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[Congressional Bills 109th Congress]
[From the U.S. Government Publishing Office]
[H.R. 3505 Engrossed in House (EH)]

109th CONGRESS

  2d Session

                               H. R. 3505

_______________________________________________________________________

                                 AN ACT

   To provide regulatory relief and improve productivity for insured 
            depository institutions, and for other purposes.
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
109th CONGRESS
  2d Session
                                H. R. 3505

_______________________________________________________________________

                                 AN ACT

 
   To provide regulatory relief and improve productivity for insured 
            depository institutions, and for other purposes.

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

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Financial Services 
Regulatory Relief Act of 2005''.
    (b) Table of Contents.--The table of contents for this Act is as 
follows:

Sec. 1. Short title; table of contents.
                   TITLE I--NATIONAL BANK PROVISIONS

Sec. 101. National bank directors.
Sec. 102. Voting in shareholder elections.
Sec. 103. Simplifying dividend calculations for national banks.
Sec. 104. Repeal of obsolete limitation on removal authority of the 
                            Comptroller of the Currency.
Sec. 105. Repeal of intrastate branch capital requirements.
Sec. 106. Clarification of waiver of publication requirements for bank 
                            merger notices.
Sec. 107. Equal treatment for Federal agencies of foreign banks.
Sec. 108. Maintenance of a Federal branch and a Federal agency in the 
                            same State.
Sec. 109. Business organization flexibility for national banks.
Sec. 110. Clarification of the main place of business of a national 
                            bank.
Sec. 111. Capital equivalency deposits for Federal branches and 
                            agencies of foreign banks.
Sec. 112. Enhancing the authority for national banks to make community 
                            development investments.
                TITLE II--SAVINGS ASSOCIATION PROVISIONS

Sec. 201. Parity for savings associations under the Securities Exchange 
                            Act of 1934 and the Investment Advisers Act 
                            of 1940.
Sec. 202. Investments by Federal savings associations authorized to 
                            promote the public welfare.
Sec. 203. Mergers and consolidations of Federal savings associations 
                            with nondepository institution affiliates.
Sec. 204. Repeal of statutory dividend notice requirement for savings 
                            association subsidiaries of savings and 
                            loan holding companies.
Sec. 205. Modernizing statutory authority for trust ownership of 
                            savings associations.
Sec. 206. Repeal of overlapping rules governing purchased mortgage 
                            servicing rights.
Sec. 207. Restatement of authority for Federal savings associations to 
                            invest in small business investment 
                            companies.
Sec. 208. Removal of limitation on investments in auto loans.
Sec. 209. Selling and offering of deposit products.
Sec. 210. Funeral- and cemetery-related fiduciary services.
Sec. 211. Repeal of qualified thrift lender requirement with respect to 
                            out-of-state branches.
Sec. 212. Small business and other commercial loans.
Sec. 213. Clarifying citizenship of Federal savings associations for 
                            Federal court jurisdiction.
Sec. 214. Increase in limits on commercial real estate loans.
Sec. 215. Repeal of one limit on loans to one borrower.
Sec. 216. Savings association credit card banks.
Sec. 217. Interstate acquisitions by S&L holding companies.
Sec. 218. Business organization flexibility for federal savings 
                            associations.
                   TITLE III--CREDIT UNION PROVISIONS

Sec. 301. Privately insured credit unions authorized to become members 
                            of a Federal home loan bank.
Sec. 302. Leases of land on Federal facilities for credit unions.
Sec. 303. Investments in securities by Federal credit unions.
Sec. 304. Increase in general 12-year limitation of term of Federal 
                            credit union loans to 15 years.
Sec. 305. Increase in 1 percent investment limit in credit union 
                            service organizations.
Sec. 306. Member business loan exclusion for loans to nonprofit 
                            religious organizations.
Sec. 307. Check cashing and money transfer services offered within the 
                            field of membership.
Sec. 308. Voluntary mergers involving multiple common-bond credit 
                            unions.
Sec. 309. Conversions involving common-bond credit unions.
Sec. 310. Credit union governance.
Sec. 311. Providing the National Credit Union Administration with 
                            greater flexibility in responding to market 
                            conditions.
Sec. 312. Exemption from pre-merger notification requirement of the 
                            Clayton Act.
Sec. 313. Treatment of credit unions as depository institutions under 
                            securities laws.
Sec. 314. Clarification of definition of net worth under certain 
                            circumstances for purposes of prompt 
                            corrective action.
Sec. 315. Amendments relating to nonfederally insured credit unions.
              TITLE IV--DEPOSITORY INSTITUTION PROVISIONS

Sec. 401. Easing restrictions on interstate branching and mergers.
Sec. 402. Statute of limitations for judicial review of appointment of 
                            a receiver for depository institutions.
Sec. 403. Reporting requirements relating to insider lending.
Sec. 404. Amendment to provide an inflation adjustment for the small 
                            depository institution exception under the 
                            Depository Institution Management 
                            Interlocks Act.
Sec. 405. Enhancing the safety and soundness of insured depository 
                            institutions.
Sec. 406. Investments by insured savings associations in bank service 
                            companies authorized.
Sec. 407. Cross guarantee authority.
Sec. 408. Golden parachute authority and nonbank holding companies.
Sec. 409. Amendments relating to change in bank control.
Sec. 410. Community reinvestment credit for esops and ewocs.
Sec. 411. Minority financial institutions.
         TITLE V--DEPOSITORY INSTITUTION AFFILIATES PROVISIONS

Sec. 501. Clarification of cross marketing provision.
Sec. 502. Amendment to provide the Federal Reserve Board with 
                            discretion concerning the imputation of 
                            control of shares of a company by trustees.
Sec. 503. Eliminating geographic limits on thrift service companies.
Sec. 504. Clarification of scope of applicable rate provision.
Sec. 505. Savings associations acting as agents for affiliated 
                            depository institutions.
Sec. 506. Credit card bank investments for the public welfare.
                  TITLE VI--BANKING AGENCY PROVISIONS

Sec. 601. Waiver of examination schedule in order to allocate examiner 
                            resources.
Sec. 602. Interagency data sharing.
Sec. 603. Penalty for unauthorized participation by convicted 
                            individual.
Sec. 604. Amendment permitting the destruction of old records of a 
                            depository institution by the FDIC after 
                            the appointment of the FDIC as receiver.
Sec. 605. Modernization of recordkeeping requirement.
Sec. 606. Streamlining reports of condition.
Sec. 607. Expansion of eligibility for 18-month examination schedule 
                            for community banks.
Sec. 608. Short form reports of condition for certain community banks.
Sec. 609. Clarification of extent of suspension, removal, and 
                            prohibition authority of Federal banking 
                            agencies in cases of certain crimes by 
                            institution-affiliated parties.
Sec. 610. Streamlining depository institution merger application 
                            requirements.
Sec. 611. Inclusion of Director of the Office of Thrift Supervision in 
                            list of banking agencies regarding 
                            insurance customer protection regulations.
Sec. 612. Protection of confidential information received by Federal 
                            banking regulators from foreign banking 
                            supervisors.
Sec. 613. Prohibition on participation by convicted individual.
Sec. 614. Clarification that notice after separation from service may 
                            be made by an order.
Sec. 615. Enforcement against misrepresentations regarding FDIC deposit 
                            insurance coverage.
Sec. 616. Changes required to small bank holding company policy 
                            statement on assessment of financial and 
                            managerial factors.
Sec. 617. Exception to annual privacy notice requirement under the 
                            Gramm-Leach-Bliley Act.
Sec. 618. Biennial reports on the status of agency employment of 
                            minorities and women.
Sec. 619. Coordination of State examination authority.
Sec. 620. Nonwaiver of privileges.
Sec. 621. Right to Financial Privacy Act of 1978 amendment.
Sec. 622. Deputy director; succession authority for Director of the 
                            Office of Thrift Supervision.
Sec. 623. Limitation on scope of new agency guidelines.
             TITLE VII--``BSA'' COMPLIANCE BURDEN REDUCTION

Sec. 701. Exception from currency transaction reports for seasoned 
                            customers.
Sec. 702. Reduction in inconsistencies in monetary transaction 
                            recordkeeping and reporting enforcement and 
                            examination requirements.
Sec. 703. Additional reforms relating to monetary transaction and 
                            recordkeeping requirements applicable to 
                            financial institutions.
Sec. 704. Study by Comptroller General.
Sec. 705. Feasibility study required.
Sec. 706. Annual report by Secretary of the Treasury.
Sec. 707. Preservation of money services businesses.
             TITLE VIII--CLERICAL AND TECHNICAL AMENDMENTS

Sec. 801. Clerical amendments to the Home Owners' Loan Act.
Sec. 802. Technical corrections to the Federal Credit Union Act.
Sec. 803. Other technical corrections.
Sec. 804. Repeal of obsolete provisions of the Bank Holding Company Act 
                            of 1956.
        TITLE IX--FAIR DEBT COLLECTION PRACTICES ACT AMENDMENTS

Sec. 901. Exception for certain bad check enforcement programs.
Sec. 902. Other amendments.

                   TITLE I--NATIONAL BANK PROVISIONS

SEC. 101. NATIONAL BANK DIRECTORS.

    (a) In General.--Section 5146 of the Revised Statutes of the United 
States (12 U.S.C. 72) is amended--
            (1) by striking ``Sec. 5146. Every director must during'' 
        and inserting the following:

``SEC. 5146. REQUIREMENTS FOR BANK DIRECTORS.

    ``(a) Residency Requirements.--Every director of a national bank 
shall, during'';
            (2) by striking ``total number of directors. Every director 
        must own in his or her own right'' and inserting ``total number 
        of directors.
    ``(b) Investment Requirement.--
            ``(1) In general.--Every director of a national bank shall 
        own, in his or her own right,''; and
            (3) by adding at the end the following new paragraph:
            ``(2) Exception for subordinated debt in certain cases.--In 
        lieu of the requirements of paragraph (1) relating to the 
        ownership of capital stock in the national bank, the 
        Comptroller of the Currency may, by regulation or order, permit 
        an individual to serve as a director of a national bank that 
        has elected, or notifies the Comptroller of the bank's 
        intention to elect, to operate as a S corporation pursuant to 
        section 1362(a) of the Internal Revenue Code of 1986, if that 
        individual holds debt of at least $1,000 issued by the national 
        bank that is subordinated to the interests of depositors and 
        other general creditors of the national bank.''.
    (b) Clerical Amendment.--The table of sections for chapter one of 
title LXII of the Revised Statutes of the United States (12 U.S.C. 21 
et seq.) is amended by striking the item relating to section 5146 and 
inserting the following new item:

``5146. Requirements for bank directors.''.

SEC. 102. VOTING IN SHAREHOLDER ELECTIONS.

    Section 5144 of the Revised Statutes of the United States (12 
U.S.C. 61) is amended--
            (1) by striking ``or to cumulate'' and inserting ``or, if 
        so provided by the articles of association of the national 
        bank, to cumulate'';
            (2) by striking the comma after ``his shares shall equal''; 
        and
            (3) by adding at the end the following new sentence: ``The 
        Comptroller of the Currency may prescribe such regulations to 
        carry out the purposes of this section as the Comptroller 
        determines to be appropriate.''.

SEC. 103. SIMPLIFYING DIVIDEND CALCULATIONS FOR NATIONAL BANKS.

    (a) In General.--Section 5199 of the Revised Statutes of the United 
States (12 U.S.C. 60) is amended to read as follows:

``SEC. 5199. NATIONAL BANK DIVIDENDS.

    ``(a) In General.--Subject to subsection (b), the directors of any 
national bank may declare a dividend of so much of the undivided 
profits of the bank as the directors judge to be expedient.
    ``(b) Approval Required Under Certain Circumstances.--A national 
bank may not declare and pay dividends in any year in excess of an 
amount equal to the sum of the total of the net income of the bank for 
that year and the retained net income of the bank in the preceding two 
years, minus any transfers required by the Comptroller of the Currency 
(including any transfers required to be made to a fund for the 
retirement of any preferred stock), unless the Comptroller of the 
Currency approves the declaration and payment of dividends in excess of 
such amount.''.
    (b) Clerical Amendment.--The table of sections for chapter three of 
title LXII of the Revised Statutes of the United States is amended by 
striking the item relating to section 5199 and inserting the following 
new item:

``5199. National bank dividends.''.

SEC. 104. REPEAL OF OBSOLETE LIMITATION ON REMOVAL AUTHORITY OF THE 
              COMPTROLLER OF THE CURRENCY.

    Section 8(e)(4) of the Federal Deposit Insurance Act (12 U.S.C. 
1818(e)(4)) is amended by striking the 5th sentence.

SEC. 105. REPEAL OF INTRASTATE BRANCH CAPITAL REQUIREMENTS.

    Section 5155(c) of the Revised Statutes of the United States (12 
U.S.C. 36(c)) is amended--
            (1) in the 2nd sentence, by striking ``, without regard to 
        the capital requirements of this section,''; and
            (2) by striking the last sentence.

SEC. 106. CLARIFICATION OF WAIVER OF PUBLICATION REQUIREMENTS FOR BANK 
              MERGER NOTICES.

    The last sentence of sections 2(a) and 3(a)(2) of the National Bank 
Consolidation and Merger Act (12 U.S.C. 215(a) and 215a(a)(2), 
respectively) are each amended by striking ``Publication of notice may 
be waived, in cases where the Comptroller determines that an emergency 
exists justifying such waiver, by unanimous action of the shareholders 
of the association or State bank'' and inserting ``Publication of 
notice may be waived if the Comptroller determines that an emergency 
exists justifying such waiver or if the shareholders of the association 
or State bank agree by unanimous action to waive the publication 
requirement for their respective institutions''.

SEC. 107. EQUAL TREATMENT FOR FEDERAL AGENCIES OF FOREIGN BANKS.

    The 1st sentence of section 4(d) of the International Banking Act 
of 1978 (12 U.S.C. 3102(d)) is amended by inserting ``from citizens or 
residents of the United States'' after ``deposits''.

SEC. 108. MAINTENANCE OF A FEDERAL BRANCH AND A FEDERAL AGENCY IN THE 
              SAME STATE.

    Section 4(e) of the International Banking Act of 1978 (12 U.S.C. 
3102(e)) is amended by inserting ``if the maintenance of both an agency 
and a branch in the State is prohibited under the law of such State'' 
before the period at the end.

SEC. 109. BUSINESS ORGANIZATION FLEXIBILITY FOR NATIONAL BANKS.

    (a) In General.--Chapter one of title LXII of the Revised Statutes 
of the United States (12 U.S.C. 21 et seq.) is amended by inserting 
after section 5136B the following new section:

``SEC. 5136C. ALTERNATIVE BUSINESS ORGANIZATION.

    ``(a) In General.--The Comptroller of the Currency may prescribe 
regulations--
            ``(1) to permit a national bank to be organized other than 
        as a body corporate; and
            ``(2) to provide requirements for the organizational 
        characteristics of a national bank organized and operating 
        other than as a body corporate, consistent with the safety and 
        soundness of the national bank.
    ``(b) Equal Treatment.--Except as provided in regulations 
prescribed under subsection (a), a national bank that is operating 
other than as a body corporate shall have the same rights and 
privileges and shall be subject to the same duties, restrictions, 
penalties, liabilities, conditions, and limitations as a national bank 
that is organized as a body corporate.''.
    (b) Technical and Conforming Amendment.--Section 5136 of the 
Revised Statutes of the United States (12 U.S.C. 24) is amended, in the 
matter preceding the paragraph designated as the ``First'', by 
inserting ``or other form of business organization provided under 
regulations prescribed by the Comptroller of the Currency under section 
5136C'' after ``a body corporate''.
    (c) Clerical Amendment.--The table of sections for chapter one of 
title LXII of the Revised Statutes of the United States (12 U.S.C. 21 
et seq.) is amended by inserting after the item relating to section 
5136B the following new item:

``5136C. Alternative business organization.''.

SEC. 110. CLARIFICATION OF THE MAIN PLACE OF BUSINESS OF A NATIONAL 
              BANK.

    Title LXII of the Revised Statutes of the United States is 
amended--
            (1) in the paragraph designated the ``Second'' of section 
        5134 (12 U.S.C. 22), by striking ``The place where its 
        operations of discount and deposit are to be carried on'' and 
        inserting ``The place where the main office of the national 
        bank is, or is to be, located''; and
            (2) in section 5190 (12 U.S.C. 81), by striking ``the place 
        specified in its organization certificate'' and inserting ``the 
        main office of the national bank''.

SEC. 111. CAPITAL EQUIVALENCY DEPOSITS FOR FEDERAL BRANCHES AND 
              AGENCIES OF FOREIGN BANKS.

    Section 4(g) of the International Banking Act of 1978 (12 U.S.C. 
3102(g)) is amended to read as follows:
    ``(g) Capital Equivalency Deposit.--
            ``(1) In general.--Upon the opening of a Federal branch or 
        agency of a foreign bank in any State and thereafter, the 
        foreign bank, in addition to any deposit requirements imposed 
        under section 6, shall keep on deposit, in accordance with such 
        regulations as the Comptroller of the Currency may prescribe in 
        accordance with paragraph (2), dollar deposits, investment 
        securities, or other assets in such amounts as the Comptroller 
        of the Currency determines to be necessary for the protection 
        of depositors and other investors and to be consistent with the 
        principles of safety and soundness.
            ``(2) Limitation.--Notwithstanding paragraph (1), 
        regulations prescribed under such paragraph shall not permit a 
        foreign bank to keep assets on deposit in an amount that is 
        less than the amount required for a State licensed branch or 
        agency of a foreign bank under the laws and regulations of the 
        State in which the Federal agency or branch is located.''.

SEC. 112. ENHANCING THE AUTHORITY FOR NATIONAL BANKS TO MAKE COMMUNITY 
              DEVELOPMENT INVESTMENTS.

    The last sentence in the paragraph designated as the ``Eleventh.'' 
of section 5136 of the Revised Statutes of the United States (12 U.S.C. 
24) is amended by striking ``10 percent'' each place such term appears 
and inserting ``15 percent''.

                TITLE II--SAVINGS ASSOCIATION PROVISIONS

SEC. 201. PARITY FOR SAVINGS ASSOCIATIONS UNDER THE SECURITIES EXCHANGE 
              ACT OF 1934 AND THE INVESTMENT ADVISERS ACT OF 1940.

