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[House Report 107-250]
[From the U.S. Government Publishing Office]

107th Congress                                            Rept. 107-250
                        HOUSE OF REPRESENTATIVES
 1st Session                                                     Part 1

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

 
                  FINANCIAL ANTI-TERRORISM ACT OF 2001

                                _______
                                

                October 17, 2001.--Ordered to be printed

                                _______
                                

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

                              R E P O R T

                             together with

                            DISSENTING VIEWS

                        [To accompany H.R. 3004]

      [Including cost estimate of the Congressional Budget Office]

  The Committee on Financial Services, to whom was referred the 
bill (H.R. 3004) to combat the financing of terrorism and other 
financial crimes, and for other purposes, having considered the 
same, report favorably thereon with an amendment and recommend 
that the bill as amended do pass.

                                CONTENTS

                                                                   Page
Amendment........................................................     2
Purpose and Summary..............................................    33
Background and Need for Legislation..............................    34
Hearings.........................................................    40
Committee Consideration..........................................    40
Committee Votes..................................................    40
Committee Oversight Findings.....................................    44
Performance Goals and Objectives.................................    45
New Budget Authority, Entitlement Authority, and Tax Expenditures    45
Committee Cost Estimate..........................................    45
Congressional Budget Office Estimate.............................    45
Federal Mandates Statement.......................................    49
Advisory Committee Statement.....................................    49
Constitutional Authority Statement...............................    50
Applicability to Legislative Branch..............................    50
Exchange of Committee Correspondence.............................    50
Section-by-Section Analysis of the Legislation...................    52
Changes in Existing Law Made by the Bill, as Reported............    76
Dissenting Views.................................................   121

                               Amendment

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

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

  (a) Short Title.--This Act may be cited as the ``Financial Anti-
Terrorism Act of 2001''.
  (b) Table of Contents.--The table of contents for this Act is as 
follows:
Sec. 1. Short title; table of contents.

                 TITLE I--STRENGTHENING LAW ENFORCEMENT

Sec. 101. Bulk cash smuggling into or out of the United States.
Sec. 102. Forfeiture in currency reporting cases.
Sec. 103. Interstate currency couriers.
Sec. 104. Illegal money transmitting businesses.
Sec. 105. Long-arm jurisdiction over foreign money launderers.
Sec. 106. Laundering money through a foreign bank.
Sec. 107. Specified unlawful activity for money laundering.
Sec. 108. Laundering the proceeds of terrorism.
Sec. 109. Violations of reporting requirements for nonfinancial trades 
and business.
Sec. 110. Proceeds of foreign crimes.
Sec. 111. Availability of reports relating to coins and currency 
received in nonfinancial trade or business.
Sec. 112. Penalties for violations of geographic targeting orders and 
certain record keeping requirements.
Sec. 113. Exclusion of aliens involved in money laundering.
Sec. 114. Standing to contest forfeiture of funds deposited into 
foreign bank that has a correspondent account in the United States.
Sec. 115. Subpoenas for records regarding funds in correspondent bank 
accounts.
Sec. 116. Authority to order convicted criminal to return property 
located abroad.
Sec. 117. Corporation represented by a fugitive.
Sec. 118. Enforcement of foreign judgments.
Sec. 119. Reporting provisions and anti-terrorist activities of United 
States intelligence agencies.
Sec. 120. Financial Crimes Enforcement Network.
Sec. 121. Customs Service border searches.
Sec. 122. Prohibition on false statements to financial institutions 
concerning the identity of a customer.
Sec. 123. Verification of identification.
Sec. 124. Consideration of anti-money laundering record.
Sec. 125. Reporting of suspicious activities by informal underground 
banking systems, such as hawalas.

                  TITLE II--PUBLIC-PRIVATE COOPERATION

Sec. 201. Establishment of highly secure network.
Sec. 202. Report on improvements in data access and other issues.
Sec. 203. Reports to the financial services industry on suspicious 
financial activities.
Sec. 204. Efficient use of currency transaction report system.
Sec. 205. Public-private task force on terrorist financing issues.
Sec. 206. Suspicious activity reporting requirements.
Sec. 207. Amendments relating to reporting of suspicious activities.
Sec. 208. Authorization to include suspicions of illegal activity in 
written employment references.
Sec. 209. International cooperation on identification of originators of 
wire transfers.
Sec. 210. Check truncation study.

          TITLE III--COMBATTING INTERNATIONAL MONEY LAUNDERING

Sec. 301. Special measures for jurisdictions, financial institutions, 
or international transactions of primary money laundering concern.
Sec. 302. Special due diligence for correspondent accounts and private 
banking accounts.
Sec. 303. Prohibition on United States correspondent accounts with 
foreign shell banks.
Sec. 304. Anti-money laundering programs.
Sec. 305. Concentration accounts at financial institutions.
Sec. 306. International cooperation in investigations of money 
laundering, financial crimes, and the finances of terrorist groups.
Sec. 307. Prohibition on acceptance of any bank instrument for unlawful 
Internet gambling.
Sec. 308. Internet gambling in or through foreign jurisdictions.

                     TITLE IV--CURRENCY PROTECTION

Sec. 401. Counterfeiting domestic currency and obligations.
Sec. 402. Counterfeiting foreign currency and obligations.
Sec. 403. Production of documents.
Sec. 404. Reimbursement.

                 TITLE I--STRENGTHENING LAW ENFORCEMENT

SEC. 101. BULK CASH SMUGGLING INTO OR OUT OF THE UNITED STATES.

  (a) Findings.--The Congress finds the following:
          (1) Effective enforcement of the currency reporting 
        requirements of subchapter II of chapter 53 of title 31, United 
        States Code, and the regulations prescribed under such 
        subchapter, has forced drug dealers and other criminals engaged 
        in cash-based businesses to avoid using traditional financial 
        institutions.
          (2) In their effort to avoid using traditional financial 
        institutions, drug dealers and other criminals are forced to 
        move large quantities of currency in bulk form to and through 
        the airports, border crossings, and other ports of entry where 
        the currency can be smuggled out of the United States and 
        placed in a foreign financial institution or sold on the black 
        market.
          (3) The transportation and smuggling of cash in bulk form may 
        now be the most common form of money laundering, and the 
        movement of large sums of cash is one of the most reliable 
        warning signs of drug trafficking, terrorism, money laundering, 
        racketeering, tax evasion and similar crimes.
          (4) The intentional transportation into or out of the United 
        States of large amounts of currency or monetary instruments, in 
        a manner designed to circumvent the mandatory reporting 
        provisions of subchapter II of chapter 53 of title 31, United 
        States Code,, is the equivalent of, and creates the same harm 
        as, the smuggling of goods.
          (5) The arrest and prosecution of bulk cash smugglers are 
        important parts of law enforcement's effort to stop the 
        laundering of criminal proceeds, but the couriers who attempt 
        to smuggle the cash out of the United States are typically low-
        level employees of large criminal organizations, and thus are 
        easily replaced. Accordingly, only the confiscation of the 
        smuggled bulk cash can effectively break the cycle of criminal 
        activity of which the laundering of the bulk cash is a critical 
        part.
          (6) The current penalties for violations of the currency 
        reporting requirements are insufficient to provide a deterrent 
        to the laundering of criminal proceeds. In particular, in cases 
        where the only criminal violation under current law is a 
        reporting offense, the law does not adequately provide for the 
        confiscation of smuggled currency. In contrast, if the 
        smuggling of bulk cash were itself an offense, the cash could 
        be confiscated as the corpus delicti of the smuggling offense.
  (b) Purposes.--The purposes of this section are--
          (1) to make the act of smuggling bulk cash itself a criminal 
        offense;
          (2) to authorize forfeiture of any cash or instruments of the 
        smuggling offense;
          (3) to emphasize the seriousness of the act of bulk cash 
        smuggling; and
          (4) to prescribe guidelines for determining the amount of 
        property subject to such forfeiture in various situations.
  (c) Enactment of Bulk Cash Smuggling Offense.--Subchapter II of 
chapter 53 of title 31, United States Code, is amended by adding at the 
end the following:

``Sec. 5331. Bulk cash smuggling into or out of the United States

  ``(a) Criminal Offense.--
          ``(1) In general.--Whoever, with the intent to evade a 
        currency reporting requirement under section 5316, knowingly 
        conceals more than $10,000 in currency or other monetary 
        instruments on the person of such individual or in any 
        conveyance, article of luggage, merchandise, or other 
        container, and transports or transfers or attempts to transport 
        or transfer such currency or monetary instruments from a place 
        within the United States to a place outside of the United 
        States, or from a place outside the United States to a place 
        within the United States, shall be guilty of a currency 
        smuggling offense and subject to punishment pursuant to 
        subsection (b).
          ``(2) Concealment on person.--For purposes of this section, 
        the concealment of currency on the person of any individual 
        includes concealment in any article of clothing worn by the 
        individual or in any luggage, backpack, or other container worn 
        or carried by such individual.
  ``(b) Penalty.--
          ``(1) Term of imprisonment.--A person convicted of a currency 
        smuggling offense under subsection (a), or a conspiracy to 
        commit such offense, shall be imprisoned for not more than 5 
        years.
          ``(2) Forfeiture.--In addition, the court, in imposing 
        sentence under paragraph (1), shall order that the defendant 
        forfeit to the United States, any property, real or personal, 
involved in the offense, and any property traceable to such property, 
subject to subsection (d) of this section.
          ``(3) Procedure.--The seizure, restraint, and forfeiture of 
        property under this section shall be governed by section 413 of 
        the Controlled Substances Act.
          ``(4) Personal money judgment.--If the property subject to 
        forfeiture under paragraph (2) is unavailable, and the 
        defendant has insufficient substitute property that may be 
        forfeited pursuant to section 413(p) of the Controlled 
        Substances Act, the court shall enter a personal money judgment 
        against the defendant for the amount that would be subject to 
        forfeiture.
  ``(c) Civil Forfeiture.--
          ``(1) In general.--Any property involved in a violation of 
        subsection (a), or a conspiracy to commit such violation, and 
        any property traceable to such violation or conspiracy, may be 
        seized and, subject to subsection (d) of this section, 
        forfeited to the United States.
          ``(2) Procedure.--The seizure and forfeiture shall be 
        governed by the procedures governing civil forfeitures in money 
        laundering cases pursuant to section 981(a)(1)(A) of title 18, 
        United States Code.
          ``(3) Treatment of certain property as involved in the 
        offense.--For purposes of this subsection and subsection (b), 
        any currency or other monetary instrument that is concealed or 
        intended to be concealed in violation of subsection (a) or a 
        conspiracy to commit such violation, any article, container, or 
        conveyance used, or intended to be used, to conceal or 
        transport the currency or other monetary instrument, and any 
        other property used, or intended to be used, to facilitate the 
        offense, shall be considered property involved in the offense.
  ``(d) Proportionality of Forfeiture.--
          ``(1) In general.--Upon a showing by the property owner by a 
        preponderance of the evidence that the currency or monetary 
        instruments involved in the offense giving rise to the 
        forfeiture were derived from a legitimate source, and were 
        intended for a lawful purpose, the court shall reduce the 
        forfeiture to the maximum amount that is not grossly 
        disproportional to the gravity of the offense.
          ``(2) Factors to be considered.--In determining the amount of 
        the forfeiture, the court shall consider all aggravating and 
        mitigating facts and circumstances that have a bearing on the 
        gravity of the offense, including the following:
                  ``(A) The value of the currency or other monetary 
                instruments involved in the offense.
                  ``(B) Efforts by the person committing the offense to 
                structure currency transactions, conceal property, or 
                otherwise obstruct justice.
                  ``(C) Whether the offense is part of a pattern of 
                repeated violations of Federal law.''.
  (c) Clerical Amendment.--The table of sections for subchapter II of 
chapter 53 of title 31, United States Code, is amended by inserting 
after the item relating to section 5330, the following new item:

``5331. Bulk cash smuggling into or out of the United States.''.

SEC. 102. FORFEITURE IN CURRENCY REPORTING CASES.

  (a) In General.--Subsection (c) of section 5317 of title 31, United 
States Code, is amended to read as follows:
  ``(c) Forfeiture.--
          ``(1) In general.--The court in imposing sentence for any 
        violation of section 5313, 5316, or 5324 of this title, or 
        section 6050I of the Internal Revenue Code of 1986, or any 
        conspiracy to commit such violation, shall order the defendant 
        to forfeit all property, real or personal, involved in the 
        offense and any property traceable thereto.
          ``(2) Procedure.--Forfeitures under this subsection shall be 
        governed by the procedures established in section 413 of the 
        Controlled Substances Act and the guidelines established in 
        paragraph (4).
          ``(3) Civil forfeiture.--Any property involved in a violation 
        of section 5313, 5316, or 5324 of this title, or section 6050I 
        of the Internal Revenue Code of 1986, or any conspiracy to 
        commit any such violation, and any property traceable to any 
        such violation or conspiracy, may be seized and, subject to 
        paragraph (4), forfeited to the United States in accordance 
        with the procedures governing civil forfeitures in money 
        laundering cases pursuant to section 981(a)(1)(A) of title 18, 
        United States Code.
          ``(4) Proportionality of forfeiture.--
                  ``(A) In general.--Upon a showing by the property 
                owner by a preponderance of the evidence that any 
                currency or monetary instruments involved in the 
                offense giving rise to the forfeiture were derived from 
                a legitimate source, and were intended for a lawful 
                purpose, the court shall reduce the forfeiture to the 
                maximum amount that is not grossly disproportional to 
                the gravity of the offense.
                  ``(B) Factors to be considered.--In determining the 
                amount of the forfeiture, the court shall consider all 
                aggravating and mitigating facts and circumstances that 
                have a bearing on the gravity of the offense, including 
                the following:
                          ``(i) The value of the currency or other 
                        monetary instruments involved in the offense.
                          ``(ii) Efforts by the person committing the 
                        offense to structure currency transactions, 
                        conceal property, or otherwise obstruct 
                        justice.
                          ``(iii) Whether the offense is part of a 
                        pattern of repeated violations of Federal 
                        law.''.
  (b) Conforming Amendments.--(1) Section 981(a)(1)(A) of title 18, 
United States Code, is amended by striking ``of section 5313(a) or 
5324(a) of title 31, or''.
  (2) Section 982(a)(1) of title 18, United States Code, is amended by 
striking ``of section 5313(a), 5316, or 5324 of title 31, or''.

SEC. 103. INTERSTATE CURRENCY COURIERS.

  Section 1957 of title 18, United States Code, is amended by adding at 
the end the following new subsection:
  ``(g) Any person who conceals more than $10,000 in currency on his or 
her person, in any vehicle, in any compartment or container within any 
vehicle, or in any container placed in a common carrier, and 
transports, attempts to transport, or conspires to transport such 
currency in interstate commerce on any public road or highway or on any 
bus, train, airplane, vessel, or other common carrier, knowing that the 
currency was derived from some form of unlawful activity, or knowing 
that the currency was intended to be used to promote some form of 
unlawful activity, shall be punished as provided in subsection (b). The 
defendant's knowledge may be established by proof that the defendant 
was willfully blind to the source or intended use of the currency. For 
purposes of this subsection, the concealment of currency on the person 
of any individual includes concealment in any article of clothing worn 
by the individual or in any luggage, backpack, or other container worn 
or carried by such individual.''.

SEC. 104. ILLEGAL MONEY TRANSMITTING BUSINESSES.

  (a) Scienter Requirement for Section 1960 Violation.--Section 1960 of 
title 18, United States Code, is amended to read as follows:

``Sec. 1960. Prohibition of unlicensed money transmitting businesses

  ``(a) Whoever knowingly conducts, controls, manages, supervises, 
directs, or owns all or part of an unlicensed money transmitting 
business, shall be fined in accordance with this title or imprisoned 
not more than 5 years, or both.
  ``(b) As used in this section--
          ``(1) the term `unlicensed money transmitting business' means 
        a money transmitting business which affects interstate or 
        foreign commerce in any manner or degree and--
                  ``(A) is operated without an appropriate money 
                transmitting license in a State where such operation is 
                punishable as a misdemeanor or a felony under State 
                law, whether or not the defendant knew that the 
                operation was required to be licensed or that the 
                operation was so punishable;
                  ``(B) fails to comply with the money transmitting 
                business registration requirements under section 5330 
                of title 31, United States Code, or regulations 
                prescribed under such section; or
                  ``(C) otherwise involves the transportation or 
                transmission of funds that are known to the defendant 
                to have been derived from a criminal offense or are 
                intended to be used to be used to promote or support 
                unlawful activity;
          ``(2) the term `money transmitting' includes transferring 
        funds on behalf of the public by any and all means including 
        but not limited to transfers within this country or to 
        locations abroad by wire, check, draft, facsimile, or courier; 
        and
          ``(3) the term `State' means any State of the United States, 
        the District of Columbia, the Northern Mariana Islands, and any 
        commonwealth, territory, or possession of the United States.''.
  (b) Seizure of Illegally Transmitted Funds.--Section 981(a)(1)(A) of 
title 18, United States Code, is amended by striking ``or 1957'' and 
inserting ``, 1957 or 1960''.
  (c) Clerical Amendment.--The table of sections for chapter 95 of 
title 18, United States Code, is amended in the item relating to 
section 1960 by striking ``illegal'' and inserting ``unlicensed''.

SEC. 105. LONG-ARM JURISDICTION OVER FOREIGN MONEY LAUNDERERS.

  Section 1956(b) of title 18, United States Code, is amended--
          (1) by striking ``(b) Whoever'' and inserting ``(b)(1) 
        Whoever'';
          (2) by redesignating paragraphs (1) and (2) as subparagraphs 
        (A) and (B), respectively;
          (3) by striking ``subsection (a)(1) or (a)(3),'' and 
        inserting ``subsection (a)(1) or (a)(2) or section 1957,''; and
          (4) by adding at the end the following new paragraphs:
  ``(2) For purposes of adjudicating an action filed or enforcing a 
penalty ordered under this section, the district courts shall have 
jurisdiction over any foreign person, including any financial 
institution authorized under the laws of a foreign country, against 
whom the action is brought, if--
          ``(A) service of process upon such foreign person is made 
        under the Federal Rules of Civil Procedure or the laws of the 
        country where the foreign person is found; and
          ``(B) the foreign person--
                  ``(i) commits an offense under subsection (a) 
                involving a financial transaction that occurs in whole 
                or in part in the United States;
                  ``(ii) converts to such person's own use property in 
                which the United States has an ownership interest by 
                virtue of the entry of an order of forfeiture by a 
                court of the United States; or
                  ``(iii) is a financial institution that maintains a 
                correspondent bank account at a financial institution 
                in the United States.
  ``(3) The court may issue a pretrial restraining order or take any 
other action necessary to ensure that any bank account or other 
property held by the defendant in the United States is available to 
satisfy a judgment under this section.''.

SEC. 106. LAUNDERING MONEY THROUGH A FOREIGN BANK.

  Section 1956(c)(6) of title 18, United States Code, is amended to 
read as follows:
          ``(6) the term `financial institution' includes any financial 
        institution described in section 5312(a)(2) of title 31, United 
        States Code, or the regulations promulgated thereunder, as well 
        as any foreign bank, as defined in paragraph (7) of section 
        1(b) of the International Banking Act of 1978 (12 U.S.C. 
        3101(7));''.

SEC. 107. SPECIFIED UNLAWFUL ACTIVITY FOR MONEY LAUNDERING.

  Section 1956(c)(7) of title 18, United States Code, is amended--
          (1) in subparagraph (B)--
                  (A) by striking clause (ii) and inserting the 
                following new clause:
                          ``(ii) any act or acts constituting a crime 
                        of violence, as defined in section 16 of this 
                        title;''; and
                  (B) by inserting after clause (iii) the following new 
                clauses:
                          ``(iv) bribery of a public official, or the 
                        misappropriation, theft, or embezzlement of 
                        public funds by or for the benefit of a public 
                        official;
                          ``(v) smuggling or export control violations 
                        involving munitions listed in the United States 
                        Munitions List or technologies with military 
                        applications as defined in the Commerce Control 
                        List of the Export Administration Regulations; 
                        or
                          ``(vi) an offense with respect to which the 
                        United States would be obligated by a bilateral 
                        treaty either to extradite the alleged offender 
                        or to submit the case for prosecution, if the 
                        offender were found within the territory of the 
                        United States;''; and
          (2) in subparagraph (D)--
                  (A) by inserting ``section 541 (relating to goods 
                falsely classified),'' before ``section 542'';
                  (B) by inserting ``section 922(1) (relating to the 
                unlawful importation of firearms), section 924(n) 
                (relating to firearms trafficking),'' before ``section 
                956'';
                  (C) by inserting ``section 1030 (relating to computer 
                fraud and abuse),'' before ``1032'';
                  (D) by inserting ``any felony violation of the 
                Foreign Agents Registration Act of 1938, as amended,'' 
                before ``or any felony violation of the Foreign Corrupt 
                Practices Act''; and
                  (E) by striking ``fraud in the sale of securities'' 
                and inserting ``fraud in the purchase or sale of 
                securities''.

SEC. 108. LAUNDERING THE PROCEEDS OF TERRORISM.

  Section 1956(c)(7)(D) of title 18, United States Code, is amended by 
inserting ``or 2339B'' after ``2339A''.

SEC. 109. VIOLATIONS OF REPORTING REQUIREMENTS FOR NONFINANCIAL TRADES 
                    AND BUSINESS.

  (a) Civil Forfeiture.--Section 981(a)(1)(A) of title 18, United 
States Code, is amended by inserting ``section 6050I of the Internal 
Revenue Code of 1986, or'' before ``section 1956''.
  (b) Criminal Forfeiture.--Section 982(a)(1) of title 18, United 
States Code, is amended by inserting ``section 6050I of the Internal 
Revenue Code of 1986, or'' before ``section 1956''.

SEC. 110. PROCEEDS OF FOREIGN CRIMES.

  Section 981(a)(1)(B) of title 18, United States Code, is amended to 
read as follows:
          ``(B) Any property, real or personal, within the jurisdiction 
        of the United States, constituting, derived from, or traceable 
        to, any proceeds obtained directly or indirectly from an 
        offense against a foreign nation, or any property used to 
        facilitate such offense, if--
                  ``(i) the offense involves the manufacture, 
                importation, sale, or distribution of a controlled 
                substance (as such term is defined for the purposes of 
                the Controlled Substances Act), or any other conduct 
                described in section 1956(c)(7)(B),
                  ``(ii) the offense would be punishable within the 
                jurisdiction of the foreign nation by death or 
                imprisonment for a term exceeding one year, and
                  ``(iii) the offense would be punishable under the 
                laws of the United States by imprisonment for a term 
                exceeding one year if the act or activity constituting 
                the offense had occurred within the jurisdiction of the 
                United States.''.

SEC. 111. AVAILABILITY OF REPORTS RELATING TO COINS AND CURRENCY 
                    RECEIVED IN NONFINANCIAL TRADE OR BUSINESS.

  (a) Action Required.--Before the end of the 6-month period beginning 
on the date of the enactment of this Act, the Secretary of the Treasury 
shall take such action and establish such procedures as may be 
necessary and appropriate to make the information contained on returns 
filed under section 6050I of the Internal Revenue Code of 1986 
available through the Financial Crimes Enforcement Network to 
government agencies in accordance with subsections (l)(15) and (p)(4) 
of section 6103 of such Code and other applicable laws.
  (b) Report.--The Secretary of the Treasury shall submit a report to 
the Congress within 15 days after the end of the 6-month period 
described in subsection (a) containing a description of the actions of 
the Secretary pursuant to such subsection, together with such 
recommendations for legislative and administrative action as the 
Secretary may determine to be appropriate to achieve the goal described 
in such subsection.

SEC. 112. PENALTIES FOR VIOLATIONS OF GEOGRAPHIC TARGETING ORDERS AND 
                    CERTAIN RECORD KEEPING REQUIREMENTS.

  (a) Civil Penalty for Violation of Targeting Order.--Section 
5321(a)(1) of title 31, United States Code, is amended--
          (1) by inserting ``or order issued'' after ``subchapter or a 
        regulation prescribed''; and
          (2) by inserting ``, or willfully violating a regulation 
        prescribed under section 21 of the Federal Deposit Insurance 
        Act or section 123 of Public Law 91-508,'' after ``sections 
        5314 and 5315)''.
  (b) Criminal Penalties for Violation of Targeting Order.--
  Section 5322 of title 31, United States Code, is amended--
          (1) in subsection (a)--
                  (A) by inserting ``or order issued'' after 
                ``willfully violating this subchapter or a regulation 
                prescribed''; and
                  (B) by inserting ``, or willfully violating a 
                regulation prescribed under section 21 of the Federal 
                Deposit Insurance Act or section 123 of Public Law 91-
                508,'' after ``under section 5315 or 5324)'';
          (2) in subsection (b)--
                  (A) by inserting ``or order issued'' after 
                ``willfully violating this subchapter or a regulation 
                prescribed''; and
                  (B) by inserting ``or willfully violating a 
                regulation prescribed under section 21 of the Federal 
                Deposit Insurance Act or section 123 of Public Law 91-
                508,'' after ``under section 5315 or 5324),'';
  (c) Structuring Transactions To Evade Targeting Order or Certain 
Record Keeping Requirements.--Section 5324(a) of title 31, United 
States Code, is amended--
          (1) by inserting a comma after ``shall'';
          (2) by striking ``section--'' and inserting ``section, the 
        reporting requirements imposed by any order issued under 
        section 5326, or the record keeping requirements imposed by any 
        regulation prescribed under section 21 of the Federal Deposit 
        Insurance Act or section 123 of Public Law 91-508--''; and
          (3) in paragraphs (1) and (2), by inserting ``, to file a 
        report required by any order issued under section 5326, or to 
        maintain a record required pursuant to any regulation 
        prescribed under section 21 of the Federal Deposit Insurance 
        Act or section 123 of Public Law 91-508'' after ``regulation 
        prescribed under any such section'' each place that term 
        appears.
  (d) Increase in Civil Penalties for Violation of Certain Record 
Keeping Requirements.--
          (1) Federal deposit insurance act.--Section 21(j)(1) of the 
        Federal Deposit Insurance Act (12 U.S.C. 1829b(j)(1)) is 
        amended by striking ``$10,000'' and inserting ``the greater 
        of--
                  ``(A) the amount (not to exceed $100,000) involved in 
                the transaction (if any) with respect to which the 
                violation occurred; or
                  ``(B) $25,000''.
          (2) Public law 91-508.--Section 125(a) of Public Law 91-508 
        (12 U.S.C. 1955(a)) is amended by striking ``$10,000'' and 
        inserting ``the greater of--
          ``(1) the amount (not to exceed $100,000) involved in the 
        transaction (if any) with respect to which the violation 
        occurred; or
          ``(2) $25,000''.
  (e) Criminal Penalties for Violation of Certain Record Keeping 
Requirements.--
          (1) Section 126.--Section 126 of Public Law 91-508 (12 U.S.C. 
        1956) is amended to read as follows:

``SEC. 126. CRIMINAL PENALTY.

  ``A person that willfully violates this chapter, section 21 of the 
Federal Deposit Insurance Act, or a regulation prescribed under this 
chapter or that section 21, shall be fined not more than $250,000, or 
imprisoned for not more than 5 years, or both.''.
          (2) Section 127.--Section 127 of Public Law 91-508 (12 U.S.C. 
        1957) is amended to read as follows:

``SEC. 127. ADDITIONAL CRIMINAL PENALTY IN CERTAIN CASES.

  ``A person that willfully violates this chapter, section 21 of the 
Federal Deposit Insurance Act, or a regulation prescribed under this 
chapter or that section 21, while violating another law of the United 
States or as part of a pattern of any illegal activity involving more 
than $100,000 in a 12-month period, shall be fined not more than 
$500,000, imprisoned for not more than 10 years, or both.''.

SEC. 113. EXCLUSION OF ALIENS INVOLVED IN MONEY LAUNDERING.

  (a) In General.--Section 212 of the Immigration and Nationality Act, 
as amended (8 U.S.C. 1182), is amended in subsection (a)(2)--
          (1) by redesignating subparagraphs (D), (E), (F), (G), and 
        (H) as subparagraphs (E), (F), (G), (H), and (I), respectively; 
        and
          (2) by inserting after subparagraph (C) the following new 
        subparagraph (D):
                  ``(D) Money laundering activities.--
                          ``(i) In general.--Any alien who the consular 
                        officer or the Attorney General knows or has 
                        reason to believe is or has been engaged in 
                        activities which if engaged in within the 
                        United States would constitute a violation of 
                        the money laundering provisions section 1956, 
                        1957, or 1960 of title 18, United States Code, 
                        or has knowingly assisted, abetted, or 
                        conspired or colluded with others in any such 
                        illicit activity is inadmissible.
                          ``(ii) Related individuals.--Any alien who 
                        the consular officer or the Attorney General 
                        knows or has reason to believe is the spouse, 
                        son, or daughter of an alien inadmissible under 
                        clause (i), has, within the previous 5 years, 
                        obtained any financial or other benefit from 
                        such illicit activity of that alien, and knew 
                        or reasonably should have known that the 
                        financial or other benefit was the product of 
                        such illicit activity, is inadmissible, except 
                        that the Attorney General may, in the full 
                        discretion of the Attorney General, waive the 
                        exclusion of the spouse, son, or daughter of an 
                        alien under this clause if the Attorney General 
                        determines that exceptional circumstances exist 
                        that justify such waiver.''.
  (b) Conforming amendment.--Section 212(h)(1)(A)(i) of the Immigration 
and Nationality Act, as amended (8 U.S.C. 1182), is amended by striking 
``(D)(i) or (D)(ii)'' and inserting ``(E)(i) or (E)(ii)''.

SEC. 114. STANDING TO CONTEST FORFEITURE OF FUNDS DEPOSITED INTO 
                    FOREIGN BANK THAT HAS A CORRESPONDENT ACCOUNT IN 
                    THE UNITED STATES.

  Section 981 of title 18, United States Code, is amended by adding the 
following after the last subsection:
  ``(k) Correspondent Bank Accounts.--
          ``(1) Treatment of accounts of correspondent bank in domestic 
        financial institutions.--
                  ``(A) In general.--For the purpose of a forfeiture 
                under this section or under the Controlled Substances 
                Act, if funds are deposited into a dollar-denominated 
                bank account in a foreign financial institution, and 
                that foreign financial institution has a correspondent 
                account with a financial institution in the United 
                States, the funds deposited into the foreign financial 
                institution (the respondent bank) shall be deemed to 
                have been deposited into the correspondent account in 
                the United States, and any restraining order, seizure 
                warrant, or arrest warrant in rem regarding such funds 
                may be served on the correspondent bank, and funds in 
                the correspondent account up to the value of the funds 
                deposited into the dollar-denominated account in the 
                foreign financial institution may be seized, arrested 
                or restrained.
                  ``(B) Authority to suspend.--The Attorney General, in 
                consultation with the Secretary, may suspend or 
                terminate a forfeiture under this section if the 
                Attorney General determines that a conflict of law 
                exists between the laws of the jurisdiction in which 
                the foreign bank is located and the laws of the United 
                States with respect to liabilities arising from the 
                restraint, seizure, or arrest of such funds, and that 
                such suspension or termination would be in the interest 
                of justice and would not harm the national interests of 
                the United States.
          ``(2) No requirement for government to trace funds.--If a 
        forfeiture action is brought against funds that are restrained, 
        seized, or arrested under paragraph (1), the Government shall 
        not be required to establish that such funds are directly 
        traceable to the funds that were deposited into the respondent 
        bank, nor shall it be necessary for the Government to rely on 
        the application of Section 984 of this title.
          ``(3) Claims brought by owner of the funds.--If a forfeiture 
        action is instituted against funds seized, arrested, or 
        restrained under paragraph (1), the owner of the funds may 
        contest the forfeiture by filing a claim pursuant to section 
        983.
          ``(4) Definitions.--For purposes of this subsection, the 
        following definitions shall apply:
                  ``(A) Correspondent account.--The term `correspondent 
                account' has the meaning given to the term `interbank 
                account' in section 984(c)(2)(B).
                  ``(B) Owner.--
                          ``(i) In general.--Except as provided in 
                        clause (ii), the term `owner'--
                                  ``(I) means the person who was the 
                                owner, as that term is defined in 
                                section 983(d)(6), of the funds that 
                                were deposited into the foreign bank at 
                                the time such funds were deposited; and
                                  ``(II) does not include either the 
                                foreign bank or any financial 
                                institution acting as an intermediary 
                                in the transfer of the funds into the 
                                interbank account.
                          ``(ii) Exception.--The foreign bank may be 
                        considered the `owner' of the funds (and no 
                        other person shall qualify as the owner of such 
                        funds) only if--
                                  ``(I) the basis for the forfeiture 
                                action is wrongdoing committed by the 
                                foreign bank; or
                                  ``(II) the foreign bank establishes, 
                                by a preponderance of the evidence, 
                                that prior to the restraint, seizure, 
                                or arrest of the funds, the foreign 
                                bank had discharged all or part of its 
                                obligation to the prior owner of the 
                                funds, in which case the foreign bank 
                                shall be deemed the owner of the funds 
                                to the extent of such discharged 
                                obligation.''.

SEC. 115. SUBPOENAS FOR RECORDS REGARDING FUNDS IN CORRESPONDENT BANK 
                    ACCOUNTS.

  (a) In General.--Subchapter II of chapter 53 of title 31, United 
States Code, is amended by inserting after section 5331 (as added by 
section 101) the following new section:

``Sec. 5332. Subpoenas for records

  ``(a) Designation by Foreign Financial Institution of Agent.--Any 
foreign financial institution that has a correspondent bank account at 
a financial institution in the United States shall designate a person 
residing in the United States as a person authorized to accept a 
subpoena for bank records or other legal process served on the foreign 
financial institution.
  ``(b) Maintenance of Records by Domestic Financial Institution.--
          ``(1) In general.--Any domestic financial institution that 
        maintains a correspondent bank account for a foreign financial 
        institution shall maintain records regarding the names and 
        addresses of the owners of the foreign financial institution, 
        and the name and address of the person who may be served with a 
        subpoena for records regarding any funds transferred to or from 
        the correspondent account.
          ``(2) Provision to law enforcement agency.--A domestic 
        financial institution shall provide names and addresses 
        maintained under paragraph (1) to a Government authority (as 
        defined in section 1101(3) of the Right to Financial Privacy 
        Act of 1978) within 7 days of the receipt of a request, in 
        writing, for such records.
  ``(c) Administrative Subpoena.--
          ``(1) In general.--The Attorney General and the Secretary of 
        the Treasury may each issue an administrative subpoena for 
        records relating to the deposit of any funds into a dollar-
        denominated account in a foreign financial institution that 
        maintains a correspondent account at a domestic financial 
        institution.
          ``(2) Manner of issuance.--Any subpoena issued by the 
        Attorney General or the Secretary of the Treasury under 
        paragraph (1) shall be issued in the manner described in 
        section 3486 of this title, and may be served on the 
        representative designated by the foreign financial institution 
        pursuant to subsection (a) to accept legal process in the 
        United States, or in a foreign country pursuant to any mutual 
        legal assistance treaty, multilateral agreement, or other 
        request for international law enforcement assistance.
  ``(d) Correspondent Account Defined.--For purposes of this section, 
the term `correspondent account' has the same meaning as the term 
`interbank account' as such term is defined in section 984(c)(2)(B) of 
title 18, United States Code.''.
  (b) Clerical amendments.--The table of sections for subchapter II of 
chapter 53 of title 31, United States Code, is amended by inserting 
after the item relating to section 5331 the following new item:

``5332. Subpoenas for records.''.

  (c) Effective Date.--Section 5332(a) of title 31, United States Code, 
(as added by subsection (a) of this section shall apply after the end 
of the 30-day period beginning on the date of the enactment of this 
Act.
  (d) Requests for Records.--Section 3486(a)(1)(A)(i) of title 18, 
United States Code, is amended by striking ``; or (II) a Federal 
offense involving the sexual exploitation or abuse of children,'' and 
inserting ``, (II) a Federal offense involving the sexual exploitation 
or abuse of children, or (III) a money laundering offense in violation 
of section 1956, 1957 or 1960 of this title,''.

SEC. 116. AUTHORITY TO ORDER CONVICTED CRIMINAL TO RETURN PROPERTY 
                    LOCATED ABROAD.

  (a) Forfeiture of Substitute Property.--Section 413(p) of the 
Controlled Substances Act (21 U.S.C. 853) is amended to read as 
follows:
  ``(p) Forfeiture of Substitute Property.--
          ``(1) In general.--Paragraph (2) of this subsection shall 
        apply, if any property described in subsection (a), as a result 
        of any act or omission of the defendant--
                  ``(A) cannot be located upon the exercise of due 
                diligence;
                  ``(B) has been transferred or sold to, or deposited 
                with, a third party;
                  ``(C) has been placed beyond the jurisdiction of the 
                court;
                  ``(D) has been substantially diminished in value; or
                  ``(E) has been commingled with other property which 
                cannot be divided without difficulty.
          ``(2) Substitute property.--In any case described in any of 
        subparagraphs (A) through (E) of paragraph (1), the court shall 
        order the forfeiture of any other property of the defendant, up 
        to the value of any property described in subparagraphs (A) 
        through (E) of paragraph (1), as applicable.
          ``(3) Return of property to jurisdiction.--In the case of 
        property described in paragraph (1)(C), the court may, in 
        addition to any other action authorized by this subsection, 
        order the defendant to return the property to the jurisdiction 
        of the court so that the property may be seized and 
        forfeited.''.
  (b) Protective Orders.--Section 413(e) of the Controlled Substances 
Act (21 U.S.C. 853(e)) is amended by adding at the end the following:
  ``(4) Order To Repatriate and Deposit.--
          ``(A) In general.--Pursuant to its authority to enter a 
        pretrial restraining order under this section, including its 
        authority to restrain any property forfeitable as substitute 
        assets, the court may order a defendant to repatriate any 
        property that may be seized and forfeited, and to deposit that 
        property pending trial in the registry of the court, or with 
        the United States Marshals Service or the Secretary of the 
        Treasury, in an interest-bearing account, if appropriate.
          ``(B) Failure to comply.--Failure to comply with an order 
        under this subsection, or an order to repatriate property under 
        subsection (p), shall be punishable as a civil or criminal 
        contempt of court, and may also result in an enhancement of the 
        sentence of the defendant under the obstruction of justice 
        provision of the Federal Sentencing Guidelines.''.

SEC. 117. CORPORATION REPRESENTED BY A FUGITIVE.

  Section 2466 of title 28, United States Code, is amended by 
designating the present matter as subsection (a), and adding at the end 
the following:
  ``(b) Subsection (a) may be applied to a claim filed by a corporation 
if any majority shareholder, or individual filing the claim on behalf 
of the corporation is a person to whom subsection (a) applies.''.

SEC. 118. ENFORCEMENT OF FOREIGN JUDGMENTS.

  Section 2467 of title 28, United States Code, is amended--
          (1) in subsection (d), by inserting after paragraph (2) the 
        following new paragraph:
          ``(3) Preservation of property.--To preserve the availability 
        of property subject to a foreign forfeiture or confiscation 
        judgment, the Government may apply for, and the court may 
        issue, a restraining order pursuant to section 983(j) of title 
        18, United States Code, at any time before or after an 
        application is filed pursuant to subsection (c)(1). The court, 
        in issuing the restraining order--
                  ``(A) may rely on information set forth in an 
                affidavit describing the nature of the proceeding or 
                investigation underway in the foreign country, and 
                setting forth a reasonable basis to believe that the 
                property to be restrained will be named in a judgment 
                of forfeiture at the conclusion of such proceeding; or
                  ``(B) may register and enforce a restraining order 
                that has been issued by a court of competent 
                jurisdiction in the foreign country and certified by 
                the Attorney General pursuant to subsection (b)(2).
        No person may object to the restraining order on any ground 
        that is the subject of parallel litigation involving the same 
        property that is pending in a foreign court.'';
          (2) in subsection (b)(1)(C), by striking ``establishing that 
        the defendant received notice of the proceedings in sufficient 
        time to enable the defendant'' and inserting ``establishing 
        that the foreign nation took steps, in accordance with the 
        principles of due process, to give notice of the proceedings to 
        all persons with an interest in the property in sufficient time 
        to enable such persons'';
          (3) in subsection (d)(1)(D), by striking ``the defendant in 
        the proceedings in the foreign court did not receive notice'' 
        and inserting ``the foreign nation did not take steps, in 
        accordance with the principles of due process, to give notice 
        of the proceedings to a person with an interest in the 
        property''; and
          (4) in subsection (a)(2)(A), by inserting ``, any violation 
        of foreign law that would constitute a violation of an offense 
        for which property could be forfeited under Federal law if the 
        offense were committed in the United States'' after ``United 
        Nations Convention''.

SEC. 119. REPORTING PROVISIONS AND ANTI-TERRORIST ACTIVITIES OF UNITED 
                    STATES INTELLIGENCE AGENCIES.

  (a) Amendment Relating to the Purposes of Chapter 53 of Title 31, 
United States Code.--Section 5311 of title 31, United States Code, is 
amended by inserting before the period at the end the following: ``, or 
in the conduct of intelligence or counterintelligence activities, 
including analysis, to protect against international terrorism''.
  (b) Amendment Relating to Reporting of Suspicious Activities.--
Section 5318(g)(4)(B) of title 31, United States Code, is amended by 
striking ``or supervisory agency'' and inserting ``, supervisory 
agency, or United States intelligence agency for use in the conduct of 
intelligence or counterintelligence activities, including analysis, to 
protect against international terrorism''.
  (c) Amendment Relating to Availability of Reports.--Section 5319 of 
title 31, United States Code, is amended to read as follows:

``Sec. 5319. Availability of reports

  ``The Secretary of the Treasury shall make information in a report 
filed under this subchapter available to an agency, including any State 
financial institutions supervisory agency or United States intelligence 
agency, upon request of the head of the agency. The report shall be 
available for a purpose that is consistent with this subchapter. The 
Secretary may only require reports on the use of such information by 
any State financial institutions supervisory agency for other than 
supervisory purposes or by United States intelligence agencies. 
However, a report and records of reports are exempt from disclosure 
under section 552 of title 5.''.
  (d) Amendments to the Right to Financial Privacy Act.--The Right to 
Financial Privacy Act of 1978 is amended--
          (1) in section 1112(a) (12 U.S.C. 3412(a)), by inserting ``, 
        or intelligence or counterintelligence activity, investigation 
        or analysis related to international terrorism'' after 
        ``legitimate law enforcement inquiry'';
          (2) in section 1114(a)(1) (12 U.S.C. 3414(a)(1))--
                  (A) in subparagraph (A), by striking ``or'' at the 
                end;
                  (B) in subparagraph (B), by striking the period at 
                the end and inserting ``; or''; and
                  (C) by adding at the end the following:
                  ``(C) a Government authority authorized to conduct 
                investigations of, or intelligence or 
                counterintelligence analyses related to, international 
                terrorism for the purpose of conducting such 
                investigations or analyses.''; and
          (3) in section 1120(a)(2) (12 U.S.C. 3420(a)(2)), by 
        inserting ``, or for a purpose authorized by section 1112(a)'' 
        before the semicolon at the end.
  (e) Amendment to the Fair Credit Reporting Act.--
          (1) In general.--The Fair Credit Reporting Act (15 U.S.C. 
        1681 et seq.) is amended--
                  (A) by redesignating the second of the 2 sections 
                designated as section 624 (15 U.S.C. 1681u) (relating 
                to disclosure to FBI for counterintelligence purposes) 
                as section 625; and
                  (B) by adding at the end the following new section:

``Sec. 626. Disclosures to governmental agencies for counterterrorism 
                    purposes

  ``(a) Disclosure.--Notwithstanding section 604 or any other provision 
of this title, a consumer reporting agency shall furnish a consumer 
report of a consumer and all other information in a consumer's file to 
a government agency authorized to conduct investigations of, or 
intelligence or counterintelligence activities or analysis related to, 
international terrorism when presented with a written certification by 
such government agency that such information is necessary for the 
agency's conduct or such investigation, activity or analysis.
  ``(b)  Form of Certification.--The certification described in 
subsection (a) shall be signed by the Secretary of the Treasury, or an 
officer designated by the Secretary from among officers of the 
Department of the Treasury whose appointments to office are required to 
be made by the President, by and with the advice and consent of the 
Senate.
  ``(c) Confidentiality.--No consumer reporting agency, or officer, 
employee, or agent of such consumer reporting agency, shall disclose to 
any person, or specify in any consumer report, that a government agency 
has sought or obtained access to information under subsection (a).
  ``(d) Rule of Construction.--Nothing in section 625 shall be 
construed to limit the authority of the Director of the Federal Bureau 
of Investigation under this section.
  ``(e) Safe Harbor.--Notwithstanding any other provision of this 
subchapter, any consumer reporting agency or agent or employee thereof 
making disclosure of consumer reports or other information pursuant to 
this section in good-faith reliance upon a certification of a 
governmental agency pursuant to the provisions of this section shall 
not be liable to any person for such disclosure under this subchapter, 
the constitution of any State, or any law or regulation of any State or 
any political subdivision of any State.''.
          (2) Clerical amendments.--The table of sections for the Fair 
        Credit Reporting Act (15 U.S.C. 1681 et seq.) is amended--
                  (A) by redesignating the second of the 2 items 
                designated as section 624 as section 625; and
                  (B) by inserting after the item relating to section 
                625 (as so redesignated) the following new item:

``626. Disclosures to governmental agencies for counterterrorism 
purposes.''.

