. 

23 It is the sense of Congress that— 

24 (1) adequate funding should be provided for 

25 critical Federal efforts to combat human trafficking; 


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1 (2) the Department of the Treasury should 

2 have the appropriate resources to vigorously inves3 tigate human trafficking networks under section 111 

4 of the Trafficking Victims Protection Act of 2000 

5 (22 U.S.C. 7108) and other relevant statutes and 

6 Executive orders; 

7 (3) the Department of the Treasury and the 

8 Department of Justice should each have the capacity 

9 and appropriate resources to support technical as10 sistance to develop foreign partners’ ability to com11 bat human trafficking through strong national anti12 money laundering and countering the financing of 

13 terrorism programs; 

14 (4) each United States Attorney’s Office should 

15 be provided appropriate funding to increase the 

16 number of personnel for community education and 

17 outreach and investigative support and forensic anal18 ysis related to human trafficking; and 

19 (5) the Department of State should be provided 

20 additional resources, as necessary, to carry out the 

21 Survivors of Human Trafficking Empowerment Act 

22 (section 115 of Public Law 114–22; 129 Stat. 243). 

Æ 


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