    (a) Securities Exchange Act of 1934.--
            (1) Definition of bank.--Section 3(a)(6) of the Securities 
        Exchange Act of 1934 (15 U.S.C. 78c(a)(6)) is amended--
                    (A) in subparagraph (A), by inserting ``or a 
                Federal savings association, as defined in section 2(5) 
                of the Home Owners' Loan Act'' after ``a banking 
                institution organized under the laws of the United 
                States''; and
                    (B) in subparagraph (C)--
                            (i) by inserting ``or savings association 
                        as defined in section 2(4) of the Home Owners' 
                        Loan Act,'' after ``banking institution,''; and
                            (ii) by inserting ``or savings 
                        associations'' after ``having supervision over 
                        banks''.
            (2) Include ots under the definition of appropriate 
        regulatory agency for certain purposes.--Section 3(a)(34) of 
        such Act (15 U.S.C. 78c(a)(34)) is amended--
                    (A) in subparagraph (A)--
                            (i) in clause (ii), by striking ``(i) or 
                        (iii)'' and inserting ``(i), (iii), or (iv)'';
                            (ii) by striking ``and'' at the end of 
                        clause (iii);
                            (iii) by redesignating clause (iv) as 
                        clause (v); and
                            (iv) by inserting the following new clause 
                        after clause (iii):
                            ``(iv) the Director of the Office of Thrift 
                        Supervision, in the case of a savings 
                        association (as defined in section 3(b) of the 
                        Federal Deposit Insurance Act (12 U.S.C. 
                        1813(b))) the deposits of which are insured by 
                        the Federal Deposit Insurance Corporation, a 
                        subsidiary or a department or division of any 
                        such savings association, or a savings and loan 
                        holding company; and'';
                    (B) in subparagraph (B)--
                            (i) in clause (ii), by striking ``(i) or 
                        (iii)'' and inserting ``(i), (iii), or (iv)'';
                            (ii) by striking ``and'' at the end of 
                        clause (iii);
                            (iii) by redesignating clause (iv) as 
                        clause (v); and
                            (iv) by inserting the following new clause 
                        after clause (iii):
                            ``(iv) the Director of the Office of Thrift 
                        Supervision, in the case of a savings 
                        association (as defined in section 3(b) of the 
                        Federal Deposit Insurance Act (12 U.S.C. 
                        1813(b))) the deposits of which are insured by 
                        the Federal Deposit Insurance Corporation, or a 
                        subsidiary of any such savings association, or 
                        a savings and loan holding company; and'';
                    (C) in subparagraph (C)--
                            (i) in clause (ii), by striking ``(i) or 
                        (iii)'' and inserting ``(i), (iii), or (iv)'';
                            (ii) by striking ``and'' at the end of 
                        clause (iii);
                            (iii) by redesignating clause (iv) as 
                        clause (v); and
                            (iv) by inserting the following new clause 
                        after clause (iii):
                            ``(iv) the Director of the Office of Thrift 
                        Supervision, in the case of a savings 
                        association (as defined in section 3(b) of the 
                        Federal Deposit Insurance Act (12 U.S.C. 
                        1813(b))) the deposits of which are insured by 
                        the Federal Deposit Insurance Corporation, a 
                        savings and loan holding company, or a 
                        subsidiary of a savings and loan holding 
                        company when the appropriate regulatory agency 
                        for such clearing agency is not the Commission; 
                        and'';
                    (D) in subparagraph (D)--
                            (i) by striking ``and'' at the end of 
                        clause (ii);
                            (ii) by redesignating clause (iii) as 
                        clause (iv); and
                            (iii) by inserting the following new clause 
                        after clause (ii):
                            ``(iii) the Director of the Office of 
                        Thrift Supervision, in the case of a savings 
                        association (as defined in section 3(b) of the 
                        Federal Deposit Insurance Act (12 U.S.C. 
                        1813(b))) the deposits of which are insured by 
                        the Federal Deposit Insurance Corporation; 
                        and'';
                    (E) in subparagraph (F)--
                            (i) by redesignating clauses (ii), (iii), 
                        and (iv) as clauses (iii), (iv), and (v), 
                        respectively; and
                            (ii) by inserting the following new clause 
                        after clause (i):
                            ``(ii) the Director of the Office of Thrift 
                        Supervision, in the case of a savings 
                        association (as defined in section 3(b) of the 
                        Federal Deposit Insurance Act (12 U.S.C. 
                        1813(b))) the deposits of which are insured by 
                        the Federal Deposit Insurance Corporation; 
                        and'';
                    (F) by moving subparagraph (H) and inserting such 
                subparagraph after subparagraph (G); and
                    (G) by adding at the end the following new 
                sentence: ``As used in this paragraph, the term 
                `savings and loan holding company' has the meaning 
                given it in section 10(a) of the Home Owners' Loan Act 
                (12 U.S.C. 1467a(a)).''.
    (b) Investment Advisers Act of 1940.--
            (1) Definition of bank.--Section 202(a)(2) of the 
        Investment Advisers Act of 1940 (15 U.S.C. 80b-2(a)(2)) is 
        amended--
                    (A) in subparagraph (A) by inserting ``or a Federal 
                savings association, as defined in section 2(5) of the 
                Home Owners' Loan Act'' after ``a banking institution 
                organized under the laws of the United States''; and
                    (B) in subparagraph (C)--
                            (i) by inserting ``, savings association as 
                        defined in section 2(4) of the Home Owners' 
                        Loan Act,'' after ``banking institution''; and
                            (ii) by inserting ``or savings 
                        associations'' after ``having supervision over 
                        banks''.
            (2) Conforming amendments.--Subsections (a)(1)(A)(i), 
        (a)(1)(B), (a)(2), and (b) of section 210A of such Act (15 
        U.S.C. 80b-10a), as added by section 220 of the Gramm-Leach-
        Bliley Act, are each amended by striking ``bank holding 
        company'' each place it occurs and inserting ``bank holding 
        company or savings and loan holding company''.
    (c) Conforming Amendment to the Investment Company Act of 1940.--
Section 10(c) of the Investment Company Act of 1940 (15 U.S.C. 80a-
10(c)), as amended by section 213(c) of the Gramm-Leach-Bliley Act, is 
amended by inserting after ``1956)'' the following: ``or any one 
savings and loan holding company (together with its affiliates and 
subsidiaries) (as such terms are defined in section 10 of the Home 
Owners' Loan Act)''.

SEC. 202. INVESTMENTS BY FEDERAL SAVINGS ASSOCIATIONS AUTHORIZED TO 
              PROMOTE THE PUBLIC WELFARE.

    (a) In General.--Section 5(c)(3) of the Home Owners' Loan Act (12 
U.S.C. 1464(c)) is amended by adding at the end the following new 
subparagraph:
                    ``(D) Direct investments to promote the public 
                welfare.--
                            ``(i) In general.--A Federal savings 
                        association may make investments designed 
                        primarily to promote the public welfare, 
                        including the welfare of low- and moderate-
                        income communities or families through the 
                        provision of housing, services, and jobs.
                            ``(ii) Direct investments or acquisition of 
                        interest in other companies.--Investments under 
                        clause (i) may be made directly or by 
                        purchasing interests in an entity primarily 
                        engaged in making such investments.
                            ``(iii) Prohibition on unlimited 
                        liability.--No investment may be made under 
                        this subparagraph which would subject a Federal 
                        savings association to unlimited liability to 
                        any person.
                            ``(iv) Single investment limitation to be 
                        established by director.--Subject to clauses 
                        (v) and (vi), the Director shall establish, by 
                        order or regulation, limits on--
                                    ``(I) the amount any savings 
                                association may invest in any 1 
                                project; and
                                    ``(II) the aggregate amount of 
                                investment of any savings association 
                                under this subparagraph.
                            ``(v) Flexible aggregate investment 
                        limitation.--The aggregate amount of 
                        investments of any savings association under 
                        this subparagraph may not exceed an amount 
                        equal to the sum of 5 percent of the savings 
                        association's capital stock actually paid in 
                        and unimpaired and 5 percent of the savings 
                        association's unimpaired surplus, unless--
                                    ``(I) the Director determines that 
                                the savings association is adequately 
                                capitalized; and
                                    ``(II) the Director determines, by 
                                order, that the aggregate amount of 
                                investments in a higher amount than the 
                                limit under this clause will pose no 
                                significant risk to the affected 
                                deposit insurance fund.
                            ``(vi) Maximum aggregate investment 
                        limitation.--Notwithstanding clause (v), the 
                        aggregate amount of investments of any savings 
                        association under this subparagraph may not 
                        exceed an amount equal to the sum of 15 percent 
                        of the savings association's capital stock 
                        actually paid in and unimpaired and 15 percent 
                        of the savings association's unimpaired 
                        surplus.
                            ``(vii) Investments not subject to other 
                        limitation on quality of investments.--No 
                        obligation a Federal savings association 
                        acquires or retains under this subparagraph 
                        shall be taken into account for purposes of the 
                        limitation contained in section 28(d) of the 
                        Federal Deposit Insurance Act on the 
                        acquisition and retention of any corporate debt 
                        security not of investment grade.''.
    (b) Technical and Conforming Amendment.--Section 5(c)(3)(A) of the 
Home Owners' Loan Act (12 U.S.C. 1464(c)(3)(A)) is amended to read as 
follows:
                    ``(A) [Repealed].''.

SEC. 203. MERGERS AND CONSOLIDATIONS OF FEDERAL SAVINGS ASSOCIATIONS 
              WITH NONDEPOSITORY INSTITUTION AFFILIATES.

    Section 5(d)(3) of the Home Owners' Loan Act (12 U.S.C. 1464(d)(3)) 
is amended--
            (1) by redesignating subparagraph (B) as subparagraph (C); 
        and
            (2) by inserting after subparagraph (A) the following new 
        subparagraph:
                    ``(B) Mergers and consolidations with nondepository 
                institution affiliates.--
                            ``(i) In general.--Upon the approval of the 
                        Director, a Federal savings association may 
                        merge with any nondepository institution 
                        affiliate of the savings association.
                            ``(ii) Rule of construction.--No provision 
                        of clause (i) shall be construed as--
                                    ``(I) affecting the applicability 
                                of section 18(c) of the Federal Deposit 
                                Insurance Act; or
                                    ``(II) granting a Federal savings 
                                association any power or any authority 
                                to engage in any activity that is not 
                                authorized for a Federal savings 
                                association under any other provision 
                                of this Act or any other provision of 
                                law.''.

SEC. 204. REPEAL OF STATUTORY DIVIDEND NOTICE REQUIREMENT FOR SAVINGS 
              ASSOCIATION SUBSIDIARIES OF SAVINGS AND LOAN HOLDING 
              COMPANIES.

    Section 10(f) of the Home Owners' Loan Act (12 U.S.C. 1467a(f)) is 
amended to read as follows:
    ``(f) Declaration of Dividend.--The Director may--
            ``(1) require a savings association that is a subsidiary of 
        a savings and loan holding company to give prior notice to the 
        Director of the intent of the savings association to pay a 
        dividend on its guaranty, permanent, or other nonwithdrawable 
        stock; and
            ``(2) establish conditions on the payment of dividends by 
        such a savings association.''.

SEC. 205. MODERNIZING STATUTORY AUTHORITY FOR TRUST OWNERSHIP OF 
              SAVINGS ASSOCIATIONS.

    (a) In General.--Section 10(a)(1)(C) of the Home Owners' Loan Act 
(12 U.S.C. 1467a(a)(1)(C)) is amended--
            (1) by striking ``trust,'' and inserting ``business 
        trust,''; and
            (2) by inserting ``or any other trust unless by its terms 
        it must terminate within 25 years or not later than 21 years 
        and 10 months after the death of individuals living on the 
        effective date of the trust,'' after ``or similar 
        organization,''.
    (b) Technical and Conforming Amendment.--Section 10(a)(3) of the 
Home Owners' Loan Act (12 U.S.C. 1467a(a)(3)) is amended--
            (1) by striking ``does not include--'' and all that follows 
        through ``any company by virtue'' where such term appears in 
        subparagraph (A) and inserting ``does not include any company 
        by virtue'';
            (2) by striking ``; and'' at the end of subparagraph (A) 
        and inserting a period; and
            (3) by striking subparagraph (B).

SEC. 206. REPEAL OF OVERLAPPING RULES GOVERNING PURCHASED MORTGAGE 
              SERVICING RIGHTS.

    Section 5(t) of the Home Owners' Loan Act (12 U.S.C. 1464(t)) is 
amended--
            (1) by striking paragraph (4) and inserting the following 
        new paragraph:
            ``(4) [Repealed].''; and
            (2) in paragraph (9)(A), by striking ``intangible assets, 
        plus'' and all that follows through the period at the end and 
        inserting ``intangible assets.''.

SEC. 207. RESTATEMENT OF AUTHORITY FOR FEDERAL SAVINGS ASSOCIATIONS TO 
              INVEST IN SMALL BUSINESS INVESTMENT COMPANIES.

    Subparagraph (D) of section 5(c)(4) of the Home Owners' Loan Act 
(12 U.S.C. 1464(c)(4)) is amended to read as follows:
                    ``(D) Small business investment companies.--Any 
                Federal savings association may invest in 1 or more 
                small business investment companies, or in any entity 
                established to invest solely in small business 
                investment companies formed under the Small Business 
                Investment Act of 1958, except that the total amount of 
                investments under this subparagraph may not at any time 
                exceed the amount equal to 5 percent of capital and 
                surplus of the savings association.''.

SEC. 208. REMOVAL OF LIMITATION ON INVESTMENTS IN AUTO LOANS.

    (a) In General.--Section 5(c)(1) of the Home Owners' Loan Act (12 
U.S.C. 1464(c)(1)) is amended by adding at the end the following new 
subparagraph:
                    ``(V) Auto loans.--Loans and leases for motor 
                vehicles acquired for personal, family, or household 
                purposes.''.
    (b) Technical and Conforming Amendment Relating to Qualified Thrift 
Investments.--Section 10(m)(4)(C)(ii) of the Home Owners' Loan Act (12 
U.S.C. 1467a(m)(4)(C)(ii)) is amended by adding at the end the 
following new subclause:
                                    ``(VIII) Loans and leases for motor 
                                vehicles acquired for personal, family, 
                                or household purposes.''.

SEC. 209. SELLING AND OFFERING OF DEPOSIT PRODUCTS.

    Section 15(h) of the Securities Exchange Act of 1934 (15 U.S.C. 
78o(h)) is amended by adding at the end the following new paragraph:
            ``(4) Selling and offering of deposit products.--No law, 
        rule, regulation, or order, or other administrative action of 
        any State or political subdivision thereof shall directly or 
        indirectly require any individual who is an agent of 1 Federal 
        savings association (as such term is defined in section 2(5) of 
        the Home Owners' Loan Act (12 U.S.C. 1462(5)) in selling or 
        offering deposit (as such term is defined in section 3 of the 
        Federal Deposit Insurance Act (12 U.S.C. 1813(l)) products 
        issued by such association to qualify or register as a broker, 
        dealer, associated person of a broker, or associated person of 
        a dealer, or to qualify or register in any other similar status 
        or capacity, if the individual does not--
                    ``(A) accept deposits or make withdrawals on behalf 
                of any customer of the association;
                    ``(B) offer or sell a deposit product as an agent 
                for another entity that is not subject to supervision 
                and examination by a Federal banking agency (as defined 
                in section 3(z) of the Federal Deposit Insurance Act 
                (12 U.S.C. 1813(z)), the National Credit Union 
                Administration, or any officer, agency, or other entity 
                of any State which has primary regulatory authority 
                over State banks, State savings associations, or State 
                credit unions;
                    ``(C) offer or sell a deposit product that is not 
                an insured deposit (as defined in section 3(m) of the 
                Federal Deposit Insurance Act (12 U.S.C. 1813(m)));
                    ``(D) offer or sell a deposit product which 
                contains a feature that makes it callable at the option 
                of such Federal savings association; or
                    ``(E) create a secondary market with respect to a 
                deposit product or otherwise add enhancements or 
                features to such product independent of those offered 
                by the association.''.

SEC. 210. FUNERAL- AND CEMETERY-RELATED FIDUCIARY SERVICES.

    Section 5(n) of the Home Owners' Loan Act (12 U.S.C. 1464(n)) is 
amended by adding at the end the following new paragraph:
            ``(11) Funeral- and cemetery-related fiduciary services.--
                    ``(A) In general.--A funeral director or cemetery 
                operator, when acting in such capacity, (or any other 
                person in connection with a contract or other agreement 
                with a funeral director or cemetery operator) may 
                engage any Federal savings association, regardless of 
                where the association is located, to act in any 
                fiduciary capacity in which the savings association has 
                the right to act in accordance with this section, 
                including holding funds deposited in trust or escrow by 
                the funeral director or cemetery operator (or by such 
                other party), and the savings association may act in 
                such fiduciary capacity on behalf of the funeral 
                director or cemetery operator (or such other person).
                    ``(B) Definitions.--For purposes of this paragraph, 
                the following definitions shall apply:
                            ``(i) Cemetery.--The term `cemetery' means 
                        any land or structure used, or intended to be 
                        used, for the interment of human remains in any 
                        form.
                            ``(ii) Cemetery operator.--The term 
                        `cemetery operator' means any person who 
                        contracts or accepts payment for merchandise, 
                        endowment, or perpetual care services in 
                        connection with a cemetery.
                            ``(iii) Funeral director.--The term 
                        `funeral director' means any person who 
                        contracts or accepts payment to provide or 
                        arrange--
                                    ``(I) services for the final 
                                disposition of human remains; or
                                    ``(II) funeral services, property, 
                                or merchandise (including cemetery 
                                services, property, or merchandise).''.

SEC. 211. REPEAL OF QUALIFIED THRIFT LENDER REQUIREMENT WITH RESPECT TO 
              OUT-OF-STATE BRANCHES.

    Section 5(r)(1) of the Home Owners' Loan Act (12 U.S.C. 1464(r)(1)) 
is amended by striking the last sentence.

SEC. 212. SMALL BUSINESS AND OTHER COMMERCIAL LOANS.

    (a) Elimination of Lending Limit on Small Business Loans.--Section 
5(c)(1) of the Home Owners' Loan Act (12 U.S.C. 1464(c)(1)) is amended 
by inserting after subparagraph (V) (as added by section 208 of this 
title) the following new subparagraph:
                    ``(W) Small business loans.--Small business loans, 
                as defined in regulations which the Director shall 
                prescribe.''.
    (b) Increase in Lending Limit on Other Business Loans.--Section 
5(c)(2)(A) of the Home Owners' Loan Act (12 U.S.C. 1464(c)(2)(A)) is 
amended by striking ``, and amounts in excess of 10 percent'' and all 
that follows through ``by the Director''.

SEC. 213. CLARIFYING CITIZENSHIP OF FEDERAL SAVINGS ASSOCIATIONS FOR 
              FEDERAL COURT JURISDICTION.

    Section 5 of the Home Owners' Loan Act (12 U.S.C. 1464) is amended 
by adding at the end the following new subsection:
    ``(x) Home State Citizenship.--In determining whether a Federal 
court has diversity jurisdiction over a case in which a Federal savings 
association is a party, the Federal savings association shall be 
considered to be a citizen only of the States in which such savings 
association has its home office and its principal place of business (if 
the principal place of business is in a different State than the home 
office).''.

SEC. 214. INCREASE IN LIMITS ON COMMERCIAL REAL ESTATE LOANS.

    Section 5(c)(2)(B)(i) of the Home Owners' Loan Act (12 U.S.C. 
1464(c)(2)(B)(i)) is amended by striking ``400 percent'' and inserting 
``500 percent''.

SEC. 215. REPEAL OF ONE LIMIT ON LOANS TO ONE BORROWER.

    Subparagraph (A) of section 5(u)(2) of the Home Owners' Loan Act 
(12 U.S.C. 1464(u)(2)(A)) is amended--
            (1) by striking subclause (I) of clause (ii);
            (2) by redesignating subclauses (II), (III), (IV), and (V) 
        of clause (ii) as subclauses (I), (II), (III), and (IV), 
        respectively;
            (3) in clause (i)--
                    (A) by striking ``for any'' and inserting ``For 
                any''; and
                    (B) by striking ``; or'' and inserting a period; 
                and
            (4) in clause (ii), by striking ``to develop domestic'' and 
        inserting ``To develop domestic''.

SEC. 216. SAVINGS ASSOCIATION CREDIT CARD BANKS.

    Section 10(a)(1)(A) of the Home Owners' Loan Act (12 U.S.C. 
1467a(a)(1)(A)) is amended by inserting ``and such term does not 
include an institution described in section 2(c)(2)(F) of the Bank 
Holding Company Act of 1956 for purposes of subsections (a)(1)(E), 
(c)(3)(B)(i), (c)(9)(C)(i), and (e)(3)'' before the period at the end.

SEC. 217. INTERSTATE ACQUISITIONS BY S&L HOLDING COMPANIES.

    Section 10(e)(3) of the Home Owners' Loan Act (12 U.S.C. 
1467a(e)(3)) is amended--
            (1) by redesignating subparagraphs (A), (B), and (C) as 
        subparagraphs (B), (C), and (D), respectively; and
            (2) by inserting before subparagraph (B) (as so 
        redesignated) the following new subparagraph:
                    ``(A) such acquisition would be permissible under 
                section 3(d) of the Bank Holding Company Act of 1956 if 
                the savings and loan holding company were a bank 
                holding company and any savings association to be 
                acquired were a bank;''.

SEC. 218. BUSINESS ORGANIZATION FLEXIBILITY FOR FEDERAL SAVINGS 
              ASSOCIATIONS.