SEC. 120. FINANCIAL CRIMES ENFORCEMENT NETWORK.

  (a) In General.--Subchapter I of chapter 3 of title 31, United States 
Code, is amended--
          (1) by redesignating section 310 as section 311; and
          (2) by inserting after section 309 the following new section:

``Sec. 310. Financial Crimes Enforcement Network

  ``(a) In General.--The Financial Crimes Enforcement Network 
established by order of the Secretary of the Treasury (Treasury Order 
Numbered 105-08) on April 25, 1990, shall be a bureau in the Department 
of the Treasury.
  ``(b) Director.--
          ``(1) Appointment.--The head of the Financial Crimes 
        Enforcement Network shall be the Director who shall be 
        appointed by the President, by and with the consent of the 
        Senate, to a term of 4 years.
          ``(2) Duties and powers.--The duties and powers of the 
        Director are as follows:
                  ``(A) Advise and make recommendations on matters 
                relating to financial intelligence, financial criminal 
                activities, and other financial activities to the Under 
                Secretary for Enforcement.
                  ``(B) Maintain a government-wide data access service, 
                with access, in accordance with applicable legal 
                requirements, to the following:
                          ``(i) Information collected by the Department 
                        of the Treasury, including report information 
                        filed under subchapters II and III of chapter 
                        53 of this title (such as reports on cash 
                        transactions, foreign financial agency 
                        transactions and relationships, foreign 
                        currency transactions, exporting and importing 
                        monetary instruments, and suspicious 
                        activities), chapter 2 of Public Law 91-508, 
                        section 21 of the Federal Deposit Insurance Act 
                        and section 6050I of the Internal Revenue Code 
                        of 1986.
                          ``(ii) Information regarding national and 
                        international currency flows.
                          ``(iii) Other records and data maintained by 
                        other Federal, State, local, and foreign 
                        agencies, including financial and other records 
                        developed in specific cases.
                          ``(iv) Other privately and publicly available 
                        information.
                  ``(C) Analyze and disseminate the available data in 
                accordance with applicable legal requirements and 
                policies and guidelines established by the Secretary of 
                the Treasury and the Under Secretary for Enforcement 
                to--
                          ``(i) identify possible criminal activity to 
                        appropriate Federal, State, local, and foreign 
                        law enforcement agencies;
                          ``(ii) support ongoing criminal financial 
                        investigations and prosecutions and related 
                        proceedings, including civil and criminal tax 
                        and forfeiture proceedings;
                          ``(iii) identify possible instances of 
                        noncompliance with subchapters II and III of 
                        chapter 53 of this title, chapter 2 of Public 
                        Law 91-508, and section 21 of the Federal 
                        Deposit Insurance Act to Federal agencies with 
                        statutory responsibility for enforcing 
                        compliance with such provisions and other 
                        appropriate Federal regulatory agencies;
                          ``(iv) evaluate and recommend possible uses 
                        of special currency reporting requirements 
                        under section 5326; and
                          ``(v) determine emerging trends and methods 
                        in money laundering and other financial crimes.
                  ``(D) Establish and maintain a financial crimes 
                communications center to furnish law enforcement 
                authorities with intelligence information related to 
                emerging or ongoing investigations and undercover 
                operations.
                  ``(E) Furnish research, analytical, and informational 
                services to financial institutions, appropriate Federal 
                regulatory agencies with regard to financial 
                institutions, and appropriate Federal, State, local, 
                and foreign law enforcement authorities, in accordance 
                with policies and guidelines established by the 
                Secretary of the Treasury or the Under Secretary of the 
                Treasury for Enforcement, in the interest of detection, 
                prevention, and prosecution of terrorism, organized 
                crime, money laundering, and other financial crimes.
                  ``(F) Establish and maintain a special unit dedicated 
                to combatting the use of informal, nonbank networks and 
                payment and barter system mechanisms that permit the 
                transfer of funds or the equivalent of funds without 
                records and without compliance with criminal and tax 
                laws.
                  ``(G) Provide computer and data support and data 
                analysis to the Secretary of the Treasury for tracking 
                and controlling foreign assets.
                  ``(H) Coordinate with financial intelligence units in 
                other countries on anti-terrorism and anti-money 
                laundering initiatives, and similar efforts.
                  ``(I) Administer the requirements of subchapters II 
                and III of chapter 53 of this title, chapter 2 of 
                Public Law 91-508, and section 21 of the Federal 
                Deposit Insurance Act, to the extent delegated such 
                authority by the Secretary of the Treasury.
                  ``(J) Such other duties and powers as the Secretary 
                of the Treasury may delegate or prescribe.
  ``(c) Requirements Relating to Maintenance and Use of Data Banks.--
The Secretary of the Treasury shall establish and maintain operating 
procedures with respect to the government-wide data access service and 
the financial crimes communications center maintained by the Financial 
Crimes Enforcement Network which provide--
          ``(1) for the coordinated and efficient transmittal of 
        information to, entry of information into, and withdrawal of 
        information from, the data maintenance system maintained by the 
        Network, including--
                  ``(A) the submission of reports through the Internet 
                or other secure network, whenever possible;
                  ``(B) the cataloguing of information in a manner that 
                facilitates rapid retrieval by law enforcement 
                personnel of meaningful data; and
                  ``(C) a procedure that provides for a prompt initial 
                review of suspicious activity reports and other 
                reports, or such other means as the Secretary may 
                provide, to identify information that warrants 
                immediate action; and
          ``(2) in accordance with section 552a of title 5 and the 
        Right to Financial Privacy Act of 1978, appropriate standards 
        and guidelines for determining--
                  ``(A) who is to be given access to the information 
                maintained by the Network;
                  ``(B) what limits are to be imposed on the use of 
                such information; and
                  ``(C) how information about activities or 
                relationships which involve or are closely associated 
                with the exercise of constitutional rights is to be 
                screened out of the data maintenance system.
  ``(d) Authorization of Appropriations.--There are authorized to be 
appropriated for the Financial Crimes Enforcement Network such sums as 
may be necessary for fiscal years 2002, 2003, 2004, and 2005.''.
  (b) Compliance With Existing Reports Compliance.--The Secretary of 
the Treasury shall study methods for improving compliance with the 
reporting requirements established in section 5314 of title 31, United 
States Code, and shall submit a report on such study to the Congress by 
the end of the 6-month period beginning on the date of the enactment of 
this Act and each 1-year period thereafter. The initial report shall 
include historical data on compliance with such reporting requirements.
  (c) Clerical Amendment.--The table of sections for subchapter I of 
chapter 3 of title 31, United States Code, is amended--
          (1) by redesignating the item relating to section 310 as 
        section 311; and
          (2) by inserting after the item relating to section 309 the 
        following new item:

``310. Financial Crimes Enforcement Network''.

SEC. 121. CUSTOMS SERVICE BORDER SEARCHES.

  Section 5317(b) of title 31, United States Code, is amended to read 
as follows:
  ``(b) Searches at Border.--
          ``(1) In general.--For purposes of ensuring compliance with 
        the laws enforced by the United States Customs Service, a 
        customs officer may stop and search, at the border and without 
        a search warrant, any vehicle, vessel, aircraft, or other 
        conveyance, any envelope or other container, and any person 
        entering, transiting, or departing from the United States.
          ``(2) International shipments of mail.--With respect to 
        shipments of international mail that are exported or imported 
        by the United States Postal Service, the Customs Service and 
        other appropriate Federal agencies shall, subject to paragraph 
        (3), apply the customs laws of the United States and all other 
        laws relating to the importation or exportation of such 
        shipments in the same manner to both shipments by the United 
        States Postal Service and similar shipments by private 
        companies.
          ``(3) Safeguards.--No provision of this subsection shall be 
        construed as authorizing any customs officer or any other 
        person to read any correspondence unless--
                  ``(A) a search warrant has been issued pursuant to 
                Rule 41 of the Federal Rules of Criminal Procedure 
                which permits such correspondence to be read; or
                  ``(B) the sender or addressee of the correspondence 
                has given written consent for any such action.''.

SEC. 122. PROHIBITION ON FALSE STATEMENTS TO FINANCIAL INSTITUTIONS 
                    CONCERNING THE IDENTITY OF A CUSTOMER.

  (a) In General.--Chapter 47 of title 18, United States Code, is 
amended by inserting after section 1007 the following:

``Sec. 1008. False statements concerning the identity of customers of 
                    financial institutions

  ``(a) In General.--Whoever, in connection with information submitted 
to or requested by a financial institution, knowingly in any manner--
          ``(1) falsifies, conceals, or covers up, or attempts to 
        falsify, conceal, or cover up, the identity of any person in 
        connection with any transaction with a financial institution;
          ``(2) makes, or attempts to make, any materially false, 
        fraudulent, or fictitious statement or representation of the 
        identity of any person in connection with a transaction with a 
        financial institution;
          ``(3) makes or uses, or attempts to make or use, any false 
        writing or document knowing the same to contain any materially 
        false, fictitious, or fraudulent statement or entry concerning 
        the identity of any person in connection with a transaction 
        with a financial institution; or
          ``(4) uses or presents, or attempts to use or present, in 
        connection with a transaction with a financial institution, an 
        identification document or means of identification the 
        possession of which is a violation of section 1028;
shall be fined under this title, imprisoned not more than 5 years, or 
both.
  ``(b) Definitions.--In this section, the following definitions shall 
apply:
          ``(1) Financial institution.--The term `financial 
        institution'--
                  ``(A) has the same meaning as in section 20; and
                  ``(B) in addition, has the same meaning as in section 
                5312(a)(2) of title 31, United States Code.
          ``(2) Identification document.--The term `identification 
        document' has the same meaning as in section 1028(d).
          ``(3) Means of identification.--The term `means of 
        identification' has the same meaning as in section 1028(d).''.
  (b) Technical and Conforming Amendments.--
          (1) Title 18, united states code.--Section 1956(c)(7)(D) of 
        title 18, United States Code, is amended by striking ``1014 
        (relating to fraudulent loan'' and inserting ``section 1008 
        (relating to false statements concerning the identity of 
        customers of financial institutions), section 1014 (relating to 
        fraudulent loan''.
          (2) Table of sections.--The table of sections for chapter 47 
        of title 18, United States Code, is amended by inserting after 
        the item relating to section 1007 the following:

``1008. False statements concerning the identity of customers of 
financial institutions.''.

SEC. 123. VERIFICATION OF IDENTIFICATION.

  (a) In General.--Section 5318 of title 31, United States Code, is 
amended by adding at the end the following new subsection:
  ``(i) Identification and Verification of Accountholders.--
          ``(1) In general.--Subject to the requirements of this 
        subsection, the Secretary of the Treasury shall prescribe 
        regulations setting forth the minimum standards regarding 
        customer identification that shall apply in connection with the 
        opening of an account at a financial institution.
          ``(2) Minimum requirements.--The regulations shall, at a 
        minimum, require financial institutions to implement procedures 
        for--
                  ``(A) verifying the identity of any person seeking to 
                open an account to the extent reasonable and 
                practicable;
                  ``(B) maintaining records of the information used to 
                verify a person's identity, including name, address, 
                and other identifying information;
                  ``(C) consulting applicable lists of known or 
                suspected terrorists or terrorist organizations 
                generated by government agencies to determine whether a 
                person seeking to open an account appears on any such 
                list.
          ``(3) Factors to be considered.--In prescribing regulations 
        under this subsection, the Secretary shall take into 
        consideration the various types of accounts maintained by 
        various types of financial institutions, the various methods of 
        opening accounts, and the various types of identifying 
        information available.
          ``(4) Certain financial institutions.--In the case of any 
        financial institution the business of which is engaging in 
        financial activities described in section 4(k) of the Bank 
        Holding Company Act of 1956 (including financial activities 
        subject to the jurisdiction of the Commodity Futures Trading 
        Commission), the regulations prescribed by the Secretary under 
        paragraph (1) shall be prescribed jointly with each Federal 
        functional regulator (as defined in section 509 of the Gramm-
        Leach-Bliley Act, including the Commodity Futures Trading 
        Commission) appropriate for such financial institution.
          ``(5) Exemptions.--The Secretary of the Treasury (and, in the 
        case of any financial institution described in paragraph (4), 
        any Federal agency described in such paragraph) may, by 
        regulation or order, exempt any financial institution or type 
        of account from the requirements of any regulation prescribed 
        under this subsection in accordance with such standards and 
        procedures as the Secretary may prescribe.
          ``(6) Effective date.--Final regulations prescribed under 
        this subsection shall take effect before the end of the 1-year 
        period beginning on the date of the enactment of the Financial 
        Anti-Terrorism Act of 2001.''.
  (b) Study and Report Required.--Within 6 months after the date of the 
enactment of this Act, the Secretary of the Treasury, in consultation 
with the Federal functional regulators (as defined in section 509 of 
the Gramm-Leach-Bliley Act) and other appropriate Government agencies, 
shall submit a report to the Congress containing recommendations for--
          (1) determining the most timely and effective way to require 
        foreign nationals to provide domestic financial institutions 
        and agencies with appropriate and accurate information, 
        comparable to that which is required of United States 
        nationals, concerning their identity, address, and other 
        related information necessary to enable such institutions and 
        agencies to comply with the requirements of this section;
          (2) requiring foreign nationals to apply for and obtain, 
        before opening an account with a domestic financial 
        institution, an identification number which would function 
        similarly to a Social Security number or tax identification 
        number; and
          (3) establishing a system for domestic financial institutions 
        and agencies to review information maintained by relevant 
        Government agencies for purposes of verifying the identities of 
        foreign nationals seeking to open accounts at those 
        institutions and agencies.

SEC. 124. CONSIDERATION OF ANTI-MONEY LAUNDERING RECORD.

  (a) Bank Holding Company Act of 1956.--
          (1) In general.--Section 3(c) of the Bank Holding Company Act 
        of 1956 (12 U.S.C. 1842(c)) is amended by adding at the end the 
        following new paragraph:
          ``(6) Money laundering.--In every case the Board shall take 
        into consideration the effectiveness of the company or 
        companies in combating and preventing money laundering 
        activities, including in overseas branches.''.
  (2) Scope of application.--The amendment made by paragraph (1) shall 
apply with respect to any application submitted to the Board of 
Governors of the Federal Reserve System under section 3 of the Bank 
Holding Company Act of 1956 after December 31, 2000, which has not been 
approved by the Board before the date of the enactment of this Act.
  (b) Mergers Subject to Review Under Federal Deposit Insurance Act.--
          (1) In general.--Section 18(c) of the Federal Deposit 
        Insurance Act (12 U.S.C. 1828(c)) is amended--
                  (A) by redesignating paragraph (11) as paragraph 
                (12); and
                  (B) by inserting after paragraph (10), the following 
                new paragraph:
          ``(11) Money laundering.--In every case, the responsible 
        agency shall take into consideration the effectiveness of any 
        insured depository institution involved in the proposed merger 
        transaction in combating and preventing money laundering 
        activities, including in overseas branches.''.
  (2) Scope of application.--The amendment made by paragraph (1) shall 
apply with respect to any application submitted to the responsible 
agency under section 18(c) of the Federal Deposit Insurance Act after 
December 31, 2000, which has not been approved by all appropriate 
responsible agencies before the date of the enactment of this Act.

SEC. 125. REPORTING OF SUSPICIOUS ACTIVITIES BY INFORMAL UNDERGROUND 
                    BANKING SYSTEMS, SUCH AS HAWALAS.

  (a) Definition for Subchapter.--Subparagraph (R) of section 
5312(a)(2) of title 31, United States Code, is amended to read as 
follows:
                  ``(R) a licensed sender of money or any other person 
                who engages as a business in the transmission of funds, 
                including through an informal value transfer banking 
                system or network of people facilitating the transfer 
                of value domestically or internationally outside of the 
                conventional financial institutions system;''.
  (b) Money Transmitting Business.--Section 5330(d)(1)(A) of title 31, 
United States Code, is amended by inserting before the semicolon the 
following: ``or any other person who engages as a business in the 
transmission of funds, including through an informal value transfer 
banking system or network of people facilitating the transfer of value 
domestically or internationally outside of the conventional financial 
institutions system''.
  (c) Applicability of Rules.--Section 5318 of title 31, United States 
Code, as amended by this title, is amended by adding at the end the 
following:
  ``(l) Applicability of Rules.--Any rules prescribed pursuant to the 
authority contained in section 21 of the Federal Deposit Insurance Act 
shall apply, in addition to any other financial institution to which 
such rules apply, to any person that engages as a business in the 
transmission of funds, including through an informal value transfer 
banking system or network of people facilitating the transfer of value 
domestically or internationally outside of the conventional financial 
institutions system.''.
  (d) Report.--Not later than 1 year after the date of enactment of 
this Act, the Secretary of the Treasury shall report to Congress on the 
need for any additional legislation relating to--
          (1) informal value transfer banking systems or networks of 
        people facilitating the transfer of value domestically or 
        internationally outside of the conventional financial 
        institutions system;
          (2) anti-money laundering controls; and
          (3) regulatory controls relating to underground money 
        movement and banking systems, such as the system referred to as 
        ``hawala'', including whether the threshold for the filing of 
        suspicious activity reports under section 5318(g) of title 31, 
        United States Code should be lowered in the case of such 
        systems.

                  TITLE II--PUBLIC-PRIVATE COOPERATION

SEC. 201. ESTABLISHMENT OF HIGHLY SECURE NETWORK.

  (a) In General.--The Secretary of the Treasury shall establish a 
highly secure network in the Financial Crimes Enforcement Network 
that--
          (1) allows financial institutions to file reports required 
        under subchapter II or III of chapter 53 of title 31, United 
        States Code, chapter 2 of Public Law 91-508, or section 21 of 
        the Federal Deposit Insurance Act through the network; and
          (2) provides financial institutions with alerts and other 
        information regarding suspicious activities that warrant 
        immediate and enhanced scrutiny.
  (b) Expedited Development.--The Secretary of the Treasury shall take 
such action as may be necessary to ensure that the website required 
under subsection (a) is fully operational before the end of the 9-month 
period beginning on the date of the enactment of this Act.

SEC. 202. REPORT ON IMPROVEMENTS IN DATA ACCESS AND OTHER ISSUES.

  Before the end of the 6-month period beginning on the date of the 
enactment of this Act, the Secretary of the Treasury shall report to 
the Congress on the following issues:
          (1) Data collection and analysis.--Progress made since such 
        date of enactment in meeting the requirements of section 310(c) 
        of title 31, United States Code (as added by this Act).
          (2) Barriers to exchange of financial crime information.--
        Technical, legal, and other barriers to the exchange of 
        financial crime prevention and detection information among and 
        between Federal law enforcement agencies, including an 
        identification of all Federal law enforcement data systems 
        between which or among which data cannot be shared for whatever 
        reason.
          (3) Private banking.--Private banking activities in the 
        United States, including information on the following:
                  (A) The nature and extent of private banking 
                activities in the United States.
                  (B) Regulatory efforts to monitor private banking 
                activities and ensure that such activities are 
                conducted in compliance with subchapter II of chapter 
                53 of title 31, United States Code, and section 21 of 
                the Federal Deposit Insurance Act.
                  (C) With regard to financial institutions that offer 
                private banking services, the policies and procedures 
                of such institutions that are designed to ensure 
                compliance with the requirements of subchapter II of 
                chapter 53 of title 31, United States Code, and section 
                21 of the Federal Deposit Insurance Act with respect to 
                private banking activity.

SEC. 203. REPORTS TO THE FINANCIAL SERVICES INDUSTRY ON SUSPICIOUS 
                    FINANCIAL ACTIVITIES.

  At least once each calendar quarter, the Secretary of the Treasury 
shall--
          (1) publish a report containing a detailed analysis 
        identifying patterns of suspicious activity and other 
        investigative insights derived from suspicious activity reports 
        and investigations conducted by Federal, State, and local law 
        enforcement agencies to the extent appropriate; and
          (2) distribute such report to financial institutions (as 
        defined in section 5312 of title 31, United States Code).

SEC. 204. EFFICIENT USE OF CURRENCY TRANSACTION REPORT SYSTEM.

  (a) Findings.--The Congress finds the following:
          (1) The Congress established the currency transaction 
        reporting requirements in 1970 because the Congress found then 
        that such reports have a high degree of usefulness in criminal, 
        tax, and regulatory investigations and proceedings and the 
        usefulness of such reports has only increased in the years 
        since the requirements were established.
          (2) In 1994, in response to reports and testimony that excess 
        amounts of currency transaction reports were interfering with 
        effective law enforcement, the Congress reformed the currency 
        transaction report exemption requirements to provide--
                  (A) mandatory exemptions for certain reports that had 
                little usefulness for law enforcement, such as cash 
                transfers between depository institutions and cash 
                deposits from government agencies; and
                  (B) discretionary authority for the Secretary of the 
                Treasury to provide exemptions, subject to criteria and 
                guidelines established by the Secretary, for financial 
                institutions with regard to regular business customers 
                that maintain accounts at an institution into which 
                frequent cash deposits are made.
          (3) Today there is evidence that some financial institutions 
        are not utilizing the exemption system, or are filing reports 
        even if there is an exemption in effect, with the result that 
        the volume of currency transaction reports is once again 
        interfering with effective law enforcement.
  (b) Study and Report.--
          (1) Study required.--The Secretary of the Treasury shall 
        conduct a study of--
                  (A) the possible expansion of the statutory exemption 
                system in effect under 5313 of title 31, United States 
                Code; and
                  (B) methods for improving financial institution 
                utilization of the statutory exemption provisions as a 
                way of reducing the submission of currency transaction 
                reports that have little or no value for law 
                enforcement purposes, including improvements in the 
                systems in effect at financial institutions for regular 
                review of the exemption procedures used at the 
                institution and the training of personnel in its 
                effective use.
          (2) Report required.--The Secretary of the Treasury shall 
        submit a report to the Congress before the end of the 90-day 
        period beginning on the date of the enactment of this Act 
        containing the findings and conclusions of the Secretary with 
        regard to the study required under subsection (a) and such 
        recommendations for legislative or administrative action as the 
        Secretary determines to be appropriate.

SEC. 205. PUBLIC-PRIVATE TASK FORCE ON TERRORIST FINANCING ISSUES.

  Section 1564 of the Annunzio--Wylie Anti-Money Laundering Act (31 
U.S.C. 5311 note) is amended by adding at the end the following new 
subsection:
  ``(d) Terrorist Financing Issues.--
          ``(1) In general.--The Secretary of the Treasury shall 
        provide, either within the Bank Secrecy Act Advisory Group, or 
        as a subcommittee or other adjunct of the Advisory Group, for a 
        task force of representatives from agencies and officers 
        represented on the Advisory Group, a representative of the 
        Director of the Office of Homeland Security, and 
        representatives of financial institutions, private 
        organizations that represent the financial services industry, 
        and other interested parties to focus on--
                  ``(A) issues specifically related to the finances of 
                terrorist groups, the means terrorist groups use to 
                transfer funds around the world and within the United 
                States, including through the use of charitable 
                organizations, nonprofit organizations, and 
                nongovernmental organizations, and the extent to which 
                financial institutions in the United States are 
                unwittingly involved in such finances and the extent to 
                which such institutions are at risk as a result;
                  ``(B) the relationship, particularly the financial 
                relationship, between international narcotics 
                traffickers and foreign terrorist organizations, the 
                extent to which their memberships overlap and engage in 
                joint activities, and the extent to which they 
                cooperate with each other in raising and transferring 
                funds for their respective purposes; and
                  ``(C) means of facilitating the identification of 
                accounts and transactions involving terrorist groups 
                and facilitating the exchange of information concerning 
                such accounts and transactions between financial 
                institutions and law enforcement organizations.
          ``(2) Applicability of other provisions.--Sections 552, 552a, 
        and 552b of title 5, United States Code, and the Federal 
        Advisory Committee Act shall not apply to the task force 
        established pursuant to paragraph (1).''.

SEC. 206. SUSPICIOUS ACTIVITY REPORTING REQUIREMENTS.

  (a) Deadline For Suspicious Activity Reporting Requirements For 
Registered Brokers and Dealers.--The Secretary of the Treasury, in 
consultation with the Securities and Exchange Commission, shall publish 
proposed regulations in the Federal Register before January 1, 2002, 
requiring brokers and dealers registered with the Securities and 
Exchange Commission under the Securities Exchange Act of 1934 to submit 
suspicious activity reports under section 5318(g) of title 31, United 
States Code. Such regulations shall be published in final form no later 
than June 1, 2002.
  (b) Suspicious Activity Reporting Requirements For Futures Commission 
Merchants, Commodity Trading Advisors, and Commodity Pool Operators.--
The Secretary of the Treasury, in consultation with the Commodity 
Futures Trading Commission, may prescribe regulations requiring futures 
commission merchants, commodity trading advisors, and commodity pool 
operators registered under the Commodity Exchange Act to submit 
suspicious activity reports under section 5318(g) of title 31, United 
States Code.

SEC. 207. AMENDMENTS RELATING TO REPORTING OF SUSPICIOUS ACTIVITIES.

  (a) Amendment Relating to Civil Liability Immunity for Disclosures.--
Section 5318(g)(3) of title 31, United States Code, is amended to read 
as follows:
          ``(3) Liability for disclosures.--
                  ``(A) In general.--Any financial institution that 
                makes a voluntary disclosure of any possible violation 
                of law or regulation to a government agency or makes a 
                disclosure pursuant to this subsection or any other 
                authority, and any director, officer, employee, or 
                agent of such institution who makes, or requires 
                another to make any such disclosure, shall not be 
                liable to any person under any law or regulation of the 
                United States, any constitution, law, or regulation of 
                any State or political subdivision of any State, or 
                under any contract or other legally enforceable 
                agreement (including any arbitration agreement), for 
                such disclosure or for any failure to provide notice of 
                such disclosure to any person.
                  ``(B) Rule of construction.--Subparagraph (A) shall 
                not be construed as creating--
                          ``(i) any inference that the term `person', 
                        as used in such subparagraph, may be construed 
                        more broadly than its ordinary usage so to 
                        include any government or agency of government; 
                        or
                          ``(ii) any immunity against, or otherwise 
                        affecting, any civil or criminal action brought 
                        by any government or agency of government to 
                        enforce any constitution, law, or regulation of 
                        such government or agency.''.
  (b) Prohibition on Notification of Disclosures.--Section 5318(g)(2) 
of title 31, United States Code, is amended to read as follows:
          ``(2) Notification prohibited.--
                  ``(A) In general.--If a financial institution or any 
                director, officer, employee, or agent of any financial 
                institution, voluntarily or pursuant to this section or 
                any other authority, reports a suspicious transaction 
                to a government agency--
                          ``(i) the financial institution, director, 
                        officer, employee, or agent may not notify any 
                        person involved in the transaction that the 
                        transaction has been reported; and
                          ``(ii) no officer or employee of the Federal 
                        Government or of any State, local, tribal, or 
                        territorial government within the United 
                        States, who has any knowledge that such report 
                        was made may disclose to any person involved in 
                        the transaction that the transaction has been 
                        reported other than as necessary to fulfill the 
                        official duties of such officer or employee.
                  ``(B) Disclosures in certain employment references.--
                Notwithstanding the application of subparagraph (A) in 
                any other context, subparagraph (A) shall not be 
                construed as prohibiting any financial institution, or 
                any director, officer, employee, or agent of such 
                institution, from including, in a written employment 
                reference that is provided in accordance with section 
                18(v) of the Federal Deposit Insurance Act in response 
                to a request from another financial institution or a 
                written termination notice or employment reference that 
                is provided in accordance with the rules of the self-
                regulatory organizations registered with the Securities 
                and Exchange Commission, information that was included 
                in a report to which subparagraph (A) applies, but such 
                written employment reference may not disclose that such 
                information was also included in any such report or 
                that such report was made.''.

SEC. 208. AUTHORIZATION TO INCLUDE SUSPICIONS OF ILLEGAL ACTIVITY IN 
                    WRITTEN EMPLOYMENT REFERENCES.

  Section 18 of the Federal Deposit Insurance Act (12 U.S.C. 1828) is 
amended by adding at the end the following new subsection:
  ``(w) Written Employment References May Contain Suspicions of 
Involvement in Illegal Activity.--
          ``(1) In general.--Notwithstanding any other provision of 
        law, any insured depository institution, and any director, 
        officer, employee, or agent of such institution, may disclose 
        in any written employment reference relating to a current or 
        former institution-affiliated party of such institution which 
        is provided to another insured depository institution in 
        response to a request from such other institution, information 
        concerning the possible involvement of such institution-
        affiliated party in potentially unlawful activity, to the 
        extent--
                  ``(A) the disclosure does not contain information 
                which the institution, director, officer, employee, or 
                agent knows to be false; and
                  ``(B) the institution, director, officer, employee, 
                or agent has not acted with malice or with reckless 
                disregard for the truth in making the disclosure.
          ``(2) Definition.--For purposes of this subsection, the term 
        `insured depository institution' includes any uninsured branch 
        or agency of a foreign bank.''.

SEC. 209. INTERNATIONAL COOPERATION ON IDENTIFICATION OF ORIGINATORS OF 
                    WIRE TRANSFERS.

  The Secretary of the Treasury shall--
          (1) in consultation with the Attorney General and the 
        Secretary of State, take all reasonable steps to encourage 
        foreign governments to require the inclusion of the name of the 
        originator in wire transfer instructions sent to the United 
        States and other countries, with the information to remain with 
        the transfer from its origination until the point of 
        disbursement; and
          (2) report annually to the Committee on Financial Services of 
        the House of Representatives and the Committee on Banking, 
        Housing, and Urban Affairs of the Senate on--
                  (A) progress toward the goal enumerated in paragraph 
                (1), as well as impediments to implementation and an 
                estimated compliance rate; and
                  (B) impediments to instituting a regime in which all 
                appropriate identification, as defined by the 
                Secretary, about wire transfer recipients shall be 
                included with wire transfers from their point of 
                origination until disbursement.

SEC. 210. CHECK TRUNCATION STUDY.

  Before the end of the 90-day period beginning on the date of the 
enactment of this Act, the Secretary of the Treasury, in consultation 
with the Attorney General and the Board of Governors of the Federal 
Reserve System, shall conduct a study of the impact on crime 
prevention, law enforcement, and the administration of consumer 
protection laws of any policy of the Board of Governors of the Federal 
Reserve System relating to the promotion of check electronification, 
through truncation or other means, or migration from paper checks.

          TITLE III--COMBATTING INTERNATIONAL MONEY LAUNDERING

SEC. 301. SPECIAL MEASURES FOR JURISDICTIONS, FINANCIAL INSTITUTIONS, 
                    OR INTERNATIONAL TRANSACTIONS OF PRIMARY MONEY 
                    LAUNDERING CONCERN.

  (a) In General.--Subchapter II of chapter 53 of title 31, United 
States Code, is amended by inserting after section 5318 the following 
new section:

``Sec. 5318A. Special measures for jurisdictions, financial 
                    institutions, or international transactions of 
                    primary money laundering concern

  ``(a) International Counter-Money Laundering Requirements.--
          ``(1) In general.--The Secretary may require domestic 
        financial institutions and domestic financial agencies to take 
        1 or more of the special measures described in subsection (b) 
        if the Secretary finds that reasonable grounds exist for 
        concluding that a jurisdiction outside of the United States, 1 
        or more financial institutions operating outside of the United 
        States, 1 or more classes of transactions within, or involving, 
        a jurisdiction outside of the United States, or 1 or more types 
        of accounts is of primary money laundering concern, in 
        accordance with subsection (c).
          ``(2) Form of requirement.--The special measures described 
        in--
                  ``(A) subsection (b) may be imposed in such sequence 
                or combination as the Secretary shall determine;
                  ``(B) paragraphs (1) through (4) of subsection (b) 
                may be imposed by regulation, order, or otherwise as 
                permitted by law; and
                  ``(C) subsection (b)(5) may be imposed only by 
                regulation.
          ``(3) Duration of orders; rulemaking.--Any order by which a 
        special measure described in paragraphs (1) through (4) of 
        subsection (b) is imposed (other than an order described in 
        section 5326)--
                  ``(A) shall be issued together with a notice of 
                proposed rulemaking relating to the imposition of such 
                special measure; and
                  ``(B) may not remain in effect for more than 120 
                days, except pursuant to a regulation prescribed on or 
                before the end of the 120-day period beginning on the 
                date of issuance of such order.
          ``(4) Process for selecting special measures.--In selecting 
        which special measure or measures to take under this 
        subsection, the Secretary--
                  ``(A) shall consult with the Chairman of the Board of 
                Governors of the Federal Reserve System, any other 
                appropriate Federal banking agency (as defined in 
                section 3 of the Federal Deposit Insurance Act), the 
                Securities and Exchange Commission, the National Credit 
                Union Administration Board, and in the sole discretion 
                of the Secretary such other agencies and interested 
                parties as the Secretary may find to be appropriate; 
                and
                  ``(B) shall consider--
                          ``(i) whether similar action has been or is 
                        being taken by other nations or multilateral 
                        groups;
                          ``(ii) whether the imposition of any 
                        particular special measure would create a 
                        significant competitive disadvantage, including 
                        any undue cost or burden associated with 
                        compliance, for financial institutions 
                        organized or licensed in the United States; and
                          ``(iii) the extent to which the action or the 
                        timing of the action would have a significant 
                        adverse systemic impact on the international 
                        payment, clearance, and settlement system, or 
                        on legitimate business activities involving the 
                        particular jurisdiction, institution, or class 
                        of transactions.
          ``(5) No limitation on other authority.--This section shall 
        not be construed as superseding or otherwise restricting any 
        other authority granted to the Secretary, or to any other 
        agency, by this subchapter or otherwise.
  ``(b) Special Measures.--The special measures referred to in 
subsection (a), with respect to a jurisdiction outside of the United 
States, financial institution operating outside of the United States, 
class of transaction within, or involving, a jurisdiction outside of 
the United States, or 1 or more types of accounts are as follows:
          ``(1) Recordkeeping and reporting of certain financial 
        transactions.--
                  ``(A) In general.--The Secretary may require any 
                domestic financial institution or domestic financial 
                agency to maintain records, file reports, or both, 
                concerning the aggregate amount of transactions, or 
                concerning each transaction, with respect to a 
                jurisdiction outside of the United States, 1 or more 
                financial institutions operating outside of the United 
                States, 1 or more classes of transactions within, or 
                involving, a jurisdiction outside of the United States, 
                or 1 or more types of accounts if the Secretary finds 
                any such jurisdiction, institution, or class of 
                transactions to be of primary money laundering concern.
                  ``(B) Form of records and reports.--Such records and 
                reports shall be made and retained at such time, in 
                such manner, and for such period of time, as the 
                Secretary shall determine, and shall include such 
                information as the Secretary may determine, including--
                          ``(i) the identity and address of the 
                        participants in a transaction or relationship, 
                        including the identity of the originator of any 
                        funds transfer;
                          ``(ii) the legal capacity in which a 
                        participant in any transaction is acting;
                          ``(iii) the identity of the beneficial owner 
                        of the funds involved in any transaction, in 
                        accordance with such procedures as the 
                        Secretary determines to be reasonable and 
                        practicable to obtain and retain the 
                        information; and
                          ``(iv) a description of any transaction.
          ``(2) Information relating to beneficial ownership.--In 
        addition to any other requirement under any other provision of 
        law, the Secretary may require any domestic financial 
        institution or domestic financial agency to take such steps as 
        the Secretary may determine to be reasonable and practicable to 
        obtain and retain information concerning the beneficial 
        ownership of any account opened or maintained in the United 
        States by a foreign person (other than a foreign entity whose 
        shares are subject to public reporting requirements or are 
        listed and traded on a regulated exchange or trading market), 
        or a representative of such a foreign person, that involves a 
        jurisdiction outside of the United States, 1 or more financial 
        institutions operating outside of the United States, 1 or more 
        classes of transactions within, or involving, a jurisdiction 
        outside of the United States, or 1 or more types of accounts if 
        the Secretary finds any such jurisdiction, institution, 
        transaction, or account to be of primary money laundering 
        concern.
          ``(3) Information relating to certain payable-through 
        accounts.--If the Secretary finds a jurisdiction outside of the 
        United States, 1 or more financial institutions operating 
        outside of the United States, or 1 or more classes of 
        transactions within, or involving, a jurisdiction outside of 
        the United States to be of primary money laundering concern, 
        the Secretary may require any domestic financial institution or 
        domestic financial agency that opens or maintains a payable-
        through account in the United States for a foreign financial 
        institution involving any such jurisdiction or any such 
        financial institution operating outside of the United States, 
        or a payable through account through which any such transaction 
        may be conducted, as a condition of opening or maintaining such 
        account--
                  ``(A) to identify each customer (and representative 
                of such customer) of such financial institution who is 
                permitted to use, or whose transactions are routed 
                through, such payable-through account; and
                  ``(B) to obtain, with respect to each such customer 
                (and each such representative), information that is 
                substantially comparable to that which the depository 
                institution obtains in the ordinary course of business 
                with respect to its customers residing in the United 
                States.
          ``(4) Information relating to certain correspondent 
        accounts.--If the Secretary finds a jurisdiction outside of the 
        United States, 1 or more financial institutions operating 
        outside of the United States, or 1 or more classes of 
        transactions within, or involving, a jurisdiction outside of 
        the United States to be of primary money laundering concern, 
        the Secretary may require any domestic financial institution or 
        domestic financial agency that opens or maintains a 
        correspondent account in the United States for a foreign 
        financial institution involving any such jurisdiction or any 
        such financial institution operating outside of the United 
        States, or a correspondent account through which any such 
        transaction may be conducted, as a condition of opening or 
        maintaining such account--
                  ``(A) to identify each customer (and representative 
                of such customer) of any such financial institution who 
                is permitted to use, or whose transactions are routed 
                through, such correspondent account; and
                  ``(B) to obtain, with respect to each such customer 
                (and each such representative), information that is 
                substantially comparable to that which the depository 
                institution obtains in the ordinary course of business 
                with respect to its customers residing in the United 
                States.
          ``(5) Prohibitions or conditions on opening or maintaining 
        certain correspondent or payable-through accounts.--If the 
        Secretary finds a jurisdiction outside of the United States, 1 
        or more financial institutions operating outside of the United 
        States, or 1 or more classes of transactions within, or 
        involving, a jurisdiction outside of the United States to be of 
        primary money laundering concern, the Secretary, in 
        consultation with the Secretary of State, the Attorney General, 
        and the Chairman of the Board of Governors of the Federal 
        Reserve System, may prohibit, or impose conditions upon, the 
        opening or maintaining in the United States of a correspondent 
        account or payable- through account by any domestic financial 
        institution or domestic financial agency for or on behalf of a 
        foreign banking institution, if such correspondent account or 
        payable-through account involves any such jurisdiction or 
        institution, or if any such transaction may be conducted 
        through such correspondent account or payable-through account.
  ``(c) Consultations and Information To Be Considered in Finding 
Jurisdictions, Institutions, Types of Accounts, or Transactions To Be 
of Primary Money Laundering Concern.--
          ``(1) In general.--In making a finding that reasonable 
        grounds exist for concluding that a jurisdiction outside of the 
        United States, 1 or more financial institutions operating 
        outside of the United States, 1 or more classes of transactions 
        within, or involving, a jurisdiction outside of the United 
        States, or 1 or more types of accounts is of primary money 
        laundering concern so as to authorize the Secretary to take 1 
        or more of the special measures described in subsection (b), 
        the Secretary shall consult with the Secretary of State, and 
        the Attorney General.
          ``(2) Additional considerations.--In making a finding 
        described in paragraph (1), the Secretary shall consider in 
        addition such information as the Secretary determines to be 
        relevant, including the following potentially relevant factors:
                  ``(A) Jurisdictional factors.--In the case of a 
                particular jurisdiction--
                          ``(i) evidence that organized criminal 
                        groups, international terrorists, or both, have 
                        transacted business in that jurisdiction;
                          ``(ii) the extent to which that jurisdiction 
                        or financial institutions operating in that 
                        jurisdiction offer bank secrecy or special 
                        regulatory advantages to nonresidents or 
                        nondomiciliaries of that jurisdiction;
                          ``(iii) the substance and quality of 
                        administration of the bank supervisory and 
                        counter-money laundering laws of that 
                        jurisdiction;
                          ``(iv) the relationship between the volume of 
                        financial transactions occurring in that 
                        jurisdiction and the size of the economy of the 
                        jurisdiction;
                          ``(v) the extent to which that jurisdiction 
                        is characterized as an offshore banking or 
                        secrecy haven by credible international 
                        organizations or multilateral expert groups;
                          ``(vi) whether the United States has a mutual 
                        legal assistance treaty with that jurisdiction, 
                        and the experience of United States law 
                        enforcement officials, and regulatory officials 
                        in obtaining information about transactions 
                        originating in or routed through or to such 
                        jurisdiction; and
                          ``(vii) the extent to which that jurisdiction 
                        is characterized by high levels of official or 
                        institutional corruption.
                  ``(B) Institutional factors.--In the case of a 
                decision to apply 1 or more of the special measures 
                described in subsection (b) only to a financial 
                institution or institutions, or to a transaction or 
                class of transactions, or to a type of account, or to 
                all 3, within or involving a particular jurisdiction--
                          ``(i) the extent to which such financial 
                        institutions, transactions, or types of 
                        accounts are used to facilitate or promote 
                        money laundering in or through the 
                        jurisdiction;
                          ``(ii) the extent to which such institutions, 
                        transactions, or types of accounts are used for 
                        legitimate business purposes in the 
                        jurisdiction; and
                          ``(iii) the extent to which such action is 
                        sufficient to ensure, with respect to 
                        transactions involving the jurisdiction and 
                        institutions operating in the jurisdiction, 
                        that the purposes of this subchapter continue 
                        to be fulfilled, and to guard against 
                        international money laundering and other 
                        financial crimes.
  ``(d) Notification of Special Measures Invoked by the Secretary.--Not 
later than 10 days after the date of any action taken by the Secretary 
under subsection (a)(1), the Secretary shall notify, in writing, the 
Committee on Financial Services of the House of Representatives and the 
Committee on Banking, Housing, and Urban Affairs of the Senate of any 
such action.
  ``(e) Definitions.--Notwithstanding any other provision of this 
subchapter, for purposes of this section, the following definitions 
shall apply:
          ``(1) Bank definitions.--The following definitions shall 
        apply with respect to a bank:
                  ``(A) Account.--The term `account'--
                          ``(i) means a formal banking or business 
                        relationship established to provide regular 
                        services, dealings, and other financial 
                        transactions; and
                          ``(ii) includes a demand deposit, savings 
                        deposit, or other transaction or asset account 
                        and a credit account or other extension of 
                        credit.
                  ``(B) Correspondent account.--The term `correspondent 
                account' means an account established to receive 
                deposits from, make payments on behalf of a foreign 
                financial institution, or handle other financial 
                transactions related to such institution.
                  ``(C) Payable-through account.--The term `payable-
                through account' means an account, including a 
                transaction account (as defined in section 19(b)(1)(C) 
                of the Federal Reserve Act), opened at a depository 
                institution by a foreign financial institution by means 
                of which the foreign financial institution permits its 
                customers to engage, either directly or through a 
                subaccount, in banking activities usual in connection 
                with the business of banking in the United States.
                  ``(D) Secretary.--The term `Secretary' means the 
                Secretary of the Treasury.
          ``(2) Definitions applicable to institutions other than 
        banks.--With respect to any financial institution other than a 
        bank, the Secretary shall, after consultation with the 
        appropriate Federal functional regulators (as defined in 
        section 509 of the Gramm-Leach-Bliley Act), define by 
        regulation the term `account', and shall include within the 
        meaning of that term, to the extent, if any, that the Secretary 
        deems appropriate, arrangements similar to payable-through and 
        correspondent accounts.
          ``(3) Regulatory definition.--The Secretary shall promulgate 
        regulations defining beneficial ownership of an account for 
        purposes of this subchapter. Such regulations shall address 
        issues related to an individual's authority to fund, direct, or 
        manage the account (including the power to direct payments into 
        or out of the account), and an individual's material interest 
        in the income or corpus of the account, and shall ensure that 
        the identification of individuals under this section does not 
        extend to any individual whose beneficial interest in the 
        income or corpus of the account is immaterial.
          ``(4) Other terms.--The Secretary may, by regulation, further 
        define the terms in paragraphs (1) and (2) and define other 
        terms for the purposes of this section, as the Secretary deems 
        appropriate.''.
  (b) Financial Institutions Specified in Subchapter II of Chapter 53 
of Title 31, United States Code.--
          (1) Credit unions.--Subparagraph (E) of section 5312(2) of 
        title 31, United States Code, is amended to read as follows:
                  ``(E) any credit union;''.
          (2) Futures commission merchant; commodity trading advisor; 
        commodity pool operator.--Section 5312 of title 31, United 
        States Code, is amended by adding at the end the following new 
        subsection:
  ``(c) Additional Definitions.--For purposes of this subchapter, the 
following definitions shall apply:
          ``(1) Certain institutions included in definition.--The term 
        `financial institution' (as defined in subsection (a)) includes 
        the following:
                  ``(A) Any futures commission merchant, commodity 
                trading advisor, or commodity pool operator registered, 
                or required to register, under the Commodity Exchange 
                Act.''.
          (3) CFTC included.--For purposes of this Act and any 
        amendment made by this Act to any other provision of law, the 
        term ``Federal functional regulator'' includes the Commodity 
        Futures Trading Commission.
  (c) Clerical Amendment.--The table of sections for subchapter II of 
chapter 53 of title 31, United States Code, is amended by inserting 
after the item relating to section 5318 the following new item:

``5318A. Special measures for jurisdictions, financial institutions, or 
international transactions of primary money laundering concern.''.

