I 

116TH CONGRESS 

1ST SESSION H. R. 56 

To establish an Independent Financial Technology Task Force to Combat 

Terrorism and Illicit Financing, to provide rewards for information leading to convictions related to terrorist use of digital currencies, to establish 

a Fintech Leadership in Innovation and Financial Intelligence Program 

to encourage the development of tools and programs to combat terrorist 

and illicit use of digital currencies, and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

JANUARY 3, 2019 

Mr. BUDD (for himself and Mr. LYNCH) introduced the following bill; which 

was referred to the Committee on Financial Services 

A BILL 

To establish an Independent Financial Technology Task 

Force to Combat Terrorism and Illicit Financing, to 

provide rewards for information leading to convictions 

related to terrorist use of digital currencies, to establish 

a Fintech Leadership in Innovation and Financial Intelligence Program to encourage the development of tools 

and programs to combat terrorist and illicit use of digital 

currencies, 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, 


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1 SECTION 1. SHORT TITLE. 

2 This Act may be cited as the ‘‘Financial Technology 

3 Protection Act’’. 

4 SEC. 2. SENSE OF CONGRESS. 

5 It is the sense of Congress that the Federal Govern6 ment should prioritize the investigation of terrorist and 

7 illicit use of new financial technology, including digital 

8 currencies. 

9 SEC. 3. INDEPENDENT FINANCIAL TECHNOLOGY TASK 

10 FORCE TO COMBAT TERRORISM AND ILLICIT 

11 FINANCING. 

12 (a) ESTABLISHMENT.—There is established the Inde13 pendent Financial Technology Task Force to Combat Ter14 rorism and Illicit Financing (the ‘‘Task Force’’), which 

15 shall consist of— 

16 (1) the Secretary of the Treasury, who shall 

17 serve as the head of the Task Force; 

18 (2) the Attorney General; 

19 (3) the Director of National Intelligence; 

20 (4) the Director of the Financial Crimes En21 forcement Network; 

22 (5) the Director of the Secret Service; 

23 (6) the Director of the Federal Bureau of In24 vestigation; and 

25 (7) 6 individuals appointed by the Secretary of 

26 the Treasury, in consultation with the members of 


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1 the Task Force described under paragraphs (2) 

2 through (6), to represent the private sector (includ3 ing the banking industry, nonprofit groups, and 

4 think tanks), with at least 2 of such individuals hav5 ing experience in the Fintech industry. 

6 (b) DUTIES.—The Task Force shall— 

7 (1) conduct independent research on terrorist 

8 and illicit use of new financial technologies, includ9 ing digital currencies; and 

10 (2) develop legislative and regulatory proposals 

11 to improve counter-terrorist and counter-illicit fi12 nancing efforts. 

13 (c) ANNUAL CONGRESSIONAL REPORT.—Not later 

14 than 1 year after the date of the enactment of this Act, 

15 and annually thereafter, the Task Force shall issue a re16 port to the Congress containing the findings and deter17 minations made by the Task Force in the previous year 

18 and any legislative and regulatory proposals developed by 

19 the Task Force. 

20 SEC. 4. REWARDS FOR INFORMATION RELATED TO TER21 RORIST USE OF DIGITAL CURRENCIES. 

22 (a) IN GENERAL.—The Secretary of the Treasury, in 

23 consultation with the Attorney General, shall establish a 

24 fund to pay a reward, not to exceed $450,000, to any per25 son who provides information leading to the conviction of 


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1 an individual involved with terrorist use of digital cur2 rencies. 

3 (b) USE OF FINES AND FORFEITURES.—With re4 spect to fines and forfeitures related to the conviction of 

5 an individual involved with terrorist use of digital cur6 rencies, the Secretary of the Treasury shall, without fur7 ther appropriation or fiscal year limitation— 

8 (1) use such amounts to pay rewards under this 

9 section related to such conviction; and 

10 (2) with respect to any such amounts remaining 

11 after payments are made under paragraphs (1) and 

12 (2), deposit such amounts in the Fintech Leadership 

13 in Innovation and Financial Intelligence Program. 