    (a) In General.--Section 5 of the Home Owners' Loan Act (12 U.S.C. 
1464) is amended by inserting after subsection (x) (as added by section 
213) following new subsection:
    ``(y) Alternative Business Organization.--
            ``(1) In general.--The Director may prescribe regulations 
        that--
                    ``(A) permit a Federal savings association to be 
                organized other than as a corporation; and
                    ``(B) provide requirements for the organizational 
                characteristics of a Federal savings association 
                organized and operating other than as a corporation, 
                consistent with the safety and soundness of the Federal 
                savings association.
            ``(2) Equal treatment.--Except as otherwise provided in 
        regulations prescribed under subsection (1), a Federal savings 
        association that is operating other than as a corporation shall 
        have the same rights and privileges and shall be subject to the 
        same duties, restrictions, penalties, liabilities, conditions, 
        and limitations as a Federal savings association that is 
        organized as a corporation.''.
    (b) Technical and Conforming Amendments.--
            (1) Section 5(a)(1) of the Home Owners' Loan Act (12 U.S.C. 
        1464(a)(1)) is amended by striking ``organization, 
        incorporation,'' and inserting ``organization (as a corporation 
        or other form of business organization provided under 
        regulations prescribed by the Director under subsection 
        (x)),''.
            (2) The last sentence of section 5(i)(1) of the Home 
        Owners' Loan Act (12 U.S.C. 1464(i)(1)) is amended by striking 
        ``incorporated'' and inserting ``organized''.
            (3) Section 5(o)(1) of the Home Owners' Loan Act (12 U.S.C. 
        1464(a)(1)) is amended by striking ``organization, 
        incorporation,'' and inserting ``organization (as a corporation 
        or other form of business organization provided under 
        regulations prescribed by the Director under subsection 
        (x)),''.

                   TITLE III--CREDIT UNION PROVISIONS

SEC. 301. PRIVATELY INSURED CREDIT UNIONS AUTHORIZED TO BECOME MEMBERS 
              OF A FEDERAL HOME LOAN BANK.

    (a) In General.--Section 4(a) of the Federal Home Loan Bank Act (12 
U.S.C. 1424(a)) is amended by adding at the end the following new 
paragraph:
            ``(5) Certain privately insured credit unions.--
                    ``(A) In general.--A credit union which has been 
                determined, in accordance with section 43(e)(1) of the 
                Federal Deposit Insurance Act and subject to the 
                requirements of subparagraph (B), to meet all 
                eligibility requirements for Federal deposit insurance 
                shall be treated as an insured depository institution 
                for purposes of determining the eligibility of such 
                credit union for membership in a Federal home loan bank 
                under paragraphs (1), (2), and (3).
                    ``(B) Certification by appropriate supervisor.--
                            ``(i) In general.--For purposes of this 
                        paragraph and subject to clause (ii), a credit 
                        union which lacks Federal deposit insurance and 
                        which has applied for membership in a Federal 
                        home loan bank may be treated as meeting all 
                        the eligibility requirements for Federal 
                        deposit insurance only if the appropriate 
                        supervisor of the State in which the credit 
                        union is chartered has determined that the 
                        credit union meets all the eligibility 
                        requirements for Federal deposit insurance as 
                        of the date of the application for membership.
                            ``(ii) Certification deemed valid.--If, in 
                        the case of any credit union to which clause 
                        (i) applies, the appropriate supervisor of the 
                        State in which such credit union is chartered 
                        fails to make a determination pursuant to such 
                        clause by the end of the 6-month period 
                        beginning on the date of the application, the 
                        credit union shall be deemed to have met the 
                        requirements of clause (i).
                    ``(C) Security interests of federal home loan bank 
                not avoidable.--Notwithstanding any provision of State 
                law authorizing a conservator or liquidating agent of a 
                credit union to repudiate contracts, no such provision 
                shall apply with respect to--
                            ``(i) any extension of credit from any 
                        Federal home loan bank to any credit union 
                        which is a member of any such bank pursuant to 
                        this paragraph; or
                            ``(ii) any security interest in the assets 
                        of such credit union securing any such 
                        extension of credit.''.
    (b) Copies of Audits of Private Insurers of Certain Depository 
Institutions Required to Be Provided to Supervisory Agencies.--Section 
43(a)(2) of the Federal Deposit Insurance Act (12 U.S.C. 1831t(a)(2)) 
is amended--
            (1) by striking ``and'' at the end of subparagraph (A)(i);
            (2) by striking the period at the end of clause (ii) of 
        subparagraph (A) and inserting a semicolon;
            (3) by inserting the following new clauses at the end of 
        subparagraph (A):
                            ``(iii) in the case of depository 
                        institutions described in subsection (f)(2)(A) 
                        the deposits of which are insured by the 
                        private insurer, the National Credit Union 
                        Administration, not later than 7 days after 
                        that audit is completed; and
                            ``(iv) in the case of depository 
                        institutions described in subsection (f)(2)(A) 
                        the deposits of which are insured by the 
                        private insurer which are members of a Federal 
                        home loan bank, the Federal Housing Finance 
                        Board, not later than 7 days after that audit 
                        is completed.''; and
            (4) by adding at the end the following new subparagraph:
                    ``(C) Consultation.--The appropriate supervisory 
                agency of each State in which a private deposit insurer 
                insures deposits in an institution described in 
                subsection (f)(2)(A) which--
                            ``(i) lacks Federal deposit insurance; and
                            ``(ii) has become a member of a Federal 
                        home loan bank,
                shall provide the National Credit Union Administration, 
                upon request, with the results of any examination and 
                reports related thereto concerning the private deposit 
                insurer to which such agency may have in its 
                possession.''.

SEC. 302. LEASES OF LAND ON FEDERAL FACILITIES FOR CREDIT UNIONS.

    (a) In General.--Section 124 of the Federal Credit Union Act (12 
U.S.C. 1770) is amended--
            (1) by striking ``Upon application by any credit union'' 
        and inserting ``Notwithstanding any other provision of law, 
        upon application by any credit union'';
            (2) by inserting ``on lands reserved for the use of, and 
        under the exclusive or concurrent jurisdiction of, the United 
        States or'' after ``officer or agency of the United States 
        charged with the allotment of space'';
            (3) by inserting ``lease land or'' after ``such officer or 
        agency may in his or its discretion''; and
            (4) by inserting ``or the facility built on the lease 
        land'' after ``credit union to be served by the allotment of 
        space''.
    (b) Clerical Amendment.--The heading for section 124 is amended by 
inserting ``or federal land'' after ``buildings''.

SEC. 303. INVESTMENTS IN SECURITIES BY FEDERAL CREDIT UNIONS.

    Section 107 of the Federal Credit Union Act (12 U.S.C. 1757) is 
amended--
            (1) in the matter preceding paragraph (1) by striking ``A 
        Federal credit union'' and inserting ``(a) In General.--Any 
        Federal credit union''; and
            (2) by adding at the end the following new subsection:
    ``(b) Additional Investment Authority.--
            ``(1) In general.--In addition to any investments otherwise 
        authorized, a Federal credit union may purchase and hold for 
        its own account such investment securities of investment grade 
        as the Board may authorize by regulation, subject to such 
        limitations and restrictions as the Board may prescribe in the 
        regulations.
            ``(2) Percentage limitations.--
                    ``(A) Single obligor.--In no event may the total 
                amount of investment securities of any single obligor 
                or maker held by a Federal credit union for the credit 
                union's own account exceed at any time an amount equal 
                to 10 percent of the net worth of the credit union.
                    ``(B) Aggregate investments.--In no event may the 
                aggregate amount of investment securities held by a 
                Federal credit union for the credit union's own account 
                exceed at any time an amount equal to 10 percent of the 
                assets of the credit union.
            ``(3) Investment security defined.--
                    ``(A) In general.--For purposes of this subsection, 
                the term `investment security' means marketable 
                obligations evidencing the indebtedness of any person 
                in the form of bonds, notes, or debentures and other 
                instruments commonly referred to as investment 
                securities.
                    ``(B) Further definition by board.--The Board may 
                further define the term `investment security'.
            ``(4) Investment grade defined.--The term `investment 
        grade' means with respect to an investment security purchased 
        by a credit union for its own account, an investment security 
        that at the time of such purchase is rated in one of the 4 
        highest rating categories by at least 1 nationally recognized 
        statistical rating organization.
            ``(5) Clarification of prohibition on stock ownership.--No 
        provision of this subsection shall be construed as authorizing 
        a Federal credit union to purchase shares of stock of any 
        corporation for the credit union's own account, except as 
        otherwise permitted by law.''.

SEC. 304. INCREASE IN GENERAL 12-YEAR LIMITATION OF TERM OF FEDERAL 
              CREDIT UNION LOANS TO 15 YEARS.

    Section 107(a)(5) of the Federal Credit Union Act (12 U.S.C. 
1757(5)) (as so designated by section 303 of this title) is amended--
            (1) in the matter preceding subparagraph (A), by striking 
        ``to make loans, the maturities of which shall not exceed 
        twelve years except as otherwise provided herein'' and 
        inserting ``to make loans, the maturities of which shall not 
        exceed 15 years or any longer maturity as the Board may allow, 
        in regulations, except as otherwise provided in this Act'';
            (2) in subparagraph (A)--
                    (A) by striking clause (ii);
                    (B) by redesignating clauses (iii) through (x) as 
                clauses (ii) through (ix), respectively; and
                    (C) by inserting ``and'' after the semicolon at the 
                end of clause (viii) (as so redesignated).

SEC. 305. INCREASE IN 1 PERCENT INVESTMENT LIMIT IN CREDIT UNION 
              SERVICE ORGANIZATIONS.

    Section 107(a)(7)(I) of the Federal Credit Union Act (12 U.S.C. 
1757(7)(I)) (as so designated by section 303 of this title) is amended 
by striking ``up to 1 per centum of the total paid'' and inserting ``up 
to 3 percent of the total paid''.

SEC. 306. MEMBER BUSINESS LOAN EXCLUSION FOR LOANS TO NONPROFIT 
              RELIGIOUS ORGANIZATIONS.

    Section 107A(a) of the Federal Credit Union Act (12 U.S.C. 
1757a(a)) is amended by inserting ``, excluding loans made to nonprofit 
religious organizations,'' after ``total amount of such loans''.

SEC. 307. CHECK CASHING AND MONEY TRANSFER SERVICES OFFERED WITHIN THE 
              FIELD OF MEMBERSHIP.

    Paragraph (12) of section 107(a) of the Federal Credit Union Act 
(12 U.S.C. 1757(12)) (as so designated by section 303 of this title) is 
amended to read as follows:
            ``(12) in accordance with regulations prescribed by the 
        Board--
                    ``(A) to sell, to persons in the field of 
                membership, negotiable checks (including travelers 
                checks), money orders, and other similar money transfer 
                instruments (including international and domestic 
                electronic fund transfers); and
                    ``(B) to cash checks and money orders and receive 
                international and domestic electronic fund transfers 
                for persons in the field of membership for a fee;''.

SEC. 308. VOLUNTARY MERGERS INVOLVING MULTIPLE COMMON-BOND CREDIT 
              UNIONS.

    Section 109(d)(2) of the Federal Credit Union Act (12 U.S.C. 
1759(d)(2)) is amended--
            (1) by striking ``or'' at the end of clause (ii) of 
        subparagraph (B);
            (2) by striking the period at the end of subparagraph (C) 
        and inserting ``; or''; and
            (3) by adding at the end the following new subparagraph:
                    ``(D) a merger involving any such Federal credit 
                union approved by the Board on or after August 7, 
                1998.''.

SEC. 309. CONVERSIONS INVOLVING COMMON-BOND CREDIT UNIONS.

    Section 109(g) of the Federal Credit Union Act (12 U.S.C. 1759(g)) 
is amended by inserting after paragraph (2) the following new 
paragraph:
            ``(3) Criteria for continued membership of certain member 
        groups in community charter conversions.--In the case of a 
        voluntary conversion of a common-bond credit union described in 
        paragraph (1) or (2) of subsection (b) into a community credit 
        union described in subsection (b)(3), the Board shall 
        prescribe, by regulation, the criteria under which the Board 
        may determine that a member group or other portion of a credit 
        union's existing membership, that is located outside the well-
        defined local community, neighborhood, or rural district that 
        shall constitute the community charter, can be satisfactorily 
        served by the credit union and remain within the community 
        credit union's field of membership.''.

SEC. 310. CREDIT UNION GOVERNANCE.

    (a) Expulsion of Members for Just Cause.--Subsection (b) of section 
118 of the Federal Credit Union Act (12 U.S.C. 1764(b)) is amended to 
read as follows:
    ``(b) Policy and Actions of Boards of Directors of Federal Credit 
Unions.--
            ``(1) Expulsion of members for nonparticipation or for just 
        cause.--The board of directors of a Federal credit union may, 
        by majority vote of a quorum of directors, adopt and enforce a 
        policy with respect to expulsion from membership, by a majority 
        vote of such board of directors, based on just cause, including 
        disruption of credit union operations, or on nonparticipation 
        by a member in the affairs of the credit union.
            ``(2) Written notice of policy to members.--If a policy 
        described in paragraph (1) is adopted, written notice of the 
        policy as adopted and the effective date of such policy shall 
        be provided to--
                    ``(A) each existing member of the credit union not 
                less than 30 days prior to the effective date of such 
                policy; and
                    ``(B) each new member prior to or upon applying for 
                membership.''.
    (b) Term Limits Authorized for Board Members of Federal Credit 
Unions.--Section 111(a) of the Federal Credit Union Act (12 U.S.C. 
1761(a)) is amended by adding at the end the following new sentence: 
``The bylaws of a Federal credit union may limit the number of 
consecutive terms any person may serve on the board of directors of 
such credit union.''.
    (c) Reimbursement for Lost Wages Due to Service on Credit Union 
Board not Treated as Compensation.--Section 111(c) of the Federal 
Credit Union Act (12 U.S.C. 1761(c)) is amended by inserting ``, 
including lost wages,'' after ``the reimbursement of reasonable 
expenses''.

SEC. 311. PROVIDING THE NATIONAL CREDIT UNION ADMINISTRATION WITH 
              GREATER FLEXIBILITY IN RESPONDING TO MARKET CONDITIONS.

    Section 107(a)(5)(A)(v)(I) of the Federal Credit Union Act (12 
U.S.C. 1757(5)(A)(vi)(I)) (as so designated by section 303 and 
redesignated by section 304(2)(B) of this title) is amended by striking 
``six-month period and that prevailing interest rate levels'' and 
inserting ``6-month period or that prevailing interest rate levels''.

SEC. 312. EXEMPTION FROM PRE-MERGER NOTIFICATION REQUIREMENT OF THE 
              CLAYTON ACT.

    Section 7A(c)(7) of the Clayton Act (15 U.S.C. 18a(c)(7)) is 
amended by inserting ``section 205(b)(3) of the Federal Credit Union 
Act (12 U.S.C. 1785(b)(3)),'' before ``or section 3''.

SEC. 313. TREATMENT OF CREDIT UNIONS AS DEPOSITORY INSTITUTIONS UNDER 
              SECURITIES LAWS.

    (a) Definition of Bank Under the Securities Exchange Act of 1934.--
Section 3(a)(6) of the Securities Exchange Act of 1934 (15 U.S.C. 
78c(a)(6)) (as amended by section 201(a)(1) of this Act) is amended--
            (1) by striking ``this title, and (D) a receiver'' and 
        inserting ``this title, (D) an insured credit union (as defined 
        in section 101(7) of the Federal Credit Union Act) but only for 
        purposes of paragraphs (4) and (5) of this subsection and only 
        for activities otherwise authorized by applicable laws to which 
        such credit unions are subject, and (E) a receiver''; and
            (2) in subparagraph (E) (as so redesignated by paragraph 
        (1) of this subsection) by striking ``(A), (B), or (C)'' and 
        inserting ``(A), (B), (C), or (D)''.
    (b) Definition of Bank Under the Investment Advisers Act of 1940.--
Section 202(a)(2) of the Investment Advisers Act of 1940 (15 U.S.C. 
80b-2(a)(2)) (as amended by section 201(b)(1) of this Act) is amended--
            (1) by striking ``this title, and (D) a receiver'' and 
        inserting ``this title, (D) an insured credit union (as defined 
        in section 101(7) of the Federal Credit Union Act) but only for 
        activities otherwise authorized by applicable laws to which 
        such credit unions are subject, and (E) a receiver''; and
            (2) in subparagraph (E) (as so redesignated by paragraph 
        (1) of this subsection) by striking ``(A), (B), or (C)'' and 
        inserting ``(A), (B), (C), or (D)''.
    (c) Definition of Appropriate Federal Banking Agency.--Section 
210A(c) of the Investment Advisers Act of 1940 (15 U.S.C. 80b-10a(c)) 
is amended by inserting ``and includes the National Credit Union 
Administration Board, in the case of an insured credit union (as 
defined in section 101(7) of the Federal Credit Union Act)'' before the 
period at the end.

SEC. 314. CLARIFICATION OF DEFINITION OF NET WORTH UNDER CERTAIN 
              CIRCUMSTANCES FOR PURPOSES OF PROMPT CORRECTIVE ACTION.

    Subparagraph (A) of section 216(o)(2) of the Federal Credit Union 
Act (12 U.S.C. 1790d(o)(2)(A)) is amended--
            (1) by inserting ``the'' before ``retained earnings 
        balance''; and
            (2) by inserting ``, together with any amounts that were 
        previously retained earnings of any other credit union with 
        which the credit union has combined'' before the semicolon at 
        the end.

SEC. 315. AMENDMENTS RELATING TO NONFEDERALLY INSURED CREDIT UNIONS.