SEC. 302. SPECIAL DUE DILIGENCE FOR CORRESPONDENT ACCOUNTS AND PRIVATE 
                    BANKING ACCOUNTS.

  (a) In General.--Section 5318 of title 31, United States Code, is 
amended by inserting after subsection (i) (as added by section 123 of 
this Act) the following new subsection:
  ``(j) Due Diligence for United States Private Banking and 
Correspondent Bank Accounts Involving Foreign Persons.--
          ``(1) In general.--Each financial institution that 
        establishes, maintains, administers, or manages a private 
        banking account or a correspondent account in the United States 
        for a non-United States person, including a foreign individual 
        visiting the United States, or a representative of a non-United 
        States person, shall establish appropriate, specific, and, 
        where necessary, enhanced due diligence policies, procedures, 
        and controls to detect and report instances of money laundering 
        through those accounts.
          ``(2) Minimum standards for correspondent accounts.--
                  ``(A) In general.--Subparagraph (B) shall apply if a 
                correspondent account is requested or maintained by, or 
                on behalf of, a foreign bank operating--
                          ``(i) under an offshore banking license; or
                          ``(ii) under a banking license issued by a 
                        foreign country that has been designated--
                                  ``(I) as noncooperative with 
                                international anti-money laundering 
                                principles or procedures by an 
                                intergovernmental group or organization 
                                of which the United States is a member 
                                with which designation the Secretary of 
                                the Treasury concurs; or
                                  ``(II) by the Secretary as warranting 
                                special measures due to money 
                                laundering concerns.
                  ``(B) Policies, procedures, and controls.--The 
                enhanced due diligence policies, procedures, and 
                controls required under paragraph (1) for foreign banks 
                described in subparagraph (A) shall, at a minimum, 
                ensure that the financial institution in the United 
                States takes reasonable steps--
                          ``(i) to ascertain for any such foreign bank, 
                        the shares of which are not publicly traded, 
                        the identity of each of the owners of the 
                        foreign bank, and the nature and extent of the 
                        ownership interest of each such owner;
                          ``(ii) to conduct enhanced scrutiny of such 
                        account to guard against money laundering and 
                        report any suspicious transactions under 
                        section 5318(g); and
                          ``(iii) to ascertain whether such foreign 
                        bank provides correspondent accounts to other 
                        foreign banks and, if so, the identity of those 
                        foreign banks and related due diligence 
                        information, as appropriate under paragraph 
                        (1).
          ``(3) Minimum standards for private banking accounts.--If a 
        private banking account is requested or maintained by, or on 
        behalf of, a non-United States person, then the due diligence 
        policies, procedures, and controls required under paragraph (1) 
        shall, at a minimum, ensure that the financial institution 
        takes reasonable steps--
                  ``(A) to ascertain the identity of the nominal and 
                beneficial owners of, and the source of funds deposited 
                into, such account as needed to guard against money 
                laundering and report any suspicious transactions under 
                section 5318(g); and
                  ``(B) to conduct enhanced scrutiny of any such 
                account that is requested or maintained by, or on 
                behalf of, a senior foreign political figure, or any 
                immediate family member or close associate of a senior 
                foreign political figure, to prevent, detect, and 
                report transactions that may involve the proceeds of 
                foreign corruption.
          ``(4) Definitions.--For purposes of this subsection, the 
        following definitions shall apply:
                  ``(A) Offshore banking license.--The term `offshore 
                banking license' means a license to conduct banking 
                activities which, as a condition of the license, 
                prohibits the licensed entity from conducting banking 
                activities with the citizens of, or with the local 
                currency of, the country which issued the license.
                  ``(B) Private bank account.--The term `private bank 
                account' means an account (or any combination of 
                accounts) that--
                          ``(i) requires a minimum aggregate deposits 
                        of funds or other assets of not less than 
                        $1,000,000;
                          ``(ii) is established on behalf of 1 or more 
                        individuals who have a direct or beneficial 
                        ownership interest in the account; and
                          ``(iii) is assigned to, or is administered or 
                        managed by, in whole or in part, an officer, 
                        employee, or agent of a financial institution 
                        acting as a liaison between the financial 
                        institution and the direct or beneficial owner 
                        of the account.
          ``(5) Regulatory authority.--Before the end of the 6-month 
        period beginning on the date of the enactment of the Financial 
        Anti-Terrorism Act of 2001, the Secretary, in consultation with 
        the appropriate Federal functional regulators (as defined in 
        section 509 of the Gramm-Leach-Bliley Act) shall further define 
        and clarify, by regulation, the requirements of this 
        subsection.''.
  (b) Effective Date.--The amendments made by this section shall take 
effect beginning 180 days after the date of the enactment of this Act 
with respect to accounts covered by subsection (j) of section 5318 of 
title 31, United States Code (as added by this section) that are opened 
before, on, or after the date of the enactment of this Act.

SEC. 303. PROHIBITION ON UNITED STATES CORRESPONDENT ACCOUNTS WITH 
                    FOREIGN SHELL BANKS.

  Section 5318 of title 31, United States Code, is amended by inserting 
after subsection (j) (as added by section 302 of this title) the 
following new subsection:
  ``(k) Prohibition on United States Correspondent Accounts With 
Foreign Shell Banks.--
          ``(1) In general.--A depository institution shall not 
        establish, maintain, administer, or manage a correspondent 
        account in the United States for, or on behalf of, a foreign 
        bank that does not have a physical presence in any country.
          ``(2) Prevention of indirect service to foreign shell 
        banks.--
                  ``(A) In general.--A depository institution shall 
                take reasonable steps to ensure that any correspondent 
                account established, maintained, administered, or 
                managed by that institution in the United States for a 
                foreign bank is not being used by that foreign bank to 
                indirectly provide banking services to another foreign 
                bank that does not have a physical presence in any 
                country.
                  ``(B) Regulations.--The Secretary shall, in 
                regulations, delineate reasonable steps necessary for a 
                depository institution to comply with this subsection.
          ``(3) Exception.--Paragraphs (1) and (2) shall not be 
        construed as prohibiting a depository institution from 
        providing a correspondent account to a foreign bank, if the 
        foreign bank--
                  ``(A) is an affiliate of a depository institution, 
                credit union, or other foreign bank that maintains a 
                physical presence in the United States or a foreign 
                country, as applicable; and
                  ``(B) is subject to supervision by a banking 
                authority in the country regulating the affiliated 
                depository institution, credit union, or foreign bank, 
                described in subparagraph (A), as applicable.
          ``(4) Definitions.--For purposes of this section, the 
        following definitions shall apply:
                  ``(A) Affiliate.--The term `affiliate' means a 
                foreign bank that is controlled by or is under common 
                control with a depository institution, credit union, or 
                foreign bank.
                  ``(B) Depository institution.--The `depository 
                institution'--
                          ``(i) has the meaning given such term in 
                        section 3 of the Federal Deposit Insurance Act; 
                        and
                          ``(ii) includes a credit union.
                  ``(C) Physical presence.--The term `physical 
                presence' means a place of business that--
                          ``(i) is maintained by a foreign bank;
                          ``(ii) is located at a fixed address (other 
                        than solely an electronic address) in a country 
                        in which the foreign bank is authorized to 
                        conduct banking activities, at which location 
                        the foreign bank--
                                  ``(I) employs 1 or more individuals 
                                on a full-time basis; and
                                  ``(II) maintains operating records 
                                related to its banking activities; and
                          ``(iii) is subject to inspection by the 
                        banking authority which licensed the foreign 
                        bank to conduct banking activities.''.

SEC. 304. ANTI-MONEY LAUNDERING PROGRAMS.

  (a) In General.--Section 5318(h) of title 31, United States Code, is 
amended to read as follows:
  ``(h) Anti-Money Laundering Programs.--
          ``(1) In general.--In order to guard against money laundering 
        through financial institutions, each financial institution 
        shall establish anti-money laundering programs, including, at a 
        minimum--
                  ``(A) the development of internal policies, 
                procedures, and controls;
                  ``(B) the designation of an officer of the financial 
                institution responsible for compliance;
                  ``(C) an ongoing employee training program; and
                  ``(D) an independent audit function to test programs.
          ``(2) Regulations.--The Secretary may, after consultation 
        with the appropriate Federal functional regulators (as defined 
        in section 509 of the Gramm-Leach-Bliley Act), prescribe 
        minimum standards for programs established under paragraph (1), 
        and may exempt from the application of those standards any 
        financial institution that is not subject to the provisions of 
        the regulations contained in part 103 of title 31, of the Code 
        of Federal Regulations, as in effect on the date of the 
        enactment of the Financial Anti-Terrorism Act of 2001, or any 
        successor to such regulations, for so long as such financial 
        institution is not subject to the provisions of such 
        regulations.''.
  (b) Effective Date.--The amendment made by subsection (a) shall take 
effect at the end of the 180-day period beginning on the date of the 
enactment of this Act.
  (c) Date of Application of Regulations; Factors to Be Taken Into 
Account.--Before the end of the 180-day period beginning on the date of 
the enactment of this Act, the Secretary of the Treasury shall 
prescribe regulations to implement the amendment made by subsection 
(a). In prescribing such regulations, the Secretary shall consider the 
extent to which the requirements imposed under such regulations are 
commensurate with the size, location, and activities of the financial 
institutions to which such regulations apply.

SEC. 305. CONCENTRATION ACCOUNTS AT FINANCIAL INSTITUTIONS.

  Section 5318(h) of title 31, United States Code (as amended by 
section 304) is amended by adding at the end the following:
          ``(3) Concentration accounts.--The Secretary may prescribe 
        regulations under this subsection that govern maintenance of 
        concentration accounts by financial institutions, in order to 
        ensure that such accounts are not used to prevent association 
        of the identity of an individual customer with the movement of 
        funds of which the customer is the direct or beneficial owner, 
        which regulations shall, at a minimum--
                  ``(A) prohibit financial institutions from allowing 
                clients to direct transactions that move their funds 
                into, out of, or through the concentration accounts of 
                the financial institution;
                  ``(B) prohibit financial institutions and their 
                employees from informing customers of the existence of, 
                or the means of identifying, the concentration accounts 
                of the institution; and
                  ``(C) require each financial institution to establish 
                written procedures governing the documentation of all 
                transactions involving a concentration account, which 
                procedures shall ensure that, any time a transaction 
                involving a concentration account commingles funds 
                belonging to 1 or more customers, the identity of, and 
                specific amount belonging to, each customer is 
                documented.''.

SEC. 306. INTERNATIONAL COOPERATION IN INVESTIGATIONS OF MONEY 
                    LAUNDERING, FINANCIAL CRIMES, AND THE FINANCES OF 
                    TERRORIST GROUPS.

  (a) Negotiations.--
          (1) In general.--In addition to the requirements of section 
        4702 of the Anti-Drug Abuse Act of 1988, the Secretary of the 
        Treasury (hereinafter in this section referred to as the 
        ``Secretary''), in consultation with the Attorney General, the 
        Secretary of State, and the Board of Governors of the Federal 
        Reserve System, shall enter into negotiations with the 
        appropriate financial supervisory agencies and other officials 
        of any foreign country the financial institutions of which do 
        business with United States financial institutions or which may 
        be utilized by any foreign terrorist organization (as 
        designated under section 219 of the Immigration and Nationality 
        Act), any person who is a member or representative of any such 
        organization, or any person engaged in money laundering or 
        financial or other crimes.
          (2) Purposes of negotiations.--In carrying out negotiations 
        under paragraph (1), the Secretary shall seek to enter into and 
        further cooperative efforts, voluntary information exchanges, 
        the use of letters rogatory, mutual legal assistance treaties, 
        and international agreements to--
                  (A) ensure that foreign banks and other financial 
                institutions maintain adequate records of--
                          (i) large United States currency 
                        transactions; and
                          (ii) transaction and account information 
                        relating to any foreign terrorist organization 
                        (as designated under section 219 of the 
                        Immigration and Nationality Act), any person 
                        who is a member or representative of any such 
                        organization, or any person engaged in money 
                        laundering or financial or other crimes; and
          (B) establish a mechanism whereby such records may be made 
        available to United States law enforcement officials and 
        domestic financial institution supervisors, when appropriate.
  (b) Reports.--
          (1) Interim report.--Not later than 1 year after the date of 
        the enactment of this Act, the Secretary shall submit an 
        interim report to the Congress on progress in the negotiations 
        under subsection (a).
          (2) Final report.--Not later than 2 years after the date of 
        the enactment of this Act, the Secretary shall submit a final 
        report to the President and the Congress, on the outcome of 
        negotiations under subsection (a).
          (3) Identification of certain countries.--In the report 
        submitted under paragraph (2), the Secretary shall identify 
        countries--
                  (A) with respect to which the Secretary determines 
                there is evidence that the financial institutions in 
                such countries are being utilized, knowingly or 
                unwittingly, by any foreign terrorist organization (as 
                designated under section 219 of the Immigration and 
                Nationality Act), any person who is a member or 
                representative of any such organization, or any person 
                engaged in money laundering or financial or other 
                crimes; and
                  (B) which have not reached agreement with United 
                States authorities to meet the objectives of 
                subparagraphs (A) and (B) of subsection (a)(2).
  (c) Authority for Other Action.--
          (1) In general.--If the President determines that--
                  (A) a foreign country is described in subparagraphs 
                (A) and (B) of subsection (b)(3); and
                  (B) such country--
                          (i) is not negotiating in good faith to reach 
                        an agreement described in subsection (a)(2); or
                          (ii) or a financial institution of such 
                        country, has not complied with a request, made 
                        by an official of the United States Government 
                        authorized to make such request, for 
                        information regarding a foreign terrorist 
                        organization (as designated under section 219 
                        of the Immigration and Nationality Act), a 
                        person who is a member or representative of any 
                        such organization, or a person engaged in money 
                        laundering for or with any such organization,
        the President may impose appropriate penalties and sanctions on 
        such country and, except as provided in paragraph (3), 
        financial institutions of such country.
          (2) Penalties and sanctions.--The penalties and sanctions 
        which may be imposed by the President under paragraph (1) 
        include temporarily or permanently--
                  (A) prohibiting such persons, institutions, or other 
                entities as the President may designate in any such 
                country from participating in any United States dollar 
                clearing or wire transfer system; and
                  (B) prohibiting such persons, institutions or 
                entities as the President may designate in such 
                countries from maintaining an account with any bank or 
                other financial institution chartered under the laws of 
                the United States or any State.
          (3) Exemption for certain financial institutions.--Financial 
        institutions that maintain adequate records shall be exempt 
        from such penalties and sanctions.

SEC. 307. PROHIBITION ON ACCEPTANCE OF ANY BANK INSTRUMENT FOR UNLAWFUL 
                    INTERNET GAMBLING.

  (a) In General.--No person engaged in the business of betting or 
wagering may knowingly accept, in connection with the participation of 
another person in unlawful Internet gambling--
          (1) credit, or the proceeds of credit, extended to or on 
        behalf of such other person (including credit extended through 
        the use of a credit card);
          (2) an electronic fund transfer or funds transmitted by or 
        through a money transmitting business, or the proceeds of an 
        electronic fund transfer or money transmitting service, from or 
        on behalf of the other person;
          (3) any check, draft, or similar instrument which is drawn by 
        or on behalf of the other person and is drawn on or payable at 
        or through any financial institution; or
          (4) the proceeds of any other form of financial transaction 
        as the Secretary may prescribe by regulation which involves a 
        financial institution as a payor or financial intermediary on 
        behalf of or for the benefit of the other person.
  (b) Definitions.--For purposes of this Act, the following definitions 
shall apply:
          (1) Bets or wagers.--The term ``bets or wagers''--
                  (A) means the staking or risking by any person of 
                something of value upon the outcome of a contest of 
                others, a sporting event, or a game subject to chance, 
                upon an agreement or understanding that the person or 
                another person will receive something of greater value 
                than the amount staked or risked in the event of a 
                certain outcome;
                  (B) includes the purchase of a chance or opportunity 
                to win a lottery or other prize (which opportunity to 
                win is predominantly subject to chance);
                  (C) includes any scheme of a type described in 
                section 3702 of title 28, United States Code;
                  (D) includes any instructions or information 
                pertaining to the establishment or movement of funds in 
                an account by the bettor or customer with the business 
                of betting or wagering; and
                  (E) does not include--
                          (i) any activity governed by the securities 
                        laws (as that term is defined in section 
                        3(a)(47) of the Securities Exchange Act of 
                        1934) for the purchase or sale at a future date 
                        of securities (as that term is defined in 
                        section 3(a)(10) of such Act);
                          (ii) any transaction on or subject to the 
                        rules of a contract market designated pursuant 
                        to the Commodity Exchange Act;
                          (iii) any over-the-counter derivative 
                        instrument;
                          (iv) any contract of indemnity or guarantee;
                          (v) any contract for insurance;
                          (vi) any deposit or other transaction with a 
                        depository institution (as defined in section 
                        3(c) of the Federal Deposit Insurance Act);
                          (vii) any participation in a simulation 
                        sports game or an educational game or contest 
                        that--
                                  (I) is not dependent solely on the 
                                outcome of any single sporting event or 
                                nonparticipant's singular individual 
                                performance in any single sporting 
                                event;
                                  (II) has an outcome that reflects the 
                                relative knowledge and skill of the 
                                participants with such outcome 
                                determined predominantly by accumulated 
                                statistical results of sporting events; 
                                and
                                  (III) offers a prize or award to a 
                                participant that is established in 
                                advance of the game or contest and is 
                                not determined by the number of 
                                participants or the amount of any fees 
                                paid by those participants; and
                          (viii) any transaction with a business 
                        licensed by a State.
          (2) Business of betting or wagering.--The term ``business of 
        betting or wagering'' does not include, other than for purposes 
        of subsection (e), any creditor, credit card issuer, insured 
        depository institution, financial institution, operator of a 
        terminal at which an electronic fund transfer may be initiated, 
        money transmitting business, or international, national, 
        regional, or local network utilized to effect a credit 
        transaction, electronic fund transfer, stored value product 
        transaction, or money transmitting service, or any participant 
        in such network.
          (3) Internet.--The term ``Internet'' means the international 
        computer network of interoperable packet switched data 
        networks.
          (4) Unlawful internet gambling.--The term ``unlawful Internet 
        gambling'' means to place, receive, or otherwise transmit a bet 
        or wager by any means which involves the use, at least in part, 
        of the Internet where such bet or wager is unlawful under any 
        applicable Federal or State law in the State in which the bet 
        or wager is initiated, received, or otherwise made.
          (5) Other terms.--
                  (A) Credit; creditor; and credit card.--The terms 
                ``credit'', ``creditor'', and ``credit card'' have the 
                meanings given such terms in section 103 of the Truth 
                in Lending Act.
                  (B) Electronic fund transfer.--The term ``electronic 
                fund transfer''--
                          (i) has the meaning given such term in 
                        section 903 of the Electronic Fund Transfer 
                        Act; and
                          (ii) includes any fund transfer covered by 
                        Article 4A of the Uniform Commercial Code, as 
                        in effect in any State.
                  (C) Financial institution.--The term ``financial 
                institution'' has the meaning given such term in 
                section 903 of the Electronic Fund Transfer Act.
                  (D) Money transmitting business and money 
                transmitting service.--The terms ``money transmitting 
                business'' and ``money transmitting service'' have the 
                meanings given such terms in section 5330(d) of title 
                31, United States Code.
                  (E) Secretary.--The term ``Secretary'' means the 
                Secretary of the Treasury.
  (c) Civil Remedies.--
          (1) Jurisdiction.--The district courts of the United States 
        shall have original and exclusive jurisdiction to prevent and 
        restrain violations of this section by issuing appropriate 
        orders in accordance with this section, regardless of whether a 
        prosecution has been initiated under this section.
          (2) Proceedings.--
                  (A) Institution by federal government.--
                          (i) In general.--The United States, acting 
                        through the Attorney General, may institute 
                        proceedings under this subsection to prevent or 
                        restrain a violation of this section.
                          (ii) Relief.--Upon application of the United 
                        States under this subparagraph, the district 
                        court may enter a preliminary injunction or an 
                        injunction against any person to prevent or 
                        restrain a violation of this section, in 
                        accordance with Rule 65 of the Federal Rules of 
                        Civil Procedure.
                  (B) Institution by state attorney general.--
                          (i) In general.--The attorney general of a 
                        State (or other appropriate State official) in 
                        which a violation of this section allegedly has 
                        occurred or will occur may institute 
                        proceedings under this subsection to prevent or 
                        restrain the violation.
                          (ii) Relief.--Upon application of the 
                        attorney general (or other appropriate State 
                        official) of an affected State under this 
                        subparagraph, the district court may enter a 
                        preliminary injunction or an injunction against 
                        any person to prevent or restrain a violation 
                        of this section, in accordance with Rule 65 of 
                        the Federal Rules of Civil Procedure.
                  (C) Indian lands.--
                          (i) In general.--Notwithstanding 
                        subparagraphs (A) and (B), for a violation that 
                        is alleged to have occurred, or may occur, on 
                        Indian lands (as that term is defined in 
                        section 4 of the Indian Gaming Regulatory 
                        Act)--
                                  (I) the United States shall have the 
                                enforcement authority provided under 
                                subparagraph (A);
                                  (II) the enforcement authorities 
                                specified in an applicable Tribal-State 
                                compact negotiated under section 11 of 
                                the Indian Gaming Regulatory Act shall 
                                be carried out in accordance with that 
                                compact; and
                                  (III) class III Internet gaming 
                                activities shall be lawful only if such 
                                activities are--
                                          (aa) located in a State that 
                                        permits Internet gambling;
                                          (bb) conducted in conformance 
                                        with a tribal-State compact 
                                        pursuant to section 11(d)(3) of 
                                        the Indian Gaming Regulatory 
                                        Act; and
                                          (cc) the person placing or 
                                        transmitting the wager or bet 
                                        is located in a jurisdiction 
                                        that permits Internet gambling.
                          (ii) Rule of construction.--No provision of 
                        this section shall be construed as altering, 
                        superseding, or otherwise affecting the 
                        application of the Indian Gaming Regulatory 
                        Act.
                  (D) Banking regulators.--Before initiating any 
                proceeding under this paragraph with respect to a 
                violation or potential violation of subsection (e) by 
                an insured depository institution (as defined in 
                section 3 of the Federal Deposit Insurance Act), the 
                Attorney General of the United States or an attorney 
                general of a State (or other appropriate State 
                official) shall--
                          (i) notify the appropriate Federal banking 
                        agency (as defined in such section) of such 
                        violation or potential violation; and
                          (ii) allow such agency a reasonable time to 
                        issue an order to such insured depository 
                        institution under section 8(x) of the Federal 
                        Deposit Insurance Act.
          (3) Expedited proceedings.--In addition to any proceeding 
        under paragraph (2), a district court may, in exigent 
        circumstances, enter a temporary restraining order against a 
        person alleged to be in violation of this section upon 
        application of the United States under paragraph (2)(A), or the 
        attorney general (or other appropriate State official) of an 
        affected State under paragraph (2)(B), in accordance with Rule 
        65(b) of the Federal Rules of Civil Procedure.
          (4) Limitation.--No provision of this section shall be 
        construed as authorizing an injunction against an interactive 
        computer service (as defined in section 230(f) of the 
        Communications Act of 1934) unless such interactive computer 
        service is acting in concert or participation with a person who 
        violates this section and such service receives actual notice 
        of the order.
  (d) Criminal Penalty.--
          (1) In general.--Whoever violates this section shall be fined 
        under title 18, United States Code, or imprisoned for not more 
        than 5 years, or both.
          (2) Permanent injunction.--Upon conviction of a person under 
        this subsection, the court may enter a permanent injunction 
        enjoining such person from placing, receiving, or otherwise 
        making bets or wagers or sending, receiving, or inviting 
        information assisting in the placing of bets or wagers.
  (e) Circumventions Prohibited.--Notwithstanding subsection (b)(2), a 
creditor, credit card issuer, financial institution, operator of a 
terminal at which an electronic fund transfer may be initiated, money 
transmitting business, or international, national, regional, or local 
network utilized to effect a credit transaction, electronic fund 
transfer, or money transmitting service, or any participant in such 
network, may be liable under this section if such creditor, issuer, 
institution, operator, business, network, or participant has actual 
knowledge and control of bets and wagers--
          (1) operates, manages, supervises, or directs an Internet 
        website at which unlawful bets or wagers may be placed, 
        received, or otherwise made or at which unlawful bets or wagers 
        are offered to be placed, received, or otherwise made; or
          (2) owns or controls, or is owned or controlled by, any 
        person who operates, manages, supervises, or directs an 
        Internet website at which unlawful bets or wagers may be 
        placed, received, or otherwise made or at which unlawful bets 
        or wagers are offered to be placed, received, or otherwise 
        made.
  (f) Enforcement Actions.--Section 8 of the Federal Deposit Insurance 
Act (12 U.S.C. 1818) is amended by adding at the end the following new 
subsection:
  ``(x) Depository Institution Involvement in Internet Gambling.--If 
any appropriate Federal banking agency determines that any insured 
depository institution is engaged in any of the following activities, 
the agency may issue an order to such institution prohibiting such 
institution from continuing to engage in any of the following 
activities:
          ``(1) Extending credit, or facilitating an extension of 
        credit, electronic fund transfer, or money transmitting service 
        with the actual knowledge that any person is violating section 
        3(a) of the Unlawful Internet Gambling Funding Prohibition Act 
        in connection with such extension of credit, electronic fund 
        transfer, or money transmitting service.
          ``(2) Paying, transferring, or collecting on any check, 
        draft, or other instrument drawn on any depository institution 
        with the actual knowledge that any person is violating section 
        3(a) of the Unlawful Internet Gambling Funding Prohibition Act 
        in connection with such check, draft, or other instrument.''.

SEC. 308. INTERNET GAMBLING IN OR THROUGH FOREIGN JURISDICTIONS.

  (a) In General.--In deliberations between the United States 
Government and any other country on money laundering, corruption, and 
crime issues, the United States Government should--
          (1) encourage cooperation by foreign governments and relevant 
        international fora in identifying whether Internet gambling 
        operations are being used for money laundering, corruption, or 
        other crimes;
          (2) advance policies that promote the cooperation of foreign 
        governments, through information sharing or other measures, in 
        the enforcement of this Act; and
          (3) encourage the Financial Action Task Force on Money 
        Laundering, in its annual report on money laundering 
        typologies, to study the extent to which Internet gambling 
        operations are being used for money laundering.
  (b) Report Required.--The Secretary of the Treasury shall submit an 
annual report to the Congress on the deliberations between the United 
States and other countries on issues relating to Internet gambling.

                     TITLE IV--CURRENCY PROTECTION

SEC. 401. COUNTERFEITING DOMESTIC CURRENCY AND OBLIGATIONS.

  (a) Counterfeit Acts Committed Outside the United States.--Section 
470 of title 18, United States Code, is amended--
          (1) in paragraph (2), by inserting ``analog, digital, or 
        electronic image,'' after ``plate, stone,''; and
          (2) by striking ``shall be fined under this title, imprisoned 
        not more than 20 years, or both'' and inserting ``shall be 
        punished as is provided for the like offense within the United 
        States''.
  (b) Obligations or securities of the United States.--Section 471 of 
title 18, United States Code, is amended by striking ``fifteen years'' 
and inserting ``20 years''.
  (c) Uttering Counterfeit Obligations or Securities.--Section 472 of 
title 18, United States Code, is amended by striking ``fifteen years'' 
and inserting ``20 years''.
  (d) Dealing in Counterfeit Obligations or Securities.--Section 473 of 
title 18, United States Code, is amended by striking ``ten years'' and 
inserting ``20 years''.
  (e) Plates, Stones, or Analog, Digital, or Electronic Images For 
Counterfeiting Obligations or Securities.--
          (1) In general.--Section 474(a) of title 18, United States 
        Code, is amended by inserting after the second paragraph the 
        following new paragraph:
  ``Whoever, with intent to defraud, makes, executes, acquires, scans, 
captures, records, receives, transmits, reproduces, sells, or has in 
such person's control, custody, or possession, an analog, digital, or 
electronic image of any obligation or other security of the United 
States; or''.
          (2) Amendment to definition.--Section 474(b) of title 18, 
        United States Code, is amended by striking the first sentence 
        and inserting the following new sentence: ``For purposes of 
        this section, the term `analog, digital, or electronic image' 
        includes any analog, digital, or electronic method used for the 
        making, execution, acquisition, scanning, capturing, recording, 
        retrieval, transmission, or reproduction of any obligation or 
        security, unless such use is authorized by the Secretary of the 
        Treasury.''.
          (3) Technical and conforming amendment.--The heading for 
        section 474 of title 18, United States Code, is amended by 
        striking ``or stones'' and inserting ``, stones, or analog, 
        digital, or electronic images''.
          (4) Clerical amendment.--The table of sections for chapter 25 
        of title 18, United States Code, is amended in the item 
        relating to section 474 by striking ``or stones'' and inserting 
        ``, stones, or analog, digital, or electronic images''.
  (f) Taking Impressions of Tools Used for Obligations or Securities.--
Section 476 of title 18, United States Code, is amended--
          (1) by inserting ``analog, digital, or electronic image,'' 
        after ``impression, stamp,''; and
          (2) by striking ``ten years'' and inserting ``25 years''.
  (g) Possessing or Selling Impressions of Tools Used for Obligations 
or Securities.--Section 477 of title 18, United States Code, is 
amended--
          (1) in the first paragraph, by inserting ``analog, digital, 
        or electronic image,'' after ``imprint, stamp,'';
          (2) in the second paragraph, by inserting ``analog, digital, 
        or electronic image,'' after ``imprint, stamp,''; and
          (3) in the third paragraph, by striking ``ten years'' and 
        inserting ``25 years''.
  (h) Connecting Parts of Different Notes.--Section 484 of title 18, 
United States Code, is amended by striking ``five years'' and inserting 
``10 years''.
  (i) Bonds and Obligations of Certain Lending Agencies.--The first and 
second paragraphs of section 493 of title 18, United States Code, are 
each amended by striking ``five years'' and inserting ``10 years''.

SEC. 402. COUNTERFEITING FOREIGN CURRENCY AND OBLIGATIONS.

  (a) Foreign Obligations or Securities.--Section 478 of title 18, 
United States Code, is amended by striking ``five years'' and inserting 
``20 years''.
  (b) Uttering Counterfeit Foreign Obligations or Securities.--Section 
479 of title 18, United States Code, is amended by striking ``three 
years'' and inserting ``20 years''.
  (c) Possessing Counterfeit Foreign Obligations or Securities.--
Section 480 of title 18, United States Code, is amended by striking 
``one year'' and inserting ``20 years''.
  (d) Plates, Stones, or Analog, Digital, or Electronic Images for 
Counterfeiting Foreign Obligations or Securities.--
          (1) In general.--Section 481 of title 18, United States Code, 
        is amended by inserting after the second paragraph the 
        following new paragraph:
  ``Whoever, with intent to defraud, makes, executes, acquires, scans, 
captures, records, receives, transmits, reproduces, sells, or has in 
such person's control, custody, or possession, an analog, digital, or 
electronic image of any bond, certificate, obligation, or other 
security of any foreign government, or of any treasury note, bill, or 
promise to pay, lawfully issued by such foreign government and intended 
to circulate as money; or''.
          (2) Increased sentence.--The last paragraph of section 481 of 
        title 18, United States Code, is amended by striking ``five 
        years'' and inserting ``25 years''.
          (3) Technical and conforming amendment.--The heading for 
        section 481 of title 18, United States Code, is amended by 
        striking ``or stones'' and inserting ``, stones, or analog, 
        digital, or electronic images''.
          (4) Clerical amendment.--The table of sections for chapter 25 
        of title 18, United States Code, is amended in the item 
        relating to section 481 by striking ``or stones'' and inserting 
        ``, stones, or analog, digital, or electronic images''.
  (e) Foreign Bank Notes.--Section 482 of title 18, United States Code, 
is amended by striking ``two years'' and inserting ``20 years''.
  (f) Uttering Counterfeit Foreign Bank Notes.--Section 483 of title 
18, United States Code, is amended by striking ``one year'' and 
inserting ``20 years''.

SEC. 403. PRODUCTION OF DOCUMENTS.

  Section 5114(a) of title 31, United States Code (relating to 
engraving and printing currency and security documents), is amended--
          (1) by striking ``(a) The Secretary of the Treasury'' and 
        inserting:
  ``(a) Authority To Engrave and Print.--
          ``(1) In general.--The Secretary of the Treasury''; and
          (2) by adding at the end the following new paragraph:
          ``(2) Engraving and printing for other governments.--The 
        Secretary of the Treasury may, if the Secretary determines that 
        it will not interfere with engraving and printing needs of the 
        United States, produce currency, postage stamps, and other 
        security documents for foreign governments, subject to a 
        determination by the Secretary of State that such production 
        would be consistent with the foreign policy of the United 
        States.''.

SEC. 404. REIMBURSEMENT.

  Section 5143 of title 31, United States Code (relating to payment for 
services of the Bureau of Engraving and Printing), is amended--
          (1) in the first sentence, by inserting ``, any foreign 
        government, or any territory of the United States'' after 
        ``agency'';
          (2) in the second sentence, by inserting ``and other'' after 
        ``administrative''; and
          (3) in the last sentence, by inserting ``, foreign 
        government, or territory of the United States'' after 
        ``agency''.

                          Purpose and Summary

    H.R. 3004, the Financial Anti-Terrorism Act of 2001, 
provides the United States government with new tools to combat 
the financing of terrorism and other financial crimes. The 
legislation contains provisions to strengthen law enforcement 
authorities, as well as enhance public-private cooperation 
between government and industry in disrupting terrorist 
funding.
    The bill (1) makes it a crime to smuggle over $10,000 into 
or out of the United States, and to transport more than $10,000 
in criminal proceeds across State lines; (2) gives the Justice 
Department new prosecutorial tools to combat terrorist-related 
and other money laundering through U.S. financial institutions; 
(3) provides statutory authorization for the Financial Crimes 
Enforcement Network (FinCEN), which analyzes reports filed by 
financial institutions on currency transactions and suspicious 
financial activity; (4) sets up a unit in FinCEN directed at 
oversight and analysis of hawalas and other underground black 
market banking systems; (5) authorizes the Customs Service to 
inspect outbound international mail; (6) makes it a crime to 
knowingly falsify one's identity in opening an account at a 
financial institution and directs the Treasury to develop 
regulations to guide financial institutions in identifying 
account holders; (7) directs the Treasury Department to 
establish a secure web site to receive electronic filings of 
Suspicious Activity Reports (SARs) and provide financial 
institutions with alerts and other information regarding 
patterns of terrorist or other suspicious activity that warrant 
enhanced scrutiny; (8) requires the Secretary of the Treasury 
to report quarterly to industry on how SARs are used to assist 
law enforcement in combating terrorism and other crimes; (10) 
authorizes intelligence agency access to reports filed by 
financial institutions and expands government access to 
consumer financial records and credit histories; (11) creates a 
public-private task force on terrorist financing; (12) sets a 
December 31, 2001, deadline for proposed regulations on SAR 
reporting requirements for broker-dealers and authorizes the 
Department of the Treasury to require SARs of certain commodity 
futures traders; (13) authorizes the Secretary of the Treasury 
to impose ``special measures'' if a foreign country, financial 
institution, transaction, or account is deemed to be a 
``primary money laundering concern''; (14) prohibits U.S. 
financial institutions from providing banking services to 
``shell'' banks that have no physical presence in any country 
nor any affiliation with a financial institution; (15) requires 
greater due diligence for certain correspondent and private 
banking accounts; (16) authorizes Treasury to regulate 
concentration accounts; (17) requires financial institutions to 
have anti-money laundering programs; (18) authorizes the 
President to impose certain sanctions (including limiting 
access to the U.S. financial system) against foreign 
governments that refuse to cooperate in law enforcement efforts 
against terrorism and money laundering; (19) prohibits the use 
of financial instruments for unlawful Internet gambling; and 
(20) updates U.S. anti-counterfeiting laws.