14 SEC. 5. FINTECH LEADERSHIP IN INNOVATION AND FINAN15 CIAL INTELLIGENCE PROGRAM. 

16 (a) ESTABLISHMENT.—There is established a pro17 gram to be known as the ‘‘Fintech Leadership in Innova18 tion and Financial Intelligence Program’’, which shall be 

19 funded as provided under section 4(b)(2). 

20 (b) INNOVATION GRANTS.— 

21 (1) IN GENERAL.—The Secretary of the Treas22 ury shall make grants for the development of tools 

23 and programs to detect terrorist and illicit use of 

24 digital currencies. 


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1 (2) ELIGIBLE RECIPIENTS.—The Secretary may 

2 make grants under this subsection to entities located 

3 in the United States, including academic institu4 tions, companies, nonprofit institutions, individuals, 

5 and any other entities located in the United States 

6 that the Secretary determines appropriate. 

7 (3) ELIGIBLE PROJECTS.—With respect to tools 

8 and programs described under paragraph (1), in ad9 dition to grants for the development of such tools 

10 and programs, the Secretary may make grants 

11 under this subsection to carry out pilot programs 

12 using such tools, the development of test cases using 

13 such tools, and research related to such tools. 

14 (4) PREFERENCES.—In making grants under 

15 this subsection, the Secretary shall give preference 

16 to— 

17 (A) technology that is nonproprietary or 

18 that is community commons-based; 

19 (B) computer code that is developed and 

20 released on an open source basis; 

21 (C) tools that are proactive (such as meet22 ing regulatory requirements under ‘‘know your 

23 customer’’ and anti-money laundering require24 ments for any entity that has to comply with 

25 U.S. Government regulations) vs. reactive (such 


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1 as aiding law enforcement organizations in 

2 catching illegal activity after the fact); and 

3 (D) tools and incentives that are on decen4 tralized platforms. 

5 (5) OTHER REQUIREMENTS.— 

6 (A) USE OF EXISTING GLOBAL STAND7 ARDS.—Any new technology developed with a 

8 grant made under this subsection shall be based 

9 on existing global standards, such as those de10 veloped by the Internet Engineering Task Force 

11 (IETF) and the World Wide Web Consortium 

12 (W3C). 

13 (B) SUPPORTING EXISTING LAWS OR REG14 ULATIONS.—Tools and programs developed with 

15 a grant made under this subsection shall be in 

16 support of existing laws or regulations, includ17 ing the Bank Secrecy Act, and make efforts to 

18 balance privacy and anti-money laundering con19 cerns. 

20 (C) OPEN ACCESS REQUIREMENT.—Tools 

21 and programs developed with a grant made 

22 under this subsection shall be freely accessible 

23 and usable by the public. This requirement may 

24 be fulfilled by publicly availing application proVerDate Sep 11 2014 01:24 Jan 09, 2019 Jkt 089200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\H56.IH H56

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1 gramming interfaces or software development 

2 kits. 

3 SEC. 6. PREVENTING ROGUE AND FOREIGN ACTORS FROM 

4 EVADING SANCTIONS. 

5 (a) REPORT AND STRATEGY WITH RESPECT TO DIG6 ITAL CURRENCIES AND OTHER RELATED EMERGING

7 TECHNOLOGIES.— 

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

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

10 President, acting through the Secretary of Treasury 

11 and in consultation with the Attorney General, the 

12 Secretary of State, the Secretary of Homeland Secu13 rity, the Director of National Intelligence, the Direc14 tor of the Office of Management and Budget, and 

15 the appropriate Federal banking agencies and Fed16 eral functional regulators, shall— 

17 (A) submit to the appropriate congres18 sional committees a report that identifies and 

19 describes the potential uses of digital currencies 

20 and other related emerging technologies by 

21 states, non-state actors, and foreign terrorist 

22 organizations to evade sanctions, finance ter23 rorism, or launder monetary instruments, and 

24 threaten United States national security; and 


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1 (B) develop and submit to the appropriate 

2 congressional committees a strategy to mitigate 

3 and prevent such illicit use of digital currencies 

4 and other related emerging technologies. 