    (a) In General.--Subsection (a) of section 43 of the Federal 
Deposit Insurance Act (12 U.S.C. 1831t(a)) is amended by adding at the 
end the following new paragraph:
            ``(3) Enforcement by appropriate state supervisor.--Any 
        appropriate State supervisor of a private deposit insurer, and 
        any appropriate State supervisor of a depository institution 
        which receives deposits that are insured by a private deposit 
        insurer, may examine and enforce compliance with this 
        subsection under the applicable regulatory authority of such 
        supervisor.''.
    (b) Amendment Relating to Disclosures Required, Periodic Statements 
and Account Records.--Section 43(b)(1) of the Federal Deposit Insurance 
Act (12 U.S.C. 1831t(b)(1)) is amended by striking ``or similar 
instrument evidencing a deposit'' and inserting ``or share 
certificate''.
    (c) Amendments Relating to Disclosures Required, Advertising, 
Premises.-- Section 43(b)(2) of the Federal Deposit Insurance Act (12 
U.S.C. 1831t(b)(2)) is amended to read as follows:
            ``(2) Advertising; premises.--
                    ``(A) In general.--Include clearly and 
                conspicuously in all advertising, except as provided in 
                subparagraph (B); and at each station or window where 
                deposits are normally received, its principal place of 
                business and all its branches where it accepts deposits 
                or opens accounts (excluding automated teller machines 
                or point of sale terminals), and on its main Internet 
                page, a notice that the institution is not federally 
                insured.
                    ``(B) Exceptions.--The following need not include a 
                notice that the institution is not federally insured:
                            ``(i) Statements or reports of financial 
                        condition of the depository institution that 
                        are required to be published or posted by State 
                        or Federal law or regulation.
                            ``(ii) Any sign, document, or other item 
                        that contains the name of the depository 
                        institution, its logo, or its contact 
                        information, but only if the sign, document, or 
                        item does not include any information about the 
                        institution's products or services or 
                        information otherwise promoting the 
                        institution.
                            ``(iii) Small utilitarian items that do not 
                        mention deposit products or insurance if 
                        inclusion of the notice would be 
                        impractical.''.
    (d) Amendments Relating to Acknowledgment of Disclosure.--Section 
43(b)(3) of the Federal Deposit Insurance Act (12 U.S.C. 1831t(b)(3)) 
is amended to read as follows:
            ``(3) Acknowledgment of disclosure.--
                    ``(A) New depositors obtained other than through a 
                conversion or merger.--With respect to any depositor 
                who was not a depositor at the depository institution 
                before the effective date of the Financial Services 
                Relief Act of 2005, and who is not a depositor as 
                described in subparagraph (B), receive any deposit for 
                the account of such depositor only if the depositor has 
                signed a written acknowledgement that--
                            ``(i) the institution is not federally 
                        insured; and
                            ``(ii) if the institution fails, the 
                        Federal Government does not guarantee that the 
                        depositor will get back the depositor's money.
                    ``(B) New depositors obtained through a conversion 
                or merger.--With respect to a depositor at a federally 
                insured depository institution that converts to, or 
                merges into, a depository institution lacking federal 
                insurance after the effective date of the Financial 
                Services Regulatory Relief Act of 2005, receive any 
                deposit for the account of such depositor only if--
                            ``(i) the depositor has signed a written 
                        acknowledgement described in subparagraph (A); 
                        or
                            ``(ii) the institution makes an attempt, as 
                        described in subparagraph (D) and sent by mail 
                        no later than 45 days after the effective date 
                        of the conversion or merger, to obtain the 
                        acknowledgment.
                    ``(C) Current depositors.--Receive any deposit 
                after the effective date of the Financial Services 
                Regulatory Relief Act of 2005 for the account of any 
                depositor who was a depositor on that date only if--
                            ``(i) the depositor has signed a written 
                        acknowledgement described in subparagraph (A); 
                        or
                            ``(ii) the institution makes an attempt, as 
                        described in subparagraph (D) and sent by mail 
                        no later than 45 days after the effective date 
                        of the Financial Services Regulatory Relief Act 
                        of 2005, to obtain the acknowledgment.
                    ``(D) Alternative provision of notice to current 
                depositors and new depositors obtained through a 
                conversion or merger.--
                            ``(i) In general.--Transmit to each 
                        depositor who has not signed a written 
                        acknowledgement described in subparagraph (A)--
                                    ``(I) a conspicuous card containing 
                                the information described in clauses 
                                (i) and (ii) of subparagraph (A), and a 
                                line for the signature of the 
                                depositor; and
                                    ``(II) accompanying materials 
                                requesting the depositor to sign the 
                                card, and return the signed card to the 
                                institution.''.
    (e) Repeal of Provision Prohibiting Nondepository Institutions From 
Accepting Deposits.--Section 43 of the Federal Deposit Insurance Act 
(12 U.S.C. 1831t) is amended--
            (1) by striking subsection (e); and
            (2) by redesignating subsections (f) and (g) as subsections 
        (e) and (f), respectively.
    (f) Repeal of Provision Concerning Nondepository Institutions 
Masquerading as Depository Institutions and Clarification of Depository 
Institutions Covered by the Statute.--Subsection (e)(2) (as so 
redesignated by subsection (e) of this section) of section 43 of the 
Federal Deposit Insurance Act (12 U.S.C. 1831t) is amended to read as 
follows:
            ``(2) Depository institution.--The term `depository 
        institution'--
                    ``(A) includes any entity described in section 
                19(b)(1)(A)(iv) of the Federal Reserve Act; and
                    ``(B) does not include any national bank, State 
                member bank, or Federal branch.''.
    (g) Repeal of FTC Authority to Enforce Independent Audit 
Requirement; Concurrent State Enforcement.--Subsection (f) (as so 
redesignated by subsection (e) of this section) of section 43 of the 
Federal Deposit Insurance Act (12 U.S.C. 1831t) is amended to read as 
follows:
    ``(f) Enforcement.--
            ``(1) Limited ftc enforcement authority.--Compliance with 
        the requirements of subsections (b) and (c), and any regulation 
        prescribed or order issued under any such subsection, shall be 
        enforced under the Federal Trade Commission Act by the Federal 
        Trade Commission.
            ``(2) Broad state enforcement authority.--
                    ``(A) In general.--Subject to subparagraph (C), an 
                appropriate State supervisor of a depository 
                institution lacking Federal deposit insurance may 
                examine and enforce compliance with the requirements of 
                this section, and any regulation prescribed under this 
                section.
                    ``(B) State powers.--For purposes of bringing any 
                action to enforce compliance with this section, no 
                provision of this section shall be construed as 
                preventing an appropriate State supervisor of a 
                depository institution lacking Federal deposit 
                insurance from exercising any powers conferred on such 
                official by the laws of such State.
                    ``(C) Limitation on state action while federal 
                action pending.--If the Federal Trade Commission has 
                instituted an enforcement action for a violation of 
                this section, no appropriate State supervisor may, 
                during the pendency of such action, bring an action 
                under this section against any defendant named in the 
                complaint of the Commission for any violation of this 
                section that is alleged in that complaint.''.

              TITLE IV--DEPOSITORY INSTITUTION PROVISIONS

SEC. 401. EASING RESTRICTIONS ON INTERSTATE BRANCHING AND MERGERS.

    (a) De Novo Interstate Branches of National Banks.--
            (1) In general.--Section 5155(g)(1) of the Revised Statutes 
        of the United States (12 U.S.C. 36(g)(1)) is amended by 
        striking ``maintain a branch if--'' and all that follows 
        through the end of subparagraph (B) and inserting ``maintain a 
        branch.''.
            (2) Clerical amendment.--The heading for subsection (g) of 
        section 5155 of the Revised Statutes of the United States is 
        amended by striking ``State `Opt-in' Election to Permit''.
    (b) De Novo Interstate Branches of State Nonmember Banks.--
            (1) In general.--Section 18(d)(4)(A) of the Federal Deposit 
        Insurance Act (12 U.S.C. 1828(d)(4)(A)) is amended by striking 
        ``maintain a branch if--'' and all that follows through the end 
        of clause (ii) and inserting ``maintain a branch.''.
            (2) Interstate branching by subsidiaries of commercial 
        firms prohibited.--Section 18(d)(3)) of the Federal Deposit 
        Insurance Act (12 U.S.C. 1828(d)(3)) is amended by adding at 
        the end the following new subparagraph:
                    ``(C) Interstate branching by subsidiaries of 
                commercial firms prohibited.--
                            ``(i) In general.--If the appropriate State 
                        bank supervisor of the home State of any 
                        industrial loan company, industrial bank, or 
                        other institution described in section 
                        2(c)(2)(H) of the Bank Holding Company Act of 
                        1956, or the appropriate State bank supervisor 
                        of any host State with respect to such company, 
                        bank, or institution, determines that such 
                        company, bank, or institution is controlled, 
                        directly or indirectly, by a commercial firm, 
                        such company, bank, or institution may not 
                        acquire, establish, or operate a branch in such 
                        host State.
                            ``(ii) Commercial firm defined.--For 
                        purposes of this subsection, the term 
                        `commercial firm' means any entity at least 15 
                        percent of the annual gross revenues of which 
                        on a consolidated basis, including all 
                        affiliates of the entity, were derived from 
                        engaging, on an on-going basis, in activities 
                        that are not financial in nature or incidental 
                        to a financial activity during at least 3 of 
                        the prior 4 calendar quarters.
                            ``(iii) Grandfathered institutions.--Clause 
                        (i) shall not apply with respect to any 
                        industrial loan company, industrial bank, or 
                        other institution described in section 
                        2(c)(2)(H) of the Bank Holding Company Act of 
                        1956--
                                    ``(I) which became an insured 
                                depository institution before October 
                                1, 2003 or pursuant to an application 
                                for deposit insurance which was 
                                approved by the Corporation before such 
                                date; and
                                    ``(II) with respect to which there 
                                is no change in control, directly or 
                                indirectly, of the company, bank, or 
                                institution after September 30, 2003, 
                                that requires an application under 
                                subsection (c), section 7(j), section 3 
                                of the Bank Holding Company Act of 
                                1956, or section 10 of the Home Owners' 
                                Loan Act.
                            ``(iv) Transition provision.--Any 
                        divestiture required under this subparagraph of 
                        a branch in a host State shall be completed as 
                        quickly as is reasonably possible.
                            ``(v) Corporate reorganizations 
                        permitted.--The acquisition of direct or 
                        indirect control of the company, bank, or 
                        institution referred to in clause (iii)(II) 
                        shall not be treated as a `change in control' 
                        for purposes of such clause if the company 
                        acquiring control is itself directly or 
                        indirectly controlled by a company that was an 
                        affiliate of such company, bank, or institution 
                        on the date referred to in clause (iii)(II), 
                        and remained an affiliate at all times after 
                        such date.''.
            (3) Technical and conforming amendments.--Section 18(d)(4) 
        of the Federal Deposit Insurance Act (12 U.S.C. 1828(d)(4)) is 
        amended--
                    (A) in subparagraph (A) by striking ``Subject to 
                subparagraph (B)'' and inserting ``Subject to 
                subparagraph (B) and paragraph (3)(C)''; and
                    (B) in subparagraphs (D) and (E), by striking ``The 
                term'' and inserting ``For purposes of this subsection, 
                the term''.
            (4) Clerical amendment.--The heading for paragraph (4) of 
        section 18(d) of the Federal Deposit Insurance Act is amended 
        by striking ``State `opt-in' election to permit interstate'' 
        and inserting ``Interstate''.
    (c) De Novo Interstate Branches of State Member Banks.--The 3rd 
undesignated paragraph of section 9 of the Federal Reserve Act (12 
U.S.C. 321) is amended by adding at the end the following new 
sentences: ``A State member bank may establish and operate a de novo 
branch in a host State (as such terms are defined in section 18(d) of 
the Federal Deposit Insurance Act) on the same terms and conditions and 
subject to the same limitations and restrictions as are applicable to 
the establishment of a de novo branch of a national bank in a host 
State under section 5155(g) of the Revised Statutes of the United 
States or are applicable to an insured State nonmember bank under 
section 18(d)(3) of the Federal Deposit Insurance Act''. Such section 
5155(g) shall be applied for purposes of the preceding sentence by 
substituting `Board of Governors of the Federal Reserve System' for 
`Comptroller of the Currency' and `State member bank' for `national 
bank'.''.
    (d) Interstate Merger of Banks.--
            (1) Merger of insured bank with another depository 
        institution or trust company.--Section 44(a)(1) of the Federal 
        Deposit Insurance Act (12 U.S.C. 1831u(a)(1)) is amended--
                    (A) by striking ``Beginning on June 1, 1997, the'' 
                and inserting ``The''; and
                    (B) by striking ``insured banks with different home 
                States'' and inserting ``an insured bank and another 
                insured depository institution or trust company with a 
                different home State than the resulting insured bank''.
            (2) National bank trust company merger with other trust 
        company.--Subsection (b) of section 4 of the National Bank 
        Consolidation and Merger Act (12 U.S.C. 215a-1(b)) is amended 
        to read as follows:
    ``(b) Merger of National Bank Trust Company With Another Trust 
Company.--A national bank that is a trust company may engage in a 
consolidation or merger under this Act with any trust company with a 
different home State, under the same terms and conditions that would 
apply if the trust companies were located within the same State.''.
    (e) Interstate Fiduciary Activity.--Section 18(d) of the Federal 
Deposit Insurance Act (12 U.S.C. 1828(d)) is amended by adding at the 
end the following new paragraph:
            ``(5) Interstate fiduciary activity.--
                    ``(A) Authority of state bank supervisor.--The 
                State bank supervisor of a State bank may approve an 
                application by the State bank, when not in 
                contravention of home State or host State law, to act 
                as trustee, executor, administrator, registrar of 
                stocks and bonds, guardian of estates, assignee, 
                receiver, committee of estates of lunatics, or in any 
                other fiduciary capacity in a host State in which State 
                banks or other corporations which come into competition 
                with national banks are permitted to act under the laws 
                of such host State.
                    ``(B) Noncontravention of host state law.--Whenever 
                the laws of a host State authorize or permit the 
                exercise of any or all of the foregoing powers by State 
                banks or other corporations which compete with national 
                banks, the granting to and the exercise of such powers 
                by a State bank as provided in this paragraph shall not 
                be deemed to be in contravention of host State law 
                within the meaning of this paragraph.
                    ``(C) State bank includes trust companies.--For 
                purposes of this paragraph, the term `State bank' 
                includes any State-chartered trust company (as defined 
                in section 44(g)).
                    ``(D) Other definitions.--For purposes of this 
                paragraph, the term `home State' and `host State' have 
                the meanings given such terms in section 44.''.
    (f) Technical and Conforming Amendments.--
            (1) Section 44 of the Federal Deposit Insurance Act (12 
        U.S.C. 1831u) is amended--
                    (A) in subsection (a)--
                            (i) by striking paragraph (4) and inserting 
                        the following new paragraph:
            ``(4) Treatment of branches in connection with certain 
        interstate merger transactions.--In the case of an interstate 
        merger transaction which involves the acquisition of a branch 
        of an insured depository institution or trust company without 
        the acquisition of the insured depository institution or trust 
        company, the branch shall be treated, for purposes of this 
        section, as an insured depository institution or trust company 
        the home State of which is the State in which the branch is 
        located.''; and
                            (ii) by striking paragraphs (5) and (6) and 
                        inserting the following new paragraph:
            ``(5) Applicability to industrial loan companies.--No 
        provision of this section shall be construed as authorizing the 
        approval of any transaction involving a industrial loan 
        company, industrial bank, or other institution described in 
        section 2(c)(2)(H) of the Bank Holding Company Act of 1956, or 
        the acquisition, establishment, or operation of a branch by any 
        such company, bank, or institution, that is not allowed under 
        section 18(d)(3).''.
                    (B) in subsection (b)--
                            (i) by striking ``bank'' each place such 
                        term appears in paragraph (2)(B)(i) and 
                        inserting ``insured depository institution'';
                            (ii) by striking ``banks'' where such term 
                        appears in paragraph (2)(E) and inserting 
                        ``insured depository institutions or trust 
                        companies'';
                            (iii) by striking ``bank affiliate'' each 
                        place such term appears in that portion of 
                        paragraph (3) that precedes subparagraph (A) 
                        and inserting ``insured depository institution 
                        affiliate'';
                            (iv) by striking ``any bank'' where such 
                        term appears in paragraph (3)(B) and inserting 
                        ``any insured depository institution'';
                            (v) by striking ``bank'' where such term 
                        appears in paragraph (4)(A) and inserting 
                        ``insured depository institution and trust 
                        company''; and
                            (vi) by striking ``all banks'' where such 
                        term appears in paragraph (5) and inserting 
                        ``all insured depository institutions and trust 
                        companies'';
                    (C) in subsection (d)(1), by striking ``any bank'' 
                and inserting ``any insured depository institution or 
                trust company'';
                    (D) in subsection (e)--
                            (i) by striking ``1 or more banks'' and 
                        inserting ``1 or more insured depository 
                        institutions''; and
                            (ii) by striking ``paragraph (2), (4), or 
                        (5)'' and inserting ``paragraph (2)'';
                    (E) by striking clauses (i) and (ii) of subsection 
                (g)(4)(A) and inserting the following new clauses:
                            ``(i) with respect to a national bank or 
                        Federal savings association, the State in which 
                        the main office of the bank or savings 
                        association is located; and
                            ``(ii) with respect to a State bank, State 
                        savings association, or State-chartered trust 
                        company, the State by which the bank, savings 
                        association, or trust company is chartered; 
                        and'';
                    (F) by striking paragraph (5) of subsection (g) and 
                inserting the following new paragraph:
            ``(5) Host state.--The term `host State' means--
                    ``(A) with respect to a bank, a State, other than 
                the home State of the bank, in which the bank 
                maintains, or seeks to establish and maintain, a 
                branch; and
                    ``(B) with respect to a trust company and solely 
                for purposes of section 18(d)(5), a State, other than 
                the home State of the trust company, in which the trust 
                company acts, or seeks to act, in 1 or more fiduciary 
                capacities.'';
                    (G) in subsection (g)(10), by striking ``section 
                18(c)(2)'' and inserting ``paragraph (1) or (2) of 
                section 18(c), as appropriate,''; and
                    (H) in subsection (g), by adding at the end the 
                following new paragraph:
            ``(12) Trust company.--The term `trust company' means--
                    ``(A) any national bank;
                    ``(B) any savings association; and
                    ``(C) any bank, banking association, trust company, 
                savings bank, or other banking institution which is 
                incorporated under the laws of any State,
        that is authorized to act in 1 or more fiduciary capacities but 
        is not engaged in the business of receiving deposits other than 
        trust funds (as defined in section 3(p)).''.
            (2) Section 3(d) of the Bank Holding Company Act of 1956 
        (12 U.S.C. 1842(d)) is amended--
                    (A) in paragraph (1)--
                            (i) by striking subparagraphs (B) and (C); 
                        and
                            (ii) by redesignating subparagraph (D) as 
                        subparagraph (B); and
                    (B) in paragraph (5), by striking ``subparagraph 
                (B) or (D)'' and inserting ``subparagraph (B)''.
            (3) Subsection (c) of section 4 of the National Bank 
        Consolidation and Merger Act (12 U.S.C. 215a-1(c)) is amended 
        to read as follows:
    ``(c) Definitions.--For purposes of this section, the terms `home 
State', `out-of-State bank', and `trust company' each have the same 
meaning as in section 44(g) of the Federal Deposit Insurance Act.''.
    (g) Clerical Amendments.--
            (1) The heading for section 44(b)(2)(E) of the Federal 
        Deposit Insurance Act (12 U.S.C. 1831u(b)(2)(E)) is amended by 
        striking ``banks'' and inserting ``insured depository 
        institutions and trust companies''.
            (2) The heading for section 44(e) of the Federal Deposit 
        Insurance Act (12 U.S.C. 1831u(e)) is amended by striking 
        ``Banks'' and inserting ``Insured Depository Institutions''.

SEC. 402. STATUTE OF LIMITATIONS FOR JUDICIAL REVIEW OF APPOINTMENT OF 
              A RECEIVER FOR DEPOSITORY INSTITUTIONS.

    (a) National Banks.--Section 2 of the National Bank Receivership 
Act (12 U.S.C. 191) is amended--
            (1) by striking ``SECTION 2. The Comptroller of the 
        Currency'' and inserting the following:

``SEC. 2. APPOINTMENT OF RECEIVER FOR A NATIONAL BANK.

    ``(a) In General.--The Comptroller of the Currency''; and
            (2) by adding at the end the following new subsection:
    ``(b) Judicial Review.--If the Comptroller of the Currency appoints 
a receiver under subsection (a), the national bank may, within 30 days 
thereafter, bring an action in the United States district court for the 
judicial district in which the home office of such bank is located, or 
in the United States District Court for the District of Columbia, for 
an order requiring the Comptroller of the Currency to remove the 
receiver, and the court shall, upon the merits, dismiss such action or 
direct the Comptroller of the Currency to remove the receiver.''.
    (b) Insured Depository Institutions.--Section 11(c)(7) of the 
Federal Deposit Insurance Act (12 U.S.C. 1821(c)(7)) is amended to read 
as follows:
            ``(7) Judicial review.--If the Corporation is appointed 
        (including the appointment of the Corporation as receiver by 
        the Board of Directors) as conservator or receiver of a 
        depository institution under paragraph (4), (9), or (10), the 
        depository institution may, within 30 days thereafter, bring an 
        action in the United States district court for the judicial 
        district in which the home office of such depository 
        institution is located, or in the United States District Court 
        for the District of Columbia, for an order requiring the 
        Corporation to be removed as the conservator or receiver 
        (regardless of how such appointment was made), and the court 
        shall, upon the merits, dismiss such action or direct the 
        Corporation to be removed as the conservator or receiver.''.
    (c) Expansion of Period for Challenging the Appointment of a 
Liquidating Agent.--Subparagraph (B) of section 207(a)(1) of the 
Federal Credit Union Act (12 U.S.C. 1787(a)(1)) is amended by striking 
``10 days'' and inserting ``30 days''.
    (d) Effective Date.--The amendments made by subsections (a), (b), 
and (c) shall apply with respect to conservators, receivers, or 
liquidating agents appointed on or after the date of the enactment of 
this Act.

SEC. 403. REPORTING REQUIREMENTS RELATING TO INSIDER LENDING.

    (a) Reporting Requirements Regarding Loans to Executive Officers of 
Member Banks.--Section 22(g) of the Federal Reserve Act (12 U.S.C. 
375a) is amended--
            (1) by striking paragraphs (6) and (9); and
            (2) by redesignating paragraphs (7), (8), and (10) as 
        paragraphs (6), (7), and (8), respectively.
    (b) Reporting Requirements Regarding Loans From Correspondent Banks 
to Executive Officers and Shareholders of Insured Banks.--Section 
106(b)(2) of the Bank Holding Company Act Amendments of 1970 (12 U.S.C. 
1972(2)) is amended--
            (1) by striking subparagraph (G); and
            (2) by redesignating subparagraphs (H) and (I) as 
        subparagraphs (G) and (H), respectively.