                  Background and Need for Legislation

    In the wake of the September 11, 2001, terrorist attacks on 
the World Trade Center and the Pentagon, the financial 
transactions and infrastructure associated with the terrorists 
have received extensive coverage. Early reports revealed that 
terrorist operatives used thousands of dollars in cash for 
expensive flight school training, paid their rent with checks 
drawn on local American banks, bought airline tickets over the 
Internet with credit cards, and engaged in numerous other 
financial transactions. Although the hijackers are suspected to 
have underwritten much of their low-budget operation from funds 
generated in the United States, perhaps by petty financial 
crime, experts suspect that at least some of the seed money may 
have originated overseas from Osama Bin Laden's organization, 
Al Qaeda.
    According to press reports, Mr. Bin Laden's financial net 
worth may be as high as $300 million. His fortune derives from 
an inheritance from his wealthy Saudi family and from revenue 
generated by a far-flung business empire engaged in everything 
from construction and agriculture to banking and trade. 
Witnesses at the trial earlier this year of terrorists 
responsible for the U.S. embassy bombings in Africa described 
Mr. Bin Laden's banking relationship with Al Shamal Islamic 
Bank in the Sudan. Mr. Bin Laden also reportedly enjoys 
financial support from Persian Gulf businessmen as well as from 
front organizations posing as Islamic charities.
    Despite evidence suggesting Mr. Bin Laden and Al Qaeda 
utilize formal banking relationships as part of their global 
financial network, experts believe that a major share of 
terrorist financing is conducted through international cash 
couriers as well as through informal banking systems, like the 
ancient South Asian money exchange system called hawala. The 
latter consists of an international network of non-bank 
financial agents, often built on trusted family or cultural 
relationships. In most cases, the funds themselves are never 
transferred, just messages relating to receipt or disbursement 
of funds. These underground systems are exploited by terrorists 
and other financial criminals because of the lack of record-
keeping and opportunity for anonymity.
    Immediately after the September 11 terrorist attacks, the 
Administration mounted an aggressive strategy to track and 
disrupt the financial networks that sustain international 
terrorism. On September 14, 2001, the Treasury Department 
announced the creation of a Foreign Terrorist Asset Tracking 
Center (FTAT) in Treasury's Office of Foreign Asset Control 
(OFAC). On September 24, vowing that ``we will starve 
terrorists of funding,'' the President issued Executive Order 
13224 under the International Emergency Economic Powers Act 
(IEEPA), directing Treasury to freeze any U.S. assets of, and 
prohibit any financial transactions with, twenty-seven 
individuals and organizations including Mr. Bin Laden, his top 
subordinates, Al Qaeda, and business and charitable entities 
providing support to Al Qaeda. The Executive Order was broader 
than previous orders, most notably by authorizing the blocking 
of U.S. assets of foreign banks that refuse to freeze terrorist 
assets abroad. On October 12, the Administration added 39 more 
individuals and entities to the blocking list.
    In addition to the OFAC order, Federal regulators advised 
U.S. banks and other financial institutions to search their 
records for any transactions associated with the FBI's list of 
19 hijacking suspects,and Treasury's Financial Crimes 
Enforcement Network (FinCEN) established a 24-hour hotline for banks 
and other financial institutions to report suspicious transactions that 
may be related to terrorist activity against the United States. To 
further bolster its efforts to disrupt terrorist financing, Treasury is 
accelerating the implementation of registration and suspicious activity 
reporting (SAR) requirements for non-bank financial institutions, 
including hawala. At the international level, the Administration has 
been working with the G-8 countries and the United Nations to tackle 
the financial underpinnings of terrorism. Several allies, including 
Switzerland and Britain, have already frozen accounts of suspected 
terrorists and, on September 28, the U.N. Security Council unanimously 
passed a U.S.-drafted resolution directing all member nations to freeze 
the assets of terrorists and to prohibit all financial support to 
terrorist organizations. All countries were urged to report to the 
Security Council within 90 days on steps they have taken to implement 
the resolution.
    Despite the provisions of the 1970 Bank Secrecy Act and 
various money laundering laws enacted since, the current money 
laundering regime appears to have been ineffective in detecting 
or preventing the terrorist hijackers from operating freely in 
the United States. For example, current law requires that U.S. 
banks file Currency Transaction Reports (CTRs) for financial 
transactions in excess of $10,000, and Suspicious Activity 
Reports (SARs) for potentially criminal financial transactions 
of $5,000 or more. The evidence gathered thus far indicates 
that these thresholds exceeded many of the reported financial 
transactions of the terrorists. Even the Currency or Monetary 
Instrument Reports (CMIRs) which must be filed by any person 
transporting more than $10,000 into or out of the United States 
may have proved futile in detecting any large cash flows 
through U.S. ports of entry.
    At the Committee's October 3, 2001, hearing on terrorist 
funding, Treasury Under Secretary Gurule testified how Al Qaeda 
operatives ``use checks, credit cards, ATM cards, and wire-
transfer systems and brokerage accounts throughout the world, 
including the U.S.'' He explained how some Islamic charities 
have been penetrated and their fund-raising activities 
exploited by terrorists. He also testified that Al Qaeda uses 
banks, legal businesses, front companies, and underground 
financial systems to finance the organization's activities, and 
that some elements of the organization rely on profits from the 
drug trade. Under Secretary Gurule outlined the steps U.S. 
officials are taking to address financial networks and 
transactions that support terrorism including: (1) 
investigating terrorist organizations and their supporters; (2) 
identifying assets to be blocked; (3) figuring out the methods 
terrorists use to move funds for operational support; (4) 
identifying the gaps in U.S. law enforcement and regulatory 
regimes that terrorists exploit in order to move funds; (5) 
sharing information with law enforcement agencies and other 
organizations around the world; and (6) utilizing the powers of 
existing laws and regulations, such as the International 
Emergency Economic Powers Act, the Bank Secrecy Act, and the 
Anti-Terrorism Act, to deprive terrorists of access to any 
funds or other financial assets in the United States.
    In testimony presented on behalf of Assistant Attorney 
General Michael Chertoff, Deputy Assistant Attorney General 
Mary Lee Warren warned that ``we are fighting with outdated 
weapons in the money laundering arena today.'' She described 
money laundering as an increasingly global problem involving 
cross-border smuggling of bulk cash and the international 
electronic transfer of funds enabling criminals in one country 
to conceal their funds in another.
    Mr. Dennis Lormel, Chief of the Financial Crimes Section of 
the Federal Bureau of Investigation's (FBI's) Criminal 
Investigations Division expressed support for the money 
laundering legislation proposed by the Administration and 
described the Bureau's concerns regarding vulnerabilities in 
the current financial system which facilitate movement of 
terrorist funds. Like Ms. Warren, he warned that terrorist and 
other criminal organizations ``rely heavily upon wire 
transfers'' and called for greater transparency in the 
originators of such funds. Mr. Lormel also cited correspondent 
banking as another ``potential vulnerability in the financial 
services sector that can offer terrorist organizations a 
gateway into U.S. banks,'' and called for banks to ``more 
thoroughly screen and monitor foreign banks as clients.'' He 
also warned of the problems associated with nonbank financial 
institutions, so-called ``Money Services Businesses'' (MSBs), 
which terrorists are able to exploit because of heretofore 
inadequate regulation.
    Industry witnesses from the American Bankers Association 
and the Securities Industry Association discussed their current 
efforts to cooperate with law enforcement to stop terrorist 
funding and outlined some of the obstacles they are 
encountering in that endeavor. Both called for enhanced efforts 
to strengthen the ongoing public-private partnership.
    Former Deputy Secretary of Treasury Stuart Eizenstat 
underscored the need for new tools to deal in a ``measured, 
precise, and cost-effective way with particular money 
laundering threats,'' and endorsed legislation passed by the 
House Banking Committee in the last Congress and reintroduced 
in the 107th Congress as H.R. 1114. Finally, money laundering 
expert John Moynihan of BERG Associates noted that the 
``Achilles heel of any criminal organization is its 
financialinfrastructure'' and described in detail how underground 
``black market banking'' operations--like hawala systems--are used by 
criminals to finance their trade.
    Bulk Cash Smuggling.--As recent Congressional hearings have 
demonstrated, currency smuggling is an extremely serious law 
enforcement problem. Hundreds of millions of dollars in U.S. 
currency-representing the proceeds of drug trafficking and 
other criminal offenses--is annually transported out of the 
United States to foreign countries in shipments of bulk cash. 
Smugglers use all available means to transport the currency out 
of the country, from false bottoms in personal luggage, to 
secret compartments in automobiles, to concealment in durable 
goods exported for sale abroad.
    Even more serious, press reports indicate that persons 
involved in planning and perpetrating terrorist acts in the 
United States may have smuggled currency into the United States 
from abroad.
    Presently, the only law enforcement weapon against such 
smuggling is section 5316 of title 31, United States Code, 
which makes it an offense to transport more than $10,000 in 
currency or monetary instruments into, or out of, the United 
States without filing a report with the United States Customs 
Service. The effectiveness of section 5316 as a law enforcement 
tool has been diminished, however, by a recent Supreme Court 
decision. In United States v. Bajakajian, 118 S. Ct. 2028 
(1998), the Supreme Court held that section 5316 constitutes a 
mere reporting violation, which is not a serious offense for 
purposes of the Excessive Fines Clause of the Eighth Amendment. 
Accordingly, confiscation of the full amount of the smuggled 
currency is unconstitutional, even if the smuggler took 
elaborate steps to conceal the currency and otherwise obstruct 
justice.
    Confiscation of the smuggled currency is, of course, the 
most effective weapon that can be employed against currency 
smugglers. Accordingly, in response to the Bajakajian decision, 
the Department of Justice proposed making the act of bulk cash 
smuggling itself a criminal offense, and to authorize the 
imposition of the full range of civil and criminal sanctions 
when the offense is discovered. Because the act of concealing 
currency for the purpose of smuggling it out of the United 
States is inherently more serious than simply failing to file a 
Customs report, strong and meaningful sanctions, such as 
confiscation of the smuggled currency, are likely to withstand 
Eighth Amendment challenges to the new statute.
    The Committee felt that this proposal would be an important 
weapon in the arsenal against terrorism, and included these 
provisions in the legislation.
    Interstate Currency Couriers.--An essential component of 
the money laundering cycle in drug cases is the consolidation 
of cash proceeds of drug sales at a collection point. 
Typically, money-laundering organizations employ couriers to 
pick-up cash at various locations and transport it to another 
location. A number of recent cases illustrate this process. See 
United States v. $141,770.00 in U.S. Currency, 157 F.3d 600 
(8th Cir. 1998) (currency packaged in three-layers of zip-lock 
bags wrapped in fabric-softener sheets found in hidden vehicle 
compartment); United States v. $189,825.00 in U.S. Currency, 8 
F. Supp.2d 1300 (N.D. Okla. 1998) (currency bundled and hidden 
in gas tank); United States v. $206,323.56 in U.S. Currency, 
998 F. Supp. 693 (S.D. W. Va. 1998) (courier flees during 
highway stop when drug dog detects concealed currency); United 
States v. $94,010 U.S. Currency, 1998 WL 567837 (W.D.N.Y. 1998) 
(currency concealed in false compartment).
    The common elements in these cases include the 
transportation of a large quantity of currency, bundled in 
street denominations and concealed in a vehicle, on an 
interstate or other major highway, by a person or persons who 
disclaim any knowledge of where the currency came from or where 
it is to be delivered. Yet under current law, the person 
transporting the currency may not be guilty of any money 
laundering offense. See United States v. Puig-Infante, 19 F.3d 
929 (5th Cir. 1994) (simply transporting drug proceeds from 
Fla. to Tex. not a money laundering offense).
    Having the tools to stop interstate currency smuggling is 
particularly important in terrorism cases because terrorists, 
as press reports reveal, engage in a form of reverse money 
laundering: instead of conducting transactions to conceal or 
disguise criminal proceeds, terrorists transport funds from 
seemingly legitimate sources, but with the intent to use those 
funds for an illegal purpose. Criminalizing such activity at 
the Federal level follows the example of the State of Florida, 
which has made such transportation an offense under State money 
laundering laws. See Florida Statutes, section 896.101(b).
    Improving Money Laundering Laws.--The Committee's review of 
current law regarding money laundering revealed a number of 
shortcomings. For instance, section 1956 of title 18, United 
States Code, makes it an offense to conduct a transaction 
involving a financial institution if the transaction involves 
criminally derived property. Similarly, 18 U.S.C. Sec. 1957 
creates an offense relating to the deposit, withdrawal, 
transfer or exchange of criminally derived funds ``by, to or 
through a financial institution.'' For the purposes of both 
statutes, the term ``financial institution'' is defined in 31 
U.S.C. Sec. 5312. See 18 U.S.C. Sec. 1956(c)(6); 18 U.S.C. 
Sec. 1957(f).
    The definition of ``financial institution'' in Sec. 5312 
does not explicitly include foreign banks. Such banks may well 
be covered because they fall within the meaning of ``commercial 
bank'' or other terms in the statute, but as presently drafted, 
there is some confusion over whether the government can rely on 
section 5312 to prosecute an offense under either Sec. 1956 or 
Sec. 1957 involving a transaction through a foreign bank, even 
if the offense occurs in part in the United States. For 
example, if a person in the United States sends criminal 
proceeds abroad--say to a Mexican bank--and launders them 
through a series of financial transactions, the government 
conceivably could not rely on the definition of a ``financial 
institution'' in Sec. 1956(c)(6) to establish that the 
transaction was a ``financial transaction'' within the meaning 
of Sec. 1956(c)(4)(B) (defining a ``financial transaction'' as 
a transaction involving the use of a ``financial 
institution''), or that it was a ``monetary transaction'' 
within the meaning of Sec. 1957(f) (defining ``monetary 
transaction'' as, inter alia, a transaction that would be a 
``financial transaction'' under Sec. 1956(c)(4)(B)).
    Similarly, the money laundering laws in effect in most 
countries simply make it an offense to launder the proceeds of 
any crime, foreign or domestic. In the United States, however, 
the money laundering statute is violated only when a person 
launders the proceeds of one of the crimes set forth on a list 
of ``specified unlawful activities.'' 18 U.S.C. 
Sec. 1956(c)(7). Currently only a handful of foreign crimes 
appear on that list. See Sec. 1956(c)(7)(B).
    Most importantly, the Committee found significant 
shortcomings in the use of information already in possession of 
the government. Section 6050I of the Internal Revenue Code 
requires that any person engaged in a trade or business (other 
than financial institutions required to report under the Bank 
Secrecy Act) file a report with the Federal government on cash 
transactions in excess of $10,000. Reports filed pursuant to 
this requirement provide law enforcement authorities with a 
paper trail that can, among other things, lead to the detection 
and prosecution of money laundering activity.
    Under current law, non-financial institutions are required 
to report cash transactions exceeding $10,000 to the Internal 
Revenue Service (IRS) on IRS Form 8300. Because the requirement 
that such reports be filed is contained in the Internal Revenue 
Code, Form 8300 information is considered tax return 
information, and is subject to the procedural and record-
keeping requirements of section 6103 of the Internal Revenue 
Code. For example, section 6103(p)(4)(E) requires agencies 
seeking Form 8300 information to file a report with the 
Secretary of the Treasury that describes the procedures 
established and utilized by the agency for ensuring the 
confidentiality of the information. IRS requires that agencies 
requesting Form 8300 information file a ``Safeguard Procedures 
Report'' which must be approved by the IRS before any such 
information can be released. For that reason, Federal, State 
and local law enforcement agencies are not given access to the 
Form 8300s as Congress anticipated when it last amended this 
statute. See 26 U.S.C. Sec. 6103(l)(15).
    While the IRS uses Form 8300 to identify individuals who 
may be engaged in tax evasion, Form 8300 information can also 
be instrumental in helping law enforcement authorities trace 
cash payments by drug traffickers and other criminals for 
luxury cars, jewelry, and other expensive merchandise. Because 
of the restrictions on their dissemination outlined above, 
however, Form 8300s are not nearly as accessible to law 
enforcement authorities as the various reports mandated by the 
Bank Secrecy Act, which can typically be retrieved 
electronically from a database maintained by the Treasury 
Department. The differential access to the two kinds of reports 
is made anomalous by the fact that Form 8300 elicits much the 
same information that is required to be disclosed by the Bank 
Secrecy Act. For example, just as Form 8300 seeks the name, 
address, and social security number of a customer who engages 
in a cash transaction exceeding $10,000 with a trade or 
business, Currency Transaction Reports (CTRs) mandated by the 
Bank Secrecy Act require the same information to be reported on 
a cash transaction exceeding $10,000 between a financial 
institution and its customer.
    The Committee believes that these are significant 
oversights, and has included provisions intended to address 
these shortcomings.
    Internet Gambling.--Among the subjects covered at the 
hearing was offshore Internet gambling operations. The FBI, the 
Department of Justice, and an investigator specializing in 
money laundering cases testified that Internet gambling serves 
as a vehicle for money laundering activities and can be 
exploited by terrorists to launder money. The FBI currently has 
at least two pending cases involving Internet gambling as a 
conduit for money laundering, as well as a number of pending 
cases linking Internet gambling to organized crime.
    As the Committee learned at earlier Subcommittee hearings, 
unlike casino gambling, State lotteries, and horse racing--
which are highly regulated, and legal when licensed by a 
particular State--Internet gambling is illegal in most U.S. 
jurisdictions, and operates largely from offshore sites that 
are outside the reach of U.S. regulators and law enforcement. 
The National Gambling Impact Study Commission, in a final 
report in June 1999, recommended that wire transfers to 
Internet gambling sites or their banks be outlawed.
    The vast majority of an estimated 1,500 Internet gambling 
sites operate offshore--outside the coverage of U.S. law. These 
``virtual casinos'' are free to misuse a bettor's credit card 
information or manipulate the odds of a particular wager to the 
casino's advantage. The only effective way to curb these abuses 
is by implementing effective civil remedies such as those 
contained in this legislation.
    Summary.--In sum, H.R. 3004 is designed to supplement and 
reinforce existing U.S. money laundering laws by expanding the 
strategies the United States can employ to combat international 
money laundering. Numerous provisions in the bill have been 
drawn from anti-terrorism and anti-money laundering legislation 
the Administration submitted to Congress. In addition, the bill 
draws on provisions contained in H.R. 3886 from the 106th 
Congress, reintroduced as H.R. 1114 in this Congress. Finally, 
the bill also incorporates bulk cash smuggling language from 
H.R. 2920 and H.R. 2922, and H.R. 556 (similar to H.R. 4419 
which was approved by the Committee on Banking and Financial 
Services in the 106th Congress), which addresses Internet 
gambling.

                                Hearings

    The full Committee held a hearing on October 3, 2001, 
entitled ``Dismantling the Financial Infrastructure of Global 
Terrorism'' to examine the methods by which Osama Bin Laden, 
his terrorist organization Al Qaeda, and other terrorist 
organizations finance their operations. Treasury Secretary Paul 
O'Neill and Under Secretary for Enforcement Jimmy Gurule 
testified, as well as Mary Lee Warren, Deputy Assistant 
Attorney General for the Criminal Division of the Justice 
Department, and Special Agent Dennis Lormel, Chief of the 
Financial Crimes Section of the FBI's Criminal Investigations 
Division. Private witnesses included Ed Yingling of the 
American Bankers Association (ABA), Marc Lackritz of the 
Securities Industry Association (SIA), former Deputy Secretary 
of Treasury Stuart Eizenstat, and money laundering expert John 
Moynihan of BERG Associates. Written testimony was received 
jointly from the Independent Community Bankers of America 
(ICBA) and America's Community Bankers (ACB).

                        Committee Consideration

    On October 11, 2001, the Committee met in open session and 
ordered H.R. 3004 reported, with an amendment, to the House 
with a favorable recommendation by a record vote of 62 yeas and 
1 nay.

                            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 motion to report legislation and amendments thereto. A 
motion by Mr. Oxley to report the bill to the House with a 
favorable recommendation was agreed to by a record vote of 62 
yeas and 1 nay (Record vote no. 9). The names of members voting 
for and against follow:
        YEAS                          NAYS
Mr. Oxley                           Mr. Paul
Mr. Leach
Mrs. Roukema
Mr. Bereuter
Mr. Baker
Mr. Bachus
Mr. Castle
Mr. Royce
Mr. Lucas of Oklahoma
Mr. Ney
Mr. Barr of Georgia
Mrs. Kelly
Mr. Gillmor
Mr. Cox
Mr. Weldon of Florida
Mr. Ryun of Kansas
Mr. Riley
Mr. LaTourette
Mr. Manzullo
Mr. Jones of North Carolina
Mr. Ose
Mrs. Biggert
Mr. Green of Wisconsin
Mr. Toomey
Mr. Shadegg
Mr. Fossella
Mr. Gary G. Miller of California
Mr. Cantor
Mr. Grucci
Ms. Hart
Mrs. Capito
Mr. Ferguson
Mr. Rogers of Michigan
Mr. Tiberi
Mr. LaFalce
Mr. Frank
Mr. Kanjorski
Ms. Waters
Mr. Sanders
Mrs. Maloney of New York
Mr. Gutierrez
Mr. Watt of North Carolina
Mr. Ackerman
Mr. Bentsen
Mr. Maloney of Connecticut
Ms. Hooley of Oregon
Ms. Carson of Indiana
Mr. Sherman
Mr. Sandlin
Ms. Lee
Mr. Mascara
Mr. Inslee
Ms. Schakowsky
Mr. Moore
Mr. Capuano
Mr. Ford
Mr. Lucas of Kentucky
Mr. Shows
Mr. Crowley
Mr. Clay
Mr. Israel
Mr. Ross

    The following amendments were not agreed to by a record 
vote. The names of Members voting for and against follow:
    An amendment to the amendment in the nature of a substitute 
by Mr. Barr, no. 1m, prohibiting the Customs Service from 
opening outgoing international mail without a warrant during 
cross-border searches, was not agreed to by a record vote of 20 
yeas and 43 nays (Record vote no. 8).\1\
---------------------------------------------------------------------------
    \1\ An earlier voice vote on which the nays prevailed was vacated 
by unanimous consent, and the question put to the Committee de novo.

        YEAS                          NAYS
Mr. Barr of Georgia                 Mr. Oxley
Mr. Paul                            Mr. Leach
Mr. Jones of North Carolina         Mrs. Roukema
Mr. Ose                             Mr. Bereuter
Ms. Hart                            Mr. Baker
Mr. Frank                           Mr. Bachus
Mr. Kanjorski                       Mr. Castle
Ms. Waters                          Mr. Royce
Mr. Sanders                         Mr. Lucas of Oklahoma
Mrs. Maloney of New York            Mr. Ney
Mr. Gutierrez                       Mrs. Kelly
Mr. Watt of North Carolina          Mr. Gillmor
Mr. Ackerman                        Mr. Cox
Ms. Carson of Indiana               Mr. Weldon of Florida
Mr. Sandlin                         Mr. Ryun of Kansas
Ms. Lee                             Mr. Riley
Mr. Inslee                          Mr. LaTourette
Ms. Schakowsky                      Mr. Manzullo
Mr. Capuano                         Mrs. Biggert
Mr. Clay                            Mr. Green of Wisconsin
                                    Mr. Toomey
                                    Mr. Shays
                                    Mr. Shadegg
                                    Mr. Fossella
                                    Mr. Gary G. Miller of California
                                    Mr. Cantor
                                    Mr. Grucci
                                    Mrs. Capito
                                    Mr. Ferguson
                                    Mr. Rogers of Michigan
                                    Mr. Tiberi
                                    Mr. LaFalce
                                    Mr. Bentsen
                                    Mr. Maloney of Connecticut
                                    Ms. Hooley of Oregon
                                    Mr. Sherman
                                    Mr. Mascara
                                    Mr. Moore
                                    Mr. Ford
                                    Mr. Lucas of Kentucky
                                    Mr. Shows
                                    Mr. Crowley
                                    Mr. Israel

    An amendment to the amendment in the nature of a substitute 
by Mr. Castle, no. 1p, striking provisions relating to Internet 
gambling, was not agreed to by a record vote of 25 yeas and 37 
nays (Record vote no. 7).
        YEAS                          NAYS
Mr. Baker                           Mr. Oxley
Mr. Castle                          Mr. Leach
Mr. Ney                             Mrs. Roukema
Mr. Barr of Georgia                 Mr. Bereuter
Mr. Paul                            Mr. Bachus
Mr. Gillmor                         Mr. Royce
Mr. Cox                             Mr. Lucas of Oklahoma
Mr. Jones of North Carolina         Mrs. Kelly
Mr. Ose                             Mr. Weldon of Florida
Mrs. Biggert                        Mr. Ryun of Kansas
Mr. Toomey                          Mr. Riley
Mr. Fossella                        Mr. Green of Wisconsin
Mr. Cantor                          Mr. Shays
Mr. Tiberi                          Mr. Shadegg
Mr. Frank                           Mr. Gary G. Miller of California
Mr. Kanjorski                       Mr. Grucci
Mr. Watt of North Carolina           Ms. Hart
Mr. Ackerman                        Mrs. Capito
Mr. Bentsen                         Mr. Ferguson
Mr. Sandlin                         Mr. Rogers of Michigan
Ms. Schakowsky                      Mr. LaFalce
Mr. Moore                           Ms. Waters
Mr. Capuano                         Mr. Sanders
Mr. Crowley                         Mrs. Maloney of New York
Mr. Clay                            Mr. Gutierrez
                                    Mr. Maloney of Connecticut
                                    Ms. Hooley of Oregon
                                    Ms. Carson of Indiana
                                    Mr. Sherman
                                    Ms. Lee
                                    Mr. Mascara
                                    Mr. Inslee
                                    Mr. Ford
                                    Mr. Lucas of Kentucky
                                    Mr. Shows
                                    Mr. Israel
                                    Mr. Ross

    The following amendments were agreed to by a voice vote:
    An amendment in the nature of a substitute by Mr. Oxley, 
no. 1, making various changes to the bill;
    An amendment to the amendment in the nature of a substitute 
by Mr. LaFalce, no. 1a, making technical changes requested by 
the Administration;
    An amendment to the amendment in the nature of a substitute 
by Mr. Bentsen, no. 1c, striking a study of the feasibility of 
imposing sanctions against financial institutions that file 
currency transaction reports that qualify for exemptions;
    An amendment to the amendment in the nature of a substitute 
by Ms. Waters, no. 1e, requiring the consideration of a 
financial institution's money laundering record in reviewing of 
merger applications;
    An amendment to the amendment in the nature of a substitute 
by Mr. Leach, no. 1f, reinstating coverage for checks and 
drafts;
    An amendment to the amendment in the nature of a substitute 
by Mr. Israel, no. 1g, addressing the consideration of 
charitable organizations by the public-private anti-terrorism 
task force;
    An amendment to the amendment in the nature of a substitute 
by Mrs. Kelly, no. 1h, addressing the date of application of 
regulations requiring financial institutions to establish anti-
money laundering programs and the factors to be taken into 
account for anti-money laundering programs;
    An amendment to the amendment in the nature of a substitute 
by Mr. Maloney of Connecticut, no. 1i, making explicit that 
hawala-type systems are covered by certain statutory 
requirements;
    An amendment to the amendment in the nature of a substitute 
by Mr. Sherman, no. 1k, regarding Presidential sanctions on 
non-cooperating countries;
    An amendment to the amendment in the nature of a substitute 
by Mr. Baker, no. 1l, modifying the Secretary's authority to 
require financial institutions to apply enhanced due diligence 
standards to correspondent accounts;
    A substitute amendment to the amendment offered by Mr. 
Baker by Mr. LaFalce, no. 1l(1), clarifying the circumstances 
under which the Secretary of the Treasury must require 
financial institutions to apply enhanced due diligence 
standards to correspondent accounts, as modified by unanimous 
consent;
    An amendment to the amendment in the nature of a substitute 
by Mr. Watt, no. 1o, clarifying the term ``compliance 
officer''; and
    An amendment to the amendment in the nature of a substitute 
by Mr. Watt, no. 1q, clarifying the exemption for Internet 
service providers from certain Internet gambling provisions.
    The following amendment was not agreed to by a voice vote:
    An amendment to the amendment in the nature of a substitute 
by Mr. Sherman, no. 1n, authorizing the President to prohibit 
certain credit and contract transactions with non-cooperative 
countries.
    The following amendments were withdrawn:
    An amendment to the amendment in the nature of a substitute 
by Mr. Weldon of Florida, no. 1b, relating to the sharing of 
grand jury information relating to money laundering and bulk 
cash smuggling;
    An amendment to the amendment in the nature of a substitute 
by Mr. Leach, no. 1d, eliminating the exemption for ISPs from 
Internet gambling restrictions; and,
    An amendment to the amendment in the nature of a substitute 
by Mr. Weldon of Florida, no. 1j, striking certain factors from 
those the Secretary of the Treasury must consider in 
designating jurisdictions as ``primary money laundering 
concerns''.

                      Committee Oversight Findings

    Pursuant to clause 3(c)(1) of rule XIII of the Rules of the 
House of Representatives, the Committee held a hearing and made 
findings that are reflected in this report.

                    Performance Goals and Objectives

    Pursuant to clause 3(c)(4) of rule XIII of the Rules of the 
House of Representatives, the Committee establishes the 
following performance related goals and objectives for this 
legislation:
    The President and the Secretary of the Treasury will use 
the authority granted by this legislation to track and prevent 
individuals from laundering the proceeds of criminal activity 
and from diverting funds to terrorist or criminal activities.

   New Budget Authority, Entitlement Authority, and Tax Expenditures

    In compliance with clause 3(c)(2) of rule XIII of the Rules 
of the House of Representatives, the Committee finds that this 
legislation would result in no new budget authority, 
entitlement authority, or tax expenditures or revenues.

                        Committee Cost Estimate

    The Committee adopts as its own the cost estimate prepared 
by the Director of the Congressional Budget Office pursuant to 
section 402 of the Congressional Budget Act of 1974.

                  Congressional Budget Office Estimate

    Pursuant to clause 3(c)(3) of rule XIII of the Rules of the 
House of Representatives, the following is the cost estimate 
provided by the Congressional Budget Office pursuant to section 
402 of the Congressional Budget Act of 1974:

                                     U.S. Congress,
                               Congressional Budget Office,
                                  Washington, DC, October 16, 2001.
Hon. Michael G. Oxley,
Chairman, Committee on Financial Services, House of Representatives, 
        Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for H.R. 3004, the 
Financial Anti-Terrorism Act of 2001.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contacts are Mark 
Grabowicz and Mark Hadley (for federal costs), Susan Sieg 
Tompkins (for the state and local impact), and Jean Talarico 
(for the private-sector impact).
            Sincerely,
                                          Barry B. Anderson
                                    (For Dan L. Crippen, Director.)
    Enclosure.

H.R. 3004--Financial Anti-Terrorism Act of 2001

    Summary: H.R. 3004 would expand the powers of federal 
financial regulators to prevent money laundering, internet 
gambling, and smuggling of currency. It also would establish 
new federal crimes relating to such acts. H.R. 3004 would 
authorize the appropriation of such sums as necessary for each 
of fiscal years 2002 through 2005 for the Financial Crimes 
Enforcement Network (FINCEN), an agency in the Department of 
the Treasury that collects data from banks and other financial 
institutions and serves as a clearinghouse for financial 
intelligence. The bill would authorize the Secretary of the 
Treasury, through financial regulators, to impose special 
requirements on U.S. financial institutions if the Secretary 
suspects the transactions of their foreign clients are tied to 
money laundering.
    Assuming appropriation of the necessary amounts, CBO 
estimates that implementing H.R. 3004 would cost about $36 
million in fiscal year 2002 and about $210 million over the 
2002-2006 period, mostly for FINCEN. This estimate assumes 
adjustments for anticipated inflation. Without such 
adjustments, we estimate that implementation would cost $202 
million over the 2002-2006 period. H.R. 3004 would affect 
direct spending and receipts, so pay-as-you-go procedures would 
apply, but CBO estimates that any such effects would be less 
than $500,000 a year.
    H.R. 3004 contains intergovernmental mandates as defined in 
the Unfunded Mandates Reform Act (UMRA) because it would impose 
requirements on certain state and local agencies and because it 
includes a preemption of state laws. CBO estimates that the 
total cost of complying with those mandates would be small, and 
would not exceed the threshold established in UMRA ($56 million 
in 2001, adjusted annually for inflation).
    The bill also contains private-sector mandates as defined 
in UMRA. The bill would impose new information collection, 
reporting, and recordkeeping requirements on financial 
institutions and agencies as defined in the bill. Because those 
new requirements would depend on specific regulations that 
would be established by the Secretary of the Treasury, CBO 
cannot determine whether the direct cost to the private sector 
would exceed the annual threshold specified in UMRA ($113 
million in 2001, adjusted annually for inflation).
    Estimated cost to the Federal Government: For this 
estimate, CBO assumes that the bill will be enacted near the 
start of fiscal year 2002 and that the necessary amount will be 
appropriated each year. The estimated budgetary impact of H.R. 
3004 is shown in the following table. The costs of this 
legislation fall within budget functions 370 (commerce and 
housing credit) and 750 (administration of justice).

----------------------------------------------------------------------------------------------------------------
                                                                    By fiscal year, in millions of dollars--
                                                               -------------------------------------------------
                                                                  2002      2003      2004      2005      2006
----------------------------------------------------------------------------------------------------------------
                                CHANGES IN SPENDING SUBJECT TO APPROPRIATION \1\
FINCEN:
    Estimated authorization level \2\.........................        48        49        51        52         0
    Estimated outlays.........................................        33        49        50        52        15
Administrative cost to regulatory agencies:
    Estimated authorization level.............................         2         2         2         2         2
    Estimated outlays.........................................         2         2         2         2         2
Reports by Department of Treasury:
    Estimated authorization level.............................         1     (\3\)     (\3\)     (\3\)     (\3\)
    Estimated outlays.........................................         1     (\3\)     (\3\)     (\3\)     (\3\)
Total:
    Estimated authorization level.............................        51        51        53        54         2
    Estimated outlays.........................................        36        51        52        54        17
----------------------------------------------------------------------------------------------------------------
\1\ The bill also would affect direct spending and revenues, but CBO estimates that those changes would each be
  less than $500,000 a year.
\2\ FINCEN received an appropriation of $38 million for fiscal year 2001. For fiscal year 2002, there is no
  authorization in current law for the agency and a full-year appropriation has not yet been enacted.
\3\ Less than $500,000.

Basis of estimate

    CBO estimates that implementing H.R. 3004 would cost about 
$50 million annually for FINCEN, about $2 million annually for 
increased administrative costs at agencies thatregulate 
financial institutions, and about $1 million in 2002 for additional 
reports by the Secretary of the Treasury. In addition to these effects 
on discretionary spending, the bill also would have a negligible effect 
on the collection and spending of civil and criminal penalties. 
Finally, the legislation would have a small effect on the operating 
costs of the Federal Deposit Insurance Corporation (FDIC).
            Spending subject to appropriation
    FINCEN.--H.R. 3004 would authorize the appropriation of 
such sums as necessary for FINCEN for each of fiscal years 2002 
through 2005. Based on information from the agency, CBO 
estimates that FINCEN would need about $46 million in 2002 to 
carry out its current statutory responsibilities and an 
additional $2 million to perform new duties required by the 
bill. Thus, CBO estimates that implementing H.R. 3004 would 
require appropriations of $48 million in fiscal year 2002 and 
$200 million over the 2002-2005 period, assuming annual 
adjustments for inflation.
    Administrative costs.--H.R. 3004 would authorize the 
Secretary of the Treasury to impose special measures on U.S. 
financial institutions if the Secretary suspects the 
transactions of their foreign clients are tied to money 
laundering. Such measures would be implemented by the 
Department of the Treasury, the Securities and Exchange 
Commission (SEC), the Commodity Futures Trading Commission, and 
other financial regulators, and could include increasing 
recordkeeping and reporting requirements and regulating or 
prohibiting certain types of financial accounts. Based on 
information from the affected agencies, CBO estimates that 
implementing H.R. 3004 would cost a total of about $2 million a 
year over the 2002-2006 period. Most of these funds would pay 
for additional SEC staff to examine the records of investment 
advisors and investment companies for transactions that may 
involve money laundering, and to oversee the efforts of self-
regulating securities markets to detect money laundering.
    Reports.--H.R. 3004 would require the Department of 
Treasury to develop regulations and prepare studies for the 
Congress relating to financial crimes. CBO estimates these 
requirements would cost $1 million in fiscal year 2002 and less 
than $500,000 in each of the subsequent years.
            Direct spending and revenues
    Trustees' Administrative Costs.--The National Credit Union 
Administration (NCUA), Office of the Comptroller of the 
Currency, and the Office of Thrift Supervision charge fees to 
the institutions they regulate to cover all of their 
administrative costs; therefore, any additional spending by 
these agencies to implement the bill would have no net budget 
effect. That is not the case with the FDIC, however, which uses 
deposit insurance premiums paid by all banks to cover the 
expenses it incurs to supervise state-chartered banks. The bill 
would cause a small increase in FDIC spending, but would 
probably not affect its premium income. In any case, CBO 
estimates that imposing special measures would increase direct 
spending and offsetting receipts for those agencies by less 
than $500,000 a year over the 2002-2006 period.
    Bureau of Engraving and Printing.--H.R. 3004 would allow 
the Bureau of Engraving and Printing (BEP) to impose charges 
for any BEP services provided to any foreign government or any 
territory of the United States. Because foreign governments or 
territories of the United States would pay BEP for the full 
cost of producing any documents, and because BEP has the 
authority to retain and spend such collections without further 
appropriation this would have no significant net budgetary 
impact.
    Additional Fines.--Enacting H.R. 3004 would establish civil 
and criminal fines for new crimes that would be established by 
the bill. Civil fines are classified as governmental receipts 
(revenues). Criminal fines are recorded as receipts and 
deposited in the Crime Victims Fund, and spent without further 
appropriation action. Based on information from the Department 
of the Treasury and the Department of Justice, CBO estimates 
that any net increase in collections would not be significant 
because of the small number of individuals that are likely to 
be subject to such fines.
    Federal Reserve.--Budgetary effects on the Federal Reserve 
are also recorded as changes in revenues. Based on information 
from the Federal Reserve, CBO estimates that enforcing the 
special requirements on U.S. Financial Trustees under the bill 
would reduce such revenues by less than $500,000 a year over 
the 2002-2006 period.
    Pay-as-you-go considerations: The Balanced Budget and 
Emergency Deficit Control Act sets up pay-as-you go procedures 
for legislation affecting direct spending or receipts. CBO 
estimates that enacting H.R. 3004 would affect direct spending 
and governmental receipts but that there would be no 
significant impact in any year.
    Estimated impact on state, local, and tribal governments: 
H.R. 3004 contains intergovernmental mandates as defined in 
UMRA, but CBO estimates that the total cost of complying with 
these mandates would be small, and would not exceed the 
threshold established in that act ($56 million in 2001, 
adjusted annually for inflation). Provisions in several 
sections of this bill would place new reporting, monitoring, 
recordkeeping, and other procedural requirements on financial 
institutions. (Financial institutions include certain state and 
local agencies acting in that capacity.) Largely because the 
number of affected agencies would be very small, CBO estimates 
that state and local governments would incur minimal costs to 
comply with these requirements. Another provision would impose 
a mandate by prohibiting employees of state, local, tribal, and 
territorial governments from disclosing certain information.
    This bill also includes a preemption of state and local 
laws. It would require consumer reporting agencies to furnish a 
report and all other information in a consumer's file, without 
notifying the consumer, to a government agency authorized to 
conduct investigations, intelligence, and or 
counterintelligence activities. The legislation would 
explicitly preempt state law by exempting these agencies from 
liability for violating the constitution of any state, or the 
law or regulations of any state or local government. Such a 
preemption would be a mandate under UMRA. CBO estimates, 
however, that it would not affect the budgets of state, local, 
or tribal governments, because, while it would limit the 
application of state law, it would impose no duty on states 
that would result in additional spending.
    Estimated impact on the private sector: The bill also 
contains private-sector mandates as defined in UMRA. The bill 
would impose new information collection, reporting, and 
recordkeeping requirements on financial institutions and 
agencies as defined in the bill. Because those new requirements 
would depend on specific regulations that would be established 
by the Secretary of the Treasury, CBO cannot determine whether 
the direct cost to the private sector would exceed the annual 
threshold specified in UMRA ($113 million in 2001, adjusted 
annually for inflation).
    Although H.R. 3004 would prohibit gambling businesses from 
accepting credit card payments and other bank instruments from 
gamblers who bet illegally over the Internet, the bill would 
not create a new private-sector mandate. Under current federal 
and state law, gambling businesses are generally prohibited 
from accepting bets or wagers over the Internet. Thus, H.R. 
3004 does not contain a new mandate relative to current law.
    H.R. 3004 would authorize federal banking regulators to 
require depository institutions that have knowingly 
participated in transactions with unlawful Internet gambling 
businesses to cease doing so. This provision would not create a 
new private-sector mandate for depository institutions because 
federal banking regulators already have such powers under 
current law.
    Estimate prepared by: Federal spending: Mark Grabowicz, 
Mark Hadley, Ken Johnson, Matthew Pickford, and Lanette Walker; 
Federal revenues: Carolyn Lynch and Erin Whitaker; impact on 
state, local, and tribal governments: Susan Sieg Tompkins; 
impact on the private sector: Jean Talarico.
    Estimate approved by: Peter H. Fontaine, Deputy Assistant 
Director for Budget Analysis.

                       Federal Mandates Statement

    The Committee adopts as its own the estimate of Federal 
mandates prepared by the Director of the Congressional Budget 
Office pursuant to section 423 of the Unfunded Mandates Reform 
Act.

                      Advisory Committee Statement

    Section 205 of the bill directs the Secretary of the 
Treasury to establish, either within the Bank Secrecy Act 
Advisory Group or a subcommittee or other adjunct of that 
advisory group, a task force comprised of representatives of 
the agencies and officers represented on the advisory group, a 
representative from the Office of Homeland Security, and 
representatives of financial institutions, private 
organizations that represent the financial services industry, 
and other interested parties to focus on the finances of 
terrorist groups, the financial relationships between 
international narcotics traffickers and foreign terrorist 
organizations, and the means of facilitating the identification 
of accounts and transactions involving foreign terrorist 
organizations. Pursuant to the requirements of subsection 5(b) 
of the Federal Advisory Committee Act, the Committee finds that 
the functions of the proposed advisory committees are not and 
cannot be performed by an existing Federal agency or advisory 
commission requiring the enlargement of the mandate of the Bank 
Secrecy Act Advisory Group.

                   Constitutional Authority Statement

    Pursuant to clause 3(d)(1) of rule XIII of the Rules of the 
House of Representatives, the Committee finds that the 
Constitutional Authority of Congress to enact this legislation 
is provided by Article 1, section 8, clause 1 (relating to the 
general welfare of the United States), clause 3 (relating to 
the power to regulate interstate commerce), and clause 5 
(relating to the power to coin money and regulate the value 
thereof).

                  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.

                  Exchange of Committee Correspondence

                          House of Representatives,
                                  Committee on Agriculture,
                                     Washington, DC, April 2, 2001.
Hon. Michael G. Oxley,
Chairman, House Committee on Financial Services, Rayburn House Office 
        Building, Washington, DC.
    Dear Chairman Oxley: I understand that the Committee on 
Financial Services recently ordered H.R. 3004, the ``Financial 
Anti-Terrorism Act of 2001'', reported to the House. Further, 
it is my understanding that your Committee amended this 
legislation in a manner that effects certain entities 
registered with the Commodity Futures Trading Commission 
pursuant to the Commodity Exchange Act. As you know, the 
Committee on Agriculture has jurisdiction over that Act under 
rule X of the Rules of the House of Representatives, which 
grants the Agriculture Committee jurisdiction over ``commodity 
exchanges''.
    Because of the importance of this matter, I recognize your 
desire to bring this legislation before the House in an 
expeditious manner and will waive consideration of the bill by 
the Agriculture Committee. By agreeing to waive its 
consideration of the bill, the Agriculture Committee does not 
waive its jurisdiction over H.R. 3004. In addition, the 
Committee reserves its authority to seek conferees on any 
provisions of the bill that are within the Committee's 
jurisdiction during any House-Senate conference that may be 
convened on this legislation. I ask your commitment to support 
any request by the Committee on Agriculture for conferees on 
H.R. 3004 or related legislation.
    I request that you include this letter and your response as 
part of the Congressional Record during consideration of the 
legislation on the House floor.
    Thank you for your attention to these matters.
            Sincerely,
                                           Larry Combest, Chairman.
                                ------                                

                          House of Representatives,
                           Committee on Financial Services,
                                     Washington, DC, April 2, 2001.
Hon. Larry Combest,
Chairman, House Committee on Agriculture, Longworth House Office 
        Building, Washington, DC.
    Dear Chairman Combest: Thank you for your letter regarding 
your Committee's jurisdictional interest in H.R. 3004, the 
``Financial Anti-Terrorism Act of 2001''.
    I acknowledge your committee's jurisdictional interest in 
this legislation and appreciate your cooperation in moving the 
bill to the House floor expeditiously. I agree that your 
decision to forego further action on the bill will not 
prejudice the Committee on Agriculture with respect to its 
jurisdictional prerogatives on this or similar legislation. I 
will include a copy of your letter and this response in the 
Committee's report on the bill and the Congressional Record 
when the legislation is considered by the House.
    Thank you again for your cooperation.
            Sincerely,
                                        Michael G. Oxley, Chairman.
                                ------                                

                          House of Representatives,
                                  Committee on Agriculture,
                                  Washington, DC, October 15, 2001.
Hon. Michael G. Oxley,
Chairman, Committee on Financial Services, Rayburn House Office 
        Building, Washington, DC.
    Dear Chairman Oxley: I understand that the Committee on 
Financial Services recently ordered H.R. 3004, the ``Financial 
Anti-Terrorism Act of 2001'', reported to the House. Further, 
it is my understanding that your Committee amended this 
legislation in a manner that effects certain entities 
registered with the Commodity Futures Trading Commission 
pursuant to the Commodity Exchange Act. As you know, the 
Committee on Agriculture has jurisdiction over that Act under 
rule X of the Rules of the House of Representatives, which 
grants the Agriculture Committee jurisdiction over ``commodity 
exchanges''.
    Because of the importance of this matter, I recognize your 
desire to bring this legislation before the House in an 
expeditious manner and will waive consideration of the bill by 
the Agriculture Committee. By agreeing to waive its 
consideration of the bill, the Agriculture Committee does not 
waive its jurisdiction over H.R. 3004. In addition, the 
Committee reserves its authority to seek conferees on any 
provisions of the bill that are within the Committee's 
jurisdiction during any House-Senate conference that may be 
convened on this legislation. I ask your commitment to support 
any request by the Committee on Agriculture for conferees on 
H.R. 3004 or related legislation.
    I request that you include this letter and your response as 
part of the Congressional Record during consideration of the 
legislation on the House floor.
    Thank you for your attention to these matters.
            Sincerely,
                                           Larry Combest, Chairman.
                                ------                                

                          House of Representatives,
                           Committee on Financial Services,
                                  Washington, DC, October 15, 2001.
Hon. Larry Combest,
Chairman, Committee on Agriculture, Longworth House Office Building, 
        Washington, DC.
    Dear Chairman Combest: Thank you for your letter regarding 
your Committee's jurisdictional interest in H.R. 3004, the 
``Financial Anti-Terrorism Act of 2001''.
    I acknowledge your committee's jurisdictional interest in 
this legislation and appreciate your cooperation in moving the 
bill to the House floor expeditiously. I agree that your 
decision to forego further action on the bill will not 
prejudice the Committee on Agriculture with respect to its 
jurisdictional prerogatives on this or similar legislation. I 
will include a copy of your letter and this response in the 
Committee's report on the bill and the Congressional Record 
when the legislation is considered by the House.
    Thank you again for your cooperation.
            Sincerely,
                                        Michael G. Oxley, Chairman.

