II 

117TH CONGRESS 

2D SESSION S. 5264 

To amend the Bank Holding Company Act of 1956 to prohibit bank holding 

companies from facilitating fossil fuel production from new sources, or 

from facilitating transactions that would provide funds for the construction of new or expanded fossil infrastructure that would drive such 

production, and for other purposes. 

IN THE SENATE OF THE UNITED STATES 

DECEMBER 15, 2022 

Mr. MERKLEY introduced the following bill; which was read twice and referred 

to the Committee on Banking, Housing, and Urban Affairs 

A BILL 

To amend the Bank Holding Company Act of 1956 to prohibit bank holding companies from facilitating fossil fuel 

production from new sources, or from facilitating transactions that would provide funds for the construction 

of new or expanded fossil infrastructure that would drive 

such production, 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. 

4 This Act may be cited as the ‘‘Protecting America’s 

5 Economy from the Carbon Bubble Act of 2022’’. 


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•S 5264 IS

1 SEC. 2. PROHIBITION ON FACILITATING FOSSIL FUEL PRO2 DUCTION FROM NEW SOURCES. 

3 The Bank Holding Company Act of 1956 (12 U.S.C. 

4 1841 et seq.) is amended by adding at the end the fol5 lowing: 

6 ‘‘SEC. 15. PROHIBITION ON FACILITATING FOSSIL FUEL 

7 PRODUCTION FROM NEW SOURCES. 

8 ‘‘(a) DEFINITIONS.—In this section— 

9 ‘‘(1) the terms ‘exchange’, ‘issuer’, and ‘secu10 rity’ have the meanings given those terms in section 

11 3(a) of the Securities Exchange Act of 1934 (15 

12 U.S.C. 78c(a)); 

13 ‘‘(2) the term ‘financial company’ means— 

14 ‘‘(A) a bank holding company, savings and 

15 loan holding company, or similar institution; 

16 ‘‘(B) a foreign banking organization or 

17 company that is treated as a bank holding com18 pany under this Act; 

19 ‘‘(C) an insured depository institution, a 

20 thrift institution, a savings association, an in21 dustrial loan company, or similar institution; or 

22 ‘‘(D) any subsidiary, agency, or affiliate of 

23 an entity described in subparagraph (A), (B), 

24 or (C); 

25 ‘‘(3) the term ‘fossil fuel’ means coal, petro26 leum, natural gas, or any derivative of coal, petroVerDate Sep 11 2014 03:16 Dec 28, 2022 Jkt 039200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\S5264.IS S5264

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1 leum, or natural gas, that is used for fuel, including 

2 hydrogen combined with any such derivative; 

3 ‘‘(4) the term ‘fossil infrastructure’ means fossil 

4 fuel-related projects, including wells, rail infrastruc5 ture, pipelines, terminals, refineries, and power 

6 plants; 

7 ‘‘(5) the term ‘national securities exchange’ 

8 means an exchange registered as a national securi9 ties exchange in accordance with section 6 of the Se10 curities Exchange Act of 1934 (15 U.S.C. 78f); 

11 ‘‘(6) the term ‘new sources’ means— 

12 ‘‘(A) any production in excess of proven 

13 developed producing reserves of fossil fuels, as 

14 of the date of enactment of this section; or 

15 ‘‘(B) new or expanded fossil infrastructure 

16 that would facilitate the production described in 

17 subparagraph (A); 

18 ‘‘(7) the term ‘production’ means extractive or 

19 production activities that result in fossil fuels being 

20 made available for refining or use; and 

21 ‘‘(8) the term ‘publicly traded entity’ means an 

22 issuer, the securities of which are listed on a na23 tional securities exchange. 

24 ‘‘(b) PROHIBITION.—No financial company may fa25 cilitate production, including by— 


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1 ‘‘(1) making loans to, making investments in, 

2 or otherwise engaging in any activity that is finan3 cial in nature, or incidental to such financial activ4 ity, with a fossil fuel company; 

5 ‘‘(2) making loans to, making investments in, 

6 or otherwise engaging in any activity that is finan7 cial in nature, or incidental to such financial activ8 ity, for a fossil fuel project; 

9 ‘‘(3) taking compensation to arrange, or facili10 tate a transaction that provides funds for, produc11 tion with respect to new sources; 

12 ‘‘(4) securitizing assets that provide funds for 

13 production with respect to new sources; 

14 ‘‘(5) entering into a derivatives transaction de15 signed to provide funding for, facilitate, or hedge 

16 risks from production with respect to new sources; 

17 ‘‘(6) engaging in any activity that is com18 plementary to a financial activity involving produc19 tion with respect to new sources, including financing 

20 the international trade of production with respect to 

21 new sources; or 

22 ‘‘(7) engaging in any other form of activity de23 fined by regulators or supervisors of the financial 

24 company. 

25 ‘‘(c) COMPLIANCE PROGRAM.— 


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1 ‘‘(1) IN GENERAL.—Each financial company 

2 shall maintain policies and procedures reasonably 

3 designed to ensure that relationships with customers 

4 or counterparties do not facilitate production with 

5 respect to new sources. 

6 ‘‘(2) ATTESTATION.—The chief executive officer 

7 of each financial company shall comply with an at8 testation for compliance with this section, subject to 

9 such rules as the Board may prescribe that shall be 

10 no less strict than those set forth under section 

11 351.20(c) of title 12, Code of Federal Regulations, 

12 or any successor regulation. 

13 ‘‘(3) SUPERVISION.—The appropriate Federal 

14 banking agency shall supervise the policies and pro15 cedures described in this subsection and the imple16 mentation of those policies and procedures. 

17 ‘‘(d) PENALTIES.— 

18 ‘‘(1) CRIMINAL PENALTY.— 

19 ‘‘(A) IN GENERAL.—Whoever knowingly 

20 violates any provision of this section or, being 

21 a company, violates any regulation or order 

22 issued by the Board under this section, shall be 

23 imprisoned not more than 1 year, fined not 

24 more than $1,000,000 per day for each day 

25 during which the violation continues, or both. 


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1 ‘‘(B) INTENT TO DECEIVE, DEFRAUD, OR

2 PROFIT.—Whoever, with the intent to deceive, 

3 defraud, or profit significantly, knowingly vio4 lates any provision of this section shall be im5 prisoned not more than 5 years, fined not more 

6 than $5,000,000 per day for each day during 

7 which the violation continues, or both. 

8 ‘‘(2) PROHIBITION ON EMPLOYMENT.—Any in9 dividual who knowingly violates any provision of this 

10 section shall be banned from future employment 

11 with any bank holding company or issuer or publicly 

12 traded entity. 

13 ‘‘(3) CIVIL MONETARY PENALTY.—Any finan14 cial company that violates, and any individual who 

15 participates in a violation of, any provision of this 

16 section, or any regulation or order issued under this 

17 section, shall forfeit all revenues associated with 

18 such a violation and pay an additional civil penalty 

19 of not more than $25,000 for each day during which 

20 the violation continues.’’. 

Æ 


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