SEC. 404. AMENDMENT TO PROVIDE AN INFLATION ADJUSTMENT FOR THE SMALL 
              DEPOSITORY INSTITUTION EXCEPTION UNDER THE DEPOSITORY 
              INSTITUTION MANAGEMENT INTERLOCKS ACT.

    Section 203(1) of the Depository Institution Management Interlocks 
Act (12 U.S.C. 3202(1)) is amended by striking ``$20,000,000'' and 
inserting ``$100,000,000''.

SEC. 405. ENHANCING THE SAFETY AND SOUNDNESS OF INSURED DEPOSITORY 
              INSTITUTIONS.

    (a) Clarification Relating to the Enforceability of Agreements and 
Conditions.--The Federal Deposit Insurance Act (12 U.S.C. 1811 et seq.) 
is amended by adding at the end the following new section:

``SEC. 49. ENFORCEMENT OF AGREEMENTS.

    ``(a) In General.--Notwithstanding clause (i) or (ii) of section 
8(b)(6)(A) or section 38(e)(2)(E)(i), an appropriate Federal banking 
agency may enforce, under section 8, the terms of--
            ``(1) any condition imposed in writing by the agency on a 
        depository institution or an institution-affiliated party 
        (including a bank holding company) in connection with any 
        action on any application, notice, or other request concerning 
        a depository institution; or
            ``(2) any written agreement entered into between the agency 
        and an institution-affiliated party (including a bank holding 
        company).
    ``(b) Receiverships and Conservatorships.--After the appointment of 
the Corporation as the receiver or conservator for any insured 
depository institution, the Corporation may enforce any condition or 
agreement described in paragraph (1) or (2) of subsection (a) involving 
such institution or any institution-affiliated party (including a bank 
holding company), through an action brought in an appropriate United 
States district court.''.
    (b) Protection of Capital of Insured Depository Institutions.--
Paragraph (1) of section 18(u) of the Federal Deposit Insurance Act (12 
U.S.C. 1828(u)) is amended by striking subparagraph (B) and by 
redesignating subparagraph (C) as subparagraph (B).

SEC. 406. INVESTMENTS BY INSURED SAVINGS ASSOCIATIONS IN BANK SERVICE 
              COMPANIES AUTHORIZED.

    (a) In General.--Sections 2 and 3 of the Bank Service Company Act 
(12 U.S.C. 1862, 1863) are each amended by striking ``insured bank'' 
each place such term appears and inserting ``insured depository 
institution''.
    (b) Technical and Conforming Amendments.--
            (1) Section 1(b)(4) of the Bank Service Company Act (12 
        U.S.C. 1861(b)(4)) is amended--
                    (A) by inserting ``, except when such term appears 
                in connection with the term `insured depository 
                institution','' after ``means''; and
                    (B) by striking ``Federal Home Loan Bank Board'' 
                and inserting ``Director of the Office of Thrift 
                Supervision''.
            (2) Section 1(b) of the Bank Service Company Act (12 U.S.C. 
        1861(b)) is amended--
                    (A) by striking paragraph (5) and inserting the 
                following new paragraph:
            ``(5) Insured depository institution.--The term `insured 
        depository institution' has the meaning given the term in 
        section 3(c) of the Federal Deposit Insurance Act;'';
                    (B) by striking ``and'' at the end of paragraph 
                (7);
                    (C) by striking the period at the end of paragraph 
                (8) and inserting ``; and''; and
                    (D) by adding at the end the following new 
                paragraph:
            ``(9) the terms `State depository institution', `Federal 
        depository institution', `State savings association' and 
        `Federal savings association' have the meanings given the terms 
        in section 3 of the Federal Deposit Insurance Act.''.
            (3) The 1st sentence of section 5(c)(4)(B) of the Home 
        Owners' Loan Act (12 U.S.C. 1464(c)(4)(B)) is amended by 
        striking ``by savings associations of such State and by Federal 
        associations'' and inserting ``by State and Federal depository 
        institutions''.
            (4) Subparagraph (A)(ii) and subparagraph (B)(ii) of 
        section 1(b)(2) of the Bank Service Company Act (12 U.S.C. 
        1861(b)(2)) are each amended by striking ``insured banks'' and 
        inserting ``insured depository institutions''.
            (5) Section 1(b)(8) of the Bank Service Company Act (12 
        U.S.C. 1861(b)(8)) is further amended--
                    (A) by striking ``insured bank'' and inserting 
                ``insured depository institution'';
                    (B) by striking ``insured banks'' each place such 
                term appears and inserting ``insured depository 
                institutions''; and
                    (C) by striking ``the bank's'' and inserting ``the 
                depository institution's''.
            (6) Section 2 of the Bank Service Company Act (12 U.S.C. 
        1862) is amended by inserting ``or savings associations, other 
        than the limitation on the amount of investment by a Federal 
        savings association contained in section 5(c)(4)(B) of the Home 
        Owners' Loan Act'' after ``relating to banks''.
            (7) Section 4(b) of the Bank Service Company Act (12 U.S.C. 
        1864(b)) is amended by inserting ``as permissible under 
        subsection (c), (d), or (e) or'' after ``Except''.
            (8) Section 4(c) of the Bank Service Company Act (12 U.S.C. 
        1864(c)) is amended by inserting ``or State savings 
        association'' after ``State bank'' each place such term 
        appears.
            (9) Section 4(d) of the Bank Service Company Act (12 U.S.C. 
        1864(d)) is amended by inserting ``or Federal savings 
        association'' after ``national bank'' each place such term 
        appears.
            (10) Section 4(e) of the Bank Service Company Act (12 
        U.S.C. 1864(e)) is amended to read as follows:
    ``(e) A bank service company may perform--
            ``(1) only those services that each depository institution 
        shareholder or member is otherwise authorized to perform under 
        any applicable Federal or State law; and
            ``(2) such services only at locations in a State in which 
        each such shareholder or member is authorized to perform such 
        services.''.
            (11) Section 4(f) of the Bank Service Company Act (12 
        U.S.C. 1864(f)) is amended by inserting ``or savings 
        associations'' after ``location of banks''.
            (12) Section 5 of the Bank Service Company Act (12 U.S.C. 
        1865) is amended--
                    (A) in subsection (a)--
                            (i) by striking ``insured bank'' and 
                        inserting ``insured depository institution''; 
                        and
                            (ii) by striking ``bank's'' and inserting 
                        ``institution's'';
                    (B) in subsection (b)--
                            (i) by striking ``insured bank'' and 
                        inserting ``insured depository institution'';
                            (ii) by inserting ``authorized only'' after 
                        ``performs any service''; and
                            (iii) by inserting ``authorized only'' 
                        after ``perform any activity''; and
                    (C) in subsection (c)--
                            (i) by striking ``the bank or banks'' and 
                        inserting ``any depository institution''; and
                            (ii) by striking ``capability of the bank'' 
                        and inserting ``capability of the depository 
                        institution''.
            (13) Section 7 of the Bank Service Company Act (12 U.S.C. 
        1867) is amended--
                    (A) in subsection (b), by striking ``insured bank'' 
                and inserting ``insured depository institution''; and
                    (B) in subsection (c)--
                            (i) by striking ``a bank'' each place such 
                        term appears and inserting ``a depository 
                        institution''; and
                            (ii) by striking ``the bank'' each place 
                        such term appears and inserting ``the 
                        depository institution''.

SEC. 407. CROSS GUARANTEE AUTHORITY.

    Subparagraph (A) of section 5(e)(9) of the Federal Deposit 
Insurance Act (12 U.S.C. 1815(e)(9)(A)) is amended to read as follows:
                    ``(A) such institutions are controlled by the same 
                company; or''.

SEC. 408. GOLDEN PARACHUTE AUTHORITY AND NONBANK HOLDING COMPANIES.

    Subsection (k) of section 18 of the Federal Deposit Insurance Act 
(12 U.S.C. 1828(k)) is amended--
            (1) in paragraph (2)(A), by striking ``or depository 
        institution holding company'' and inserting ``or covered 
        company'';
            (2) by striking subparagraph (B) of paragraph (2) and 
        inserting the following new subparagraph:
                    ``(B) Whether there is a reasonable basis to 
                believe that the institution-affiliated party is 
                substantially responsible for--
                            ``(i) the insolvency of the depository 
                        institution or covered company;
                            ``(ii) the appointment of a conservator or 
                        receiver for the depository institution; or
                            ``(iii) the depository institution's 
                        troubled condition (as defined in the 
                        regulations prescribed pursuant to section 
                        32(f)).'';
            (3) in paragraph (2)(F), by striking ``depository 
        institution holding company'' and inserting ``covered 
        company,'';
            (4) in paragraph (3) in the matter preceding subparagraph 
        (A), by striking ``depository institution holding company'' and 
        inserting ``covered company'';
            (5) in paragraph (3)(A), by striking ``holding company'' 
        and inserting ``covered company'';
            (6) in paragraph (4)(A)--
                    (A) by striking ``depository institution holding 
                company'' each place such term appears and inserting 
                ``covered company''; and
                    (B) by striking ``holding company'' each place such 
                term appears (other than in connection with the term 
                referred to in subparagraph (A)) and inserting 
                ``covered company'';
            (7) in paragraph (5)(A), by striking ``depository 
        institution holding company'' and inserting ``covered 
        company'';
            (8) in paragraph (5), by adding at the end the following 
        new subparagraph:
                    ``(D) Covered company.--The term `covered company' 
                means any depository institution holding company 
                (including any company required to file a report under 
                section 4(f)(6) of the Bank Holding Company Act of 
                1956), or any other company that controls an insured 
                depository institution.''; and
            (9) in paragraph (6)--
                    (A) by striking ``depository institution holding 
                company'' and inserting ``covered company,''; and
                    (B) by striking ``or holding company'' and 
                inserting ``or covered company''.

SEC. 409. AMENDMENTS RELATING TO CHANGE IN BANK CONTROL.

    Section 7(j) of the Federal Deposit Insurance Act (12 U.S.C. 
1817(j)) is amended--
            (1) in paragraph (1)(D)--
                    (A) by striking ``is needed to investigate'' and 
                inserting ``is needed--
                            ``(i) to investigate'';
                    (B) by striking ``United States Code.'' and 
                inserting ``United States Code; or''; and
                    (C) by adding at the end the following new clause:
                            ``(ii) to analyze the safety and soundness 
                        of any plans or proposals described in 
                        paragraph (6)(E) or the future prospects of the 
                        institution.''; and
            (2) in paragraph (7)(C), by striking ``the financial 
        condition of any acquiring person'' and inserting ``either the 
        financial condition of any acquiring person or the future 
        prospects of the institution''.

SEC. 410. COMMUNITY REINVESTMENT CREDIT FOR ESOPS AND EWOCS.

    Section 804 of the Community Reinvestment Act of 1977 (12 U.S.C. 
2903) is amended by adding at the end the following new subsection--
    ``(d) Establishment of Esops and Ewocs.--
            ``(1) In general.--In assessing and taking into account, 
        under subsection (a), the record of a financial institution, 
        the appropriate Federal financial supervisory agency shall 
        consider as a factor activities that support or enable the 
        establishment of employee stock ownership plans or eligible 
        worker-owned cooperatives, so long as the employer sponsoring 
        the plan or cooperative is at least 51 percent owned by 
        employees, including low to moderate income employees.
            ``(2) Definitions.--For purposes of this subsection, the 
        following definitions shall apply:
                    ``(A) Employee stock ownership plan.--The term 
                `employee stock ownership plan' has the same meaning as 
                in section 4975(e)(7) of the Internal Revenue Code of 
                1986.
                    ``(B) Eligible worker-owned cooperative.--The term 
                `eligible worker-owned cooperative' has the same 
                meaning as in section 1042(c)(2) of the Internal 
                Revenue Code of 1986.''.

SEC. 411. MINORITY FINANCIAL INSTITUTIONS.

    (a) In General.--The Federal Deposit Insurance Corporation and the 
Office of Thrift Supervision shall provide such technical assistance to 
minority financial institutions affected by Hurricane Katrina, 
Hurricane Rita, and Hurricane Wilma as may be appropriate to preserve 
the present number of minority depository institutions and preserve the 
minority character in cases involving mergers or acquisitions of a 
minority depository institution consistent with section 308(a) of the 
Financial Institutions Reform, Recovery, and Enforcement Act of 1989.
    (b) Minority Financial Institution Defined.--For purposes of this 
subsection, the term ``minority financial institution'' has the same 
meaning as in section 308(b) of the Financial Institutions Reform, 
Recovery, and Enforcement Act of 1989.

         TITLE V--DEPOSITORY INSTITUTION AFFILIATES PROVISIONS

SEC. 501. CLARIFICATION OF CROSS MARKETING PROVISION.

    Section 4(n)(5) of the Bank Holding Company Act of 1956 (12 U.S.C. 
1843(n)(5)) is amended--
            (1) in subparagraph (B), by striking ``subsection 
        (k)(4)(I)'' and inserting ``subparagraph (H) or (I) of 
        subsection (k)(4)''; and
            (2) by adding at the end the following new subparagraph:
                    ``(C) Threshold of control.--Subparagraph (A) shall 
                not apply with respect to a company described or 
                referred to in clause (i) or (ii) of such subparagraph 
                if the financial holding company does not own or 
                control 25 percent or more of the total equity or any 
                class of voting securities of such company.''.

SEC. 502. AMENDMENT TO PROVIDE THE FEDERAL RESERVE BOARD WITH 
              DISCRETION CONCERNING THE IMPUTATION OF CONTROL OF SHARES 
              OF A COMPANY BY TRUSTEES.

    Section 2(g)(2) of the Bank Holding Company Act of 1956 (12 U.S.C. 
1841(g)(2)) is amended by inserting ``, unless the Board determines 
that such treatment is not appropriate in light of the facts and 
circumstances of the case and the purposes of this Act'' before the 
period at the end.

SEC. 503. ELIMINATING GEOGRAPHIC LIMITS ON THRIFT SERVICE COMPANIES.

    (a) In General.--The 1st sentence of section 5(c)(4)(B) of the Home 
Owners' Loan Act (12 U.S.C. 1464(c)(4)(B)) (as amended by section 
406(b)(3) of this Act) is amended--
            (1) by striking ``corporation organized'' and all that 
        follows through ``is available for purchase'' and inserting 
        ``company, if the entire capital of the company is available 
        for purchase''; and
            (2) by striking ``having their home offices in such 
        State''.
    (b) Technical Corrections.--
            (1) The heading for subparagraph (B) of section 5(c)(4) of 
        the Home Owners' Loan Act (12 U.S.C. 1464(c)(4)(B)) is amended 
        by striking ``corporations'' and inserting ``companies''.
            (2) The 2nd sentence of section 5(n)(1) of the Home Owners' 
        Loan Act (12 U.S.C. 1464(n)(1)) is amended by striking 
        ``service corporations'' and inserting ``service companies''.
            (3) Section 5(q)(1) of the Home Owners' Loan Act (12 U.S.C. 
        1464(q)(1)) is amended by striking ``service corporation'' each 
        place such term appears in subparagraphs (A), (B), and (C) and 
        inserting ``service company''.
            (4) Section 10(m)(4)(C)(iii)(II) of the Home Owners' Loan 
        Act (12 U.S.C. 1467a(m)(4)(C)(iii)(II)) is amended by striking 
        ``service corporation'' each place such term appears and 
        inserting ``service company''.

SEC. 504. CLARIFICATION OF SCOPE OF APPLICABLE RATE PROVISION.

    Section 44(f) of the Federal Deposit Insurance Act (12 U.S.C. 
1831u(f)) is amended by adding at the end the following new paragraphs:
            ``(3) Other lenders.--In the case of any other lender doing 
        business in the State described in paragraph (1), the maximum 
        interest rate or amount of interest, discount points, finance 
        charges, or other similar charges that may be charged, taken, 
        received, or reserved from time to time in any loan, discount, 
        or credit sale made, or upon any note, bill of exchange, 
        financing transaction, or other evidence of debt issued to or 
        acquired by any other lender shall be equal to not more than 
        the greater of the rates described in subparagraph (A) or (B) 
        of paragraph (1).
            ``(4) Other lender defined.--For purposes of paragraph (3), 
        the term `other lender' means any person engaged in the 
        business of selling or financing the sale of personal property 
        (and any services incidental to the sale of personal property) 
        in such State, except that, with regard to any person or entity 
        described in such paragraph, such term does not include--
                    ``(A) an insured depository institution; or
                    ``(B) any person or entity engaged in the business 
                of providing a short-term cash advance to any consumer 
                in exchange for--
                            ``(i) a consumer's personal check or share 
                        draft, in the amount of the advance plus a fee, 
                        where presentment or negotiation of such check 
                        or share draft is deferred by agreement of the 
                        parties until a designated future date; or
                            ``(ii) a consumer authorization to debit 
                        the consumer's transaction account, in the 
                        amount of the advance plus a fee, where such 
                        account will be debited on or after a 
                        designated future date.''.

SEC. 505. SAVINGS ASSOCIATIONS ACTING AS AGENTS FOR AFFILIATED 
              DEPOSITORY INSTITUTIONS.

    (a) In General.--Section 18(r) of the Federal Deposit Insurance Act 
(12 U.S.C. 1828(r)) is amended--
            (1) in paragraph (1)--
                    (A) by striking ``bank subsidiary'' and inserting 
                ``depository institution subsidiary''; and
                    (B) by striking ``bank holding company'' and 
                inserting ``depository institution holding company'';
            (2) in paragraph (2), by striking ``a bank acting'' and 
        inserting ``a depository institution acting'';
            (3) in paragraphs (3) and (5), by striking ``or (6)'' each 
        place such term appears in each such paragraph; and
            (4) by striking paragraph (6).
    (b) Clerical Amendment.--The heading for section 18(r)(2) of the 
Federal Deposit Insurance Act (12 U.S.C. 1828(r)) is amended by 
striking ``Bank'' and inserting ``Depository institution''.

SEC. 506. CREDIT CARD BANK INVESTMENTS FOR THE PUBLIC WELFARE.

    Section 2(c)(2)(F) of the Bank Holding Company Act of 1956 (12 
U.S.C. 1841(c)(2)(F)) is amended--
            (1) in clause (i), by striking ``engages only in credit 
        card operations;'' and inserting ``engages only in--
                                    ``(I) credit card operations; and
                                    ``(II) making investments designed 
                                primarily to promote the public 
                                welfare, including the welfare of low- 
                                and moderate-income communities or 
                                families (such as by providing housing, 
                                services, or jobs), in the manner and 
                                to the extent permitted for national 
                                banks under the paragraph designated 
                                the `Eleventh' of section 5136 of the 
                                Revised Statutes of the United States 
                                and regulations prescribed under such 
                                paragraph, except that the last 
                                sentence of such paragraph shall be 
                                applied for purposes of this subclause 
                                by substituting `5 percent' for `15 
                                percent' each place such term appears; 
                                ''; and
            (2) in clause (v), by inserting ``, other than making or 
        purchasing loans for the purposes described in and to the 
        extent permitted in clause (i)(II))'' before the period at the 
        end.

                  TITLE VI--BANKING AGENCY PROVISIONS

SEC. 601. WAIVER OF EXAMINATION SCHEDULE IN ORDER TO ALLOCATE EXAMINER 
              RESOURCES.

    Section 10(d) of the Federal Deposit Insurance Act (12 U.S.C. 
1820(d)) is amended--
            (1) by redesignating paragraphs (5), (6), (7), (8), (9), 
        and (10) as paragraphs (6), (7), (8), (9), (10), and (11), 
        respectively;
            (2) by inserting after paragraph (4), the following new 
        paragraph:
            ``(5) Waiver of schedule when necessary to achieve safe and 
        sound allocation of examiner resources.--Notwithstanding 
        paragraphs (1), (2), (3), and (4), an appropriate Federal 
        banking agency may make adjustments in the examination cycle 
        for an insured depository institution if necessary to allocate 
        available resources of examiners in a manner that provides for 
        the safety and soundness of, and the effective examination and 
        supervision of, insured depository institutions.''; and
            (3) in paragraphs (8) and (9), as so redesignated, by 
        striking ``paragraph (6)'' and inserting ``paragraph (7)''.