             Section-by-Section Analysis of the Legislation

Section 1. Short Title; Table of Contents

    This section provides the short title of the bill, the 
``Financial Anti-Terrorism Act of 2001'' and a table of 
contents.

                 TITLE I--STRENGTHENING LAW ENFORCEMENT

Section 101. Bulk Cash Smuggling Into or Out of the United States

    Subsections (a) through (c) set forth the new bulk cash 
smuggling offense as well as a set of findings explaining why 
the smuggling of bulk cash is a serious law enforcement 
problem. The new offense, which would be codified at 31 U.S.C. 
Sec. 5331, would make it an offense for anyone to knowingly 
conceal more than $10,000 in currency or other monetary 
instruments on his person or in any conveyance, article of 
luggage, merchandise or other container, and to transport or 
attempt to transport that currency across the border with the 
intent to avoid the reporting requirements in section 5316. In 
other words, the offense has three elements: (1) concealment; 
(2) transportation (or attempted transportation); and (3) 
specific intent to evade filing a complete and accurate report 
with the Customs Service.
    The penalty section provides for incarceration of up to 5 
years. In addition, and in lieu of any criminal fine, the 
penalty section authorizes the confiscation of the smuggled 
money in accordance with the usual procedures for criminal and 
civil forfeiture, including all of the due process protections 
enacted as part of the Civil Asset Forfeiture Reform Act of 
2000. Confiscation of smuggled goods has been regarded as the 
appropriate penalty for smuggling offenses since the first 
Customs laws were enacted in the 18th Century. In the 
alternative, in accordance with rule 32.2 of the Federal Rules 
of Criminal Procedure and existing case law, the court may 
enter a personal money judgment against the defendant. See 
United States v. Candelaria-Silva, 166 F.3d 19 (1st Cir. 1999) 
(criminal forfeiture order may take several forms: money 
judgment, directly forfeitable property, and substitute 
assets).
    To address concerns that such confiscation is a blunt 
instrument that should be mitigated in some circumstances to 
avoid a hardship, the bill explicitly authorizes courts to 
mitigate forfeitures of currency involved in currency reporting 
offenses to avoid Eighth Amendment violations by considering a 
range of aggravating and mitigating circumstances. Those 
circumstances include the value of the currency orother 
monetary instruments involved in the offense; efforts by the person 
committing the offense to structure currency transactions, conceal 
property or otherwise obstruct justice; and whether the offense is part 
of a pattern of repeated violations.
    The Committee believes, however, that bulk cash smuggling 
is an inherently more serious offense than simply failing to 
file a Customs report. Because the constitutionality of a 
forfeiture is dependent on the ``gravity of the offense'' under 
Bajakajian, it is anticipated that the full forfeiture of 
smuggled money will withstand constitutional scrutiny in most 
cases. For the confiscation to be reduced at all, the smuggler 
will have to show that the money was derived from a legitimate 
source and not intended to be used for any unlawful purpose. 
Even then, the court's duty will be to reduce the amount of 
confiscation to the maximum that would be permitted in 
accordance with the Eighth Amendment and the aggravating and 
mitigating factors set forth in the statute. The civil 
forfeiture provision would apply to conduct occurring before 
the effective date of the act.

Section 102. Forfeiture in Currency Reporting Cases

    Section 102 makes conforming amendments to the existing 
criminal and civil forfeiture provisions for the reporting and 
structuring violations in title 31. The section creates 
parallel forfeiture authority for violating the currency 
reporting requirements applicable to businesses under 26 U.S.C. 
Sec. 6050I and sets forth rules for mitigating the forfeitures 
to avoid constitutional violations in accordance with 
Bajakajian. This is necessary to address the concern expressed 
by the Court in Bajakajian that Congress had not made it clear 
that trial courts are authorized to reduce forfeitures down to 
the maximum level permissible to avoid violating the Excessive 
Fines Clause when a statute, on its face, appears to authorize 
only the forfeiture of the full amount of structured or 
unreported currency.

Section 103. Interstate Currency Couriers

    This section amends the money laundering statute to make it 
an offense for anyone to transport more than $10,000 in 
currency concealed in a vehicle traveling in interstate 
commerce (e.g. on an interstate highway) knowing that the 
currency was derived from some kind of unlawful activity, or 
knowing that the currency was intended to be used to promote 
such activity. The courier's willful blindness regarding the 
source or intended use of the currency would be sufficient to 
establish the requisite knowledge.

Section 104. Illegal Money Transmitting Businesses

    The operation of an unlicensed money transmitting business 
is a violation of Federal law under 18 U.S.C. Sec. 1960. First, 
section 104 clarifies the scienter requirement in Sec. 1960 to 
avoid the problems that occurred when the Supreme Court 
interpreted the currency transaction reporting statutes to 
require proof that the defendant knew that structuring a cash 
transaction to avoid the reporting requirements had been made a 
criminal offense. See Ratzlaf v. United States, 114 S. Ct. 655 
(1994). The proposal makes clear that an offense under 
Sec. 1960 is a general intent crime for which a defendant is 
liable if he knowingly operates an unlicensed money 
transmitting business. For purposes of a criminal prosecution, 
the Government would not have to show that the defendant knew 
that a State license was required or that the Federal 
registration requirements promulgated pursuant to 31 U.S.C. 
Sec. 5330 applied to the business.
    Second, section 104 expands the definition of an unlicensed 
money transmitting business to include a business engaged in 
the transportation or transmission of funds that the defendant 
knows are derived from a criminal offense, or are intended to 
be used for an unlawful purpose. Thus, a person who agrees to 
transmit or to transport drug proceeds for a drug dealer, or 
funds from any source for a terrorist, knowing such funds are 
to be used to commit a terrorist act, would be engaged in the 
operation of an unlicensed money transmitting business. It 
would not be necessary for the Government to show that the 
business was a storefront or other formal business open to 
walk-in trade. To the contrary, it would be sufficient to show 
that the defendant offered his services as a money transmitter 
to another.
    Finally, when Congress enacted Sec. 1960 in 1992, it 
provided for criminal but not civil forfeiture. The proposal 
corrects this oversight, and allows the government to obtain 
forfeiture of property involved in the operation of an illegal 
money transmitting business even if the perpetrator is a 
fugitive.

Section 105. Long-Arm Jurisdiction over Foreign Money Launderers

    The first provision in this section creates a long arm 
statute that gives the district court jurisdiction over a 
foreign person, including a foreign bank, that commits a money 
laundering offense in the United States or converts laundered 
funds that have been forfeited to the Government to his own 
use. Thus, if the Government files a civil enforcement action 
under section 1956(b), or files a civil lawsuit to recover 
forfeited property from a third party, the district court would 
have jurisdiction over the defendant if the defendant has been 
served with process pursuant to the applicable statutes or 
rules of procedure,and the constitutional requirement of 
minimum contacts is satisfied in one of three ways: the money 
laundering offense took place in the United States; in the case of 
converted property, the property was the property of the United States 
by virtue of a civil or criminal forfeiture judgment; or in the case of 
a financial institution, the defendant maintained a correspondent bank 
account at another bank in the United States. Under this provision, for 
example, the district courts would have had jurisdiction over the 
defendant in the circumstances described in United States v. Swiss 
American Bank, 191 F.3d 30 (1st Cir. 1999).
    The second provision, modeled on 18 U.S.C. Sec. 1345(b), 
gives the district court the power to restrain property, issue 
seizure warrants, or take other action necessary to ensure that 
a defendant in an action covered by the statute does not 
dissipate the assets that would be needed to satisfy a 
judgment.
    This section also authorizes a court, on the motion of the 
Government or a State or Federal regulator, to appoint a 
receiver to gather and protect assets needed to satisfy a 
judgment under sections 1956 and 1957, and the forfeiture 
provisions in sections 981 and 982. This authority is intended 
to apply in three circumstances: (1) when there is a judgment 
in a criminal case, including an order of restitution, 
following a conviction for a violation of section 1956 or 1957; 
(2) when there is a judgment in a civil case under section 
1956(b) assessing a penalty for a violation of either section 
1956 or 1957; and (3) when there is a civil forfeiture judgment 
under section 981 or a criminal forfeiture judgment, including 
a personal money judgment, under section 982.
    The amendment also makes section 1956(b) applicable to 
violations of section 1957. It applies to conduct occurring 
before the effective date of the Act.

Section 106. Laundering Money through a Foreign Bank

    This section eliminates the ambiguity in current law 
regarding money laundering through foreign banks by including 
foreign banks within the definition of ``financial 
institution'' in Sec. 1956(c)(6). The definition is the same as 
the one set forth in 12 U.S.C. Sec. 3101(7), which is already 
employed in Sec. 1956(c)(7)(B) for another purpose.

Section 107. Specified Unlawful Activity for Money Laundering

    This amendment enlarges the list of foreign crimes that can 
lead to money laundering prosecutions in this country when the 
proceeds of additional foreign crimes are laundered in the 
United States. The additional crimes include all crimes of 
violence, public corruption, and offenses covered by existing 
bilateral extradition treaties. The Committee intends this 
provision to send a strong signal that the United States will 
not tolerate the use of its financial institutions for the 
purpose of laundering the proceeds of such activities.

Section 108. Laundering the Proceeds of Terrorism

    The Antiterrorism and Effective Death Penalty Act of 1996 
(AEDPA) made it a criminal offense to provide material support 
or resources to an organization designated by the Secretary of 
State as a ``foreign terrorist organization.'' 18 U.S.C. 
Sec. 2339B.
    Section 2339B, however, was not added to the list of money 
laundering predicate offenses in section 1956(c)(7)(D). This 
provision adds Sec. 2339B to the list of money laundering 
predicates.

Section 109. Violations of Reporting Requirements for Nonfinancial 
        Trades and Businesses

    18 U.S.C. Sec. Sec. 981 and 982 are the civil and criminal 
forfeiture statutes pertaining to money laundering. Presently, 
they provide for forfeiture for money laundering violations 
under the Bank Secrecy Act (31 U.S.C. Sec. 5311 et seq.) and 
the Money Laundering Control Act (18 U.S.C. Sec. Sec. 1956-57). 
This section would add 26 U.S.C. Sec. 6050I of the Internal 
Revenue Code to this list in both statutes.
    Section 6050I is the statute that requires any trade or 
business receiving more than $10,000 in cash to report the 
transaction to the IRS on Form 8300. Subsection (f) makes it an 
offense to structure a transaction with the intent to avoid the 
filing of such form. Thus, section 6050I is the counterpart to 
31 U.S.C. Sec. Sec. 5313 and 5324 which require the filing of 
Currency Transaction Reports (CTRs) and Currency or Monetary 
Instrument Report (CMIRs) by financial institutions whenever a 
$10,000 cash transaction takes place, and by other persons 
whenever they send more than $10,000 in currency into or out of 
the United States. Including a reference to section 6050I in 
sections 981 and 982 thus means that violations of the Form 
8300 requirement will be treated the same as CTR and CMIR 
violations for forfeiture purposes.

Section 110. Proceeds of Foreign Crimes

    This section is intended to reinforce the United States' 
compliance with the Vienna Convention. It amends 18 U.S.C. 
Sec. 981(a)(1)(B) to allow the United States to institute its 
own action against the proceeds of foreign criminal offenses 
when such proceeds are found in the United States. As required 
by the Vienna Convention, it also authorizes the confiscation 
of property used to facilitate such crimes. The listof foreign 
crimes to which this section applies is determined by cross-reference 
to the foreign crimes that are money laundering predicates under 
Sec. 1956(c)(7)(B). This section will permit the forfeiture of property 
involved in conduct occurring before the effective date of the Act.

Section 111. Availability of Reports Relating to Coins and Currency 
        Received in Non-Financial Trade or Business

    Section 111 addresses the problem of the accessibility of 
the Form 8300 information by directing the Secretary of the 
Treasury to take the necessary actions and establish the 
necessary procedures to make the information contained on Form 
8300 available to government agencies through the network 
administered by FinCEN. The Secretary is given six months from 
date of enactment to achieve this objective, and is required to 
report to Congress on the actions taken pursuant to this 
section, together with recommendations for any legislative or 
administrative action determined to be appropriate by the 
Secretary.
    The Committee believes that safeguards built into the 
FinCEN information-sharing protocols currently satisfies 
appropriate confidentiality concerns, as specified by section 
6103 (p)(4), but expects the Secretary to address--and 
resolve--the issue squarely within the six-month timeline 
specified. The Committee is aware that some of the ``outreach'' 
and data-sharing aspects of FinCEN's duties might be 
problematic with regards the sharing of other tax data, 
specifically personal or corporate income data. However, the 
Committee does not view what is essentially law-enforcement 
data about specific transactions to be personal or corporate 
``income data,'' regardless of the fact that it is collected by 
the Internal Revenue Service.

Section 112. Penalties for Violations of Geographic Targeting Orders 
        and Certain Record Keeping Requirements

    31 U.S.C. Sec. Sec. 5321 and 5322 impose civil and criminal 
penalties, respectively, for violations of the Bank Secrecy Act 
(BSA) and BSA regulations; 31 U.S.C. Sec. 5324 creates 
additional criminal offenses for failing to file a report, 
filing a false or incomplete report, and structuring currency 
transactions in order to evade a reporting requirement under 
the BSA. Those statutes, however, do not specifically refer to 
reports required by GTOs (geographic targeting orders) issued 
under 31 U.S.C. Sec. 5326. This provision eliminates any 
ambiguity concerning the applicability of these provisions to 
GTOs by inserting specific references to 31 U.S.C. Sec. 5326 in 
the respective statutes.

Section 113. Exclusion of Aliens Involved in Money Laundering

    This section will provide for inadmissibility of any 
individual who a consular officer has reason to believe has or 
is engaged in certain money laundering offenses, or any 
criminal activity in a foreign country that would constitute 
such an offense if committed in the United States, regardless 
of whether a judgment of conviction has been entered or avoided 
due to flight, corruption, etc. This section treats money 
launderers with the same standard applicable to drug 
traffickers and will make the United States' ability to exclude 
aliens involved in such activities less dependent upon the 
Nation's ability to draw inferences about a person's intent to 
do something illicit in the United States. Money laundering 
offenses are, in general, related to underlying crimes 
involving moral turpitude that are already grounds for 
exclusion under the Immigration and Nationality Act.
    As an added deterrent, the amendment allows the consular 
officer to exclude the money launderer's family members, while 
also giving the Attorney General the authority to waive such 
exclusion if he determines that exceptional circumstances 
exist.

Section 114. Standing to Contest Forfeiture of Funds Deposited Into 
        Foreign Bank that has a Correspondent Account in the United 
        States

    Section 114 creates a new provision in the civil forfeiture 
statute, 18 U.S.C. Sec. 981(k), authorizing the forfeiture of 
funds found in an interbank account. The new provision is 
necessary to reconcile the law regarding the forfeiture of 
funds in bank accounts with the realities of the global 
movement of electronic funds and the use of off-shore banks to 
insulate criminal proceeds from forfeiture.
    To prevent drug dealers and other criminals from taking 
advantage of certain nuances of forfeiture law to insulate 
their property from forfeiture even though it is deposited in a 
bank account in the United States, it is necessary to change 
the law regarding the location of the debt that a bank owes to 
its depositor, and the identity of the real party in interest 
with standing to contest the forfeiture. The amendment in this 
section addresses the location issue by treating a deposit made 
into an account in a foreign bank that has a correspondent 
account at a U.S. bank as if the deposit had been made into the 
U.S. bank directly. Second, the section treats the deposit in 
the correspondent account as a debt owed directly to the 
depositor, and not as a debt owed to the respondent bank. In 
other words, the correspondent account is treated as if it were 
the foreign bank itself, and the funds in the correspondent 
account were debts owed to the foreign bank's customers.
    Under this arrangement, if funds traceable to criminal 
activity are deposited into a foreign bank, the Government may 
bring a forfeiture action against funds in that bank's 
correspondent account, and only the initial depositor, and not 
the intermediary bank, would have standing to contest it.
    The section authorizes the Attorney General to suspend or 
terminate a forfeiture in cases where there exists a conflict 
of laws between the U.S. and the jurisdiction in which the 
foreign bank is located, where such suspension or termination 
would be in the interest of justice and not harm U.S. national 
interests.

Section 115. Subpoenas for Records Regarding Funds in Correspondent 
        Bank Accounts

    Section 115 gives the Attorney General and the Secretary of 
the Treasury new authority to subpoena records from a foreign 
bank that relate to transactions occurring overseas. Under this 
provision, a foreign bank that maintains a correspondent 
account in the United States must have a representative in the 
United States who will accept service of a subpoena for any 
records of any transaction with the foreign bank that occurs 
overseas. This is necessary to enable law enforcement to 
determine the source of money being placed in the United States 
through the correspondent banking system. The duty to comply 
with such a subpoena is now a requirement for foreign banks 
that choose to avail themselves of access to that system in the 
United States.
    Subsection (c) delays the effective date for the 
requirement to appoint a person authorized to accept service of 
a subpoena for 30 days, but once in effect, the provision 
allows the Government to subpoena records relating to 
transactions occurring before the effective date of the Act.
    Subsection (d) contains a conforming amendment, revising 
the existing authority in 18 U.S.C. Sec. 3486 to allow the 
Attorney General to issue subpoenas in money laundering cases. 
Currently, section 3486 contains such authority in health care 
fraud and child pornography cases. Thus, the subpoena would be 
issued in the manner and for the purposes previously authorized 
for the issuance of such subpoenas in those cases. See United 
States v. Doe, 235 F.3d 256 (6th Cir. 2001) (discussing 
standard for enforcement of administrative subpoena issued 
under section 3486).

Section 116. Authority to Order Convicted Criminal to Return Property 
        Located Abroad

    Section 116 authorizes a court to order a criminal 
defendant to repatriate his property to the United States in 
criminal cases. In criminal forfeiture cases, the sentencing 
court is authorized to order the forfeiture of ``substitute 
assets'' when the defendant has placed the property otherwise 
subject to forfeiture ``beyond the jurisdiction of the court.'' 
Frequently, this provision is applied when a defendant has 
transferred drug proceeds or other criminally derived property 
to a foreign country. In many cases, however, the defendant has 
no other assets in the United States of a value commensurate 
with the forfeitable property overseas. In such cases, ordering 
the forfeiture of substitute assets is a hollow sanction.
    This section amends 21 U.S.C. Sec. 853 to make clear that a 
court in a criminal case may issue a repatriation order--either 
post-trial as part of the criminal sentence and judgment, or 
pre-trial pursuant to the court's authority under 21 U.S.C. 
Sec. 853(e) to restrain property--so that they will be 
available for forfeiture. Failure to comply with such an order 
would be punishable as a contempt of court, or it could result 
in a sentencing enhancement, such as a longer prison term, 
under the U.S. Sentencing Guidelines, or both.

Section 117. Corporation Represented by a Fugitive

    Currently, 28 U.S.C. Sec. 2466 permits a court to disallow 
the claim filed in a forfeiture proceeding by a person who is a 
fugitive in a related criminal case. The amendment clarifies 
that a natural person who is a fugitive may not circumvent this 
provision by filing, or having another person file, a claim on 
behalf of a corporation that the fugitive controls.

Section 118. Enforcement of Foreign Judgments

    Under current law, 28 U.S.C. Sec. 2467(d) gives Federal 
courts the authority to enforce civil and criminal forfeiture 
judgments entered by foreign courts. This section amends that 
provision to include a mechanism for preserving property 
subject to forfeiture in a foreign country.
    Specifically, a Federal court could issue a restraining 
order under 18 U.S.C. Sec. 983(j) or register and enforce a 
foreign restraining order, if the Attorney General certified 
that such foreign order was obtained in accordance with the 
principles of due process. A person seeking to contest the 
restraining order could do so on the ground that 28 U.S.C. 
Sec. 2467 was not properly applied to the particular case, but 
could not oppose the restraining order on any ground that could 
also be raised in the proceedings pending in a foreign court. 
This provision preventsa litigant from taking ``two bites at 
the apple'' by raising objections to the basis for the forfeiture in 
the Federal court that he also raised, or is entitled to raise, in the 
foreign court where the forfeiture action is pending. It complements 
the existing provision in section 2467(e) providing that the Federal 
court is bound by the findings of fact of the foreign court, and may 
not look behind such findings in determining whether to enter an order 
enforcing a foreign forfeiture judgment.
    This section also amends 28 U.S.C. Sec. 2467 to make clear 
that it is not necessary to prove that the person asserting an 
interest in the property received actual notice of the 
forfeiture proceedings. As is the case with respect to 
forfeitures under U.S. law, it is sufficient if the foreign 
nation takes steps to provide notice, in accordance with the 
principles of due process. See Gonzalez v. United States, 1997 
WL 278123 (S.D.N.Y. 1997) (``the [G]overnment is not required 
to ensure actual receipt of notice that is properly mailed''); 
Albajon v. Gugliotta, 72 F. Supp. 2d 1362 (S.D. Fla. 1999) 
(notice sent to various addresses on claimant's 
identifications, and mailed after claimant released from jail, 
is sufficient to satisfy due process, even if claimant never 
received notice); United States v. Schiavo, 897 F. Supp. 644, 
648-49 (D. Mass. 1995) (sending notice to fugitive's last known 
address is sufficient; due process satisfied even if he did not 
receive the notice).
    Finally, 28 U.S.C. Sec. 2467 is amended to authorize the 
enforcement of a forfeiture judgment based on any foreign 
offense that would constitute an offense giving rise to a civil 
or criminal forfeiture of the same property if the offense had 
been committed in the United States. This is one of two 
safeguards that the statute contains against the enforcement of 
judgments that the United States does not consider appropriate 
for enforcement: if the judgment is based on an act that would 
not constitute a crime in the United States, such as removing 
assets from the reach of a repressive regime, it could not be 
enforced. In addition, section 2467 already provides that a 
foreign judgment may only be enforced by a Federal court at the 
request of the United States, and only after the Attorney 
General has certified that the judgment was obtained in 
accordance with the principles of due process. Thus, neither a 
foreign Government nor a foreign private party could enforce a 
foreign judgment on its own under this provision.

Section 119. Reporting Provisions and Anti-Terrorist Activities of 
        United States Intelligence Agencies

    This section clarifies the authority of the Secretary of 
the Treasury to share Bank Secrecy Act information with the 
intelligence community for intelligence or counterintelligence 
activities related to domestic or international terrorism. 
Under current law, the Secretary may share BSA information with 
the intelligence community for the purpose of investigating and 
prosecuting terrorism. This section would make clear that the 
intelligence community may use this information for purposes 
unrelated to law enforcement.
    The provision would also expand a Right to Financial 
Privacy Act (RFPA) exemption, currently applicable to law 
enforcement inquiries, to allow an agency or department to 
share relevant financial records with another agency or 
department involved in intelligence or counterintelligence 
activities, investigations, or analyses related to domestic or 
international terrorism. The section would also exempt from 
most provisions of the RFPA a government authority engaged in 
investigations of or analyses related to domestic or 
international terrorism. This section would also authorize the 
sharing of financial records obtained through a Federal grand 
jury subpoena when relevant to intelligence or 
counterintelligence activities, investigations, or analyses 
related to domestic or international terrorism. In each case, 
the transferring governmental entity must certify that there is 
reason to believe that the financial records are relevant to 
such an activity, investigation, or analysis.
    Finally, this section facilitates government access to 
information contained in suspected terrorists' credit reports 
when the governmental inquiry relates to an investigation of, 
or intelligence activity or analysis relating to, domestic or 
international terrorism. Even though private entities such as 
lenders and insurers can access an individual's credit history, 
the government is strictly limited in its ability under current 
law to obtain the information. This section would permit those 
investigating suspected terrorists prompt access to credit 
histories that may reveal key information about the terrorist's 
plan or source of funding--without notifying the target. To 
obtain the information, the governmental authority must certify 
to the credit bureau that the information is necessary to 
conduct a terrorism investigation or analysis. The amendment 
would also create a safe harbor from liability for credit 
bureaus acting in good faith that comply with a government 
agency's request for information.

Section 120. Financial Crimes Enforcement Network

    The Financial Crimes Enforcement Network, or FinCEN, was 
created by executive order in 1990, and its duties augmented by 
several subsequent orders. Its mission is to create and 
maintain a computer system that holds information on financial 
crimes--allowing law enforcement agencies to view and query the 
data with appropriate safeguards--and to analyze the 
information to identify leads for further investigation or 
possible prosecution.
    This section codifies the executive orders, establishing 
FinCEN as a permanent bureau of the Treasury, giving it a 
separate authorization (FY 2002 through FY 2005) and assigning 
duties consistent with those of the executive orders. This 
section also makes the Director of FinCEN a Presidential 
appointee, with a four year term. Additionally, the section 
establishes a special unit within FinCEN to deal with informal 
value-transferring arrangements such as the hawala 
organizations thought to be a method by which some terrorists 
transfer funds outside of normal banking channels. Also 
assigned as a new duty is support of the Treasury Secretary's 
efforts in tracking and controlling foreign terrorists' assets 
by providing computer storage and analysis to the new Foreign 
Terrorist Asset Tracking Center recently established at the 
Office of Foreign Assets Control.
    References in section 120(c)(2) to section 552(a) of title 
V and the Right to Financial Privacy Act are not intended by 
the Committee to impose additional and/or more stringent 
standards than what the Privacy Act outlines.
    This section also requires the Treasury Secretary to report 
to Congress regularly on compliance with laws requiring the 
reporting of foreign bank accounts, along with methods for 
improving compliance. The Committee is aware that non-
compliance with such regulations is a possible method of 
laundering money or financing terrorism, and that compliance 
over the last decades has been unacceptably low--probably in 
the single-digit percentages.

Section 121. Customs Service Border Searches

    This section authorizes the U.S. Customs Service to conduct 
warrantless searches of outbound mail transmitted by or for the 
Postal Service for bulk cash, dangerous contraband, and other 
items subject to the laws enforced by Customs. Because the 
Customs Service is responsible for enforcing laws vital to the 
national interest, including provisions on the export of 
weapons of mass destruction, child pornography, and munitions, 
there is a critical need for Customs to have this authority.
    The Customs Service currently has the authority to conduct 
such warrantless searches in virtually every situation in which 
people or merchandise cross the U.S. border, including the 
authority to search shipments sent by private carrier, such as 
Federal Express or United Parcel Service. This section simply 
extends this authority to outbound mail sent via the Postal 
Service, and is intended to ensure that in rule and practice 
Postal mail is subject to the same types of border searches as 
currently are authorized for private carrier shipments. This 
section is not intended to change in any way the existing 
authority of Customs to conduct border searches of shipments 
sent by private carriers.
    The provision includes safeguards prohibiting Customs 
officers from reading any correspondence in mail sent by the 
Postal Service without a search warrant or the written consent 
of the sender or addressee. Finally, with regard to sealed 
letter class mail exported by the Postal Service, it is 
intended that Customs officers must have reasonable suspicion 
that such mail contains merchandise before opening or examining 
it. This parallels the existing rule for Customs border 
searches of imported letter class mail. See 19 C.F.R. 
Sec. 145.3.

Section 122. Prohibition on False Statements to Financial Institutions 
        Concerning the Identity of a Customer

    This section makes it a Federal crime, punishable by up to 
5 years in prison, for a person submitting information to a 
financial institution to knowingly falsify or conceal their 
true identity in a transaction with a financial institution, 
including a bank, securities firm, or insurance company.

Section 123. Verification of Identification

    Section 123(a) amends 31 U.S.C. Sec. 5318 by adding a new 
subsection governing the identification of account holders. 
Paragraph (1) directs Treasury to prescribe regulations setting 
forth minimum standards for customer identification by 
financial institutions in connection with the opening of an 
account. By referencing ``customers'' in this section, the 
Committee intends that the regulations prescribed by Treasury 
take an approach similar to that of regulations promulgated 
under title V of the Gramm-Leach-Bliley Act of 1999, where the 
functional regulators defined ``customers'' and ``customer 
relationship'' for purposes of the financial privacy rules. 
Under this approach, for example, where a mutual fund sells its 
shares to the public through a broker-dealer and maintains a 
``street name'' or omnibus account in the broker-dealer's name, 
the individual purchasers of the fund shares are customers of 
the broker-dealer, rather than the mutual fund. The mutual fund 
would not be required to ``look through'' the broker-dealer to 
identify and verify the identities of those customers. 
Similarly, where a mutual fund sells its shares to a qualified 
retirement plan, the plan, and not its participants, would be 
the fund's customers. Thus, the fund would not be required to 
``look through'' the plan to identify its participants.
    Paragraph (2) requires that the regulations must, at a 
minimum, require financial institutions to implement procedures 
to verify (to the extent reasonable and practicable) the 
identity of any person seekingto open an account, maintain 
records of the information used to do so, and consult applicable lists 
of known or suspected terrorist or terrorist organizations. The lists 
of known or suspected terrorists that the Committee intends financial 
institutions to consult are those already supplied to financial 
institutions by the Office of Foreign Asset Control (OFAC), and 
occasionally by law enforcement and regulatory authorities, as in the 
days immediately following the September 11, 2001, attacks on the World 
Trade Center and the Pentagon. It is the Committee's intent that the 
verification procedures prescribed by Treasury make use of information 
currently obtained by most financial institutions in the account 
opening process. It is not the Committee's intent for the regulations 
to require verification procedures that are prohibitively expensive or 
impractical.
    Paragraph (3) requires that Treasury consider the various 
types of accounts maintained by various financial institutions, 
the various methods of opening accounts, and the various types 
of identifying information available in promulgating its 
regulations. This would require Treasury to consider, for 
example, the feasibility of obtaining particular types of 
information for accounts opened through the mail, 
electronically, or in other situations where the accountholder 
is not physically present at the financial institution. 
Millions of Americans open accounts at mutual funds, broker-
dealers, and other financial institutions in this manner; it is 
not the Committee's intent that the regulations adopted 
pursuant to this legislation impose burdens that would make 
this prohibitively expensive or impractical. This provision 
allows Treasury to adopt regulations that are appropriately 
tailored to these types of accounts.
    Current regulatory guidance instructs depository 
institutions to make reasonable efforts to determine the true 
identity of all customers requesting an institution's services. 
(See, e.g., FDIC Division of Supervision Manual of Exam 
Policies, section 9.4 VI.) The Committee intends that the 
regulations prescribed under this section adopt a similar 
approach, and impose requirements appropriate to the size, 
location, and type of business of an institution.
    Paragraph (4) requires that Treasury consult with the 
appropriate functional regulator in developing the regulations. 
This will help ensure that the regulations are appropriately 
tailored to the business practices of various types of 
financial institutions, and the risks that such practices may 
pose.
    Paragraph (5) gives each functional regulator the authority 
to exempt, by regulation or order, any financial institution or 
type of account from the regulations prescribed under paragraph 
(1).
    Paragraph (6) requires that Treasury's regulations 
prescribed under paragraph (1) become effective within one year 
after enactment of this bill.

Section 124. Consideration of Anti-Money Laundering Record

    This section amends the Bank Holding Company Act and 
Federal Deposit Insurance Act to require Federal banking 
regulators, when considering merger applications, to take into 
account the effectiveness of all parties to the transaction in 
combating and preventing money laundering activities, including 
in overseas branches.

Section 125. Reporting of Suspicious Activities by Informal Underground 
        Banking Systems, such as Hawalas

    Although the Committee believes that informal value 
transfer banking systems like hawalas are already adequately 
covered by references to money transmitting businesses in 
certain provisions of existing law, this section makes that 
understanding explicit. First, it makes clear that informal 
value transfer banking systems are included in the definition 
of ``financial institutions'' under the Bank Secrecy Act. 
Second, it makes clear such systems are included under 
statutory registration requirements for money transmitting 
businesses. Third, it makes clear that informal value transfer 
banking systems are included under record-keeping rules for 
international wire transfers.
    The section requires the Secretary of the Treasury to 
report to Congress within one year from the date of enactment 
on the need for any additional legislation relating to informal 
value transfer banking systems. The report is to cover such 
items as anti-money laundering and other regulatory controls, 
including a discussion of whether the $5,000 threshold for the 
filing of suspicious activity reports (SARs) should be lowered 
for hawalas and similar systems.

                  TITLE II--PUBLIC-PRIVATE COOPERATION

Section 201. Establishment of Highly Secure Network

    This section directs the Secretary of the Treasury to 
establish a highly secure computer network dedicated to (1) 
receiving electronic filings of reports of suspicious activity 
and large currency transactions filed by financial 
institutions; and (2) providing financial institutions with 
alerts and other information regarding suspicious activity that 
warrants immediate and enhanced scrutiny. The network is to be 
fully operational within nine months of the date of enactment 
of this legislation.

Section 202. Report on Improvements in Data Access and Other Issues

    The section requires the Secretary of the Treasury to file 
three separate reports to Congress within six months of 
enactment, covering:
    (1) Progress made in the improvements of data entry, data 
access and data analysis with respect to the computer systems 
maintained by the Financial Crimes Enforcement Network 
(FinCEN);
    (2) Technical, legal and other barriers to the exchange of 
financial crime prevention and detection information between 
Federal law-enforcement agencies; and,
    (3) The nature and extent of private banking activities in 
the United States.
    The Committee continues to be concerned that FinCEN 
computer systems are not used to their maximum efficiency 
because it is difficult, costly and time-consuming to enter 
data into them; analytical tools need constant improvement; and 
a number of technical and legal constraints as well as some 
inter-agency ``turf'' issues appear to prevent all financial 
crime data from being housed in a single system to which all 
Federal law enforcement has access. The Committee believes that 
constant improvement must be made to the FinCEN system's 
hardware and software to improve its effectiveness, and that 
until such barriers to data-sharing are eliminated, FinCEN will 
be impaired in performance of its mission, and enforcement of 
anti-money-laundering and anti-terrorism laws will suffer as a 
result.

Section 203. Reports to the Financial Services Industry on Suspicious 
        Financial Activities

    This section directs the Secretary of the Treasury to 
disseminate quarterly reports to the financial services 
industry identifying and analyzing patterns of suspicious 
financial activity disclosed by the reports filed by the 
industry pursuant to the Bank Secrecy Act.

Section 204. Efficient Use of Currency Transaction Report System

    This section requires the Secretary of the Treasury to 
report to Congress within 90 days of enactment on (1) possible 
expansion of the statutory exemptions to the CTR requirement 
available under current law; and (2) methods for improving 
compliance by financial institutions with the exemptions. The 
Committee intends that the Secretary's report look specifically 
at methods to reduce unnecessary filing of CTRs, and to improve 
the quality of data available to law enforcement. The Committee 
does not intend that the Secretary's review encompass the issue 
of increasing the monetary thresholds for filing CTRs.

Section 205. Public-Private Task Force on Terrorist Financing Issues

    This section mandates the creation of a public-private task 
force, under the aegis of the Bank Secrecy Act Advisory Group, 
to focus on issues related to terrorist financing. Among the 
issues to be addressed by the task force are the methods used 
by terrorist organizations to transfer funds globally and 
within the U.S., including through the use of charitable 
organizations; the relationship between international narcotics 
traffickers and foreign terrorist organizations; and the means 
of facilitating the identification of accounts and transactions 
involving terrorist groups, and facilitating the exchange of 
information concerning terrorist financing between financial 
institutions and law enforcement organizations.

Section 206. Suspicious Activity Reporting Requirements

    This section directs the Secretary of the Treasury, in 
consultation with the Securities Exchange Commission (SEC), to 
publish by no later than December 31, 2001, a proposed 
regulation requiring securities broker-dealers to file 
Suspicious Activity Reports. The Secretary is also authorized, 
in consultation with the Commodity Futures Trading Commission 
(CFTC), to prescribe regulations requiring futures commission 
merchants, commodity trading advisors, and commodity pool 
operators registered under the Commodity Exchange Act (CEA) to 
file Suspicious Activity Reports.
    At the time the Secretary of the Treasury proposes any 
reporting rules for futures commission merchants, the Secretary 
should consult with the Securities and Exchange Commission and 
the Commodity Futures Trading Commission and take steps to 
provide for a reporting process for entities registered as both 
securities brokers or dealers and futures commission merchants 
that requires only a single report, to the extent practicable 
and consistent with the Bank Secrecy Act. The Secretary should 
also act to prevent inconsistent regulations being applied to 
dually registered entities. Further, the Secretary should 
consult with the Commodity Futures Trading Commission to 
promote the use of a single reporting form for the Commodity 
Futures Trading Commission and Treasury, to the extent 
practicable and consistent with the Bank Secrecy Act.
    The Committee notes that, under the Bank Secrecy Act, the 
Secretary currently has the authority to require Suspicious 
Activity Reports of entities similar to futures commission 
merchants, commodity trading advisors, and commodity pool 
operators, namely registered investment advisors and registered 
investment companies. Accordingly, registered investment 
advisors and registered investment companies are not 
specifically identified in section 206(a). The Secretary and 
theCommodity Futures Trading Commission should consider the 
money laundering regulations and requirements imposed on registered 
investment companies and investment advisors when considering what 
regulations, if any, should apply to registered commodity pool 
operators and commodity trading advisors so as to ensure that these 
similar entities are treated in a comparable manner.

Section 207. Amendments Relating to Reporting of Suspicious Activities

    Subsection (a) of section 207 makes certain technical and 
clarifying amendments to 31 U.S.C. Sec. 5318(g)(3), the Bank 
Secrecy Act's ``safe harbor'' provision that protects financial 
institutions that disclose possible violations of law or 
regulation from civil liability for reporting their suspicions 
and for not alerting those identified in the reports. The safe 
harbor is directed at Suspicious Activity Reports and similar 
reports to the government and regulatory authorities under the 
Bank Secrecy Act.
    First, section 207(a) amends section 5318(g)(3) to make 
clear that the safe harbor from civil liability applies in 
arbitration, as well as judicial, proceedings. Second, it 
amends section 5318(g)(3) to clarify the safe harbor's coverage 
of voluntary disclosures (that is, those not covered by the SAR 
regulatory reporting requirement). The language in section 
5318(g)(3)(A) providing that ``any financial institution that * 
* * makes a disclosure pursuant to * * * any other authority * 
* * shall not be liable to any person'' is not intended to 
avoid the application of the reporting and disclosure 
provisions of the Federal securities laws to any person, or to 
insulate any issuers from private rights of actions for 
disclosures made under the Federal securities laws.
    Subsection 207(b) amends section 5318(g)(2) of title 31--
which currently prohibits notification of any person involved 
in a transaction reported in a SAR that a SAR has been filed--
to clarify (1) that any government officer or employee who 
learns that a SAR has been filed may not disclose that fact to 
any person identified in the SAR, except as necessary to 
fulfill the officer or employee's official duties, and (2) that 
disclosure by a financial institution of potential wrongdoing 
in a written employment reference provided in response to a 
request from another financial institution pursuant to section 
18(v) of the Federal Deposit Insurance Act, or in a written 
termination notice or employment reference provided in 
accordance with the rules of a securities self-regulatory 
organization, is not prohibited simply because the potential 
wrongdoing was also reported in a SAR.

Section 208. Authorization to Include Suspicions of Illegal Activity in 
        Written Employment References

    This section deals with the same employment reference issue 
addressed in section 207 but with respect to title 12. 
Occasionally banks develop suspicions that a bank officer or 
employee has engaged in potentially unlawful activity. These 
suspicions typically result in the bank filing a SAR. Under 
present law, however, the ability of banks to share these 
suspicions in written employment references with other banks 
when such an officer or employee seeks new employment is 
unclear. Section 208 would amend 12 U.S.C. Sec. 1828 to permit 
a bank, upon request by another bank, to share information in a 
written employment reference concerning the possible 
involvement of a current or former officer or employee in 
potentially unlawful activity without fear of civil liability 
for sharing the information, but only to the extent that the 
disclosure does not contain information which the bank knows to 
be false, and the bank has not acted with malice or with 
reckless disregard for the truth in making the disclosure.

Section 209. International Cooperation on Identification of Originators 
        of Wire Transfers

    This section directs the Secretary of the Treasury, in 
consultation with the Attorney General and the Secretary of 
State, to (1) take all reasonable steps to encourage foreign 
governments to require the inclusion of the name of the 
originator in wire transfer instructions sent to the U.S. and 
other countries; and (2) report annually to Congress on 
Treasury's progress in achieving this objective, and on 
impediments to instituting a regime in which all appropriate 
identification about wire transfer recipients is included with 
wire transfers from their point of origination until 
disbursement.
    The Committee is concerned that inadequate information on 
the originator of wire transfers from a number of foreign 
jurisdictions makes it difficult for both law enforcement and 
financial institutions to properly understand the source of 
funds entering the United States in wire transfers. Such a lack 
of clarity could aid money launderers or terrorists in moving 
their funds into the United States financial system. 
Additionally, while arguments have been made that there are 
technical impediments to requiring that complete addressee 
information appear on all wire transfers terminating in or 
passing through the United States, the Committee believes that 
having such information is technically feasible and would aid 
both financial institutions in performing due diligence and law 
enforcement in tracking or seizing money that is the derivative 
of or would be used in the commission of a crime.

Section 210. Check Truncation Study

    This section directs the Secretary of the Treasury, in 
consultation with the Attorney General and the Federal Reserve 
Board of Governors, to study the impact on crime prevention, 
law enforcement, and the administration of consumer protection 
laws of check electronification, through truncation or 
migration from paper checks.