5 (2) FORM; PUBLIC AVAILABILITY.— 

6 (A) FORM.—The report and strategy re7 quired under paragraph (1) shall be submitted 

8 in unclassified form, but may contain a classi9 fied annex. 

10 (B) PUBLIC AVAILABILITY.—The unclassi11 fied portion of such report and strategy shall be 

12 made available to the public and posted on the 

13 internet website of the Department of Treas14 ury— 

15 (i) in pre-compressed, easily down16 loadable versions that are made available 

17 in all appropriate formats; and 

18 (ii) in machine-readable format, if ap19 plicable. 

20 (3) SOURCES OF INFORMATION.—In preparing 

21 the report and strategy required under paragraph 

22 (1), the President may utilize any credible publica23 tion, database, web-based resource, and any credible 

24 information compiled by any government agency, 


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1 nongovernmental organization, or other entity that 

2 is made available to the President. 

3 (b) BRIEFING.—Not later than 2 years after the date 

4 of the enactment of this Act, the Secretary of the Treasury 

5 shall brief the appropriate congressional committees on 

6 the implementation of the strategy required under sub7 section (a). 

8 SEC. 7. DEFINITIONS. 

9 For purposes of this Act: 

10 (1) APPROPRIATE CONGRESSIONAL COMMIT11 TEES.—The term ‘‘appropriate congressional com12 mittees’’ means— 

13 (A) the Committee on Financial Services, 

14 the Committee on the Judiciary, the Permanent 

15 Select Committee on Intelligence, and the Com16 mittee on Foreign Affairs of the House of Rep17 resentatives; and 

18 (B) the Committee on Banking, Housing, 

19 and Urban Affairs, the Committee on Home20 land Security and Governmental Affairs, the 

21 Committee on the Judiciary, the Select Com22 mittee on Intelligence, and the Committee on 

23 Foreign Relations of the Senate. 

24 (2) APPROPRIATE FEDERAL BANKING AGEN25 CIES.—The term ‘‘appropriate Federal banking 


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1 agencies’’ has the meaning given the term in section 

2 3 of the Federal Deposit Insurance Act (12 U.S.C. 

3 1813). 

4 (3) BANK SECRECY ACT.—The term ‘‘Bank Se5 crecy Act’’ means— 

6 (A) section 21 of the Federal Deposit In7 surance Act; 

8 (B) chapter 2 of title I of Public Law 91– 

9 508; and 

10 (C) subchapter II of chapter 53 of title 31, 

11 United States Code. 

12 (4) DIGITAL CURRENCY.—The term ‘‘digital 

13 currency’’— 

14 (A) means a digital representation of value 

15 that— 

16 (i) is used as a medium of exchange, 

17 unit of account, or store of value; and 

18 (ii) is not established legal tender, 

19 whether or not denominated in established 

20 legal tender; and 

21 (B) does not include— 

22 (i) a transaction in which a merchant 

23 grants, as part of an affinity or rewards 

24 program, value that cannot be taken from 


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1 or exchanged with the merchant for legal 

2 tender, bank credit, or digital currency; or 

3 (ii) a digital representation of value 

4 issued by or on behalf of a publisher and 

5 used solely within an online game, game 

6 platform, or family of games sold by the 

7 same publisher or offered on the same 

8 game platform. 

9 (5) FEDERAL FUNCTIONAL REGULATOR.—The 

10 term ‘‘Federal functional regulator’’ has the mean11 ing given that term in section 509 of the Gramm12 Leach-Bliley Act (15 U.S.C. 6809). 

13 (6) FOREIGN TERRORIST ORGANIZATION.—The 

14 term ‘‘foreign terrorist organization’’ means an or15 ganization that is designated as a foreign terrorist 

16 organization under section 219 of the Immigration 

17 and Nationality Act (8 U.S.C. 1189). 

18 (7) TERRORIST.—The term ‘‘terrorist’’ includes 

19 a person carrying out domestic terrorism or inter20 national terrorism (as such terms are defined, re21 spectively, under section 2331 of title 18, United 

22 States Code). 

Æ 


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