SEC. 602. INTERAGENCY DATA SHARING.

    (a) Federal Banking Agencies.--Section 7(a)(2) of the Federal 
Deposit Insurance Act (12 U.S.C. 1817(a)(2)) is amended by adding at 
the end the following new subparagraph:
                    ``(C) Data sharing with other agencies and 
                persons.--In addition to reports of examination, 
                reports of condition, and other reports required to be 
                regularly provided to the Corporation (with respect to 
                all insured depository institutions, including a 
                depository institution for which the Corporation has 
                been appointed conservator or receiver) or an 
                appropriate State bank supervisor (with respect to a 
                State depository institution) under subparagraph (A) or 
                (B), a Federal banking agency may, in the agency's 
                discretion, furnish any report of examination or other 
                confidential supervisory information concerning any 
                depository institution or other entity examined by such 
                agency under authority of any Federal law, to--
                            ``(i) any other Federal or State agency or 
                        authority with supervisory or regulatory 
                        authority over the depository institution or 
                        other entity;
                            ``(ii) any officer, director, or receiver 
                        of such depository institution or entity; and
                            ``(iii) any other person the Federal 
                        banking agency determines to be appropriate.''.
    (b) National Credit Union Administration.--Section 202(a) of the 
Federal Credit Union Act (12 U.S.C. 1782(a)) is amended by adding at 
the end the following new paragraph:
            ``(8) Data sharing with other agencies and persons.--In 
        addition to reports of examination, reports of condition, and 
        other reports required to be regularly provided to the Board 
        (with respect to all insured credit unions, including a credit 
        union for which the Corporation has been appointed conservator 
        or liquidating agent) or an appropriate State commission, 
        board, or authority having supervision of a State-chartered 
        credit union, the Board may, in the Board's discretion, furnish 
        any report of examination or other confidential supervisory 
        information concerning any credit union or other entity 
        examined by the Board under authority of any Federal law, to--
                    ``(A) any other Federal or State agency or 
                authority with supervisory or regulatory authority over 
                the credit union or other entity;
                    ``(B) any officer, director, or receiver of such 
                credit union or entity; and
                    ``(C) any other institution-affiliated party of 
                such credit union or entity the Board determines to be 
                appropriate.''.

SEC. 603. PENALTY FOR UNAUTHORIZED PARTICIPATION BY CONVICTED 
              INDIVIDUAL.

    Section 19 of the Federal Deposit Insurance Act (12 U.S.C. 1829) is 
amended by adding at the end the following new subsection:
    ``(c) Noninsured Banks.--Subsections (a) and (b) shall apply to a 
noninsured national bank and a noninsured State member bank, and any 
agency or noninsured branch (as such terms are defined in section 1(b) 
of the International Banking Act of 1978) of a foreign bank as if such 
bank, branch, or agency were an insured depository institution, except 
such subsections shall be applied for purposes of this subsection by 
substituting the agency determined under the following paragraphs for 
`Corporation' each place such term appears in such subsections:
            ``(1) The Comptroller of the Currency, in the case of a 
        noninsured national bank or any Federal agency or noninsured 
        Federal branch of a foreign bank.
            ``(2) The Board of Governors of the Federal Reserve System, 
        in the case of a noninsured State member bank or any State 
        agency or noninsured State branch of a foreign bank.''.

SEC. 604. AMENDMENT PERMITTING THE DESTRUCTION OF OLD RECORDS OF A 
              DEPOSITORY INSTITUTION BY THE FDIC AFTER THE APPOINTMENT 
              OF THE FDIC AS RECEIVER.

    Section 11(d)(15)(D) of the Federal Deposit Insurance Act (12 
U.S.C. 1821(d)(15)(D)) is amended--
            (1) by striking ``Recordkeeping requirement.--After the end 
        of the 6-year period'' and inserting ``Recordkeeping 
        requirement.--
                            ``(i) In general.--Except as provided in 
                        clause (ii), after the end of the 6-year 
                        period'';
            (2) by striking ``to be unnecessary'' and inserting ``are 
        unnecessary and not relevant to any pending or reasonably 
        probable future litigation''; and
            (3) by adding at the end the following new clause:
                            ``(ii) Old records.--In the case of records 
                        of an insured depository institution which--
                                    ``(I) are at least 10 years old, as 
                                of the date the Corporation is 
                                appointed as the receiver of such 
                                depository institution; and
                                    ``(II) are unnecessary and not 
                                relevant to any pending or reasonably 
                                probable future litigation, as provided 
                                in clause (i),
                        the Corporation may destroy such records in 
                        accordance with clause (i) any time after such 
                        appointment is final without regard to the 6-
                        year period of limitation contained in such 
                        clause.''.

SEC. 605. MODERNIZATION OF RECORDKEEPING REQUIREMENT.

    Subsection (f) of section 10 of the Federal Deposit Insurance Act 
(12 U.S.C. 1820(f)) is amended to read as follows:
    ``(f) Preservation of Agency Records.--
            ``(1) In general.--A Federal banking agency may cause any 
        and all records, papers, or documents kept by the agency or in 
        the possession or custody of the agency to be--
                    ``(A) photographed or microphotographed or 
                otherwise reproduced upon film; or
                    ``(B) preserved in any electronic medium or format 
                which is capable of--
                            ``(i) being read or scanned by computer; 
                        and
                            ``(ii) being reproduced from such 
                        electronic medium or format by printing or any 
                        other form of reproduction of electronically 
                        stored data.
            ``(2) Treatment as original records.--Any photographs, 
        microphotographs, or photographic film or copies thereof 
        described in paragraph (1)(A) or reproduction of electronically 
        stored data described in paragraph (1)(B) shall be deemed to be 
        an original record for all purposes, including introduction in 
        evidence in all State and Federal courts or administrative 
        agencies and shall be admissible to prove any act, transaction, 
        occurrence, or event therein recorded.
            ``(3) Authority of the federal banking agencies.--Any 
        photographs, microphotographs, or photographic film or copies 
        thereof described in paragraph (1)(A) or reproduction of 
        electronically stored data described in paragraph (1)(B) shall 
        be preserved in such manner as the Federal banking agency shall 
        prescribe and the original records, papers, or documents may be 
        destroyed or otherwise disposed of as the Federal banking 
        agency may direct.''.

SEC. 606. STREAMLINING REPORTS OF CONDITION.

    Section 7(a) of the Federal Deposit Insurance Act (12 U.S.C. 
1817(a)) is amended by adding the following new paragraph:
            ``(11) Streamlining reports of condition.--
                    ``(A) Review of information and schedules.--Before 
                the end of the 1-year period beginning on the date of 
                the enactment of the Financial Services Regulatory 
                Relief Act of 2005 and before the end of each 5-year 
                period thereafter, each Federal banking agency shall, 
                in consultation with the other relevant Federal banking 
                agencies, review the information and schedules that are 
                required to be filed by an insured depository 
                institution in a report of condition required under 
                paragraph (3).
                    ``(B) Reduction or elimination of information found 
                to be unnecessary.--After completing the review 
                required by subparagraph (A), a Federal banking agency, 
                in consultation with the other relevant Federal banking 
                agencies, shall reduce or eliminate any requirement to 
                file information or schedules under paragraph (3) 
                (other than information or schedules that are otherwise 
                required by law) if the agency determines that the 
                continued collection of such information or schedules 
                is no longer necessary or appropriate.''.

SEC. 607. EXPANSION OF ELIGIBILITY FOR 18-MONTH EXAMINATION SCHEDULE 
              FOR COMMUNITY BANKS.

    Paragraph (4)(A) of section 10(d) of the Federal Deposit Insurance 
Act (12 U.S.C. 1820(d)) is amended by striking ``$250,000,000'' and 
inserting ``$1,000,000,000''.

SEC. 608. SHORT FORM REPORTS OF CONDITION FOR CERTAIN COMMUNITY BANKS.

    (a) In General.--Section 7(a) of the Federal Deposit Insurance Act 
(12 U.S.C. 1817(a)) is amended by inserting after paragraph (11) (as 
added by section 606 of this title) the following new paragraph:
            ``(12) Short form reports of condition for community 
        banks.--
                    ``(A) In general.--With respect to reports of 
                condition required under paragraph (3) for each 
                calendar quarter, an insured depository institution 
                described in subparagraphs (A), (B), (C), and (D) of 
                section 10(d)(4) may submit a short form of any such 
                report of condition in 2 nonsequential quarters of any 
                calendar year.
                    ``(B) Short form defined.--The term `short form', 
                when used in connection with any report of condition 
                required under paragraph (3), means a report of 
                condition in a format established by the appropriate 
                Federal banking agency, after notice and opportunity 
                for comment, that--
                            ``(i) is significantly and materially less 
                        burdensome for the insured depository 
                        institution to prepare than the format of the 
                        report of condition required under paragraph 
                        (3); and
                            ``(ii) provides sufficient material 
                        information for the appropriate Federal banking 
                        agency to assure the maintenance of the safe 
                        and sound condition of the depository 
                        institution and safe and sound practices.''.
    (b) Regulations.--Any regulation required to carry out the 
amendment made by subsection (a) shall be published in final form 
before the end of the 6-month period beginning on the date of the 
enactment of this Act.

SEC. 609. CLARIFICATION OF EXTENT OF SUSPENSION, REMOVAL, AND 
              PROHIBITION AUTHORITY OF FEDERAL BANKING AGENCIES IN 
              CASES OF CERTAIN CRIMES BY INSTITUTION-AFFILIATED 
              PARTIES.

    (a) Insured Depository Institutions.--
            (1) In general.--Section 8(g)(1) of the Federal Deposit 
        Insurance Act (12 U.S.C. 1818(g)(1)) is amended--
                    (A) in subparagraph (A)--
                            (i) by striking ``is charged in any 
                        information, indictment, or complaint, with the 
                        commission of or participation in'' and 
                        inserting ``is the subject of any information, 
                        indictment, or complaint, involving the 
                        commission of or participation in'';
                            (ii) by striking ``may pose a threat to the 
                        interests of the depository institution's 
                        depositors or may threaten to impair public 
                        confidence in the depository institution,'' and 
                        insert ``posed, poses, or may pose a threat to 
                        the interests of the depositors of, or 
                        threatened, threatens, or may threaten to 
                        impair public confidence in, any relevant 
                        depository institution (as defined in 
                        subparagraph (E)),''; and
                            (iii) by striking ``affairs of the 
                        depository institution'' and inserting 
                        ``affairs of any depository institution'';
                    (B) in subparagraph (B)(i), by striking ``the 
                depository institution'' and inserting ``any depository 
                institution that the subject of the notice is 
                affiliated with at the time the notice is issued'';
                    (C) in subparagraph (C)(i)--
                            (i) by striking ``may pose a threat to the 
                        interests of the depository institution's 
                        depositors or may threaten to impair public 
                        confidence in the depository institution,'' and 
                        insert ``posed, poses, or may pose a threat to 
                        the interests of the depositors of, or 
                        threatened, threatens, or may threaten to 
                        impair public confidence in, and relevant 
                        depository institution (as defined in 
                        subparagraph (E)),''; and
                            (ii) by striking ``affairs of the 
                        depository institution'' and inserting 
                        ``affairs of any depository institution'';
                    (D) in subparagraph (C)(ii), by striking ``affairs 
                of the depository institution'' and inserting ``affairs 
                of any depository institution'';
                    (E) in subparagraph (D)(i), by striking ``the 
                depository institution'' and inserting ``any depository 
                institution that the subject of the order is affiliated 
                with at the time the order is issued''; and
                    (F) by adding at the end the following new 
                subparagraph:
                    ``(E) Relevant depository institution.--For 
                purposes of this subsection, the term `relevant 
                depository institution' means any depository 
                institution of which the party is or was an 
                institution-affiliated party at the time--
                            ``(i) the information, indictment or 
                        complaint described in subparagraph (A) was 
                        issued; or
                            ``(ii) the notice is issued under 
                        subparagraph (A) or the order is issued under 
                        subparagraph (C)(i).''.
            (2) Clerical amendment.--The heading for section 8(g) of 
        the Federal Deposit Insurance Act (12 U.S.C. 1818(g)) is 
        amended to read as follows:
    ``(g) Suspension, Removal, and Prohibition From Participation 
Orders in the Case of Certain Criminal Offenses.--''.
    (b) Insured Credit Unions.--
            (1) In general.--Section 206(i)(1) of the Federal Credit 
        Union Act (12 U.S.C. 1786(i)(1)) is amended--
                    (A) in subparagraph (A), by striking ``the credit 
                union'' each place such term appears and inserting 
                ``any credit union'';
                    (B) in subparagraph (B)(i), by inserting ``of which 
                the subject of the order is, or most recently was, an 
                institution-affiliated party'' before the period at the 
                end;
                    (C) in subparagraph (C)--
                            (i) by striking ``the credit union'' each 
                        place such term appears and inserting ``any 
                        credit union''; and
                            (ii) by striking ``the credit union's'' and 
                        inserting ``any credit union's'';
                    (D) in subparagraph (D)(i), by striking ``upon such 
                credit union'' and inserting ``upon the credit union of 
                which the subject of the order is, or most recently 
                was, an institution-affiliated party''; and
                    (E) by adding at the end the following new 
                subparagraph:
                    ``(E) Continuation of authority.--The Board may 
                issue an order under this paragraph with respect to an 
                individual who is an institution-affiliated party at a 
                credit union at the time of an offense described in 
                subparagraph (A) without regard to--
                            ``(i) whether such individual is an 
                        institution-affiliated party at any credit 
                        union at the time the order is considered or 
                        issued by the Board; or
                            ``(ii) whether the credit union at which 
                        the individual was an institution-affiliated 
                        party at the time of the offense remains in 
                        existence at the time the order is considered 
                        or issued by the Board.''.
            (2) Clerical amendment.--Section 206(i) of the Federal 
        Credit Union Act (12 U.S.C. 1786(i)) is amended by striking 
        ``(i)'' at the beginning and inserting the following new 
        subsection heading:
    ``(i) Suspension, Removal, and Prohibition From Participation 
Orders in the Case of Certain Criminal Offenses.--''.

SEC. 610. STREAMLINING DEPOSITORY INSTITUTION MERGER APPLICATION 
              REQUIREMENTS.

    (a) In General.--Paragraph (4) of section 18(c) of the Federal 
Deposit Insurance Act (12 U.S.C. 1828(c)) is amended to read as 
follows:
            ``(4) Reports on competitive factors.--
                    ``(A) Request for report.--In the interests of 
                uniform standards and subject to subparagraph (B), the 
                responsible agency shall, before acting on any 
                application for approval of a merger transaction--
                            ``(i) request a report on the competitive 
                        factors involved from the Attorney General; and
                            ``(ii) provide a copy of the request to the 
                        Corporation (when the Corporation is not the 
                        responsible agency).
                    ``(B) Concurrent consideration.--The responsible 
                agency shall not be required to make a request under 
                subparagraph (A) before acting on an application for 
                approval of a merger transaction if--
                            ``(i) the agency finds that it must act 
                        immediately in order to prevent the probable 
                        failure of a depository institution involved in 
                        the transaction; or
                            ``(ii) the transaction consists of a merger 
                        between an insured depository institution and 1 
                        or more affiliates of the depository 
                        institution.
                    ``(C) Furnishing of report.--The report requested 
                under subparagraph (A) shall be furnished by the 
                Attorney General to the responsible agency--
                            ``(i) not more than 30 calendar days after 
                        the date on which the Attorney General received 
                        the request; or
                            ``(ii) not more than 10 calendar days after 
                        such date, if the requesting agency advises the 
                        Attorney General that an emergency exists 
                        requiring expeditious action.''.
    (b) Technical and Conforming Amendment.--Section 18(c)(6) of the 
Federal Deposit Insurance Act (12 U.S.C. 1828(c)(6)) is amended--
            (1) in the second sentence by striking ``banks or savings 
        associations involved'' and inserting the following: ``insured 
        depository institutions involved, or if the proposed merger 
        transaction is solely between an insured depository institution 
        and 1 or more of affiliates of the depository institution,'' 
        and
            (2) by striking the penultimate sentence and inserting the 
        following: ``If the agency has advised the Attorney General 
        under paragraph (4)(C)(ii) of the existence of an emergency 
        requiring expeditious action and has requested a report on the 
        competitive factors within 10 days, the transaction may not be 
        consummated before the fifth calendar day after the date of 
        approval by the agency.''.

SEC. 611. INCLUSION OF DIRECTOR OF THE OFFICE OF THRIFT SUPERVISION IN 
              LIST OF BANKING AGENCIES REGARDING INSURANCE CUSTOMER 
              PROTECTION REGULATIONS.

    Section 47(g)(2)(B)(i) of the Federal Deposit Insurance Act (12 
U.S.C. 1831x(g)(2)(B)(i)) is amended by inserting ``the Director of the 
Office of Thrift Supervision,'' after ``Comptroller of the Currency,''.

SEC. 612. PROTECTION OF CONFIDENTIAL INFORMATION RECEIVED BY FEDERAL 
              BANKING REGULATORS FROM FOREIGN BANKING SUPERVISORS.

    Section 15 of the International Banking Act of 1978 (12 U.S.C. 
3109) is amended by adding at the end the following new subsection:
    ``(c) Confidential Information Received From Foreign Supervisors.--
            ``(1) In general.--Except as provided in paragraph (3), a 
        Federal banking agency shall not be compelled to disclose 
        information received from a foreign regulatory or supervisory 
        authority if--
                    ``(A) the Federal banking agency determines that 
                the foreign regulatory or supervisory authority has, in 
                good faith, determined and represented to such Federal 
                banking agency that public disclosure of the 
                information would violate the laws applicable to that 
                foreign regulatory or supervisory authority; and
                    ``(B) the relevant Federal banking agency obtained 
                such information pursuant to--
                            ``(i) such procedures as the Federal 
                        banking agency may establish for use in 
                        connection with the administration and 
                        enforcement of Federal banking laws; or
                            ``(ii) a memorandum of understanding or 
                        other similar arrangement between the Federal 
                        banking agency and the foreign regulatory or 
                        supervisory authority.
            ``(2) Treatment under title 5, united states code.--For 
        purposes of section 552 of title 5, United States Code, this 
        subsection shall be treated as a statute described in 
        subsection (b)(3)(B) of such section.
            ``(3) Savings provision.--No provision of this section 
        shall be construed as--
                    ``(A) authorizing any Federal banking agency to 
                withhold any information from any duly authorized 
                committee of the House of Representatives or the 
                Senate; or
                    ``(B) preventing any Federal banking agency from 
                complying with an order of a court of the United States 
                in an action commenced by the United States or such 
                agency.
            ``(4) Federal banking agency defined.--For purposes of this 
        subsection, the term `Federal banking agency' means the Board, 
        the Comptroller, the Federal Deposit Insurance Corporation, and 
        the Director of the Office of Thrift Supervision.''.

SEC. 613. PROHIBITION ON PARTICIPATION BY CONVICTED INDIVIDUAL.

    (a) Extension of Automatic Prohibition.--Section 19 of the Federal 
Deposit Insurance Act (12 U.S.C. 1829) is amended by inserting after 
subsection (c) (as added by section 603 of this title) the following 
new subsections:
    ``(d) Bank Holding Companies.--Subsections (a) and (b) shall apply 
to any company (other than a foreign bank) that is a bank holding 
company and any organization organized and operated under section 25A 
of the Federal Reserve Act or operating under section 25 of the Federal 
Reserve Act as if such bank holding company or organization were an 
insured depository institution, except such subsections shall be 
applied for purposes of this subsection by substituting `Board of 
Governors of the Federal Reserve System' for `Corporation' each place 
such term appears in such subsections.
    ``(e) Savings and Loan Holding Companies.--Subsections (a) and (b) 
shall apply to any savings and loan holding company and any subsidiary 
(other than a savings association) of a savings and loan holding 
company as if such savings and loan holding company or subsidiary were 
an insured depository institution, except such subsections shall be 
applied for purposes of this subsection by substituting `Director of 
the Office of Thrift Supervision' for `Corporation' each place such 
term appears in such subsections.''.
    (b) Enhanced Discretion to Remove Convicted Individuals.--Section 
8(e)(2)(A) of the Federal Deposit Insurance Act (12 U.S.C. 
1818(e)(2)(A)) is amended--
            (1) by striking ``or'' at the end of clause (ii);
            (2) by striking the comma at the end of clause (iii) and 
        inserting ``; or''; and
            (3) by adding at the end the following new clause:
                            ``(iv) an institution-affiliated party of a 
                        subsidiary (other than a bank) of a bank 
                        holding company has been convicted of any 
                        criminal offense involving dishonesty or a 
                        breach of trust, or has agreed to enter into a 
                        pretrial diversion or similar program in 
                        connection with a prosecution for such an 
                        offense,''.