          TITLE III--COMBATING INTERNATIONAL MONEY LAUNDERING

Section 301. Special Measures for Jurisdictions, Financial 
        Institutions, or International Transactions of Primary Money 
        Laundering Concern

    Section 301 adds a new section 5318A to the Bank Secrecy 
Act, authorizing the Secretary of the Treasury to require 
domestic financial institutions and agencies to take one or 
more of five ``special measures'' if the Secretary finds that 
reasonable grounds exist to conclude that a foreign 
jurisdiction, a financial institution operating outside the 
United States, a class of international transactions, or one or 
more types of accounts is a ``primary money laundering 
concern.'' Prior to invoking any of the special measures 
contained in section 5318A(b), the Secretary is required to 
consult with the Chairman of the Board of Governors of the 
Federal Reserve System, any other appropriate Federal banking 
agency, the Securities and Exchange Commission, the National 
Credit Union Administration Board, and, in the sole discretion 
of the Secretary, such other agencies and interested parties as 
the Secretary may find to be appropriate. Among other things, 
this consultation is designed to ensure that the Secretary 
possesses information on the effect that any particular special 
measure may have on the domestic and international banking 
system. In addition, the Committee encourages the Secretary to 
consult with non-governmental ``interested parties,'' 
including, for example, the Bank Secrecy Act Advisory Group, to 
obtain input from those who may be subject to a regulation or 
order under this section.
    Prior to invoking any of the special measures contained in 
section 5318A, the Secretary must consider three discrete 
factors, namely (1) whether other countries or multilateral 
groups have taken similar action; (2) whether the imposition of 
the measure would create a significant competitive 
disadvantage, including any significant cost or burden 
associated with compliance, for firms organized or licensed in 
the United States; and (3) the extent to which the action would 
have an adverse systemic impact on the payment system or 
legitimate business transactions.
    Finally, subsection (a) makes clear that this new authority 
is not to be construed as superseding or restricting any other 
authority of the Secretary or any other agency.
    Subsection (b) of the new section 5318A outlines the five 
``special measures'' the Secretary may invoke against a foreign 
jurisdiction, financial institution operating outside the U.S., 
class of transaction within, or involving, a jurisdiction 
outside the U.S., or one or more types of accounts, that he 
finds to be of primary money laundering concern.
    The first such measure would require domestic financial 
institutions \2\ to maintain records and/or file reports on 
certain transactions involving the primary money laundering 
concern, to include any information the Secretary requires, 
such as the identity and address of participants in a 
transaction, the legal capacity in which the participant is 
acting, the beneficial ownership of the funds (in accordance 
with steps that the Secretary determines to be reasonable and 
practicable to obtain such information), and a description of 
the transaction. The records and/or reports authorized by this 
section must involve transactions from a foreign jurisdiction, 
a financial institution operating outside the United States, or 
class of international transactions within, or involving, a 
foreign jurisdiction, and are not to include transactions that 
both originate and terminate in, and only involve, domestic 
financial institutions.
---------------------------------------------------------------------------
    \2\ The term ``domestic financial institution'' means a financial 
institution, wherever organized, that operates in the United States, 
but only to the extent of its U.S. operations. See 31 U.S.C. 
Sec. 5312(b)(2).
---------------------------------------------------------------------------
    The second special measure would require domestic financial 
institutions to take such steps as the Secretary determines to 
be reasonable and practicable to ascertain beneficial ownership 
of accounts opened or maintained in the U.S. by a foreign 
person (excluding publicly traded foreign corporations) 
associated with what has been determined to be a primary money 
laundering concern.
    The third special measure the Secretary could impose in the 
case of a primary money laundering concern would require 
domestic financial institutions, as a condition of opening or 
maintaining a ``payable-through account'' for a foreign 
financial institution, to identify each customer (and 
representative of the customer) who is permitted to use or 
whose transactions flow through such an account, and to obtain 
for each customer (and representative) information that is 
substantially comparable to the information it would obtain 
with respect to its own customers. A ``payable-through 
account'' is defined for purposes of thelegislation as an 
account, including a transaction account (as defined in section 
19(b)(1)(C) of the Federal Reserve Act), opened at a depository 
institution by a foreign financial institution by means of which the 
foreign financial institution permits its customers to engage, either 
directly or through a sub-account, in banking activities usual in 
connection with the business of banking in the United States.
    The fourth special measure the Secretary could impose in 
the case of a primary money laundering concern would require 
domestic financial institutions, as a condition of opening or 
maintaining a ``correspondent'' account for a foreign financial 
institution, to identify each customer (and representative of 
the customer) who is permitted to use or whose transactions 
flow through such an account, and to obtain for each customer 
(and representative) information that is substantially 
comparable to the information that it would obtain with respect 
to its own customers. With respect to a bank, the term 
``correspondent account'' means an account established to 
receive deposits from and make payments on behalf of a foreign 
financial institution.
    The fifth measure the Secretary could impose in the case of 
a primary money laundering concern would prohibit or impose 
conditions (beyond those already provided for in the third and 
fourth measures) on domestic financial institutions' 
correspondent or payable-through accounts with foreign banking 
institutions. In addition to the required consultation with the 
Chairman of the Board of Governors of the Federal Reserve, 
prior to imposing this measure the Secretary is also directed 
to consult with the Secretary of State and the Attorney 
General.
    The five special measures authorized by this section may be 
imposed in any sequence or combination as the Secretary 
determines. The first four special measures may be imposed by 
regulation, order, or otherwise as permitted by law. However, 
if the Secretary proceeds by issuing an order, the order must 
be accompanied by a notice of proposed rulemaking relating to 
the imposition of the special measure, and may not remain in 
effect for more than 120 days, except pursuant to a regulation 
prescribed on or before the end of the 120-day period. The 
fifth special measure may be imposed only by regulation.
    Section 5318A(c) guides the Secretary's determination 
whether reasonable grounds exist to conclude that a 
jurisdiction, financial institution class of international 
transactions or type of account is of ``primary money 
laundering concern.'' In determining whether reasonable grounds 
exist for reaching this conclusion regarding a particular 
jurisdiction, the Secretary is to consider relevant 
information, including: (1) evidence that organized criminal 
groups, international terrorists, or both, have transacted 
business in that jurisdiction; (2) the extent to which the 
jurisdiction or financial institutions operating in the 
jurisdiction offer bank secrecy or other regulatory advantages 
to nonresidents; (3) the quality of the jurisdiction's bank 
supervision and anti-money laundering laws; (4) the volume of 
financial transactions occurring in the jurisdiction relative 
to its economic size; (5) whether credible international 
entities characterize the jurisdiction as a bank secrecy haven; 
(6) whether the United States has a mutual legal assistance 
treaty with the jurisdiction and what the U.S. experience in 
obtaining information from the jurisdiction has been; and (7) 
the extent to which the jurisdiction is characterized by high 
levels of official or institutional corruption.
    In deciding whether reasonable grounds exist to conclude 
that an institution, a class of transactions, or a type of 
account represent a primary money laundering concern, the 
Secretary is to consider: (1) the extent to which the 
institution, transaction, or account facilitates money 
laundering; (2) the extent to which the institution, 
transaction, or account is used for legitimate business; and 
(3) the extent to which the Secretary's finding will be 
effective in guarding against money laundering.
    To ensure that the Secretary is apprised of the pertinent 
diplomatic and law enforcement implications of determinations 
made pursuant to this section, subsection (c)(1) requires the 
Secretary to consult with the Secretary of State and the 
Attorney General. The Committee expects that the Secretary will 
not routinely determine that reasonable grounds exist to 
conclude that a jurisdiction, financial institution, class of 
international transactions, or type of account is of primary 
money laundering concern, but instead will exercise this 
authority only to combat identified and significant money 
laundering threats.
    Subsection (d) requires the Secretary to notify, in 
writing, the relevant Committees in the House and Senate within 
10 days of taking a special measure to address a primary money 
laundering concern.
    Subsection (e) defines the terms ``account,'' 
``correspondent account,'' and ``payable-through account'' for 
banks, and requires the Secretary, in consultation with the 
appropriate Federal functional regulators, to define these 
terms for application to non-bank financial institutions.
    Subsection (e) also requires the Secretary of the Treasury 
to promulgate regulations defining beneficial ownership of an 
account for purposes of subchapter II of title 31. The 
regulations are required to address issues related to an 
individual's authority to fund, direct or manage the account 
(including the power to direct payments into or out of the 
account), and an individual's material interest in the incomeor 
corpus of the account, and must ensure that the identification of 
individuals under this section does not extend to any individual whose 
beneficial interest in the income or corpus of the account is 
immaterial.
    Section 301 also amends the definition of ``financial 
institution'' in 31 U.S.C. Sec. 5312 to include credit unions, 
futures commission merchants, commodity trading advisors, and 
commodity pool operators registered, or required to register, 
under the Commodity Exchange Act. The section also clarifies 
that for purposes of this Act and any amendment made by this 
Act to any other provision of law, the term ``Federal 
functional regulator'' includes the Commodity Futures Trading 
Commission.

Section 302. Special Due Diligence for Correspondent Accounts and 
        Private Banking Accounts

    Section 302 amends 31 U.S.C. Sec. 5318 to require financial 
institutions that establish, maintain, administer, or manage 
private banking or correspondent accounts for non-U.S. persons 
to establish appropriate, specific, and, where necessary, 
enhanced due diligence policies, procedures, and controls to 
detect and report instances of money laundering through those 
accounts.
    The section requires financial institutions to apply 
enhanced due diligence procedures when opening or maintaining a 
correspondent account for a foreign bank operating (1) under a 
license to conduct banking activities which, as a condition of 
the license, prohibits the licensed entity from conducting 
banking activities with the citizens of, or with the local 
currency of, the country which issued the license; or (2) under 
a license issued by a foreign country that has been designated 
(a) as non-cooperative with international anti-money laundering 
principles by an intergovernmental group or organization of 
which the United States is a member, with which designation the 
Secretary of the Treasury concurs, or (b) by the Secretary as 
warranting special measures due to money laundering concerns.
    The enhanced due diligence procedures include (1) 
ascertaining the identity of each of the owners of the foreign 
bank (except for banks that are publicly traded); (2) 
conducting enhanced scrutiny of the correspondent account to 
guard against money laundering and report any suspicious 
activity; and (3) ascertaining whether the foreign bank 
provides correspondent accounts to other foreign banks and, if 
so, the identity of those foreign banks and related due 
diligence information.
    For private banking accounts requested or maintained by a 
non-United States person, a financial institution is required 
to implement procedures for (1) ascertaining the identity of 
the nominal and beneficial owners of, and the source of funds 
deposited into, the account as needed to guard against money 
laundering and report suspicious activity; and (2) conducting 
enhanced scrutiny of any such account requested or maintained 
by, or on behalf of, a senior foreign political figure, or his 
immediate family members or close associates, to prevent, 
detect and report transactions that may involve the proceeds of 
foreign corruption. A private bank account is defined as an 
account (or any combination of accounts) that requires a 
minimum aggregate deposit of funds or other assets of not less 
than $1 million; is established on behalf of one or more 
individuals who have a direct or beneficial ownership in the 
account; and is assigned to, or administered or managed by, an 
officer, employee or agent of a financial institution acting as 
a liaison between the institution and the direct or beneficial 
owner of the account.
    This section directs the Secretary of the Treasury, within 
6 months of enactment of this bill and in consultation with 
appropriate Federal functional regulators, to further define 
and clarify, by regulation, the requirements imposed by this 
section.

Section 303. Prohibition on United States Correspondent Accounts with 
        Foreign Shell Banks

    This section bars U.S. depository institutions from 
providing correspondent banking services to foreign shell banks 
that have no physical presence in any country. It also requires 
depository institutions to take reasonable steps to ensure that 
any correspondent account established, maintained, administered 
or managed for a foreign bank is not being used to indirectly 
provide banking services to another foreign bank that does not 
have a physical presence in any country. This section does not 
prevent a U.S. bank from opening a correspondent account for a 
foreign bank that is (1) affiliated with a depository 
institution, credit union, or other foreign bank that maintains 
a physical presence in the U.S. or a foreign country, and (2) 
is subject to supervision by a banking authority in the country 
regulating the affiliated entity.
    The Secretary of the Treasury is directed to prescribe 
regulations delineating reasonable steps necessary for a 
depository institution to comply with this section.

Section 304. Anti-Money Laundering Programs

    This section directs financial institutions to establish 
anti-money laundering programs, including the development of 
internal policies, procedures, and controls; the designation of 
an officer of the financialinstitution responsible for 
compliance; an ongoing employee training program; and an independent 
audit function to test programs.
    The Secretary of the Treasury is required to prescribe 
regulations implementing this section within 180 days of 
enactment of this Act, taking into consideration the extent to 
which the requirements imposed by such regulations are 
commensurate with the size, location and activities of the 
financial institutions to which such regulations apply. The 
Committee believes that the regulations to be issued by the 
Secretary under this section, and those issued by banking and 
thrift regulators as well under other authority, could 
contribute to the detection and prevention of money laundering 
crimes by reconciling rules that could be interpreted in a way 
that places conflicting burdens on financial institutions.

Section 305. Concentration Accounts at Financial Institutions

    This section gives the Secretary of the Treasury 
discretionary authority to prescribe regulations governing the 
maintenance of concentration accounts by financial 
institutions, to ensure that these accounts are not used to 
prevent association of the identity of an individual customer 
with the movement of funds of which the customer is the direct 
or beneficial owner. If promulgated, the regulations are 
required to prohibit financial institutions from allowing 
clients to direct transactions into, out of, or through the 
concentration accounts of the institution; prohibit financial 
institutions and their employees from informing customers of 
the existence of, or means of identifying, the concentration 
accounts of the institution; and to establish written 
procedures governing the documentation of all transactions 
involving a concentration account.

Section 306. International Cooperation in Investigations of Money 
        Laundering, Financial Crimes, and the Finances of Terrorist 
        Groups

    This section directs the Secretary of the Treasury, in 
consultation with the Attorney General, the Secretary of State, 
and the Board of Governors of the Federal Reserve, to enter 
into negotiations with the appropriate financial supervisory 
agencies and other officials of any foreign country whose 
financial institutions do business with United States financial 
institutions or which may be utilized by any foreign terrorist 
organization, any person who is a member or representative of 
any such organization, or any person engaged in money 
laundering or financial or other crimes. The purpose of the 
negotiations is to further cooperative efforts to (1) ensure 
that foreign banks and other financial institutions maintain 
adequate records of large United States currency transactions, 
and transaction and account information relating to any foreign 
terrorist organization or member or representative thereof, or 
any person engaged in money laundering or financial or other 
crimes; and (2) establish a mechanism for making such records 
available to United States law enforcement officials and 
domestic financial institution supervisors, where appropriate.
    The Secretary of the Treasury is required to submit an 
interim report to Congress on progress in the negotiations 
outlined above within one year of the date of enactment of this 
Act, and a final report on the outcome of the negotiations to 
the President and the Congress within two years. In the final 
report, the Secretary is directed to identify countries whose 
financial institutions are being utilized by any foreign 
terrorist organization or representative or member thereof, or 
any person engaged in money laundering or financial or other 
crimes, and which have not reached agreement with the United 
States on the maintenance and exchange of information relating 
to such activities.
    If the President determines that a country identified in 
the report is not negotiating in good faith with the United 
States to reach agreement on matters identified in this 
section, or that a financial institution in such country has 
not complied with a United States request for information 
regarding a foreign terrorist organization or a person engaged 
in money laundering for any such organization, the President 
may impose appropriate penalties on such country. The penalties 
imposed by the President may include prohibiting persons, 
institutions, or other entities in the relevant foreign country 
from (1) participating in any United States dollar clearing or 
wire transfer system; and (2) maintaining an account with any 
bank or other financial institution chartered under United 
States law.

Section 307. Prohibition on Acceptance of Any Bank Instrument for 
        Unlawful Internet Gambling

    This section prohibits a gambling business from accepting 
bank instruments in connection with unlawful Internet gambling. 
Covered instruments include credit cards, electronic fund 
transfers, and checks. A financial intermediary would not be 
held responsible under this section unless it was involved in 
the actual operation of an illegal Internet gambling site. The 
legislation covers only unlawful Internet gambling, and would 
not apply to future lawful Internet gambling should a State 
decide to authorize it, as Nevada did this year in passing 
legislation to authorize in-State Internet gambling, provided 
such operations do not violate Federal law.
    Subsection (b) defines the term ``bets or wagers'' as the 
staking or risking by any person of something of value upon the 
outcome of acontest of others, a sporting event, or a game 
predominantly subject to chance with the agreement that the winner will 
receive something of greater value than the amount staked or risked. 
This subsection clarifies that ``bets or wagers'' does not include a 
bona fide business transaction governed by the securities laws; a 
transaction subject to the Commodity Exchange Act; an over-the-counter 
derivative instrument; a contract of indemnity or guarantee; a contract 
for life, health, or accident insurance; a deposit with a depository 
institution; or certain participation in a simulation sports game or 
education game. The subsection also clarifies that ``business of 
betting or wagering'' does not generally include any financial 
intermediary (creditor, credit card issuer, insured depository 
institution, transmitter of an electric fund transfer, money 
transmitting business, or network used to effect a credit transaction, 
electronic fund transfer, stored value product transaction, or money 
transmitting service, or any participant in such network). Subsection 
(b) also defines the terms ``Internet'' and ``unlawful Internet 
gambling.''
    Subsection (c) authorizes civil remedies, including a 
preliminary injunction, or injunction against any person other 
than an Internet service provider (unless that Internet service 
provider is acting in concert or participation with a person 
violating this section and receives actual knowledge of the 
order) to prevent or restrain a violation of this section, 
including expedited proceedings in exigent circumstances. The 
subsection authorizes such proceedings to be brought by the 
U.S. Attorney General, or the attorney general of a State or 
other appropriate State official. The subsection clarifies that 
this section should not be construed as altering, superseding, 
or otherwise affecting the application of the Indian Gaming 
Regulatory Act. The subsection requires that, before any 
proceeding under this subsection is initiated against an 
insured depository institution, notification must be made to 
the appropriate Federal banking agency and such agency must be 
allowed a reasonable time to issue the appropriate regulatory 
order.
    Subsection (d) authorizes criminal penalties for violation 
of 307(a), including fines or imprisonment for not more than 
five years, or both. The subsection also authorizes a permanent 
injunction against a person convicted under this subsection, 
enjoining such person from placing, receiving, or otherwise 
making bets or wagers or sending, receiving, or inviting 
information assisting in the placing of bets or wagers.
    Subsection (e) provides that the safe harbor provided to a 
financial intermediary (creditor, credit card issuer, financial 
institution, operator of a terminal at which an electronic fund 
transfer may be initiated, money transmitting business, or 
national, regional, or local network) under subsection (b)(2) 
does not apply to a financial intermediary that operates, 
manages, supervises, or directs an Internet website at which 
unlawful bets or wagers are or may be placed, received, or 
otherwise made; or is owned or controlled by any person who 
operates, manages, supervises, or directs such an Internet 
website.
    Subsection (f) allows the appropriate Federal banking 
agency to prohibit an insured depository institution from 
extending credit, or facilitating an extension of credit, 
electronic fund transfer, or money transmitting service, or 
from paying, transferring, or collecting on any check, draft, 
or other instrument drawn on any depository institution, where 
the institution has actual knowledge that a person is violating 
this section in connection with such activities. This 
subsection, in conjunction with subsections (b)(2) and (e), is 
intended to ensure that a financial intermediary is not held 
liable for a violation of this section solely based on the 
unknowing and unintentional involvement of the intermediary 
through the use of the facilities of such intermediary in an 
unlawful Internet gambling transaction, unless the intermediary 
acted as an agent of a gambling business and had: (1) actual 
knowledge that the specific transaction is an unlawful Internet 
gambling transaction; and (2) the intent to engage in the 
business of submitting into the payment system Internet 
gambling transactions prohibited by this section.

Section 308. Internet Gambling In or Through Foreign Jurisdictions

    This section provides that, in deliberations between the 
U.S. Government and any other country on money laundering, 
corruption, and crime issues, the U.S. Government should 
encourage cooperation by foreign governments in identifying 
whether Internet gambling operations are being used for money 
laundering, corruption, or other crimes, advance policies that 
promote the cooperation by foreign governments in the 
enforcement of this Act, and encourage the Financial Action 
Task Force on Money Laundering to study the extent to which 
Internet gambling operations are being used for money 
laundering.

                     TITLE IV--CURRENCY PROTECTION

Section 401. Counterfeiting Domestic Currency and Obligations

    This section makes it a criminal offense to possess an 
electronic image of an obligation or security document of the 
United States with intent to defraud. The provision harmonizes 
counterfeiting language to clarify that possessing either 
analog or digital copies with intent to defraud constitutes an 
offense. This section mimics existing language that makes it a 
felony to possess the plates from which currency can be 
printed, and takes into account the fact that most counterfeit 
currency seized today is generated by computers or computer-
based equipment. The section also increases maximum sentences 
for a series of counterfeiting offenses.

Section 402. Counterfeiting Foreign Currency and Obligations

    This section conforms the legal prohibition on 
counterfeiting foreign security documents or obligations within 
the U.S. to that of counterfeiting U.S. security documents or 
obligations, and raises penalties to parity with those 
established in section 401.

Section 403. Production of Documents

    This section allows the Secretary of the Treasury to 
authorize production of currency, stamps or other security 
documents for foreign countries if such work does not interfere 
with the production of such documents for the U.S. and if the 
Secretary of State has concurred in the production.

Section 404. Reimbursement

    This section provides that the Treasury be fully reimbursed 
for the printing authorized in section 403, including all real, 
administrative and other costs, by the foreign nation for which 
production services are performed.

         Changes in Existing Law Made by the Bill, as Reported

  In compliance with clause 3(e) of rule XIII of the Rules of 
the House of Representatives, changes in existing law made by 
the bill, as reported, are shown as follows (existing law 
proposed to be omitted is enclosed in black brackets, new 
matter is printed in italic, existing law in which no change is 
proposed is shown in roman):

TITLE 31, UNITED STATES CODE

           *       *       *       *       *       *       *

                 CHAPTER 3--DEPARTMENT OF THE TREASURY

     * * * * * * *

                       SUBCHAPTER I--ORGANIZATION

Sec.
301.  Department of the Treasury.
     * * * * * * *
310.  Financial Crimes Enforcement Network
[310.] 311.  Continuing in office.

           *       *       *       *       *       *       *

SUBCHAPTER I--ORGANIZATION

           *       *       *       *       *       *       *

Sec. 310. Financial Crimes Enforcement Network

  (a) In General.--The Financial Crimes Enforcement Network 
established by order of the Secretary of the Treasury (Treasury 
Order Numbered 105-08) on April 25, 1990, shall be a bureau in 
the Department of the Treasury.
  (b) Director.--
          (1) Appointment.--The head of the Financial Crimes 
        Enforcement Network shall be the Director who shall be 
        appointed by the President, by and with the consent of 
        the Senate, to a term of 4 years.
          (2) Duties and powers.--The duties and powers of the 
        Director are as follows:
                  (A) Advise and make recommendations on 
                matters relating to financial intelligence, 
                financial criminal activities, and other 
                financial activities to the Under Secretary for 
                Enforcement.
                  (B) Maintain a government-wide data access 
                service, with access, in accordance with 
                applicable legal requirements, to the 
                following:
                          (i) Information collected by the 
                        Department of the Treasury, including 
                        report information filed under 
                        subchapters II and III of chapter 53 of 
                        this title (such as reports on cash 
                        transactions, foreign financial agency 
                        transactions and relationships, foreign 
                        currency transactions, exporting and 
                        importing monetary instruments, and 
                        suspicious activities), chapter 2 of 
                        Public Law 91-508, section 21 of the 
                        Federal Deposit Insurance Act and 
                        section 6050I of the Internal Revenue 
                        Code of 1986.
                          (ii) Information regarding national 
                        and international currency flows.
                          (iii) Other records and data 
                        maintained by other Federal, State, 
                        local, and foreign agencies, including 
                        financial and other records developed 
                        in specific cases.
                          (iv) Other privately and publicly 
                        available information.
                  (C) Analyze and disseminate the available 
                data in accordance with applicable legal 
                requirements and policies and guidelines 
                established by the Secretary of the Treasury 
                and the Under Secretary for Enforcement to--
                          (i) identify possible criminal 
                        activity to appropriate Federal, State, 
                        local, and foreign law enforcement 
                        agencies;
                          (ii) support ongoing criminal 
                        financial investigations and 
                        prosecutions and related proceedings, 
                        including civil and criminal tax and 
                        forfeiture proceedings;
                          (iii) identify possible instances of 
                        noncompliance with subchapters II and 
                        III of chapter 53 of this title, 
                        chapter 2 of Public Law 91-508, and 
                        section 21 of the Federal Deposit 
                        Insurance Act to Federal agencies with 
                        statutory responsibility for enforcing 
                        compliance with such provisions and 
                        other appropriate Federal regulatory 
                        agencies;
                          (iv) evaluate and recommend possible 
                        uses of special currency reporting 
                        requirements under section 5326; and
                          (v) determine emerging trends and 
                        methods in money laundering and other 
                        financial crimes.
                  (D) Establish and maintain a financial crimes 
                communications center to furnish law 
                enforcement authorities with intelligence 
                information related to emerging or ongoing 
                investigations and undercover operations.
                  (E) Furnish research, analytical, and 
                informational services to financial 
                institutions, appropriate Federal regulatory 
                agencies with regard to financial institutions, 
                and appropriate Federal, State, local, and 
                foreign law enforcement authorities, in 
                accordance with policies and guidelines 
                established by the Secretary of the Treasury or 
                the Under Secretary of the Treasury for 
                Enforcement, in the interest of detection, 
                prevention, and prosecution of terrorism, 
                organized crime, money laundering, and other 
                financial crimes.
                  (F) Establish and maintain a special unit 
                dedicated to combatting the use of informal, 
                nonbank networks and payment and barter system 
                mechanisms that permit the transfer of funds or 
                the equivalent of funds without records and 
                without compliance with criminal and tax laws.
                  (G) Provide computer and data support and 
                data analysis to the Secretary of the Treasury 
                for tracking and controlling foreign assets.
                  (H) Coordinate with financial intelligence 
                units in other countries on anti-terrorism and 
                anti-money laundering initiatives, and similar 
                efforts.
                  (I) Administer the requirements of 
                subchapters II and III of chapter 53 of this 
                title, chapter 2 of Public Law 91-508, and 
                section 21 of the Federal Deposit Insurance 
                Act, to the extent delegated such authority by 
                the Secretary of the Treasury.
                  (J) Such other duties and powers as the 
                Secretary of the Treasury may delegate or 
                prescribe.
  (c) Requirements Relating to Maintenance and Use of Data 
Banks.--The Secretary of the Treasury shall establish and 
maintain operating procedures with respect to the government-
wide data access service and the financial crimes 
communications center maintained by the Financial Crimes 
Enforcement Network which provide--
          (1) for the coordinated and efficient transmittal of 
        information to, entry of information into, and 
        withdrawal of information from, the data maintenance 
        system maintained by the Network, including--
                  (A) the submission of reports through the 
                Internet or other secure network, whenever 
                possible;
                  (B) the cataloguing of information in a 
                manner that facilitates rapid retrieval by law 
                enforcement personnel of meaningful data; and
                  (C) a procedure that provides for a prompt 
                initial review of suspicious activity reports 
                and other reports, or such other means as the 
                Secretary may provide, to identify information 
                that warrants immediate action; and
          (2) in accordance with section 552a of title 5 and 
        the Right to Financial Privacy Act of 1978, appropriate 
        standards and guidelines for determining--
                  (A) who is to be given access to the 
                information maintained by the Network;
                  (B) what limits are to be imposed on the use 
                of such information; and
                  (C) how information about activities or 
                relationships which involve or are closely 
                associated with the exercise of constitutional 
                rights is to be screened out of the data 
                maintenance system.
  (d) Authorization of Appropriations.--There are authorized to 
be appropriated for the Financial Crimes Enforcement Network 
such sums as may be necessary for fiscal years 2002, 2003, 
2004, and 2005.

Sec. [310] 311. Continuing in office

  When the term of office of an officer of the Department of 
the Treasury ends, the officer may continue to serve until a 
successor is appointed and qualified.

           *       *       *       *       *       *       *

SUBTITLE IV--MONEY

           *       *       *       *       *       *       *

CHAPTER 51--COINS AND CURRENCY

           *       *       *       *       *       *       *

SUBCHAPTER II--GENERAL AUTHORITY

           *       *       *       *       *       *       *

Sec. 5114. Engraving and printing currency and security documents

  [(a) The Secretary of the Treasury]
  (a) Authority To Engrave and Print.--
          (1) In general.--The Secretary of the Treasury shall 
        engrave and print United States currency and bonds of 
        the United States Government and currency and bonds of 
        United States territories and possessions from intaglio 
        plates on plate printing presses the Secretary selects. 
        However, other security documents and checks may be 
        printed by any process the Secretary selects. Engraving 
        and printing shall be carried out within the Department 
        of the Treasury if the Secretary decides the engraving 
        and printing can be carried out as cheaply, perfectly, 
        and safely as outside the Department.
          (2) Engraving and printing for other governments.--
        The Secretary of the Treasury may, if the Secretary 
        determines that it will not interfere with engraving 
        and printing needs of the United States, produce 
        currency, postage stamps, and other security documents 
        for foreign governments, subject to a determination by 
        the Secretary of State that such production would be 
        consistent with the foreign policy of the United 
        States.

           *       *       *       *       *       *       *

SUBCHAPTER IV--BUREAU OF ENGRAVING AND PRINTING

           *       *       *       *       *       *       *

Sec. 5143. Payment for services

  The Secretary of the Treasury shall impose charges for Bureau 
of Engraving and Printing services the Secretary provides to an 
agency, any foreign government, or any territory of the United 
States. The charges shall be in amounts the Secretary considers 
adequate to cover the costs of the services (including 
administrative and other costs related to providing the 
services). The agency, foreign government, or territory of the 
United States shall pay promptly bills submitted by the 
Secretary.

           *       *       *       *       *       *       *

CHAPTER 53--MONETARY TRANSACTIONS

           *       *       *       *       *       *       *

SUBCHAPTER II--RECORDS AND REPORTS ON MONETARY INSTRUMENTS TRANSACTIONS

5311.  Declaration of purpose.
     * * * * * * *
5318A. Special measures for jurisdictions, financial institutions, or 
          international transactions of primary money laundering 
          concern.

           *       *       *       *       *       *       *

5331. Bulk cash smuggling into or out of the United States.
5332. Subpoenas for records.

           *       *       *       *       *       *       *

Sec. 5311. Declaration of purpose.

  It is the purpose of this subchapter (except section 5315) to 
require certain reports or records where they have a high 
degree of usefulness in criminal, tax, or regulatory 
investigations or proceedings, or in the conduct of 
intelligence or counterintelligence activities, including 
analysis, to protect against international terrorism.

Sec. 5312. Definitions and application

  (a) In this subchapter--
          (1) * * *
          (2) ``financial institution'' means--
                  (A) * * *

           *       *       *       *       *       *       *

                  [(E) an insured institution (as defined in 
                section 401(a) of the National Housing Act (12 
                U.S.C. 1724(a)));]
                  (E) any credit union;

           *       *       *       *       *       *       *

                  [(R) a licensed sender of money;]
                  (R) a licensed sender of money or any other 
                person who engages as a business in the 
                transmission of funds, including through an 
                informal value transfer banking system or 
                network of people facilitating the transfer of 
                value domestically or internationally outside 
                of the conventional financial institutions 
                system;

           *       *       *       *       *       *       *

  (c) Additional Definitions.--For purposes of this subchapter, 
the following definitions shall apply:
          (1) Certain institutions included in definition.--The 
        term ``financial institution'' (as defined in 
        subsection (a)) includes the following:
                  (A) Any futures commission merchant, 
                commodity trading advisor, or commodity pool 
                operator registered, or required to register, 
                under the Commodity Exchange Act.

           *       *       *       *       *       *       *

Sec. 5317. Search and forfeiture of monetary instruments

  (a) * * *
  [(b) Searches at Border.--For purposes of ensuring compliance 
with the requirements of section 5316, a customs officer may 
stop and search, at the border and without a search warrant, 
any vehicle, vessel, aircraft, or other conveyance, any 
envelope or other container, and any person entering or 
departing from the United States.
  [(c) If a report required under section 5316 with respect to 
any monetary instrument is not filed (or if filed, contains a 
material omission or misstatement of fact), the instrument and 
any interest in property, including a deposit in a financial 
institution, traceable to such instrument may be seized and 
forfeited to the United States Government. Any property, real 
or personal, involved in a transaction or attempted transaction 
in violation of section 5324(b), or any property traceable to 
such property, may be seized and forfeited to the United States 
Government. A monetary instrument transported by mail or a 
common carrier, messenger, or bailee is being transported under 
this subsection from the time the instrument is delivered to 
the United States Postal Service, common carrier, messenger, or 
bailee through the time it is delivered to the addressee, 
intended recipient, or agent of the addressee or intended 
recipient without being transported further in, or taken out 
of, the United States.]
  (b) Searches at Border.--
          (1) In general.--For purposes of ensuring compliance 
        with the laws enforced by the United States Customs 
        Service, a customs officer may stop and search, at the 
        border and without a search warrant, any vehicle, 
        vessel, aircraft, or other conveyance, any envelope or 
        other container, and any person entering, transiting, 
        or departing from the United States.
          (2) International shipments of mail.--With respect to 
        shipments of international mail that are exported or 
        imported by the United States Postal Service, the 
        Customs Service and other appropriate Federal agencies 
        shall, subject to paragraph (3), apply the customs laws 
        of the United States and all other laws relating to the 
        importation or exportation of such shipments in the 
        same manner to both shipments by the United States 
        Postal Service and similar shipments by private 
        companies.
          (3) Safeguards.--No provision of this subsection 
        shall be construed as authorizing any customs officer 
        or any other person to read any correspondence unless--
                  (A) a search warrant has been issued pursuant 
                to Rule 41 of the Federal Rules of Criminal 
                Procedure which permits such correspondence to 
                be read; or
                  (B) the sender or addressee of the 
                correspondence has given written consent for 
                any such action.
  (c) Forfeiture.--
          (1) In general.--The court in imposing sentence for 
        any violation of section 5313, 5316, or 5324 of this 
        title, or section 6050I of the Internal Revenue Code of 
        1986, or any conspiracy to commit such violation, shall 
        order the defendant to forfeit all property, real or 
        personal, involved in the offense and any property 
        traceable thereto.
          (2) Procedure.--Forfeitures under this subsection 
        shall be governed by the procedures established in 
        section 413 of the Controlled Substances Act and the 
        guidelines established in paragraph (4).
          (3) Civil forfeiture.--Any property involved in a 
        violation of section 5313, 5316, or 5324 of this title, 
        or section 6050I of the Internal Revenue Code of 1986, 
        or any conspiracy to commit any such violation, and any 
        property traceable to any such violation or conspiracy, 
        may be seized and, subject to paragraph (4), forfeited 
        to the United States in accordance with the procedures 
        governing civil forfeitures in money laundering cases 
        pursuant to section 981(a)(1)(A) of title 18, United 
        States Code.
          (4) Proportionality of forfeiture.--
                  (A) In general.--Upon a showing by the 
                property owner by a preponderance of the 
                evidence that any currency or monetary 
                instruments involved in the offense giving rise 
                to the forfeiture were derived from a 
                legitimate source, and were intended for a 
                lawful purpose, the court shall reduce the 
                forfeiture to the maximum amount that is not 
                grossly disproportional to the gravity of the 
                offense.
                  (B) Factors to be considered.--In determining 
                the amount of the forfeiture, the court shall 
                consider all aggravating and mitigating facts 
                and circumstances that have a bearing on the 
                gravity of the offense, including the 
                following:
                          (i) The value of the currency or 
                        other monetary instruments involved in 
                        the offense.
                          (ii) Efforts by the person committing 
                        the offense to structure currency 
                        transactions, conceal property, or 
                        otherwise obstruct justice.
                          (iii) Whether the offense is part of 
                        a pattern of repeated violations of 
                        Federal law.

Sec. 5318. Compliance, exemptions, and summons authority

  (a) * * *

           *       *       *       *       *       *       *

  (g) Reporting of Suspicious Transactions.--
          (1) * * *
          [(2) Notification prohibited.--A financial 
        institution, and a director, officer, employee, or 
        agent of any financial institution, who voluntarily 
        reports a suspicious transaction, or that reports a 
        suspicious transaction pursuant to this section or any 
        other authority, may not notify any person involved in 
        the transaction that the transaction has been reported.
          [(3) Liability for disclosures.--Any financial 
        institution that makes a disclosure of any possible 
        violation of law or regulation or a disclosure pursuant 
        to this subsection or any other authority, and any 
        director, officer, employee, or agent of such 
        institution, shall not be liable to any person under 
        any law or regulation of the United States or any 
        constitution, law, or regulation of any State or 
        political subdivision thereof, for such disclosure or 
        for any failure to notify the person involved in the 
        transaction or any other person of such disclosure.]
          (2) Notification prohibited.--
                  (A) In general.--If a financial institution 
                or any director, officer, employee, or agent of 
                any financial institution, voluntarily or 
                pursuant to this section or any other 
                authority, reports a suspicious transaction to 
                a government agency--
                          (i) the financial institution, 
                        director, officer, employee, or agent 
                        may not notify any person involved in 
                        the transaction that the transaction 
                        has been reported; and
                          (ii) no officer or employee of the 
                        Federal Government or of any State, 
                        local, tribal, or territorial 
                        government within the United States, 
                        who has any knowledge that such report 
                        was made may disclose to any person 
                        involved in the transaction that the 
                        transaction has been reported other 
                        than as necessary to fulfill the 
                        official duties of such officer or 
                        employee.
                  (B) Disclosures in certain employment 
                references.--Notwithstanding the application of 
                subparagraph (A) in any other context, 
                subparagraph (A) shall not be construed as 
                prohibiting any financial institution, or any 
                director, officer, employee, or agent of such 
                institution, from including, in a written 
                employment reference that is provided in 
                accordance with section 18(v) of the Federal 
                Deposit Insurance Act in response to a request 
                from another financial institution or a written 
                termination notice or employment reference that 
                is provided in accordance with the rules of the 
                self-regulatory organizations registered with 
                the Securities and Exchange Commission, 
                information that was included in a report to 
                which subparagraph (A) applies, but such 
                written employment reference may not disclose 
                that such information was also included in any 
                such report or that such report was made.
          (3) Liability for disclosures.--
                  (A) In general.--Any financial institution 
                that makes a voluntary disclosure of any 
                possible violation of law or regulation to a 
                government agency or makes a disclosure 
                pursuant to this subsection or any other 
                authority, and any director, officer, employee, 
                or agent of such institution who makes, or 
                requires another to make any such disclosure, 
                shall not be liable to any person under any law 
                or regulation of the United States, any 
                constitution, law, or regulation of any State 
                or political subdivision of any State, or under 
                any contract or other legally enforceable 
                agreement (including any arbitration 
                agreement), for such disclosure or for any 
                failure to provide notice of such disclosure to 
                any person.
                  (B) Rule of construction.--Subparagraph (A) 
                shall not be construed as creating--
                          (i) any inference that the term 
                        ``person'', as used in such 
                        subparagraph, may be construed more 
                        broadly than its ordinary usage so to 
                        include any government or agency of 
                        government; or
                          (ii) any immunity against, or 
                        otherwise affecting, any civil or 
                        criminal action brought by any 
                        government or agency of government to 
                        enforce any constitution, law, or 
                        regulation of such government or 
                        agency.
          (4) Single designee for reporting suspicious
        transactions.--
                  (A) * * *
                  (B) Duty of designee.--The officer or agency 
                of the United States designated by the 
                Secretary of the Treasury pursuant to 
                subparagraph (A) shall refer any report of a 
                suspicious transaction to any appropriate law 
                enforcement [or supervisory agency], 
                supervisory agency, or United States 
                intelligence agency for use in the conduct of 
                intelligence or counterintelligence activities, 
                including analysis, to protect against 
                international terrorism.

           *       *       *       *       *       *       *

  [(h) Anti-Money Laundering Programs.--
          [(1) In general.--In order to guard against money 
        laundering through financial institutions, the 
        Secretary may require financial institutions to carry 
        out anti-money laundering programs, including at a 
        minimum
                  [(A) the development of internal policies, 
                procedures, and controls,
                  [(B) the designation of a compliance officer,
                  [(C) an ongoing employee training program, 
                and
                  [(D) an independent audit function to test 
                programs.
          [(2) Regulations.--The Secretary may prescribe 
        minimum standards for programs established under 
        paragraph (1).]
  (h) Anti-Money Laundering Programs.--
          (1) In general.--In order to guard against money 
        laundering through financial institutions, each 
        financial institution shall establish anti-money 
        laundering programs, including, at a minimum--
                  (A) the development of internal policies, 
                procedures, and controls;
                  (B) the designation of an officer of the 
                financial institution responsible for 
                compliance;
                  (C) an ongoing employee training program; and
                  (D) an independent audit function to test 
                programs.
          (2) Regulations.--The Secretary may, after 
        consultation with the appropriate Federal functional 
        regulators (as defined in section 509 of the Gramm-
        Leach-Bliley Act), prescribe minimum standards for 
        programs established under paragraph (1), and may 
        exempt from the application of those standards any 
        financial institution that is not subject to the 
        provisions of the regulations contained in part 103 of 
        title 31, of the Code of Federal Regulations, as in 
        effect on the date of the enactment of the Financial 
        Anti-Terrorism Act of 2001, or any successor to such 
        regulations, for so long as such financial institution 
        is not subject to the provisions of such regulations.
          (3) Concentration accounts.--The Secretary may 
        prescribe regulations under this subsection that govern 
        maintenance of concentration accounts by financial 
        institutions, in order to ensure that such accounts are 
        not used to prevent association of the identity of an 
        individual customer with the movement of funds of which 
        the customer is the direct or beneficial owner, which 
        regulations shall, at a minimum--
                  (A) prohibit financial institutions from 
                allowing clients to direct transactions that 
                move their funds into, out of, or through the 
                concentration accounts of the financial 
                institution;
                  (B) prohibit financial institutions and their 
                employees from informing customers of the 
                existence of, or the means of identifying, the 
                concentration accounts of the institution; and
                  (C) require each financial institution to 
                establish written procedures governing the 
                documentation of all transactions involving a 
                concentration account, which procedures shall 
                ensure that, any time a transaction involving a 
                concentration account commingles funds 
                belonging to 1 or more customers, the identity 
                of, and specific amount belonging to, each 
                customer is documented.
  (i) Identification and Verification of Accountholders.--
          (1) In general.--Subject to the requirements of this 
        subsection, the Secretary of the Treasury shall 
        prescribe regulations setting forth the minimum 
        standards regarding customer identification that shall 
        apply in connection with the opening of an account at a 
        financial institution.
          (2) Minimum requirements.--The regulations shall, at 
        a minimum, require financial institutions to implement 
        procedures for--
                  (A) verifying the identity of any person 
                seeking to open an account to the extent 
                reasonable and practicable;
                  (B) maintaining records of the information 
                used to verify a person's identity, including 
                name, address, and other identifying 
                information;
                  (C) consulting applicable lists of known or 
                suspected terrorists or terrorist organizations 
                generated by government agencies to determine 
                whether a person seeking to open an account 
                appears on any such list.
          (3) Factors to be considered.--In prescribing 
        regulations under this subsection, the Secretary shall 
        take into consideration the various types of accounts 
        maintained by various types of financial institutions, 
        the various methods of opening accounts, and the 
        various types of identifying information available.
          (4) Certain financial institutions.--In the case of 
        any financial institution the business of which is 
        engaging in financial activities described in section 
        4(k) of the Bank Holding Company Act of 1956 (including 
        financial activities subject to the jurisdiction of the 
        Commodity Futures Trading Commission), the regulations 
        prescribed by the Secretary under paragraph (1) shall 
        be prescribed jointly with each Federal functional 
        regulator (as defined in section 509 of the Gramm-
        Leach-Bliley Act, including the Commodity Futures 
        Trading Commission) appropriate for such financial 
        institution.
          (5) Exemptions.--The Secretary of the Treasury (and, 
        in the case of any financial institution described in 
        paragraph (4), any Federal agency described in such 
        paragraph) may, by regulation or order, exempt any 
        financial institution or type of account from the 
        requirements of any regulation prescribed under this 
        subsection in accordance with such standards and 
        procedures as the Secretary may prescribe.
          (6) Effective date.--Final regulations prescribed 
        under this subsection shall take effect before the end 
        of the 1-year period beginning on the date of the 
        enactment of the Financial Anti-Terrorism Act of 2001.
  (j) Due Diligence for United States Private Banking and 
Correspondent Bank Accounts Involving Foreign Persons.--
          (1) In general.--Each financial institution that 
        establishes, maintains, administers, or manages a 
        private banking account or a correspondent account in 
        the United States for a non-United States person, 
        including a foreign individual visiting the United 
        States, or a representative of a non-United States 
        person, shall establish appropriate, specific, and, 
        where necessary, enhanced due diligence policies, 
        procedures, and controls to detect and report instances 
        of money laundering through those accounts.
          (2) Minimum standards for correspondent accounts.--
                  (A) In general.--Subparagraph (B) shall apply 
                if a correspondent account is requested or 
                maintained by, or on behalf of, a foreign bank 
                operating--
                          (i) under an offshore banking 
                        license; or
                          (ii) under a banking license issued 
                        by a foreign country that has been 
                        designated--
                                  (I) as noncooperative with 
                                international anti-money 
                                laundering principles or 
                                procedures by an 
                                intergovernmental group or 
                                organization of which the 
                                United States is a member with 
                                which designation the Secretary 
                                of the Treasury concurs; or
                                  (II) by the Secretary as 
                                warranting special measures due 
                                to money laundering concerns.
                  (B) Policies, procedures, and controls.--The 
                enhanced due diligence policies, procedures, 
                and controls required under paragraph (1) for 
                foreign banks described in subparagraph (A) 
                shall, at a minimum, ensure that the financial 
                institution in the United States takes 
                reasonable steps--
                          (i) to ascertain for any such foreign 
                        bank, the shares of which are not 
                        publicly traded, the identity of each 
                        of the owners of the foreign bank, and 
                        the nature and extent of the ownership 
                        interest of each such owner;
                          (ii) to conduct enhanced scrutiny of 
                        such account to guard against money 
                        laundering and report any suspicious 
                        transactions under section 5318(g); and
                          (iii) to ascertain whether such 
                        foreign bank provides correspondent 
                        accounts to other foreign banks and, if 
                        so, the identity of those foreign banks 
                        and related due diligence information, 
                        as appropriate under paragraph (1).
          (3) Minimum standards for private banking accounts.--
        If a private banking account is requested or maintained 
        by, or on behalf of, a non-United States person, then 
        the due diligence policies, procedures, and controls 
        required under paragraph (1) shall, at a minimum, 
        ensure that the financial institution takes reasonable 
        steps--
                  (A) to ascertain the identity of the nominal 
                and beneficial owners of, and the source of 
                funds deposited into, such account as needed to 
                guard against money laundering and report any 
                suspicious transactions under section 5318(g); 
                and
                  (B) to conduct enhanced scrutiny of any such 
                account that is requested or maintained by, or 
                on behalf of, a senior foreign political 
                figure, or any immediate family member or close 
                associate of a senior foreign political figure, 
                to prevent, detect, and report transactions 
                that may involve the proceeds of foreign 
                corruption.
          (4) Definitions.--For purposes of this subsection, 
        the following definitions shall apply:
                  (A) Offshore banking license.--The term 
                ``offshore banking license'' means a license to 
                conduct banking activities which, as a 
                condition of the license, prohibits the 
                licensed entity from conducting banking 
                activities with the citizens of, or with the 
                local currency of, the country which issued the 
                license.
                  (B) Private bank account.--The term ``private 
                bank account'' means an account (or any 
                combination of accounts) that--
                          (i) requires a minimum aggregate 
                        deposits of funds or other assets of 
                        not less than $1,000,000;
                          (ii) is established on behalf of 1 or 
                        more individuals who have a direct or 
                        beneficial ownership interest in the 
                        account; and
                          (iii) is assigned to, or is 
                        administered or managed by, in whole or 
                        in part, an officer, employee, or agent 
                        of a financial institution acting as a 
                        liaison between the financial 
                        institution and the direct or 
                        beneficial owner of the account.
          (5) Regulatory authority.--Before the end of the 6-
        month period beginning on the date of the enactment of 
        the Financial Anti-Terrorism Act of 2001, the 
        Secretary, in consultation with the appropriate Federal 
        functional regulators (as defined in section 509 of the 
        Gramm-Leach-Bliley Act) shall further define and 
        clarify, by regulation, the requirements of this 
        subsection.
  (k) Prohibition on United States Correspondent Accounts With 
Foreign Shell Banks.--
          (1) In general.--A depository institution shall not 
        establish, maintain, administer, or manage a 
        correspondent account in the United States for, or on 
        behalf of, a foreign bank that does not have a physical 
        presence in any country.
          (2) Prevention of indirect service to foreign shell 
        banks.--
                  (A) In general.--A depository institution 
                shall take reasonable steps to ensure that any 
                correspondent account established, maintained, 
                administered, or managed by that institution in 
                the United States for a foreign bank is not 
                being used by that foreign bank to indirectly 
                provide banking services to another foreign 
                bank that does not have a physical presence in 
                any country.
                  (B) Regulations.--The Secretary shall, in 
                regulations, delineate reasonable steps 
                necessary for a depository institution to 
                comply with this subsection.
          (3) Exception.--Paragraphs (1) and (2) shall not be 
        construed as prohibiting a depository institution from 
        providing a correspondent account to a foreign bank, if 
        the foreign bank--
                  (A) is an affiliate of a depository 
                institution, credit union, or other foreign 
                bank that maintains a physical presence in the 
                United States or a foreign country, as 
                applicable; and
                  (B) is subject to supervision by a banking 
                authority in the country regulating the 
                affiliated depository institution, credit 
                union, or foreign bank, described in 
                subparagraph (A), as applicable.
          (4) Definitions.--For purposes of this section, the 
        following definitions shall apply:
                  (A) Affiliate.--The term ``affiliate'' means 
                a foreign bank that is controlled by or is 
                under common control with a depository 
                institution, credit union, or foreign bank.
                  (B) Depository institution.--The ``depository 
                institution''--
                          (i) has the meaning given such term 
                        in section 3 of the Federal Deposit 
                        Insurance Act; and
                          (ii) includes a credit union.
                  (C) Physical presence.--The term ``physical 
                presence'' means a place of business that--
                          (i) is maintained by a foreign bank;
                          (ii) is located at a fixed address 
                        (other than solely an electronic 
                        address) in a country in which the 
                        foreign bank is authorized to conduct 
                        banking activities, at which location 
                        the foreign bank--
                                  (I) employs 1 or more 
                                individuals on a full-time 
                                basis; and
                                  (II) maintains operating 
                                records related to its banking 
                                activities; and
                          (iii) is subject to inspection by the 
                        banking authority which licensed the 
                        foreign bank to conduct banking 
                        activities.
  (l) Applicability of Rules.--Any rules prescribed pursuant to 
the authority contained in section 21 of the Federal Deposit 
Insurance Act shall apply, in addition to any other financial 
institution to which such rules apply, to any person that 
engages as a business in the transmission of funds, including 
through an informal value transfer banking system or network of 
people facilitating the transfer of value domestically or 
internationally outside of the conventional financial 
institutions system.

Sec. 5318A. Special measures for jurisdictions, financial institutions, 
                    or international transactions of primary money 
                    laundering concern

  (a) International Counter-Money Laundering Requirements.--
          (1) In general.--The Secretary may require domestic 
        financial institutions and domestic financial agencies 
        to take 1 or more of the special measures described in 
        subsection (b) if the Secretary finds that reasonable 
        grounds exist for concluding that a jurisdiction 
        outside of the United States, 1 or more financial 
        institutions operating outside of the United States, 1 
        or more classes of transactions within, or involving, a 
        jurisdiction outside of the United States, or 1 or more 
        types of accounts is of primary money laundering 
        concern, in accordance with subsection (c).
          (2) Form of requirement.--The special measures 
        described in--
                  (A) subsection (b) may be imposed in such 
                sequence or combination as the Secretary shall 
                determine;
                  (B) paragraphs (1) through (4) of subsection 
                (b) may be imposed by regulation, order, or 
                otherwise as permitted by law; and
                  (C) subsection (b)(5) may be imposed only by 
                regulation.
          (3) Duration of orders; rulemaking.--Any order by 
        which a special measure described in paragraphs (1) 
        through (4) of subsection (b) is imposed (other than an 
        order described in section 5326)--
                  (A) shall be issued together with a notice of 
                proposed rulemaking relating to the imposition 
                of such special measure; and
                  (B) may not remain in effect for more than 
                120 days, except pursuant to a regulation 
                prescribed on or before the end of the 120-day 
                period beginning on the date of issuance of 
                such order.
          (4) Process for selecting special measures.--In 
        selecting which special measure or measures to take 
        under this subsection, the Secretary--
                  (A) shall consult with the Chairman of the 
                Board of Governors of the Federal Reserve 
                System, any other appropriate Federal banking 
                agency (as defined in section 3 of the Federal 
                Deposit Insurance Act), the Securities and 
                Exchange Commission, the National Credit Union 
                Administration Board, and in the sole 
                discretion of the Secretary such other agencies 
                and interested parties as the Secretary may 
                find to be appropriate; and
                  (B) shall consider--
                          (i) whether similar action has been 
                        or is being taken by other nations or 
                        multilateral groups;
                          (ii) whether the imposition of any 
                        particular special measure would create 
                        a significant competitive disadvantage, 
                        including any undue cost or burden 
                        associated with compliance, for 
                        financial institutions organized or 
                        licensed in the United States; and
                          (iii) the extent to which the action 
                        or the timing of the action would have 
                        a significant adverse systemic impact 
                        on the international payment, 
                        clearance, and settlement system, or on 
                        legitimate business activities 
                        involving the particular jurisdiction, 
                        institution, or class of transactions.
          (5) No limitation on other authority.--This section 
        shall not be construed as superseding or otherwise 
        restricting any other authority granted to the 
        Secretary, or to any other agency, by this subchapter 
        or otherwise.
  (b) Special Measures.--The special measures referred to in 
subsection (a), with respect to a jurisdiction outside of the 
United States, financial institution operating outside of the 
United States, class of transaction within, or involving, a 
jurisdiction outside of the United States, or 1 or more types 
of accounts are as follows:
          (1) Recordkeeping and reporting of certain financial 
        transactions.--
                  (A) In general.--The Secretary may require 
                any domestic financial institution or domestic 
                financial agency to maintain records, file 
                reports, or both, concerning the aggregate 
                amount of transactions, or concerning each 
                transaction, with respect to a jurisdiction 
                outside of the United States, 1 or more 
                financial institutions operating outside of the 
                United States, 1 or more classes of 
                transactions within, or involving, a 
                jurisdiction outside of the United States, or 1 
                or more types of accounts if the Secretary 
                finds any such jurisdiction, institution, or 
                class of transactions to be of primary money 
                laundering concern.
                  (B) Form of records and reports.--Such 
                records and reports shall be made and retained 
                at such time, in such manner, and for such 
                period of time, as the Secretary shall 
                determine, and shall include such information 
                as the Secretary may determine, including--
                          (i) the identity and address of the 
                        participants in a transaction or 
                        relationship, including the identity of 
                        the originator of any funds transfer;
                          (ii) the legal capacity in which a 
                        participant in any transaction is 
                        acting;
                          (iii) the identity of the beneficial 
                        owner of the funds involved in any 
                        transaction, in accordance with such 
                        procedures as the Secretary determines 
                        to be reasonable and practicable to 
                        obtain and retain the information; and
                          (iv) a description of any 
                        transaction.
          (2) Information relating to beneficial ownership.--In 
        addition to any other requirement under any other 
        provision of law, the Secretary may require any 
        domestic financial institution or domestic financial 
        agency to take such steps as the Secretary may 
        determine to be reasonable and practicable to obtain 
        and retain information concerning the beneficial 
        ownership of any account opened or maintained in the 
        United States by a foreign person (other than a foreign 
        entity whose shares are subject to public reporting 
        requirements or are listed and traded on a regulated 
        exchange or trading market), or a representative of 
        such a foreign person, that involves a jurisdiction 
        outside of the United States, 1 or more financial 
        institutions operating outside of the United States, 1 
        or more classes of transactions within, or involving, a 
        jurisdiction outside of the United States, or 1 or more 
        types of accounts if the Secretary finds any such 
        jurisdiction, institution, transaction, or account to 
        be of primary money laundering concern.
          (3) Information relating to certain payable-through 
        accounts.--If the Secretary finds a jurisdiction 
        outside of the United States, 1 or more financial 
        institutions operating outside of the United States, or 
        1 or more classes of transactions within, or involving, 
        a jurisdiction outside of the United States to be of 
        primary money laundering concern, the Secretary may 
        require any domestic financial institution or domestic 
        financial agency that opens or maintains a payable-
        through account in the United States for a foreign 
        financial institution involving any such jurisdiction 
        or any such financial institution operating outside of 
        the United States, or a payable through account through 
        which any such transaction may be conducted, as a 
        condition of opening or maintaining such account--
                  (A) to identify each customer (and 
                representative of such customer) of such 
                financial institution who is permitted to use, 
                or whose transactions are routed through, such 
                payable-through account; and
                  (B) to obtain, with respect to each such 
                customer (and each such representative), 
                information that is substantially comparable to 
                that which the depository institution obtains 
                in the ordinary course of business with respect 
                to its customers residing in the United States.
          (4) Information relating to certain correspondent 
        accounts.--If the Secretary finds a jurisdiction 
        outside of the United States, 1 or more financial 
        institutions operating outside of the United States, or 
        1 or more classes of transactions within, or involving, 
        a jurisdiction outside of the United States to be of 
        primary money laundering concern, the Secretary may 
        require any domestic financial institution or domestic 
        financial agency that opens or maintains a 
        correspondent account in the United States for a 
        foreign financial institution involving any such 
        jurisdiction or any such financial institution 
        operating outside of the United States, or a 
        correspondent account through which any such 
        transaction may be conducted, as a condition of opening 
        or maintaining such account--
                  (A) to identify each customer (and 
                representative of such customer) of any such 
                financial institution who is permitted to use, 
                or whose transactions are routed through, such 
                correspondent account; and
                  (B) to obtain, with respect to each such 
                customer (and each such representative), 
                information that is substantially comparable to 
                that which the depository institution obtains 
                in the ordinary course of business with respect 
                to its customers residing in the United States.
          (5) Prohibitions or conditions on opening or 
        maintaining certain correspondent or payable-through 
        accounts.--If the Secretary finds a jurisdiction 
        outside of the United States, 1 or more financial 
        institutions operating outside of the United States, or 
        1 or more classes of transactions within, or involving, 
        a jurisdiction outside of the United States to be of 
        primary money laundering concern, the Secretary, in 
        consultation with the Secretary of State, the Attorney 
        General, and the Chairman of the Board of Governors of 
        the Federal Reserve System, may prohibit, or impose 
        conditions upon, the opening or maintaining in the 
        United States of a correspondent account or payable- 
        through account by any domestic financial institution 
        or domestic financial agency for or on behalf of a 
        foreign banking institution, if such correspondent 
        account or payable-through account involves any such 
        jurisdiction or institution, or if any such transaction 
        may be conducted through such correspondent account or 
        payable-through account.
  (c) Consultations and Information To Be Considered in Finding 
Jurisdictions, Institutions, Types of Accounts, or Transactions 
To Be of Primary Money Laundering Concern.--
          (1) In general.--In making a finding that reasonable 
        grounds exist for concluding that a jurisdiction 
        outside of the United States, 1 or more financial 
        institutions operating outside of the United States, 1 
        or more classes of transactions within, or involving, a 
        jurisdiction outside of the United States, or 1 or more 
        types of accounts is of primary money laundering 
        concern so as to authorize the Secretary to take 1 or 
        more of the special measures described in subsection 
        (b), the Secretary shall consult with the Secretary of 
        State, and the Attorney General.
          (2) Additional considerations.--In making a finding 
        described in paragraph (1), the Secretary shall 
        consider in addition such information as the Secretary 
        determines to be relevant, including the following 
        potentially relevant factors:
                  (A) Jurisdictional factors.--In the case of a 
                particular jurisdiction--
                          (i) evidence that organized criminal 
                        groups, international terrorists, or 
                        both, have transacted business in that 
                        jurisdiction;
                          (ii) the extent to which that 
                        jurisdiction or financial institutions 
                        operating in that jurisdiction offer 
                        bank secrecy or special regulatory 
                        advantages to nonresidents or 
                        nondomiciliaries of that jurisdiction;
                          (iii) the substance and quality of 
                        administration of the bank supervisory 
                        and counter-money laundering laws of 
                        that jurisdiction;
                          (iv) the relationship between the 
                        volume of financial transactions 
                        occurring in that jurisdiction and the 
                        size of the economy of the 
                        jurisdiction;
                          (v) the extent to which that 
                        jurisdiction is characterized as an 
                        offshore banking or secrecy haven by 
                        credible international organizations or 
                        multilateral expert groups;
                          (vi) whether the United States has a 
                        mutual legal assistance treaty with 
                        that jurisdiction, and the experience 
                        of United States law enforcement 
                        officials, and regulatory officials in 
                        obtaining information about 
                        transactions originating in or routed 
                        through or to such jurisdiction; and
                          (vii) the extent to which that 
                        jurisdiction is characterized by high 
                        levels of official or institutional 
                        corruption.
                  (B) Institutional factors.--In the case of a 
                decision to apply 1 or more of the special 
                measures described in subsection (b) only to a 
                financial institution or institutions, or to a 
                transaction or class of transactions, or to a 
                type of account, or to all 3, within or 
                involving a particular jurisdiction--
                          (i) the extent to which such 
                        financial institutions, transactions, 
                        or types of accounts are used to 
                        facilitate or promote money laundering 
                        in or through the jurisdiction;
                          (ii) the extent to which such 
                        institutions, transactions, or types of 
                        accounts are used for legitimate 
                        business purposes in the jurisdiction; 
                        and
                          (iii) the extent to which such action 
                        is sufficient to ensure, with respect 
                        to transactions involving the 
                        jurisdiction and institutions operating 
                        in the jurisdiction, that the purposes 
                        of this subchapter continue to be 
                        fulfilled, and to guard against 
                        international money laundering and 
                        other financial crimes.
  (d) Notification of Special Measures Invoked by the 
Secretary.--Not later than 10 days after the date of any action 
taken by the Secretary under subsection (a)(1), the Secretary 
shall notify, in writing, the Committee on Financial Services 
of the House of Representatives and the Committee on Banking, 
Housing, and Urban Affairs of the Senate of any such action.
  (e) Definitions.--Notwithstanding any other provision of this 
subchapter, for purposes of this section, the following 
definitions shall apply:
          (1) Bank definitions.--The following definitions 
        shall apply with respect to a bank:
                  (A) Account.--The term ``account''--
                          (i) means a formal banking or 
                        business relationship established to 
                        provide regular services, dealings, and 
                        other financial transactions; and
                          (ii) includes a demand deposit, 
                        savings deposit, or other transaction 
                        or asset account and a credit account 
                        or other extension of credit.
                  (B) Correspondent account.--The term 
                ``correspondent account'' means an account 
                established to receive deposits from, make 
                payments on behalf of a foreign financial 
                institution, or handle other financial 
                transactions related to such institution.
                  (C) Payable-through account.--The term 
                ``payable-through account'' means an account, 
                including a transaction account (as defined in 
                section 19(b)(1)(C) of the Federal Reserve 
                Act), opened at a depository institution by a 
                foreign financial institution by means of which 
                the foreign financial institution permits its 
                customers to engage, either directly or through 
                a subaccount, in banking activities usual in 
                connection with the business of banking in the 
                United States.
                  (D) Secretary.--The term ``Secretary'' means 
                the Secretary of the Treasury.
          (2) Definitions applicable to institutions other than 
        banks.--With respect to any financial institution other 
        than a bank, the Secretary shall, after consultation 
        with the appropriate Federal functional regulators (as 
        defined in section 509 of the Gramm-Leach-Bliley Act), 
        define by regulation the term ``account'', and shall 
        include within the meaning of that term, to the extent, 
        if any, that the Secretary deems appropriate, 
        arrangements similar to payable-through and 
        correspondent accounts.
          (3) Regulatory definition.--The Secretary shall 
        promulgate regulations defining beneficial ownership of 
        an account for purposes of this subchapter. Such 
        regulations shall address issues related to an 
        individual's authority to fund, direct, or manage the 
        account (including the power to direct payments into or 
        out of the account), and an individual's material 
        interest in the income or corpus of the account, and 
        shall ensure that the identification of individuals 
        under this section does not extend to any individual 
        whose beneficial interest in the income or corpus of 
        the account is immaterial.
          (4) Other terms.--The Secretary may, by regulation, 
        further define the terms in paragraphs (1) and (2) and 
        define other terms for the purposes of this section, as 
        the Secretary deems appropriate.

[Sec. 5319. Availability of reports

  The Secretary of the Treasury shall make information in a 
report filed under section 5313, 5314, or 5316 of this title 
available to an agency, including any State financial 
institutions supervisory agency, on request of the head of the 
agency. The report shall be available for a purpose consistent 
with those sections or a regulation prescribed under those 
sections. The Secretary may only require reports on the use of 
such information by any State financial institutions 
supervisory agency for other than supervisory purposes. 
However, a report and records of reports are exempt from 
disclosure under section 552 of title 5.]

Sec. 5319. Availability of reports

  The Secretary of the Treasury shall make information in a 
report filed under this subchapter available to an agency, 
including any State financial institutions supervisory agency 
or United States intelligence agency, upon request of the head 
of the agency. The report shall be available for a purpose that 
is consistent with this subchapter. The Secretary may only 
require reports on the use of such information by any State 
financial institutions supervisory agency for other than 
supervisory purposes or by United States intelligence agencies. 
However, a report and records of reports are exempt from 
disclosure under section 552 of title 5.

           *       *       *       *       *       *       *

Sec. 5321. Civil penalties

  (a)(1) A domestic financial institution, and a partner, 
director, officer, or employee of a domestic financial 
institution, willfully violating this subchapter or a 
regulation prescribed or order issued under this subchapter 
(except sections 5314 and 5315 of this title or a regulation 
prescribed under sections 5314 and 5315), or willfully 
violating a regulation prescribed under section 21 of the 
Federal Deposit Insurance Act or section 123 of Public Law 91-
508, is liable to the United States Government for a civil 
penalty of not more than the greater of the amount (not to 
exceed $100,000) involved in the transaction (if any) or 
$25,000. For a violation of section 5318(a)(2) of this title or 
a regulation prescribed under section 5318(a)(2), a separate 
violation occurs for each day the violation continues and at 
each office, branch, or place of business at which a violation 
occurs or continues.

           *       *       *       *       *       *       *

Sec. 5322. Criminal penalties

  (a) A person willfully violating this subchapter or a 
regulation prescribed or order issued under this subchapter 
(except section 5315 or 5324 of this title or a regulation 
prescribed under section 5315 or 5324), or willfully violating 
a regulation prescribed under section 21 of the Federal Deposit 
Insurance Act or section 123 of Public Law 91-508, shall be 
fined not more than $250,000, or imprisoned for not more than 
five years, or both.
  (b) a person willfully violating this subchapter or a 
regulation prescribed or order issued under this subchapter 
(except section 5315 or 5324 of this title or a regulation 
prescribed under section 5315 or 5324), or willfully violating 
a regulation prescribed under section 21 of the Federal Deposit 
Insurance Act or section 123 of Public Law 91-508, while 
violating another law of the United States or as part of a 
pattern of any illegal activity involving more than $100,000 in 
a 12-month period, shall be fined not more than $500,000, 
imprisoned for not more than 10 years, or both.

           *       *       *       *       *       *       *

Sec. 5324. Structuring transactions to evade reporting requirement 
                    prohibited

  (a) Domestic Coin and Currency Transactions.--No person 
shall, for the purpose of evading the reporting requirements of 
section 5313(a) or 5325 or any regulation prescribed under any 
such [section--] section, the reporting requirements imposed by 
any order issued under section 5326, or the record keeping 
requirements imposed by any regulation prescribed under section 
21 of the Federal Deposit Insurance Act or section 123 of 
Public Law 91-508--
          (1) cause or attempt to cause a domestic financial 
        institution to fail to file a report required under 
        section 5313(a) or 5325 or any regulation prescribed 
        under any such section, to file a report required by 
        any order issued under section 5326, or to maintain a 
        record required pursuant to any regulation prescribed 
        under section 21 of the Federal Deposit Insurance Act 
        or section 123 of Public Law 91-508;
          (2) cause or attempt to cause a domestic financial 
        institution to file a report required under section 
        5313(a) or 5325 or any regulation prescribed under any 
        such section, to file a report required by any order 
        issued under section 5326, or to maintain a record 
        required pursuant to any regulation prescribed under 
        section 21 of the Federal Deposit Insurance Act or 
        section 123 of Public Law 91-508 that contains a 
        material omission or misstatement of fact; or
          * * * * * * *

Sec. 5330. Registration of money transmitting businesses

  (a) * * *
          * * * * * * *
  (d) Definitions.--For purposes of this section, the following 
definitions shall apply:
          (1) Money transmitting business.--The term ``money 
        transmitting business'' means any business other than 
        the United States Postal Service which--
                  (A) provides check cashing, currency 
                exchange, or money transmitting or remittance 
                services, or issues or redeems money orders, 
                travelers' checks, and other similar 
                instruments or any other person who engages as 
                a business in the transmission of funds, 
                including through an informal value transfer 
                banking system or network of people 
                facilitating the transfer of value domestically 
                or internationally outside of the conventional 
                financial institutions system;
          * * * * * * *

Sec. 5331. Bulk cash smuggling into or out of the United States

  (a) Criminal Offense.--
          (1) In general.--Whoever, with the intent to evade a 
        currency reporting requirement under section 5316, 
        knowingly conceals more than $10,000 in currency or 
        other monetary instruments on the person of such 
        individual or in any conveyance, article of luggage, 
        merchandise, or other container, and transports or 
        transfers or attempts to transport or transfer such 
        currency or monetary instruments from a place within 
        the United States to a place outside of the United 
        States, or from a place outside the United States to a 
        place within the United States, shall be guilty of a 
        currency smuggling offense and subject to punishment 
        pursuant to subsection (b).
          (2) Concealment on person.--For purposes of this 
        section, the concealment of currency on the person of 
        any individual includes concealment in any article of 
        clothing worn by the individual or in any luggage, 
        backpack, or other container worn or carried by such 
        individual.
  (b) Penalty.--
          (1) Term of imprisonment.--A person convicted of a 
        currency smuggling offense under subsection (a), or a 
        conspiracy to commit such offense, shall be imprisoned 
        for not more than 5 years.
          (2) Forfeiture.--In addition, the court, in imposing 
        sentence under paragraph (1), shall order that the 
        defendant forfeit to the United States, any property, 
        real or personal, involved in the offense, and any 
        property traceable to such property, subject to 
        subsection (d) of this section.
          (3) Procedure.--The seizure, restraint, and 
        forfeiture of property under this section shall be 
        governed by section 413 of the Controlled Substances 
        Act.
          (4) Personal money judgment.--If the property subject 
        to forfeiture under paragraph (2) is unavailable, and 
        the defendant has insufficient substitute property that 
        may be forfeited pursuant to section 413(p) of the 
        Controlled Substances Act, the court shall enter a 
        personal money judgment against the defendant for the 
        amount that would be subject to forfeiture.
  (c) Civil Forfeiture.--
          (1) In general.--Any property involved in a violation 
        of subsection (a), or a conspiracy to commit such 
        violation, and any property traceable to such violation 
        or conspiracy, may be seized and, subject to subsection 
        (d) of this section, forfeited to the United States.
          (2) Procedure.--The seizure and forfeiture shall be 
        governed by the procedures governing civil forfeitures 
        in money laundering cases pursuant to section 
        981(a)(1)(A) of title 18, United States Code.
          (3) Treatment of certain property as involved in the 
        offense.--For purposes of this subsection and 
        subsection (b), any currency or other monetary 
        instrument that is concealed or intended to be 
        concealed in violation of subsection (a) or a 
        conspiracy to commit such violation, any article, 
        container, or conveyance used, or intended to be used, 
        to conceal or transport the currency or other monetary 
        instrument, and any other property used, or intended to 
        be used, to facilitate the offense, shall be considered 
        property involved in the offense.
  (d) Proportionality of Forfeiture.--
          (1) In general.--Upon a showing by the property owner 
        by a preponderance of the evidence that the currency or 
        monetary instruments involved in the offense giving 
        rise to the forfeiture were derived from a legitimate 
        source, and were intended for a lawful purpose, the 
        court shall reduce the forfeiture to the maximum amount 
        that is not grossly disproportional to the gravity of 
        the offense.
          (2) Factors to be considered.--In determining the 
        amount of the forfeiture, the court shall consider all 
        aggravating and mitigating facts and circumstances that 
        have a bearing on the gravity of the offense, including 
        the following:
                  (A) The value of the currency or other 
                monetary instruments involved in the offense.
                  (B) Efforts by the person committing the 
                offense to structure currency transactions, 
                conceal property, or otherwise obstruct 
                justice.
                  (C) Whether the offense is part of a pattern 
                of repeated violations of Federal law.

Sec. 5332. Subpoenas for records

  (a) Designation By Foreign Financial Institution of Agent.--
Any foreign financial institution that has a correspondent bank 
account at a financial institution in the United States shall 
designate a person residing in the United States as a person 
authorized to accept a subpoena for bank records or other legal 
process served on the foreign financial institution.
  (b) Maintenance of Records By Domestic Financial 
Institution.--
          (1) In general.--Any domestic financial institution 
        that maintains a correspondent bank account for a 
        foreign financial institution shall maintain records 
        regarding the names and addresses of the owners of the 
        foreign financial institution, and the name and address 
        of the person who may be served with a subpoena for 
        records regarding any funds transferred to or from the 
        correspondent account.
          (2) Provision to law enforcement agency.--A domestic 
        financial institution shall provide names and addresses 
        maintained under paragraph (1) to a Government 
        authority (as defined in section 1101(3) of the Right 
        to Financial Privacy Act of 1978) within 7 days of the 
        receipt of a request, in writing, for such records.
  (c) Administrative Subpoena.--
          (1) In general.--The Attorney General and the 
        Secretary of the Treasury may each issue an 
        administrative subpoena for records relating to the 
        deposit of any funds into a dollar-denominated account 
        in a foreign financial institution that maintains a 
        correspondent account at a domestic financial 
        institution.
          (2) Manner of issuance.--Any subpoena issued by the 
        Attorney General or the Secretary of the Treasury under 
        paragraph (1) shall be issued in the manner described 
        in section 3486 of this title, and may be served on the 
        representative designated by the foreign financial 
        institution pursuant to subsection (a) to accept legal 
        process in the United States, or in a foreign country 
        pursuant to any mutual legal assistance treaty, 
        multilateral agreement, or other request for 
        international law enforcement assistance.
  (d) Correspondent Account Defined.--For purposes of this 
section, the term ``correspondent account'' has the same 
meaning as the term ``interbank account'' as such term is 
defined in section 984(c)(2)(B) of title 18, United States 
Code.

           *       *       *       *       *       *       *

                              ----------                              

TITLE 18, UNITED STATES CODE

           *       *       *       *       *       *       *

PART I--CRIMES

           *       *       *       *       *       *       *

                 CHAPTER 25--COUNTERFEITING AND FORGERY

Sec.
470.  Counterfeit acts committed outside the United States.
     * * * * * * *
474.  Plates [or stones], stones, or analog, digital, or electronic 
          images for counterfeiting obligations or securities.
     * * * * * * *
481.  Plates [or stones], stones, or analog, digital, or electronic 
          images for counterfeiting foreign obligations or securities.

           *       *       *       *       *       *       *

Sec. 470. Counterfeit acts committed outside the United States

  A person who, outside the United States, engages in the act 
of--
          (1) making, dealing, or possessing any counterfeit 
        obligation or other security of the United States; or
          (2) making, dealing, or possessing any plate, stone, 
        analog, digital, or electronic image, or other thing, 
        or any part thereof, used to counterfeit such 
        obligation or security,
if such act would constitute a violation of section 471, 473, 
or 474 if committed within the United States, [shall be fined 
under this title, imprisoned not more than 20 years, or both] 
shall be punished as is provided for the like offense within 
the United States.

Sec. 471. Obligations or securities of United States

  Whoever, with intent to defraud, falsely makes, forges, 
counterfeits, or alters any obligation or other security of the 
United States, shall be fined under this title or imprisoned 
not more than [fifteen] 20 years, or both.

Sec. 472. Uttering counterfeit obligations or securities

  Whoever, with intent to defraud, passes, utters, publishes, 
or sells, or attempts to pass, utter, publish, or sell, or with 
like intent brings into the United States or keeps in 
possession or conceals any falsely made, forged, counterfeited, 
or altered obligation or other security of the United States, 
shall be fined under this title or imprisoned not more than 
[fifteen] 20 years, or both.

Sec. 473. Dealing in counterfeit obligations or securities

  Whoever buys, sells, exchanges, transfers, receives, or 
delivers any false, forged, counterfeited, or altered 
obligation or other security of the United States, with the 
intent that the same be passed, published, or used as true and 
genuine, shall be fined under this title or imprisoned not more 
than [ten] 20 years, or both.

Sec. 474. Plates [or stones], stones, or analog, digital, or electronic 
                    images for counterfeiting obligations or securities

  (a) Whoever, having control, custody, or possession of any 
plate, stone, or other thing, or any part thereof, from which 
has been printed, or which may be prepared by direction of the 
Secretary of the Treasury for the purpose of printing, any 
obligation or other security of the United States, uses such 
plate, stone, or other thing, or any part thereof, or knowingly 
suffers the same to be used for the purpose of printing any 
such or similar obligation or other security, or any part 
thereof, except as may be printed for the use of the United 
States by order of the proper officer thereof; or
  Whoever makes or executes any plate, stone, or other thing in 
the likeness of any plate designated for the printing of such 
obligation or other security; or
  Whoever, with intent to defraud, makes, executes, acquires, 
scans, captures, records, receives, transmits, reproduces, 
sells, or has in such person's control, custody, or possession, 
an analog, digital, or electronic image of any obligation or 
other security of the United States; or

           *       *       *       *       *       *       *

  (b) [For purposes of this section, the terms ``plate'', 
``stone'', ``thing'', or ``other thing'' includes any 
electronic method used for the acquisition, recording, 
retrieval, transmission, or reproduction of any obligation or 
other security, unless such use is authorized by the Secretary 
of the Treasury.] For purposes of this section, the term 
``analog, digital, or electronic image'' includes any analog, 
digital, or electronic method used for the making, execution, 
acquisition, scanning, capturing, recording, retrieval, 
transmission, or reproduction of any obligation or security, 
unless such use is authorized by the Secretary of the Treasury. 
The Secretary shall establish a system (pursuant to section 
504) to ensure that the legitimate use of such electronic 
methods and retention of such reproductions by businesses, 
hobbyists, press and others shall not be unduly restricted.

           *       *       *       *       *       *       *

Sec. 476. Taking impressions of tools used for obligations or 
                    securities

  Whoever, without authority from the United States, takes, 
procures, or makes an impression, stamp, analog, digital, or 
electronic image, or imprint of, from or by the use of any 
tool, implement, instrument, or thing used or fitted or 
intended to be used in printing, stamping, or impressing, or in 
making other tools, implements, instruments, or things to be 
used or fitted or intended to be used in printing, stamping, or 
impressing any obligation or other security of the United 
States, shall be fined under this title or imprisoned not more 
than [ten] 25 years, or both.

Sec. 477. Possessing or selling impressions of tools used for 
                    obligations or securities

  Whoever, with intent to defraud, possesses, keeps, 
safeguards, or controls, without authority from the United 
States, any imprint, stamp, analog, digital, or electronic 
image, or impression, taken or made upon any substance or 
material whatsoever, of any tool, implement, instrument or 
thing, used, fitted or intended to be used, for any of the 
purposes mentioned in section 476 of this title; or
  Whoever, with intent to defraud, sells, gives, or delivers 
any such imprint, stamp, analog, digital, or electronic image, 
or impression to any other person--
  Shall be fined under this title or imprisoned not more than 
[ten] 25 years, or both.

Sec. 478. Foreign obligations or securities

  Whoever, within the United States, with intent to defraud, 
falsely makes, alters, forges, or counterfeits any bond, 
certificate, obligation, or other security of any foreign 
government, purporting to be or in imitation of any such 
security issued under the authority of such foreign government, 
or any treasury note, bill, or promise to pay, lawfully issued 
by such foreign government and intended to circulate as money, 
shall be fined under this title or imprisoned not more than 
[five] 20 years, or both.

Sec. 479. Uttering counterfeit foreign obligations or securities

  Whoever, within the United States, knowingly and with intent 
to defraud, utters, passes, or puts off, in payment or 
negotiation, any false, forged, or counterfeited bond, 
certificate, obligation, security, treasury note, bill, or 
promise to pay, mentioned in section 478 of this title, whether 
or not the same was made, altered, forged, or counterfeited 
within the United States, shall be fined under this title or 
imprisoned not more than [three] 20 years, or both.

Sec. 480. Possessing counterfeit foreign obligations or securities

  Whoever, within the United States, knowingly and with intent 
to defraud, possesses or delivers any false, forged, or 
counterfeit bond, certificate, obligation, security, treasury 
note, bill, promise to pay, bank note, or bill issued by a bank 
or corporation of any foreign country, shall be fined under 
this title or imprisoned not more than [one year] 20 years, or 
both.

Sec. 481. Plates [or stones], stones, or analog, digital, or electronic 
                    images for counterfeiting foreign obligations or 
                    securities

  Whoever, within the United States except by lawful authority, 
controls, holds, or possesses any plate, stone, or other thing, 
or any part thereof, from which has been printed or may be 
printed any counterfeit note, bond, obligation, or other 
security, in whole or in part, of any foreign government, bank, 
or corporation, or uses such plate, stone, or other thing, or 
knowingly permits or suffers the same to be used in 
counterfeiting such foreign obligations, or any part thereof; 
or
  Whoever, except by lawful authority, makes or engraves any 
plate, stone, or other thing in the likeness or similitude of 
any plate, stone, or other thing designated for the printing of 
the genuine issues of the obligations of any foreign 
government, bank, or corporation; or
  Whoever, with intent to defraud, makes, executes, acquires, 
scans, captures, records, receives, transmits, reproduces, 
sells, or has in such person's control, custody, or possession, 
an analog, digital, or electronic image of any bond, 
certificate, obligation, or other security of any foreign 
government, or of any treasury note, bill, or promise to pay, 
lawfully issued by such foreign government and intended to 
circulate as money; or

           *       *       *       *       *       *       *

  Shall be fined under this title or imprisoned not more than 
[five] 25 years, or both.

Sec. 482. Foreign bank notes

  Whoever, within the United States, with intent to defraud, 
falsely makes, alters, forges, or counterfeits any bank note or 
bill issued by a bank or corporation of any foreign country, 
and intended by the law or usage of such foreign country to 
circulate as money, such bank or corporation being authorized 
by the laws of such country, shall be fined under this title or 
imprisoned not more than [two] 20 years, or both.

Sec. 483. Uttering counterfeit foreign bank notes

  Whoever, within the United States, utters, passes, puts off, 
or tenders in payment, with intent to defraud, any such false, 
forged, altered, or counterfeited bank note or bill, mentioned 
in section 482 of this title, knowing the same to be so false, 
forged, altered, and counterfeited, whether or not the same was 
made, forged, altered, or counterfeited within the United 
States, shall be fined under this title or imprisoned not more 
than [one year] 20 years, or both.

Sec. 484. Connecting parts of different notes

  Whoever so places or connects together different parts of two 
or more notes, bills, or other genuine instruments issued under 
the authority of the United States, or by any foreign 
government, or corporation, as to produce one instrument, with 
intent to defraud, shall be guilty of forgery in the same 
manner as if the parts so put together were falsely made or 
forged, and shall be fined under this title or imprisoned not 
more than [five] 10 years, or both.

           *       *       *       *       *       *       *

Sec. 493. Bonds and obligations of certain lending agencies

  Whoever falsely makes, forges, counterfeits or alters any 
note, bond, debenture, coupon, obligation, instrument, or 
writing in imitation or purporting to be in imitation of, a 
note, bond, debenture, coupon, obligation, instrument or 
writing, issued by the Reconstruction Finance Corporation, 
Federal Deposit Insurance Corporation, National Credit Union 
Administration, Home Owners' Loan Corporation, Farm Credit 
Administration, Department of Housing and Urban Development, or 
any land bank, intermediate credit bank, insured credit union, 
bank for cooperatives or any lending, mortgage, insurance, 
credit or savings and loan corporation or association 
authorized or acting under the laws of the United States, shall 
be fined under this title or imprisoned not more than [five] 10 
years, or both.
  Whoever passes, utters, or publishes, or attempts to pass, 
utter or publish any note, bond, debenture, coupon, obligation, 
instrument or document knowing the same to have been falsely 
made, forged, counterfeited or altered, contrary to the 
provisions of this section, shall be fined under this title or 
imprisoned not more than [five] 10 years, or both.

           *       *       *       *       *       *       *

CHAPTER 46--FORFEITURE

           *       *       *       *       *       *       *

Sec. 981. Civil forfeiture

  (a)(1) The following property is subject to forfeiture to the 
United States:
          (A) Any property, real or personal, involved in a 
        transaction or attempted transaction in violation [of 
        section 5313(a) or 5324(a) of title 31, or] of section 
        6050I of the Internal Revenue Code of 1986, or section 
        1956 [or 1957], 1957 or 1960 of this title, or any 
        property traceable to such property. However, no 
        property shall be seized or forfeited in the case of a 
        violation of section 5313(a) of title 31 by a domestic 
        financial institution examined by a Federal bank 
        supervisory agency or a financial institution regulated 
        by the Securities and Exchange Commission or a partner, 
        director, or employee thereof.
          [(B) Any property, real or personal, within the 
        jurisdiction of the United States, constituting, 
        derived from, or traceable to, any proceeds obtained 
        directly or indirectly from an offense against a 
        foreign nation involving the manufacture, importation, 
        sale, or distribution of a controlled substance (as 
        such term is defined for the purposes of the Controlled 
        Substances Act), within whose jurisdiction such offense 
        would be punishable by death or imprisonment for a term 
        exceeding one year and which would be punishable under 
        the laws of the United States by imprisonment for a 
        term exceeding one year if such act or activity 
        constituting the offense against the foreign nation had 
        occurred within the jurisdiction of the United States.]
          (B) Any property, real or personal, within the 
        jurisdiction of the United States, constituting, 
        derived from, or traceable to, any proceeds obtained 
        directly or indirectly from an offense against a 
        foreign nation, or any property used to facilitate such 
        offense, if--
                  (i) the offense involves the manufacture, 
                importation, sale, or distribution of a 
                controlled substance (as such term is defined 
                for the purposes of the Controlled Substances 
                Act), or any other conduct described in section 
                1956(c)(7)(B),
                  (ii) the offense would be punishable within 
                the jurisdiction of the foreign nation by death 
                or imprisonment for a term exceeding one year, 
                and
                  (iii) the offense would be punishable under 
                the laws of the United States by imprisonment 
                for a term exceeding one year if the act or 
                activity constituting the offense had occurred 
                within the jurisdiction of the United States.