SEC. 614. CLARIFICATION THAT NOTICE AFTER SEPARATION FROM SERVICE MAY 
              BE MADE BY AN ORDER.

    (a) In General.--Section 8(i)(3) of the Federal Deposit Insurance 
Act (12 U.S.C. 1818(i)(3)) is amended by inserting ``or order'' after 
``notice'' each place such term appears.
    (b) Technical and Conforming Amendment.--The heading for section 
8(i)(3) of the Federal Deposit Insurance Act (12 U.S.C. 1818(i)(3)) is 
amended by inserting ``or Order'' after ``Notice''.

SEC. 615. ENFORCEMENT AGAINST MISREPRESENTATIONS REGARDING FDIC DEPOSIT 
              INSURANCE COVERAGE.

    (a) In General.--Section 18(a) of the Federal Deposit Insurance Act 
(12 U.S.C. 1828(a)) is amended by adding at the end the following new 
paragraph:
            ``(4) False advertising, misuse of fdic names, and 
        misrepresentation to indicate insured status.--
                    ``(A) Prohibition on false advertising and misuse 
                of fdic names.--No person may--
                            ``(i) use the terms `Federal Deposit', 
                        `Federal Deposit Insurance', `Federal Deposit 
                        Insurance Corporation', any combination of such 
                        terms, or the abbreviation `FDIC' as part of 
                        the business name or firm name of any person, 
                        including any corporation, partnership, 
                        business trust, association, or other business 
                        entity; or
                            ``(ii) use such terms or any other sign or 
                        symbol as part of an advertisement, 
                        solicitation, or other document,
                to represent, suggest or imply that any deposit 
                liability, obligation, certificate or share is insured 
                or guaranteed by the Federal Deposit Insurance 
                Corporation, if such deposit liability, obligation, 
                certificate, or share is not insured or guaranteed by 
                the Corporation.
                    ``(B) Prohibition on misrepresentations of insured 
                status.--No person may knowingly misrepresent--
                            ``(i) that any deposit liability, 
                        obligation, certificate, or share is federally 
                        insured, if such deposit liability, obligation, 
                        certificate, or share is not insured by the 
                        Corporation; or
                            ``(ii) the extent to which or the manner in 
                        which any deposit liability, obligation, 
                        certificate, or share is insured by the Federal 
                        Deposit Insurance Corporation, if such deposit 
                        liability, obligation, certificate, or share is 
                        not insured by the Corporation to the extent or 
                        in the manner represented.
                    ``(C) Authority of fdic.--The Corporation shall 
                have--
                            ``(i) jurisdiction over any person that 
                        violates this paragraph, or aids or abets the 
                        violation of this paragraph; and
                            ``(ii) for purposes of enforcing the 
                        requirements of this paragraph with regard to 
                        any person--
                                    ``(I) the authority of the 
                                Corporation under section 10(c) to 
                                conduct investigations; and
                                    ``(II) the enforcement authority of 
                                the Corporation under subsections (b), 
                                (c), (d) and (i) of section 8,
                as if such person were a state nonmember insured bank.
                    ``(D) Other actions preserved.--No provision of 
                this paragraph shall be construed as barring any action 
                otherwise available, under the laws of the United 
                States or any State, to any Federal or State law 
                enforcement agency or individual.''.
    (b) Enforcement Orders.--Section 8(c) of the Federal Deposit 
Insurance Act (12 U.S.C. 1818(c)) is amended by adding at the end the 
following new paragraph:
            ``(4) False advertising or misuse of names to indicate 
        insured status.--
                    ``(A) Temporary order.--
                            ``(i) In general.--If a notice of charges 
                        served under subsection (b)(1) of this section 
                        specifies on the basis of particular facts that 
                        any person is engaged in conduct described in 
                        section 18(a)(4), the Corporation may issue a 
                        temporary order requiring--
                                    ``(I) the immediate cessation of 
                                any activity or practice described, 
                                which gave rise to the notice of 
                                charges; and
                                    ``(II) affirmative action to 
                                prevent any further, or to remedy any 
                                existing, violation.
                            ``(ii) Effect of order.--Any temporary 
                        order issued under this subparagraph shall take 
                        effect upon service.
                    ``(B) Effective period of temporary order.--A 
                temporary order issued under subparagraph (A) shall 
                remain effective and enforceable, pending the 
                completion of an administrative proceeding pursuant to 
                subsection (b)(1) in connection with the notice of 
                charges--
                            ``(i) until such time as the Corporation 
                        shall dismiss the charges specified in such 
                        notice; or
                            ``(ii) if a cease-and-desist order is 
                        issued against such person, until the effective 
                        date of such order.
                    ``(C) Civil money penalties.--Violations of section 
                18(a)(4) shall be subject to civil money penalties as 
                set forth in subsection (i) in an amount not to exceed 
                $1,000,000 for each day during which the violation 
                occurs or continues.''.
    (c) Technical and Conforming Amendments.--
            (1) Section 18(a)(3) of the Federal Deposit Insurance Act 
        (12 U.S.C. 1828(a)) is amended--
                    (A) in the 1st sentence by striking ``of this 
                subsection'' and inserting ``of paragraphs (1) and 
                (2)'';
                    (B) by striking the 2nd sentence; and
                    (C) in the 3rd sentence, by striking ``of this 
                subsection'' and inserting ``of paragraphs (1) and 
                (2)''.
            (2) The heading for subsection (a) of section 18 of the 
        Federal Deposit Insurance Act (12 U.S.C. 1828(a)) is amended by 
        striking ``Insurance Logo.--'' and inserting ``Representations 
        of Deposit Insurance.--''.

SEC. 616. CHANGES REQUIRED TO SMALL BANK HOLDING COMPANY POLICY 
              STATEMENT ON ASSESSMENT OF FINANCIAL AND MANAGERIAL 
              FACTORS.

    (a) Small Bank Holding Company Policy Statement on Assessment of 
Financial and Managerial Factors.--
            (1) In general.--Before the end of the 6-month period 
        beginning on the date of the enactment of this Act, the Board 
        of Governors of the Federal Reserve System shall publish in the 
        Federal Register proposed revisions to the Small Bank Holding 
        Company Policy Statement on Assessment of Financial and 
        Managerial Factors (12 C.F.R. part 225--appendix C) that 
        provide that the policy shall apply to a bank holding company 
        which has pro forma consolidated assets of less than 
        $1,000,000,000 and that--
                    (A) is not engaged in any nonbanking activities 
                involving significant leverage; and
                    (B) does not have a significant amount of 
                outstanding debt that is held by the general public.
            (2) Adjustment of amount.--The Board of Governors of the 
        Federal Reserve System shall annually adjust the dollar amount 
        referred to in paragraph (1) in the Small Bank Holding Company 
        Policy Statement on Assessment of Financial and Managerial 
        Factors by an amount equal to the percentage increase, for the 
        most recent year, in total assets held by all insured 
        depository institutions, as determined by the Board.
    (b) Increase in Debt-to-equity Ratio of Small Bank Holding 
Company.--Before the end of the 6-month period beginning on the date of 
the enactment of this Act, the Board of Governors of the Federal 
Reserve System shall publish in the Federal Register proposed revisions 
to the Small Bank Holding Company Policy Statement on Assessment of 
Financial and Managerial Factors (12 C.F.R. part 225--appendix C) such 
that the debt-to-equity ratio allowable for a small bank holding 
company in order to remain eligible to pay a corporate dividend and to 
remain eligible for expedited processing procedures under Regulation Y 
of the Board of Governors of the Federal Reserve System would increase 
from 1:1 to 3:1.

SEC. 617. EXCEPTION TO ANNUAL PRIVACY NOTICE REQUIREMENT UNDER THE 
              GRAMM-LEACH-BLILEY ACT.

    Section 503 of the Gramm-Leach-Bliley Act (15 U.S.C. 6803) is 
amended by adding the following new subsections:
    ``(c) Exception to Annual Notice Requirement.--A financial 
institution that--
            ``(1) provides nonpublic personal information only in 
        accordance with the provisions of subsection (b)(2) or (e) of 
        section 502 or regulations prescribed under section 504(b);
            ``(2) does not share information with affiliates under 
        section 603(d)(2)(A) of the Fair Credit Reporting Act; and
            ``(3) has not changed its policies and practices with 
        regard to disclosing nonpublic personal information from the 
        policies and practices that were disclosed in the most recent 
        disclosure sent to consumers in accordance with this 
        subsection,
shall not be required to provide an annual disclosure under this 
subsection until such time as the financial institution fails to comply 
with any criteria described in paragraph (1), (2), or (3).
    ``(d) Exception to Notice Requirement.--A financial institution 
shall not be required to provide any disclosure under this section if--
            ``(1) the financial institution is licensed by a State and 
        is subject to existing regulation of consumer confidentiality 
        that prohibits disclosure of nonpublic personal information 
        without knowing and expressed consent of the consumer in the 
        form of laws, rules, or regulation of professional conduct or 
        ethics promulgated either by the court of highest appellate 
        authority or by the principal legislative body or regulatory 
        agency or body of any State of the United States, the District 
        of Columbia, any territory of the United States, Puerto Rico, 
        Guam, American Samoa, the Trust Territory of the Pacific 
        Islands, the Virgin Islands, or the Northern Mariana Islands; 
        or
            ``(2) the financial institution is licensed by a State and 
        becomes subject to future regulation of consumer 
        confidentiality that prohibits disclosure of nonpublic personal 
        information without knowing and expressed consent of the 
        consumer in the form of laws, rules, or regulation of 
        professional conduct or ethics promulgated either by the court 
        of highest appellate authority or by the principal legislative 
        body or regulatory agency or body of any State of the United 
        States, the District of Columbia, any territory of the United 
        States, Puerto Rico, Guam, American Samoa, the Trust Territory 
        of the Pacific Islands, the Virgin Islands, or the Northern 
        Mariana Islands.''.

SEC. 618. BIENNIAL REPORTS ON THE STATUS OF AGENCY EMPLOYMENT OF 
              MINORITIES AND WOMEN.

    (a) In General.--Before December 31, 2005, and the end of each 2-
year period beginning after such date, each Federal banking agency 
shall submit a report to the Congress on the status of the employment 
by the agency of minority individuals and women.
    (b) Factors to Be Included.--The report shall include a detailed 
assessment of each of the following:
            (1) The extent of hiring of minority individuals and women 
        by the agency as of the time the report is prepared.
            (2) The successes achieved and challenges faced by the 
        agency in operating minority and women outreach programs.
            (3) Challenges the agency may face in finding qualified 
        minority individual and women applicants.
            (4) Such other information, findings, and conclusions, and 
        recommendations for legislative or agency action, as the agency 
        may determine to be appropriate to include in the report.
    (c) Definitions.--For purposes of this section, the following 
definitions shall apply:
            (1) Federal banking agency.--The term ``Federal banking 
        agency''--
                    (A) has the same meaning as in section 3(z) of the 
                Federal Deposit Insurance Act; and
                    (B) includes the National Credit Union 
                Administration.
            (2) Minority.--The term ``minority'' has the same meaning 
        as in section 1204(c)(3) of the Financial Institutions Reform, 
        Recovery, and Enforcement Act of 1989.

SEC. 619. COORDINATION OF STATE EXAMINATION AUTHORITY.

    Section 10(h) of the Federal Deposit Insurance Act (12 U.S.C. 
1820(h)) is amended to read as follows:
    ``(h) Coordination of Examination Authority.--
            ``(1) State bank supervisors of home and host states.--
                    ``(A) Home state of bank.--The appropriate State 
                bank supervisor of the home State of an insured State 
                bank has authority to examine and supervise the bank.
                    ``(B) Host state branches.--The State bank 
                supervisor of the home State of an insured State bank 
                and any State bank supervisor of an appropriate host 
                State shall exercise their respective authority to 
                supervise and examine the branches of the bank in a 
                host State in accordance with the terms of any 
                applicable cooperative agreement between the home State 
                bank supervisor and the State bank supervisor of the 
                relevant host State.
                    ``(C) Supervisory fees.--Except as expressly 
                provided in a cooperative agreement between the State 
                bank supervisors of the home State and any host State 
                of an insured State bank, only the State bank 
                supervisor of the home State of an insured State bank 
                may levy or charge State supervisory fees on the bank.
            ``(2) Host state examination.--
                    ``(A) In general.--With respect to a branch 
                operated in a host State by an out-of-State insured 
                State bank that resulted from an interstate merger 
                transaction approved under section 44 or that was 
                established in such State pursuant to section 5155(g) 
                of the Revised Statutes, the third undesignated 
                paragraph of section 9 of the Federal Reserve Act or 
                section 18(d)(4) of this Act, the appropriate State 
                bank supervisor of such host State may--
                            ``(i) with written notice to the State bank 
                        supervisor of the bank's home State and subject 
                        to the terms of any applicable cooperative 
                        agreement with the State bank supervisor of 
                        such home State, examine such branch for the 
                        purpose of determining compliance with host 
                        State laws that are applicable pursuant to 
                        section 24(j) of this Act, including those that 
                        govern community reinvestment, fair lending, 
                        and consumer protection; and
                            ``(ii) if expressly permitted under and 
                        subject to the terms of a cooperative agreement 
                        with the State bank supervisor of the bank's 
                        home State or if such out-of-State insured 
                        State bank has been determined to be in a 
                        troubled condition by either the State bank 
                        supervisor of the bank's home State or the 
                        bank's appropriate Federal banking agency, 
                        participate in the examination of the bank by 
                        the State bank supervisor of the bank's home 
                        State to ascertain that the activities of the 
                        branch in such host State are not conducted in 
                        an unsafe or unsound manner.
                    ``(B) Notice of determination.--
                            ``(i) In general.--The State bank 
                        supervisor of the home State of an insured 
                        State bank should notify the State bank 
                        supervisor of each host State of the bank if 
                        there has been a final determination that the 
                        bank is in a troubled condition.
                            ``(ii) Timing of notice.--The State bank 
                        supervisor of the home State of an insured 
                        State bank should provide notice under clause 
                        (i) as soon as reasonably possible but in all 
                        cases within 15 business days after the State 
                        bank supervisor has made such final 
                        determination or has received written 
                        notification of such final determination.
            ``(3) Host state enforcement.--If the State bank supervisor 
        of a host State determines that a branch of an out-of-State 
        State insured State bank is violating any law of the host State 
        that is applicable to such branch pursuant to section 24(j) of 
        this Act, including a law that governs community reinvestment, 
        fair lending, or consumer protection, the State bank supervisor 
        of the host State or, to the extent authorized by the law of 
        the host State, a host State law enforcement officer may, with 
        written notice to the State bank supervisor of the bank's home 
        State and subject to the terms of any applicable cooperative 
        agreement with the State bank supervisor of the bank's home 
        State, undertake such enforcement actions and proceedings as 
        would be permitted under the law of the host State as if the 
        branch were a bank chartered by that host State.
            ``(4) Cooperative agreement.--
                    ``(A) In general.--The State bank supervisors from 
                2 or more States may enter into cooperative agreements 
                to facilitate State regulatory supervision of State 
                banks, including cooperative agreements relating to the 
                coordination of examinations and joint participation in 
                examinations. For purposes of this subsection (h), the 
                term `cooperative agreement' means a written agreement 
                that is signed by the home State bank supervisor and 
                host State bank supervisor to facilitate State 
                regulatory supervision of State banks and includes 
                nationwide or multi-state cooperative agreements and 
                cooperative agreements solely between the home State 
                and host State.
                    ``(B) Rule of construction.--Except for State bank 
                supervisors, no provision of this subsection relating 
                to such cooperative agreements shall be construed as 
                limiting in any way the authority of home and host 
                State law enforcement officers, regulatory supervisors, 
                or other officials that have not signed such 
                cooperative agreements to enforce host State laws that 
                are applicable to a branch of an out-of-State insured 
                State bank located in the host State pursuant to 
                section 24(j) of this Act.
            ``(5) Federal regulatory authority.--No provision of this 
        subsection shall be construed as limiting in any way the 
        authority of any Federal banking agency.
            ``(6) State taxation authority not affected.--No provision 
        of this subsection (h) shall be construed as affecting the 
        authority of any State or political subdivision of any State to 
        adopt, apply, or administer any tax or method of taxation to 
        any bank, bank holding company, or foreign bank, or any 
        affiliate of any bank, bank holding company, or foreign bank, 
        to the extent such tax or tax method is otherwise permissible 
        by or under the Constitution of the United States or other 
        Federal law.
            ``(7) Definitions.--For purpose of this section, the 
        following definition shall apply:
                    ``(A) Host state, home state, out-of-state bank.--
                The terms `host State', `home State', and `out-of-State 
                bank' have the same meanings as in section 44(g).
                    ``(B) State supervisory fees.--The term `State 
                supervisory fees' means assessments, examination fees, 
                branch fees, license fees, and all other fees that are 
                levied or charged by a State bank supervisor directly 
                upon an insured State bank or upon branches of an 
                insured State bank.
                    ``(C) Troubled condition.--Solely for purposes of 
                subparagraph (2)(B) of this subsection (h), an insured 
                State bank has been determined to be in `troubled 
                condition' if the bank--
                            ``(i) has a composite rating, as determined 
                        in its most recent report of examination, of 4 
                        or 5 under the Uniform Financial Institutions 
                        Ratings System (UFIRS); or
                            ``(ii) is subject to a proceeding initiated 
                        by the Corporation for termination or 
                        suspension of deposit insurance; or
                            ``(iii) is subject to a proceeding 
                        initiated by the State bank supervisor of the 
                        bank's home State to vacate, revoke, or 
                        terminate the charter of the bank, or to 
                        liquidate the bank, or to appoint a receiver 
                        for the bank.
                    ``(D) Final determination.--For the purposes of 
                paragraph (2)(B), the term `final determination' means 
                the transmittal of a report of examination to the bank 
                or transmittal of official notice of proceedings to the 
                bank.''.

SEC. 620. NONWAIVER OF PRIVILEGES.

    (a) Insured Depository Institutions.--Section 18 of the Federal 
Deposit Insurance Act (12 U.S.C. 1828) is amended by adding at the end 
the following new subsection:
    ``(x) Privileges not Affected by Disclosure to Banking Agency or 
Supervisor.--
            ``(1) In general.--The submission by any person of any 
        information to any Federal banking agency, State bank 
        supervisor, or foreign banking authority for any purpose in the 
        course of any supervisory or regulatory process of such agency, 
        supervisor, or authority shall not be construed as waiving, 
        destroying, or otherwise affecting any privilege such person 
        may claim with respect to such information under Federal or 
        State law as to any person or entity other than such agency, 
        supervisor, or authority.
            ``(2) Rule of construction.--No provision of paragraph (1) 
        may be construed as implying or establishing that--
                    ``(A) any person waives any privilege applicable to 
                information that is submitted or transferred under any 
                circumstance to which paragraph (1) does not apply; or
                    ``(B) any person would waive any privilege 
                applicable to any information by submitting the 
                information to any Federal banking agency, State bank 
                supervisor, or foreign banking authority, but for this 
                subsection.''.
    (b) Insured Credit Unions.--Section 205 of the Federal Credit Union 
Act (12 U.S.C.1785) is amended by adding at the end the following new 
subsection:
    ``(j) Privileges not Affected by Disclosure to Banking Agency or 
Supervisor.--
            ``(1) In general.--The submission by any person of any 
        information to the Administration, any State credit union 
        supervisor, or foreign banking authority for any purpose in the 
        course of any supervisory or regulatory process of such Board, 
        supervisor, or authority shall not be construed as waiving, 
        destroying, or otherwise affecting any privilege such person 
        may claim with respect to such information under Federal or 
        State law as to any person or entity other than such Board, 
        supervisor, or authority.
            ``(2) Rule of construction.--No provision of paragraph (1) 
        may be construed as implying or establishing that--
                    ``(A) any person waives any privilege applicable to 
                information that is submitted or transferred under any 
                circumstance to which paragraph (1) does not apply; or
                    ``(B) any person would waive any privilege 
                applicable to any information by submitting the 
                information to the Administration, any State credit 
                union supervisor, or foreign banking authority, but for 
                this subsection.''.