           *       *       *       *       *       *       *

  (k) Correspondent Bank Accounts.--
          (1) Treatment of accounts of correspondent bank in 
        domestic financial institutions.--
                  (A) In general.--For the purpose of a 
                forfeiture under this section or under the 
                Controlled Substances Act, if funds are 
                deposited into a dollar-denominated bank 
                account in a foreign financial institution, and 
                that foreign financial institution has a 
                correspondent account with a financial 
                institution in the United States, the funds 
                deposited into the foreign financial 
                institution (the respondent bank) shall be 
                deemed to have been deposited into the 
                correspondent account in the United States, and 
                any restraining order, seizure warrant, or 
                arrest warrant in rem regarding such funds may 
                be served on the correspondent bank, and funds 
                in the correspondent account up to the value of 
                the funds deposited into the dollar-denominated 
                account in the foreign financial institution 
                may be seized, arrested or restrained.
                  (B) Authority to suspend.--The Attorney 
                General, in consultation with the Secretary, 
                may suspend or terminate a forfeiture under 
                this section if the Attorney General determines 
                that a conflict of law exists between the laws 
                of the jurisdiction in which the foreign bank 
                is located and the laws of the United States 
                with respect to liabilities arising from the 
                restraint, seizure, or arrest of such funds, 
                and that such suspension or termination would 
                be in the interest of justice and would not 
                harm the national interests of the United 
                States.
          (2) No requirement for government to trace funds.--If 
        a forfeiture action is brought against funds that are 
        restrained, seized, or arrested under paragraph (1), 
        the Government shall not be required to establish that 
        such funds are directly traceable to the funds that 
        were deposited into the respondent bank, nor shall it 
        be necessary for the Government to rely on the 
        application of Section 984 of this title.
          (3) Claims brought by owner of the funds.--If a 
        forfeiture action is instituted against funds seized, 
        arrested, or restrained under paragraph (1), the owner 
        of the funds may contest the forfeiture by filing a 
        claim pursuant to section 983.
          (4) Definitions.--For purposes of this subsection, 
        the following definitions shall apply:
                  (A) Correspondent account.--The term 
                ``correspondent account'' has the meaning given 
                to the term ``interbank account'' in section 
                984(c)(2)(B).
                  (B) Owner.--
                          (i) In general.--Except as provided 
                        in clause (ii), the term ``owner''--
                                  (I) means the person who was 
                                the owner, as that term is 
                                defined in section 983(d)(6), 
                                of the funds that were 
                                deposited into the foreign bank 
                                at the time such funds were 
                                deposited; and
                                  (II) does not include either 
                                the foreign bank or any 
                                financial institution acting as 
                                an intermediary in the transfer 
                                of the funds into the interbank 
                                account.
                          (ii) Exception.--The foreign bank may 
                        be considered the ``owner'' of the 
                        funds (and no other person shall 
                        qualify as the owner of such funds) 
                        only if--
                                  (I) the basis for the 
                                forfeiture action is wrongdoing 
                                committed by the foreign bank; 
                                or
                                  (II) the foreign bank 
                                establishes, by a preponderance 
                                of the evidence, that prior to 
                                the restraint, seizure, or 
                                arrest of the funds, the 
                                foreign bank had discharged all 
                                or part of its obligation to 
                                the prior owner of the funds, 
                                in which case the foreign bank 
                                shall be deemed the owner of 
                                the funds to the extent of such 
                                discharged obligation.

Sec. 982. Criminal forfeiture

  (a)(1) The court, in imposing sentence on a person convicted 
of an offense in violation [of section 5313(a), 5316, or 5324 
of title 31, or] of section 6050I of the Internal Revenue Code 
of 1986, or section 1956, 1957, or 1960 of this title, shall 
order that the person forfeit to the United States any 
property, real or personal, involved in such offense, or any 
property traceable to such property. However, no property shall 
be seized or forfeited in the case of a violation of section 
5313(a) of title 31 by a domestic financial institution 
examined by a Federal bank supervisory agency or a financial 
institution regulated by the Securities and Exchange Commission 
or a partner, director, or employee thereof.

           *       *       *       *       *       *       *

                 CHAPTER 47--FRAUD AND FALSE STATEMENTS

Sec.
1001.  Statements or entries generally.
     * * * * * * *
1008.  False statements concerning the identity of customers of 
          financial institutions.
     * * * * * * *

Sec. 1008. False statements concerning the identity of customers of 
                    financial institutions

  (a) In General.--Whoever, in connection with information 
submitted to or requested by a financial institution, knowingly 
in any manner--
          (1) falsifies, conceals, or covers up, or attempts to 
        falsify, conceal, or cover up, the identity of any 
        person in connection with any transaction with a 
        financial institution;
          (2) makes, or attempts to make, any materially false, 
        fraudulent, or fictitious statement or representation 
        of the identity of any person in connection with a 
        transaction with a financial institution;
          (3) makes or uses, or attempts to make or use, any 
        false writing or document knowing the same to contain 
        any materially false, fictitious, or fraudulent 
        statement or entry concerning the identity of any 
        person in connection with a transaction with a 
        financial institution; or
          (4) uses or presents, or attempts to use or present, 
        in connection with a transaction with a financial 
        institution, an identification document or means of 
        identification the possession of which is a violation 
        of section 1028;
shall be fined under this title, imprisoned not more than 5 
years, or both.
  (b) Definitions.--In this section, the following definitions 
shall apply:
          (1) Financial institution.--The term ``financial 
        institution''--
                  (A) has the same meaning as in section 20; 
                and
                  (B) in addition, has the same meaning as in 
                section 5312(a)(2) of title 31, United States 
                Code.
          (2) Identification document.--The term 
        ``identification document'' has the same meaning as in 
        section 1028(d).
          (3) Means of identification.--The term ``means of 
        identification'' has the same meaning as in section 
        1028(d).

           *       *       *       *       *       *       *

                        CHAPTER 95--RACKETEERING

Sec.
1951.  Interference with commerce by threats or violence.
     * * * * * * *
1960.  Prohibition of [illegal] unlicensed money transmitting 
          businesses.

           *       *       *       *       *       *       *

Sec. 1956. Laundering of monetary instruments

  (a)  * * *
  (b)(1) Whoever conducts or attempts to conduct a transaction 
described in [subsection (a)(1) or (a)(3),] subsection (a)(1) 
or (a)(2) or section 1957, or a transportation, transmission, 
or transfer described in subsection (a)(2), is liable to the 
United States for a civil penalty of not more than the greater 
of--
          [(1)] (A) the value of the property, funds, or 
        monetary instruments involved in the transaction; or
          [(2)] (B) $10,000.
  (2) For purposes of adjudicating an action filed or enforcing 
a penalty ordered under this section, the district courts shall 
have jurisdiction over any foreign person, including any 
financial institution authorized under the laws of a foreign 
country, against whom the action is brought, if--
          (A) service of process upon such foreign person is 
        made under the Federal Rules of Civil Procedure or the 
        laws of the country where the foreign person is found; 
        and
          (B) the foreign person--
                  (i) commits an offense under subsection (a) 
                involving a financial transaction that occurs 
                in whole or in part in the United States;
                  (ii) converts to such person's own use 
                property in which the United States has an 
                ownership interest by virtue of the entry of an 
                order of forfeiture by a court of the United 
                States; or
                  (iii) is a financial institution that 
                maintains a correspondent bank account at a 
                financial institution in the United States.
  (3) The court may issue a pretrial restraining order or take 
any other action necessary to ensure that any bank account or 
other property held by the defendant in the United States is 
available to satisfy a judgment under this section.
  (c) As used in this section--
          (1)  * * *

           *       *       *       *       *       *       *

          [(6) the term ``financial institution'' has the 
        definition given that term in section 5312(a)(2) of 
        title 31, United States Code, or the regulations 
        promulgated thereunder;]
          (6) the term ``financial institution'' includes any 
        financial institution described in section 5312(a)(2) 
        of title 31, United States Code, or the regulations 
        promulgated thereunder, as well as any foreign bank, as 
        defined in paragraph (7) of section 1(b) of the 
        International Banking Act of 1978 (12 U.S.C. 3101(7));
          (7) the term ``specified unlawful activity'' means--
                  (A)  * * *
                  (B) with respect to a financial transaction 
                occurring in whole or in part in the United 
                States, an offense against a foreign nation 
                involving--
                          (i)  * * *
                  [(ii) murder, kidnapping, robbery, extortion, 
                or destruction of property by means of 
                explosive or fire;]
                          (ii) any act or acts constituting a 
                        crime of violence, as defined in 
                        section 16 of this title;

           *       *       *       *       *       *       *

                          (iv) bribery of a public official, or 
                        the misappropriation, theft, or 
                        embezzlement of public funds by or for 
                        the benefit of a public official;
                          (v) smuggling or export control 
                        violations involving munitions listed 
                        in the United States Munitions List or 
                        technologies with military applications 
                        as defined in the Commerce Control List 
                        of the Export Administration 
                        Regulations; or
                          (vi) an offense with respect to which 
                        the United States would be obligated by 
                        a bilateral treaty either to extradite 
                        the alleged offender or to submit the 
                        case for prosecution, if the offender 
                        were found within the territory of the 
                        United States;

           *       *       *       *       *       *       *

                  (D) an offense under section 32 (relating to 
                the destruction of aircraft), section 37 
                (relating to violence at international 
                airports), section 115 (relating to 
                influencing, impeding, or retaliating against a 
                Federal official by threatening or injuring a 
                family member), section 152 (relating to 
                concealment of assets; false oaths and claims; 
                bribery), section 215 (relating to commissions 
                or gifts for procuring loans), section 351 
                (relating to congressional or Cabinet officer 
                assassination), any of sections 500 through 503 
                (relating to certain counterfeiting offenses), 
                section 513 (relating to securities of States 
                and private entities), section 541 (relating to 
                goods falsely classified), section 542 
                (relating to entry of goods by means of false 
                statements), section 545 (relating to smuggling 
                goods into the United States), section 549 
                (relating to removing goods from Customs 
                custody), section 641 (relating to public 
                money, property, or records), section 656 
                (relating to theft, embezzlement, or 
                misapplication by bank officer or employee), 
                section 657 (relating to lending, credit, and 
                insurance institutions), section 658 (relating 
                to property mortgaged or pledged to farm credit 
                agencies), section 666 (relating to theft or 
                bribery concerning programs receiving Federal 
                funds), section 793, 794, or 798 (relating to 
                espionage), section 831 (relating to prohibited 
                transactions involving nuclear materials), 
                section 844 (f) or (i) (relating to destruction 
                by explosives or fire of Government property or 
                property affecting interstate or foreign 
                commerce), section 875 (relating to interstate 
                communications), section 922(1) (relating to 
                the unlawful importation of firearms), section 
                924(n) (relating to firearms trafficking), 
                section 956 (relating to conspiracy to kill, 
                kidnap, maim, or injure certain property in a 
                foreign country), section 1005 (relating to 
                fraudulent bank entries), 1006 (relating to 
                fraudulent Federal credit institution entries), 
                1007 (relating to Federal Deposit Insurance 
                transactions), [1014 (relating to fraudulent 
                loan] section 1008 (relating to false 
                statements concerning the identity of customers 
                of financial institutions), section 1014 
                (relating to fraudulent loan or credit 
                applications), section 1030 (relating to 
                computer fraud and abuse), 1032 (relating to 
                concealment of assets from conservator, 
                receiver, or liquidating agent of financial 
                institution), section 1111 (relating to 
                murder), section 1114 (relating to murder of 
                United States law enforcement officials), 
                section 1116 (relating to murder of foreign 
                officials, official guests, or internationally 
                protected persons), section 1201 (relating to 
                kidnapping), section 1203 (relating to hostage 
                taking), section 1361 (relating to willful 
                injury of Government property), section 1363 
                (relating to destruction of property within the 
                special maritime and territorial jurisdiction), 
                section 1708 (theft from the mail), section 
                1751 (relating to Presidential assassination), 
                section 2113 or 2114 (relating to bank and 
                postal robbery and theft), section 2280 
                (relating to violence against maritime 
                navigation), section 2281 (relating to violence 
                against maritime fixed platforms), or section 
                2319 (relating to copyright infringement), 
                section 2320 (relating to trafficking in 
                counterfeit goods and services),, section 2332 
                (relating to terrorist acts abroad against 
                United States nationals), section 2332a 
                (relating to use of weapons of mass 
                destruction), section 2332b (relating to 
                international terrorist acts transcending 
                national boundaries), or section 2339A or 2339B 
                (relating to providing material support to 
                terrorists) of this title, section 46502 of 
                title 49, United States Code,, a felony 
                violation of the Chemical Diversion and 
                Trafficking Act of 1988 (relating to precursor 
                and essential chemicals), section 590 of the 
                Tariff Act of 1930 (19 U.S.C. 1590) (relating 
                to aviation smuggling), section 422 of the 
                Controlled Substances Act (relating to 
                transportation of drug paraphernalia), section 
                38(c) (relating to criminal violations) of the 
                Arms Export Control Act, section 11 (relating 
                to violations) of the Export Administration Act 
                of 1979, section 206 (relating to penalties) of 
                the International Emergency Economic Powers 
                Act, section 16 (relating to offenses and 
                punishment) of the Trading with the Enemy Act, 
                any felony violation of section 15 of the Food 
                Stamp Act of 1977 (relating to food stamp 
                fraud) involving a quantity of coupons having a 
                value of not less than $5,000, any violation of 
                section 543(a)(1) of the Housing Act of 1949 
                (relating to equity skimming), any felony 
                violation of the Foreign Agents Registration 
                Act of 1938, as amended, or any felony 
                violation of the Foreign Corrupt Practices Act; 
                or

           *       *       *       *       *       *       *

Sec. 1957. Engaging in monetary transactions in property derived from 
                    specified unlawful activity

  (a)  * * *

           *       *       *       *       *       *       *

  (g) Any person who conceals more than $10,000 in currency on 
his or her person, in any vehicle, in any compartment or 
container within any vehicle, or in any container placed in a 
common carrier, and transports, attempts to transport, or 
conspires to transport such currency in interstate commerce on 
any public road or highway or on any bus, train, airplane, 
vessel, or other common carrier, knowing that the currency was 
derived from some form of unlawful activity, or knowing that 
the currency was intended to be used to promote some form of 
unlawful activity, shall be punished as provided in subsection 
(b). The defendant's knowledge may be established by proof that 
the defendant was willfully blind to the source or intended use 
of the currency. For purposes of this subsection, the 
concealment of currency on the person of any individual 
includes concealment in any article of clothing worn by the 
individual or in any luggage, backpack, or other container worn 
or carried by such individual.

           *       *       *       *       *       *       *

[Sec. 1960. Prohibition of illegal money transmitting businesses

  [(a) Whoever conducts, controls, manages, supervises, 
directs, or owns all or part of a business, knowing the 
business is an illegal money transmitting business, shall be 
fined in accordance with this title or imprisoned not more than 
5 years, or both.
  [(b) As used in this section--
          [(1) the term ``illegal money transmitting business'' 
        means a money transmitting business which affects 
        interstate or foreign commerce in any manner or degree 
        and--
                  [(A) is intentionally operated without an 
                appropriate money transmitting license in a 
                State where such operation is punishable as a 
                misdemeanor or a felony under State law; or
                  [(B) fails to comply with the money 
                transmitting business registration requirements 
                under section 5330 of title 31, United States 
                Code, or regulations prescribed under such 
                section;
          [(2) the term ``money transmitting'' includes but is 
        not limited to transferring funds on behalf of the 
        public by any and all means including but not limited 
        to transfers within this country or to locations abroad 
        by wire, check, draft, facsimile, or courier; and
          [(3) the term ``State'' means any State of the United 
        States, the District of Columbia, the Northern Mariana 
        Islands, and any commonwealth, territory, or possession 
        of the United States.]

Sec. 1960. Prohibition of unlicensed money transmitting businesses

  (a) Whoever knowingly conducts, controls, manages, 
supervises, directs, or owns all or part of an unlicensed money 
transmitting business, shall be fined in accordance with this 
title or imprisoned not more than 5 years, or both.
  (b) As used in this section--
          (1) the term ``unlicensed money transmitting 
        business'' means a money transmitting business which 
        affects interstate or foreign commerce in any manner or 
        degree and--
                  (A) is operated without an appropriate money 
                transmitting license in a State where such 
                operation is punishable as a misdemeanor or a 
                felony under State law, whether or not the 
                defendant knew that the operation was required 
                to be licensed or that the operation was so 
                punishable;
                  (B) fails to comply with the money 
                transmitting business registration requirements 
                under section 5330 of title 31, United States 
                Code, or regulations prescribed under such 
                section; or
                  (C) otherwise involves the transportation or 
                transmission of funds that are known to the 
                defendant to have been derived from a criminal 
                offense or are intended to be used to be used 
                to promote or support unlawful activity;
          (2) the term ``money transmitting'' includes 
        transferring funds on behalf of the public by any and 
        all means including but not limited to transfers within 
        this country or to locations abroad by wire, check, 
        draft, facsimile, or courier; and
          (3) the term ``State'' means any State of the United 
        States, the District of Columbia, the Northern Mariana 
        Islands, and any commonwealth, territory, or possession 
        of the United States.

           *       *       *       *       *       *       *

PART II--CRIMINAL PROCEDURE

           *       *       *       *       *       *       *

CHAPTER 223--WITNESSES AND EVIDENCE

           *       *       *       *       *       *       *

Sec. 3486. Administrative subpoenas

  (a) Authorization.--(1)(A) In any investigation of--
          (i)(I) a Federal health care offense[; or (II) a 
        Federal offense involving the sexual exploitation or 
        abuse of children,], (II) a Federal offense involving 
        the sexual exploitation or abuse of children, or (III) 
        a money laundering offense in violation of section 
        1956, 1957 or 1960 of this title, the Attorney General; 
        or

           *       *       *       *       *       *       *

                              ----------                              

FEDERAL DEPOSIT INSURANCE ACT

           *       *       *       *       *       *       *

  Sec. 8. (a)  * * *

           *       *       *       *       *       *       *

  (x) Depository Institution Involvement in Internet 
Gambling.--If any appropriate Federal banking agency determines 
that any insured depository institution is engaged in any of 
the following activities, the agency may issue an order to such 
institution prohibiting such institution from continuing to 
engage in any of the following activities:
          (1) Extending credit, or facilitating an extension of 
        credit, electronic fund transfer, or money transmitting 
        service with the actual knowledge that any person is 
        violating section 3(a) of the Unlawful Internet 
        Gambling Funding Prohibition Act in connection with 
        such extension of credit, electronic fund transfer, or 
        money transmitting service.
          (2) Paying, transferring, or collecting on any check, 
        draft, or other instrument drawn on any depository 
        institution with the actual knowledge that any person 
        is violating section 3(a) of the Unlawful Internet 
        Gambling Funding Prohibition Act in connection with 
        such check, draft, or other instrument.

           *       *       *       *       *       *       *

  Sec. 18. (a)  * * *

           *       *       *       *       *       *       *

  (c)(1)  * * *

           *       *       *       *       *       *       *

          (11) Money laundering.--In every case, the 
        responsible agency shall take into consideration the 
        effectiveness of any insured depository institution 
        involved in the proposed merger transaction in 
        combating and preventing money laundering activities, 
        including in overseas branches.
  [(11)] (12) The provisions of this subsection do not apply to 
any merger transaction involving a foreign bank if no party to 
the transaction is principally engaged in business in the 
United States.

           *       *       *       *       *       *       *

  (w) Written Employment References May Contain Suspicions of 
Involvement in Illegal Activity.--
          (1) In general.--Notwithstanding any other provision 
        of law, any insured depository institution, and any 
        director, officer, employee, or agent of such 
        institution, may disclose in any written employment 
        reference relating to a current or former institution-
        affiliated party of such institution which is provided 
        to another insured depository institution in response 
        to a request from such other institution, information 
        concerning the possible involvement of such 
        institution-affiliated party in potentially unlawful 
        activity, to the extent--
                  (A) the disclosure does not contain 
                information which the institution, director, 
                officer, employee, or agent knows to be false; 
                and
                  (B) the institution, director, officer, 
                employee, or agent has not acted with malice or 
                with reckless disregard for the truth in making 
                the disclosure.
          (2) Definition.--For purposes of this subsection, the 
        term ``insured depository institution'' includes any 
        uninsured branch or agency of a foreign bank.

           *       *       *       *       *       *       *

  Sec. 21. (a)  * * *

           *       *       *       *       *       *       *

  (j) Civil Penalties.--
          (1) Penalty imposed.--Any insured depository 
        institution and any director, officer, or employee of 
        an insured depository institution who willfully or 
        through gross negligence violates, or any person who 
        willfully causes such a violation, any regulation 
        prescribed under subsection (b) shall be liable to the 
        United States for a civil penalty of not more than 
        [$10,000] the greater of--
                  (A) the amount (not to exceed $100,000) 
                involved in the transaction (if any) with 
                respect to which the violation occurred; or
                  (B) $25,000.

           *       *       *       *       *       *       *

                              ----------                              

                        ACT OF OCTOBER 26, 1970

                          (Public Law 91-508)

 AN ACT To amend the Federal Deposit Insurance Act to require insured 
banks to maintain certain records, to require that certain transactions 
  in the United States currency be reported to the Department of the 
Treasury, and for other purposes.

           *       *       *       *       *       *       *

Sec. 125. Civil penalties

  (a) For each willful or grossly negligent violation of any 
regulation under this chapter, the Secretary may assess upon 
any person to which the regulation applies, or any person 
willfully causing a violation of the regulation, and, if such 
person is a partnership, corporation, or other entity, upon any 
partner, director, officer, or employee thereof who willfully 
or through gross negligence participates in the violation, a 
civil penalty not exceeding [$10,000] the greater of--
          (1) the amount (not to exceed $100,000) involved in 
        the transaction (if any) with respect to which the 
        violation occurred; or
          (2) $25,000.

           *       *       *       *       *       *       *

[Sec. 126. Criminal penalty

  [Whoever willfully violates any regulation under this chapter 
shall be fined not more than $1,000 or imprisoned not more than 
one year, or both.

[Sec. 127. Additional criminal penalty in certain cases

  [Whoever willfully violates, or willfully causes a violation 
of any regulation under this chapter, section 21 of the Federal 
Deposit Insurance Act, or section 411 of the National Housing 
Act, where the violation is committed in furtherance of the 
commission of any violation of Federal law punishable by 
imprisonment for more than one year, shall be fined not more 
than $10,000 or imprisoned not more than five years, or both.]

SEC. 126. CRIMINAL PENALTY.

  A person that willfully violates this chapter, section 21 of 
the Federal Deposit Insurance Act, or a regulation prescribed 
under this chapter or that section 21, shall be fined not more 
than $250,000, or imprisoned for not more than 5 years, or 
both.

SEC. 127. ADDITIONAL CRIMINAL PENALTY IN CERTAIN CASES.

  A person that willfully violates this chapter, section 21 of 
the Federal Deposit Insurance Act, or a regulation prescribed 
under this chapter or that section 21, while violating another 
law of the United States or as part of a pattern of any illegal 
activity involving more than $100,000 in a 12-month period, 
shall be fined not more than $500,000, imprisoned for not more 
than 10 years, or both.

           *       *       *       *       *       *       *

                              ----------                              

           SECTION 212 OF THE IMMIGRATION AND NATIONALITY ACT

 GENERAL CLASSES OF ALIENS INELIGIBLE TO RECEIVE VISAS AND INELIGIBLE 
               FOR ADMISSION; WAIVERS OF INADMISSIBILITY

      Sec. 212. (a) Classes of Aliens Ineligible for Visas or 
Admission.--Except as otherwise provided in this Act, aliens 
who are inadmissible under the following paragraphs are 
ineligible to receive visas and ineligible to be admitted to 
the United States:
          (1)  * * *
          (2) Criminal and related grounds.--
                  (A)  * * *

           *       *       *       *       *       *       *

                  (D) Money laundering activities.--
                          (i) In general.--Any alien who the 
                        consular officer or the Attorney 
                        General knows or has reason to believe 
                        is or has been engaged in activities 
                        which if engaged in within the United 
                        States would constitute a violation of 
                        the money laundering provisions section 
                        1956, 1957, or 1960 of title 18, United 
                        States Code, or has knowingly assisted, 
                        abetted, or conspired or colluded with 
                        others in any such illicit activity is 
                        inadmissible.
                          (ii) Related individuals.--Any alien 
                        who the consular officer or the 
                        Attorney General knows or has reason to 
                        believe is the spouse, son, or daughter 
                        of an alien inadmissible under clause 
                        (i), has, within the previous 5 years, 
                        obtained any financial or other benefit 
                        from such illicit activity of that 
                        alien, and knew or reasonably should 
                        have known that the financial or other 
                        benefit was the product of such illicit 
                        activity, is inadmissible, except that 
                        the Attorney General may, in the full 
                        discretion of the Attorney General, 
                        waive the exclusion of the spouse, son, 
                        or daughter of an alien under this 
                        clause if the Attorney General 
                        determines that exceptional 
                        circumstances exist that justify such 
                        waiver.
                  [(D)] (E) Prostitution and commercialized 
                vice.--Any alien who--
                          (i)  * * *

           *       *       *       *       *       *       *

                  [(E)] (F) Certain aliens involved in serious 
                criminal activity who have asserted immunity 
                from prosecution.--Any alien--
                          (i)  * * *

           *       *       *       *       *       *       *

                  [(F)] (G) Waiver authorized.--For provision 
                authorizing waiver of certain subparagraphs of 
                this paragraph, see subsection (h).
                  [(G)] (H) Foreign government officials who 
                have engaged in particularly severe violations 
                of religious freedom.--Any alien who, while 
                serving as a foreign government official, was 
                responsible for or directly carried out, at any 
                time during the preceding 24-month period, 
                particularly severe violations of religious 
                freedom, as defined in section 3 of the 
                International Religious Freedom Act of 1998, 
                and the spouse and children, if any, are 
                inadmissible.
                  [(H)] (I) Significant traffickers in 
                persons.--
                          (i)  * * *

           *       *       *       *       *       *       *

      (h) The Attorney General may, in his discretion, waive 
the application of subparagraphs (A)(i)(I), (B), (D), and (E) 
of subsection (a)(2) and subparagraph (A)(i)(II) of such 
subsection insofar as it relates to a single offense of simple 
possession of 30 grams or less of marijuana if--
          (1)(A) in the case of any immigrant it is established 
        to the satisfaction of the Attorney General that--
                  (i) the alien is inadmissible only under 
                subparagraph [(D)(i) or (D)(ii)] (E)(i) or 
                (E)(ii) of such subsection or the activities 
                for which the alien is inadmissible occurred 
                more than 15 years before the date of the 
                alien's application for a visa, admission, or 
                adjustment of status,

           *       *       *       *       *       *       *

                              ----------                              

              SECTION 413 OF THE CONTROLLED SUBSTANCES ACT

                          Criminal Forfeitures

                PROPERTY SUBJECT TO CRIMINAL FORFEITURE

  Sec. 413. (a)  * * *

           *       *       *       *       *       *       *

                           PROTECTIVE ORDERS

  (e)(1)  * * *

           *       *       *       *       *       *       *

  (4) Order To Repatriate and Deposit.--
          (A) In general.--Pursuant to its authority to enter a 
        pretrial restraining order under this section, 
        including its authority to restrain any property 
        forfeitable as substitute assets, the court may order a 
        defendant to repatriate any property that may be seized 
        and forfeited, and to deposit that property pending 
        trial in the registry of the court, or with the United 
        States Marshals Service or the Secretary of the 
        Treasury, in an interest-bearing account, if 
        appropriate.
          (B) Failure to comply.--Failure to comply with an 
        order under this subsection, or an order to repatriate 
        property under subsection (p), shall be punishable as a 
        civil or criminal contempt of court, and may also 
        result in an enhancement of the sentence of the 
        defendant under the obstruction of justice provision of 
        the Federal Sentencing Guidelines.

           *       *       *       *       *       *       *

  [(p) If any of the property described in subsection (a), as a 
result of any act or omission of the defendant--
          [(1) cannot be located upon the exercise of due 
        diligence;
          [(2) has been transferred or sold to, or deposited 
        with, a third party;
          [(3) has been placed beyond the jurisdiction of the 
        court;
          [(4) has been substantially diminished in value; or
          [(5) has been commingled with other property which 
        cannot be divided without difficulty;
the court shall order the forfeiture of any other property of 
the defendant up to the value of any property described in 
paragraphs (1) through (5).]
  (p) Forfeiture of Substitute Property.--
          (1) In general.--Paragraph (2) of this subsection 
        shall apply, if any property described in subsection 
        (a), as a result of any act or omission of the 
        defendant--
                  (A) cannot be located upon the exercise of 
                due diligence;
                  (B) has been transferred or sold to, or 
                deposited with, a third party;
                  (C) has been placed beyond the jurisdiction 
                of the court;
                  (D) has been substantially diminished in 
                value; or
                  (E) has been commingled with other property 
                which cannot be divided without difficulty.
          (2) Substitute property.--In any case described in 
        any of subparagraphs (A) through (E) of paragraph (1), 
        the court shall order the forfeiture of any other 
        property of the defendant, up to the value of any 
        property described in subparagraphs (A) through (E) of 
        paragraph (1), as applicable.
          (3) Return of property to jurisdiction.--In the case 
        of property described in paragraph (1)(C), the court 
        may, in addition to any other action authorized by this 
        subsection, order the defendant to return the property 
        to the jurisdiction of the court so that the property 
        may be seized and forfeited.

           *       *       *       *       *       *       *

                              ----------                              

TITLE 28, UNITED STATES CODE

           *       *       *       *       *       *       *

PART VI--PARTICULAR PROCEEDING

           *       *       *       *       *       *       *

CHAPTER 163--FINES, PENALTIES AND FORFEITURES

           *       *       *       *       *       *       *

Sec. 2466. Fugitive disentitlement

  (a) A judicial officer may disallow a person from using the 
resources of the courts of the United States in furtherance of 
a claim in any related civil forfeiture action or a claim in 
third party proceedings in any related criminal forfeiture 
action upon a finding that such person--
          (1) * * *

           *       *       *       *       *       *       *

  (b) Subsection (a) may be applied to a claim filed by a 
corporation if any majority shareholder, or individual filing 
the claim on behalf of the corporation is a person to whom 
subsection (a) applies.

Sec. 2467. Enforcement of foreign judgment

  (a) Definitions.--In this section--
          (1) * * *
          (2) the term ``forfeiture or confiscation judgment'' 
        means a final order of a foreign nation compelling a 
        person or entity--
                  (A) to pay a sum of money representing the 
                proceeds of an offense described in Article 3, 
                Paragraph 1, of the United Nations Convention, 
                any violation of foreign law that would 
                constitute a violation of an offense for which 
                property could be forfeited under Federal law 
                if the offense were committed in the United 
                States, or any foreign offense described in 
                section 1956(c)(7)(B) of title 18, or property 
                the value of which corresponds to such 
                proceeds; or

           *       *       *       *       *       *       *

  (b) Review by Attorney General.--
          (1) In general.--A foreign nation seeking to have a 
        forfeiture or confiscation judgment registered and 
        enforced by a district court of the United States under 
        this section shall first submit a request to the 
        Attorney General or the designee of the Attorney 
        General, which request shall include--
                  (A) * * *

           *       *       *       *       *       *       *

                  (C) an affidavit or sworn declaration 
                [establishing that the defendant received 
                notice of the proceedings in sufficient time to 
                enable the defendant] establishing that the 
                foreign nation took steps, in accordance with 
                the principles of due process, to give notice 
                of the proceedings to all persons with an 
                interest in the property in sufficient time to 
                enable such persons to defend against the 
                charges and that the judgment rendered is in 
                force and is not subject to appeal; and

           *       *       *       *       *       *       *

  (d) Entry and Enforcement of Judgment.--
          (1) In general.--The district court shall enter such 
        orders as may be necessary to enforce the judgment on 
        behalf of the foreign nation unless the court finds 
        that--
                  (A) * * *

           *       *       *       *       *       *       *

                  (D) [the defendant in the proceedings in the 
                foreign court did not receive notice] the 
                foreign nation did not take steps, in 
                accordance with the principles of due process, 
                to give notice of the proceedings to a person 
                with an interest in the property of the 
                proceedings in sufficient time to enable him or 
                her to defend; or

           *       *       *       *       *       *       *

          (3) Preservation of property.--To preserve the 
        availability of property subject to a foreign 
        forfeiture or confiscation judgment, the Government may 
        apply for, and the court may issue, a restraining order 
        pursuant to section 983(j) of title 18, United States 
        Code, at any time before or after an application is 
        filed pursuant to subsection (c)(1). The court, in 
        issuing the restraining order--
                  (A) may rely on information set forth in an 
                affidavit describing the nature of the 
                proceeding or investigation underway in the 
                foreign country, and setting forth a reasonable 
                basis to believe that the property to be 
                restrained will be named in a judgment of 
                forfeiture at the conclusion of such 
                proceeding; or
                  (B) may register and enforce a restraining 
                order that has been issued by a court of 
                competent jurisdiction in the foreign country 
                and certified by the Attorney General pursuant 
                to subsection (b)(2).
        No person may object to the restraining order on any 
        ground that is the subject of parallel litigation 
        involving the same property that is pending in a 
        foreign court.

           *       *       *       *       *       *       *

                              ----------                              

                 RIGHT TO FINANCIAL PRIVACY ACT OF 1978

                  TITLE XI--RIGHT TO FINANCIAL PRIVACY

      Sec. 1100. This title may be cited as the ``Right to 
Financial Privacy Act of 1978''.

           *       *       *       *       *       *       *

                           USE OF INFORMATION

      Sec. 1112. (a) Financial records originally obtained 
pursuant to this title shall not be transferred to another 
agency or department unless the transferring agency or 
department certifies in writing that there is reason to believe 
that the records are relevant to a legitimate law enforcement 
inquiry, or intelligence or counterintelligence activity, 
investigation or analysis related to international terrorism 
within the jurisdiction of the receiving agency or department.

           *       *       *       *       *       *       *

                           SPECIAL PROCEDURES

      Sec. 1114. (a)(1) Nothing in this title (except sections 
1115, 1117, 1118, and 1121) shall apply to the production and 
disclosure of financial records pursuant to requests from--
          (A) a Government authority authorized to conduct 
        foreign counter- or foreign positive-intelligence 
        activities for purposes of conducting such activities; 
        [or]
          (B) the Secret Service for the purpose of conducting 
        its protective functions (18 U.S.C. 3056; 3 U.S.C. 202, 
        Public Law 90-331, as amended)[.]; or
                  (C) a Government authority authorized to 
                conduct investigations of, or intelligence or 
                counterintelligence analyses related to, 
                international terrorism for the purpose of 
                conducting such investigations or analyses.

           *       *       *       *       *       *       *

                         GRAND JURY INFORMATION

      Sec. 1120. (a) Financial records about a customer 
obtained from a financial institution pursuant to a subpena 
issued under the authority of a Federal grand jury--
          (1) * * *
          (2) shall be used only for the purpose of considering 
        whether to issue an indictment or presentment by that 
        grand jury, or of prosecuting a crime for which that 
        indictment or presentment is issued, or for a purpose 
        authorized by rule 6(e) of the Federal Rules of 
        Criminal Procedure, or for a purpose authorized by 
        section 1112(a);

           *       *       *       *       *       *       *

                              ----------                              

                       FAIR CREDIT REPORTING ACT

                  TITLE VI--CONSUMER CREDIT REPORTING

Sec.
601. Short title.
     * * * * * * *
[624.] 625. Disclosures to FBI for counterintelligence purposes.
626. Disclosures to governmental agencies for counterterrorism purposes.

Sec. 601. Short title

  This title may be cited as the Fair Credit Reporting Act.

           *       *       *       *       *       *       *

[Sec. 624.] Sec. 625. Disclosures to FBI for counterintelligence 
                    purposes

  (a) * * *

           *       *       *       *       *       *       *

Sec. 626. Disclosures to governmental agencies for counterterrorism 
                    purposes

  (a) Disclosure.--Notwithstanding section 604 or any other 
provision of this title, a consumer reporting agency shall 
furnish a consumer report of a consumer and all other 
information in a consumer's file to a government agency 
authorized to conduct investigations of, or intelligence or 
counterintelligence activities or analysis related to, 
international terrorism when presented with a written 
certification by such government agency that such information 
is necessary for the agency's conduct or such investigation, 
activity or analysis.
  (b)  Form of Certification.--The certification described in 
subsection (a) shall be signed by the Secretary of the 
Treasury, or an officer designated by the Secretary from among 
officers of the Department of the Treasury whose appointments 
to office are required to be made by the President, by and with 
the advice and consent of the Senate.
  (c) Confidentiality.--No consumer reporting agency, or 
officer, employee, or agent of such consumer reporting agency, 
shall disclose to any person, or specify in any consumer 
report, that a government agency has sought or obtained access 
to information under subsection (a).
  (d) Rule of Construction.--Nothing in section 625 shall be 
construed to limit the authority of the Director of the Federal 
Bureau of Investigation under this section.
  (e) Safe Harbor.--Notwithstanding any other provision of this 
subchapter, any consumer reporting agency or agent or employee 
thereof making disclosure of consumer reports or other 
information pursuant to this section in good-faith reliance 
upon a certification of a governmental agency pursuant to the 
provisions of this section shall not be liable to any person 
for such disclosure under this subchapter, the constitution of 
any State, or any law or regulation of any State or any 
political subdivision of any State.
                              ----------                              

           SECTION 3 OF THE BANK HOLDING COMPANY ACT OF 1956

                  ACQUISITION OF BANK SHARES OR ASSETS

  Sec. 3. (a) * * *

           *       *       *       *       *       *       *

  (c) Factors for Consideration by Board.--
          (1) * * *

           *       *       *       *       *       *       *

          (6) Money laundering.--In every case the Board shall 
        take into consideration the effectiveness of the 
        company or companies in combating and preventing money 
        laundering activities, including in overseas branches.

           *       *       *       *       *       *       *

                              ----------                              

                ANNUNZIO-WYLIE ANTI-MONEY LAUNDERING ACT

           TITLE XV--ANNUNZIO-WYLIE ANTI-MONEY LAUNDERING ACT

SEC. 1500. SHORT TITLE.

  This title may be cited as the ``Annunzio-Wylie Anti-Money 
Laundering Act''.

           *       *       *       *       *       *       *

Subtitle F--Miscellaneous Provisions

           *       *       *       *       *       *       *

SEC. 1564. ADVISORY GROUP ON REPORTING REQUIREMENTS.

  (a) * * *

           *       *       *       *       *       *       *

  (d) Terrorist Financing Issues.--
          (1) In general.--The Secretary of the Treasury shall 
        provide, either within the Bank Secrecy Act Advisory 
        Group, or as a subcommittee or other adjunct of the 
        Advisory Group, for a task force of representatives 
        from agencies and officers represented on the Advisory 
        Group, a representative of the Director of the Office 
        of Homeland Security, and representatives of financial 
        institutions, private organizations that represent the 
        financial services industry, and other interested 
        parties to focus on--
                  (A) issues specifically related to the 
                finances of terrorist groups, the means 
                terrorist groups use to transfer funds around 
                the world and within the United States, 
                including through the use of charitable 
                organizations, nonprofit organizations, and 
                nongovernmental organizations, and the extent 
                to which financial institutions in the United 
                States are unwittingly involved in such 
                finances and the extent to which such 
                institutions are at risk as a result;
                  (B) the relationship, particularly the 
                financial relationship, between international 
                narcotics traffickers and foreign terrorist 
                organizations, the extent to which their 
                memberships overlap and engage in joint 
                activities, and the extent to which they 
                cooperate with each other in raising and 
                transferring funds for their respective 
                purposes; and
                  (C) means of facilitating the identification 
                of accounts and transactions involving 
                terrorist groups and facilitating the exchange 
                of information concerning such accounts and 
                transactions between financial institutions and 
                law enforcement organizations.
          (2) Applicability of other provisions.--Sections 552, 
        552a, and 552b of title 5, United States Code, and the 
        Federal Advisory Committee Act shall not apply to the 
        task force established pursuant to paragraph (1).

           *       *       *       *       *       *       *

                            DISSENTING VIEWS

    The so-called Financial Anti-Terrorism Act of 2001 (HR 
3004) has more to do with the ongoing war against financial 
privacy than with the war against international terrorism. Of 
course, the federal government should take all necessary and 
constitutional actions to enhance the ability of law 
enforcement to locate and seize funds flowing to known 
terrorists and their front groups. For example, America should 
consider signing more mutual legal assistance treaties with its 
allies so we can more easily locate the assets of terrorists 
and other criminals.
    Unfortunately, instead of focusing on reasonable measures 
aimed at enhancing the ability to reach assets used to support 
terrorism, HR 3004 is a laundry list of dangerous, 
unconstitutional power grabs. Many of these proposals have 
already been rejected by the American people when presented as 
necessary to ``fight the war on drugs'' or ``crackdown on 
white-collar crime.'' Even a ban on Internet gambling has 
somehow made it into this ``anti-terrorism'' bill!
    Among the most obnoxious provisions of this bill are: 
expanding the war on cash by creating a new federal crime of 
taking over $10,000 cash into or out of the United States; 
codifying the unconstitutional authority of the Financial 
Crimes Enforcement Network (FinCEN) to snoop into the private 
financial dealings of American citizens; and expanding the 
``suspicious activity reports'' mandate to broker-dealers, even 
though history has shown that these reports fail to 
significantly aid in apprehending criminals. These measures 
will actually distract from the battle against terrorism by 
encouraging law enforcement authorities to waste time snooping 
through the financial records of innocent Americans who simply 
happen to demonstrate an ``unusual'' pattern in their financial 
dealings.
    HR 3004 also attacks the Fourth Amendment by allowing 
Customs officials to open incoming or outgoing mail without a 
search warrant. Allowing government officials to read mail 
going out of or coming into the country at whim is 
characteristic of totalitarian regimes, not free societies.
    The Financial Anti-Terrorism Act of 2001 (HR 3004) is a 
package of unconstitutional expansions of the financial police 
state, most of which will prove ultimately ineffective in the 
war against terrorism. I therefore urge my colleagues to reject 
this bill and work to fashion a measure aimed at giving the 
government a greater ability to locate and seize the assets of 
terrorists while respecting the constitutional rights of 
American citizens.

                                                          Ron Paul.

                                    
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