SEC. 621. RIGHT TO FINANCIAL PRIVACY ACT OF 1978 AMENDMENT.

    Paragraph (1) of section 1101 of the Right to Financial Privacy Act 
of 1978 (12 U.S.C. 3401) is amended by inserting ``(including any 
lender who advances funds on pledges of personal property)'' after 
``consumer finance institution''.

SEC. 622. DEPUTY DIRECTOR; SUCCESSION AUTHORITY FOR DIRECTOR OF THE 
              OFFICE OF THRIFT SUPERVISION.

    (a) Establishment of Position of Deputy Director.--Section 3(c)(5) 
of the Home Owners' Loan Act (12 U.S.C. 1462a(c)(5)) is amended to read 
as follows:
            ``(5) Deputy director.--
                    ``(A) In general.--The Secretary of the Treasury 
                shall appoint a Deputy Director and may appoint up to 3 
                additional Deputy Directors.
                    ``(B) First deputy director.--If the Secretary of 
                the Treasury appoints more than 1 Deputy Director of 
                the Office, the Secretary shall designate one such 
                appointee as the First Deputy Director.
                    ``(C) Duties.--Each Deputy Director appointed under 
                this paragraph shall take an oath of office and perform 
                such duties as the Director shall direct.
                    ``(D) Compensation and benefits.--The Director 
                shall fix the compensation and benefits for each Deputy 
                Director in accordance with this Act.''.
    (b) Service of Deputy Director as Acting Director.--Section 3(c)(3) 
of the Home Owners' Loan Act (12 U.S.C. 1462a(c)(3)) is amended--
            (1) by striking ``Vacancy.--A vacancy in the position of 
        Director'' and inserting ``Vacancy.--
                    ``(A) In general.--A vacancy in the position of 
                Director''; and
            (2) by adding at the end the following new subparagraphs:
                    ``(B) Acting director.--
                            ``(i) In general.--In the event of a 
                        vacancy in the position of Director or during 
                        the absence or disability of the Director, the 
                        Deputy Director shall serve as Acting Director.
                            ``(ii) Succession in case of 2 or more 
                        deputy directors.--If there are 2 or more 
                        Deputy Directors serving at the time a vacancy 
                        in the position of Director occurs or the 
                        absence or disability of the Director 
                        commences, the First Deputy Director shall 
                        serve as Acting Director under clause (i) 
                        followed by such other Deputy Directors under 
                        any order of succession the Director may 
                        establish.
                            ``(iii) Authority of acting director.--Any 
                        Deputy Director, while serving as Acting 
                        Director under this subparagraph, shall be 
                        vested with all authority, duties, and 
                        privileges of the Director under this Act and 
                        any other provision of Federal law.''.

SEC. 623. LIMITATION ON SCOPE OF NEW AGENCY GUIDELINES.

    (a) In General.--The provisions of the multi-agency guidance 
Numbered 2003-1 issued by the Comptroller of the Currency, the Board of 
Governors of the Federal Reserve System, the Federal Deposit Insurance 
Corporation, and the Director of the Office of Thrift Supervision that 
relate to minimum credit card payments and negative amortization--
            (1) shall only apply to new credit card accounts 
        established by a creditor for a consumer after the date of the 
        enactment of this Act under an open end consumer credit plan; 
        and
            (2) shall not apply to any outstanding balance on any 
        credit card account under an open end consumer credit plan as 
        of such date of enactment.
    (b) Definitions.--For purposes of this section, the terms 
``credit'', ``credit card'', ``creditor'', ``consumer'' and ``open end 
credit plan'' have the same meanings as in section 103 of the Truth in 
Lending Act.
    (c) Sunset Provision.--This section shall not apply after the end 
of the 3-year period beginning on the date of the enactment of this Act 

             TITLE VII--``BSA'' COMPLIANCE BURDEN REDUCTION

SEC. 701. EXCEPTION FROM CURRENCY TRANSACTION REPORTS FOR SEASONED 
              CUSTOMERS.

    (a) Findings.--The Congress finds as follows:
            (1) The completion of and filing of currency transaction 
        reports under section 5313 of title 31, United States Code, 
        poses a compliance burden on the financial industry.
            (2) Due to the nature of the transactions or the persons 
        and entities conducting such transactions, certain such reports 
        as currently filed do not appear to be relevant to the 
        detection, deterrence, or investigation of financial crimes, 
        including money laundering and the financing of terrorism.
            (3) However, the data contained in such reports can provide 
        valuable context for the analysis of other data derived 
        pursuant to subchapter II of chapter 53 of title 31, United 
        States Code, as well as investigative data, which provides 
        invaluable and indispensable information supporting efforts to 
        combat money laundering and other financial crimes.
            (4) An exemption from the reporting requirements for 
        certain currency transactions that are of little or no value to 
        ongoing efforts of law enforcement agencies, financial 
        regulatory agencies, and the financial services industry to 
        investigate, detect, or deter financial crimes would serve to 
        balance the burden placed on members of the financial services 
        industry with the compelling need to produce and provide 
        meaningful information to policy-makers, financial regulators, 
        law enforcement, and intelligence agencies.
            (5) The Secretary of the Treasury has by regulation, and in 
        accordance with section 5313 of title 31, United States Code, 
        implemented a process by which institutions may seek exemptions 
        from filing certain currency transaction reports based on 
        appropriate circumstances; however, the existing exemption 
        process has not adequately balanced the burden on the financial 
        industry with the Government's need for data to support its 
        efforts in combating financial crime.
            (6) The act of providing notice to the Secretary of the 
        Treasury of designations of exemption provides meaningful 
        information to law enforcement officials on exempt customers 
        and enables law enforcement to obtain account information 
        through appropriate legal process; the act of providing notice 
        of designations of exemption complements other sections of 
        title 31, United States Code, whereby law enforcement can 
        locate financial institutions with relevant records relating to 
        a person of investigative interest, such as information 
        requests made pursuant to regulations implementing section 
        314(a) of the USA PATRIOT Act of 2001.
            (7) A designation of exemption has no effect on 
        requirements for depository institutions to apply the full 
        range of anti-money laundering controls as set forth in 
        subchapter II of chapter 53 of title 31, United States Code, 
        including the requirement to apply the customer identification 
        program pursuant to Section 5326 of subchapter II of chapter 53 
        of title 31, United States Code, and the requirement to 
        identify, monitor, and, if appropriate, report suspicious 
        activity in accordance with section 5318(g) of title 31, United 
        States Code.
            (8) The Federal banking agencies and the Financial Crimes 
        Enforcement Network have recently provided guidance through the 
        Federal Financial Institutions Examination Council Bank Secrecy 
        Act/Anti-Money Laundering Examination Manual on applying 
        appropriate levels of due diligence and identifying suspicious 
        activity by the types of cash-intensive businesses that 
        generally will be subject to exemption.
    (b) Seasoned Customer Exemption.--
            (1) In general.--Section 5313(e) of title 31, United States 
        Code, is amended to read as follows:
    ``(e) Qualified Customer Exemption.--
            ``(1) In general.--The Secretary of the Treasury shall 
        prescribe regulations within 270 days of the enactment of the 
        Financial Services Regulatory Relief Act of 2005 that exempt 
        any depository institution from filing a report pursuant to 
        this section in a transaction for the payment, receipt, or 
        transfer of United States coins or currency (or other monetary 
        instruments the Secretary of the Treasury prescribes) with a 
        qualified customer of the depository institution.
            ``(2) Qualified customer defined.--For purposes of this 
        section, the term `qualified customer', with respect to a 
        depository institution, has such meaning as the Secretary of 
        the Treasury shall prescribe, which shall include any person 
        that--
                    ``(A) is incorporated or organized under the laws 
                of the United States or any State, including a sole 
                proprietorship, or is registered as and eligible to do 
                business within the United States or a State;
                    ``(B) has maintained a deposit account with the 
                depository institution for at least 12 months; and
                    ``(C) has engaged, using such account, in multiple 
                currency transactions that are subject to the reporting 
                requirements of subsection (a).
            ``(3) Regulations.--
                    ``(A) In general.--The Secretary of the Treasury 
                shall prescribe regulations requiring a depository 
                institution to file a 1-time notice of designation of 
                exemption for each qualified customer of the depository 
                institution.
                    ``(B) Form and content of exemption notice.--The 
                Secretary shall by regulation prescribe the form, 
                manner, content, and timing of the qualified customer 
                exemption notice; such notice shall include information 
                sufficient to identify the qualified customer and its 
                accounts.
                    ``(C) Authority of secretary.--
                            ``(i) In general.--The Secretary may 
                        suspend, reject or revoke any qualified 
                        customer exemption notice, in accordance with 
                        criteria prescribed by the Secretary by 
                        regulation.
                            ``(ii) Conditions.--The Secretary may 
                        establish conditions, in accordance with 
                        criteria prescribed by regulation, under which 
                        exempt qualified customers of an insured 
                        depository institution that is merged with or 
                        acquired by another insured depository 
                        institution will continue to be treated as 
                        designated exempt qualified customers of the 
                        surviving or acquiring institution.''.
    (c) 3-Year Review and Report.--Before the end of the 3-year period 
beginning on the date of the enactment of this Act, the Secretary of 
the Treasury, in consultation with the Attorney General, the Secretary 
of the Department of Homeland Security, the Federal banking agencies, 
the banking industry, and such other persons as the Secretary deems 
appropriate, shall evaluate the operations and effect of this provision 
and make recommendations to Congress as to any legislative action with 
respect to this provision as the Secretary may determine to be 
appropriate.

SEC. 702. REDUCTION IN INCONSISTENCIES IN MONETARY TRANSACTION 
              RECORDKEEPING AND REPORTING ENFORCEMENT AND EXAMINATION 
              REQUIREMENTS.

    (a) Sense of the Congress.--It is the sense of the Congress that 
inconsistencies and redundancies among regulations implementing 
monetary transaction recordkeeping and reporting enforcement programs 
under section 8 of the Federal Deposit Insurance Act, section 206(q) of 
the Federal Credit Union Act, and chapter II of chapter 53 of title 31, 
United States Code by the Secretary of the Treasury and the Federal 
banking agencies--
            (1) increase the difficulty depository institutions have in 
        complying with congressional intent in creating such 
        enforcement programs,
            (2) reduce the transparency and clarity of the regulatory 
        regime;
            (3) increase the potential for conflict among the various 
        regulations in the future; and
            (4) contribute to the perception that various agencies 
        involved in the enforcement of the monetary transaction 
        recordkeeping and reporting requirements apply such 
        requirements inconsistently.
    (b) Agency Coordination of Monetary Transaction Recordkeeping and 
Reporting Requirements.--
            (1) Enforcement programs.--
                    (A) Federal deposit insurance act.--Section 8(s) of 
                the Federal Deposit Insurance Act (12 U.S.C. 1818(s)) 
                is amended by adding at the end the following new 
                paragraph:
            ``(4) Coordination on uniform requirements.--In prescribing 
        regulations under paragraph (1), the Federal banking agencies, 
        acting through the Financial Institutions Examination Council, 
        shall--
                    ``(A) consult with each other, the National Credit 
                Union Administration Board, and the Secretary of the 
                Treasury; and
                    ``(B) take such action as may be necessary to 
                ensure that the requirements for procedures established 
                pursuant to such regulations, and the examination 
                standards for reviewing such procedures, are congruent 
                and reasonably uniform (taking into account differences 
                in the form and function of the institutions subject to 
                such requirements).''.
                    (B) Federal credit union act.--Section 206(q) of 
                the Federal Credit Union Act (12 U.S.C. 1786(q)) is 
                amended by adding at the end the following new 
                paragraph:
            ``(4) Coordination on uniform requirements.--In prescribing 
        regulations under paragraph (1), the Board, acting through the 
        Financial Institutions Examination Council, shall--
                    ``(A) consult with the Federal banking agencies and 
                the Secretary of the Treasury; and
                    ``(B) take such action as may be necessary to 
                ensure that the requirements for procedures established 
                pursuant to such regulations, and the examination 
                standards for reviewing such procedures, are congruent 
                and reasonably uniform (taking into account differences 
                in the form and function of the institutions subject to 
                such requirements).''.
            (2) Examination standards and disputes.--Section 1006 of 
        the Federal Financial Institutions Examination Council Act of 
        1978 (12 U.S.C. 3305) is amended by adding at the end the 
        following new subsection:
    ``(h) Monetary Transaction Recordkeeping and Reporting 
Requirements.--The Council and the Secretary of the Treasury shall 
jointly establish--
            ``(1) uniform standards and principles applicable to the 
        examination of financial institutions to ensure compliance with 
        the requirements of subchapter II of chapter 53, United States 
        Code, sections 8(s) and 21 of the Federal Deposit Insurance 
        Act, and section 206(q) of the Federal Credit Union Act; and
            ``(2) a clear policy statement on appropriate processes for 
        resolving examiner-institution disagreements concerning the 
        application of subchapter II of chapter 53, United States Code, 
        sections 8(s) and 21 of the Federal Deposit Insurance Act, and 
        section 206(q) of the Federal Credit Union Act to financial 
        institutions.''.
            (3) Effective date.--The Federal banking agencies, the 
        National Credit Union Administration Board, the Financial 
        Institutions Examination Council, and the Secretary of the 
        Treasury shall commence the discussions and consultations 
        required under the amendments made by this subsection as soon 
        as practicable after the date of the enactment of this Act.
    (c) Review of and Report on Additional Regulatory or Legislative 
Changes.--
            (1) Review 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 conduct a review of the 
        potential inconsistencies in, or redundancies among, the 
        regulations pertaining to the application of the requirements 
        of subchapter II of chapter 53, United States Code, sections 
        8(s) and 21 of the Federal Deposit Insurance Act, and section 
        206(q) of the Federal Credit Union Act to financial 
        institutions.
            (2) Report to congress and the financial institutions 
        examination council.--Upon completion of the review under 
        paragraph (1), the Secretary of the Treasury shall promptly 
        submit a report on the findings and conclusions of the 
        Secretary with respect to the review to the Committee on 
        Financial Services of the House of Representatives and the 
        Committee on Banking, Housing, and Urban Affairs of the Senate, 
        together with such recommendations for legislative and 
        administrative actions as the Secretary may determine to be 
        appropriate, and shall transmit a copy of such report to the 
        members of the Financial Institutions Examination Council.
    (d) Reform of Application of Monetary Transaction Recordkeeping and 
Reporting Requirements to Financial Institutions.--Before the end of 
the 9-month period beginning on the date of the submission of the 
report to Congress under subsection (c)(2), the Secretary of the 
Treasury shall prescribe regulations implementing appropriate changes 
to regulations within the jurisdiction of the Secretary to remedy 
redundancies or inconsistencies identified in the review by, and 
included in the recommendations of, the Secretary under subsection (c).

SEC. 703. ADDITIONAL REFORMS RELATING TO MONETARY TRANSACTION AND 
              RECORDKEEPING REQUIREMENTS APPLICABLE TO FINANCIAL 
              INSTITUTIONS.

    (a) Notification of Officers and Directors of Financial 
Institutions.--Before the end of the 6-month period beginning on the 
date of the enactment of this Act, the Secretary of the Treasury 
shall--
            (1) review any regulation, guideline, or guidance of the 
        Secretary, any Federal banking agency, or the National Credit 
        Union Administration Board that serves as the basis for any 
        requirement to provide notice to any officer or director of a 
        depository institution of any suspicious activity report 
        submitted by the depository institution to the Secretary and 
        any such agency or Board;
            (2) modify or eliminate any such requirement of the 
        Secretary that the Secretary determines is not necessary to 
        achieve the purposes of section 5318(g) of title 31, United 
        States Code; and
            (3) make a recommendation to any Federal banking agency or 
        the National Credit Union Administration Board to modify or 
        eliminate any such requirement of such agency or Board that the 
        Secretary determines is not necessary to achieve the purposes 
        of section 5318(g) of title 31, United States Code.
    (b) Elimination of Unnecessary Verification Requirements Applicable 
to the Purchase of Financial Instruments.--Before the end of the 9-
month period beginning on the date of the enactment of this Act, the 
Secretary of the Treasury shall--
            (1) review all verification of customer identity 
        requirements as they relate to the purchases of monetary 
        instruments by customers of depository institutions, including 
        the regulations codified in section 103.29(a)(ii) of title 31, 
        Code of Federal Regulations; and
            (2) modify or eliminate any customer identity requirement 
        related to the purchases of monetary instruments by customers 
        of depository institutions codified in section 103.29(a)(ii) of 
        title 31, Code of Federal Regulations, that the Secretary 
        determines is unnecessary.
    (c) Elimination of Recurring Filings of Suspicious Activity Reports 
on a Single Transaction.--Before the end of the 9-month period 
beginning on the date of the enactment of this Act, the Secretary of 
the Treasury, as appropriate, shall prescribe regulations, or issue 
other forms of guidance, that eliminate the need for depository 
institutions to file recurring suspicious activity reports on the same 
transaction unless there has been a subsequent change in any pattern of 
activity involving any person who was connected with the transaction.
    (d) Electronic Acknowledgement of Certain Electronic Filings.--
Before the end of the 1-year period beginning on the date of the 
enactment of this Act, the Director of the Financial Crimes Enforcement 
Network shall put into effect a system for promptly furnishing an 
electronic acknowledgement of receipt to any institution that files a 
form with FinCEN under subchapter II of chapter 53 of title 31, United 
States Code, through the Network's electronic filing system.

SEC. 704. STUDY BY COMPTROLLER GENERAL.

    (a) Study Required.--The Comptroller General of the United States 
shall conduct a study on methods and practices which would--
            (1) reduce the overall number of currency transaction 
        reports filed with the Secretary of the Treasury under section 
        5313(a) of title 31, United States Code, while ensuring that 
        the needs of the Secretary, the Financial Crimes Enforcement 
        Network, law enforcement agencies, and financial institution 
        regulatory agencies continue to be met;
            (2) improve financial institution utilization of the 
        current exemption provisions; and
            (3) mitigate the difficulties in the current implementation 
        of such exemption provisions that limit the utility of the 
        exemption process for financial institutions.
    (b) Report.--Before the end of the 6-month period beginning on the 
date of the enactment of this Act, the Comptroller General shall submit 
a report to the Committee on Financial Services of the House of 
Representatives and the Committee on Banking, Housing, and Urban 
Affairs of the Senate on the findings and conclusions of the 
Comptroller General with respect to the study conducted under 
subsection (a) and such recommendations for legislative and 
administrative action as the Comptroller General may determine to be 
appropriate.

SEC. 705. FEASIBILITY STUDY REQUIRED.

    (a) In General.--For the purpose of simplifying, and increasing 
compliance with, the various recordkeeping and reporting requirements 
under subchapter II of chapter 53 of title 31, United States Code, 
chapter 2 of title I of Public Law 91--508, and section 21 of the 
Federal Deposit Insurance Act, and regulations prescribed under such 
provisions of law, the Secretary of the Treasury (hereafter in this 
section referred to as the ``Secretary'') shall conduct a study on the 
feasibility of developing and implementing interfaces and templates for 
use in electronic communications between financial institutions (as 
defined in section 5312 of title 31, United States Code) and the 
Secretary, the Financial Crimes Enforcement Network, and other Federal 
financial institution regulatory agencies.
    (b) Factors to Be Considered.--In conducting the study required 
under subsection (a), the Secretary shall take into account--
            (1) any procedures required to be maintained by financial 
        institutions under regulations prescribed pursuant to section 
        5318(a)(2) of title 31 of the United States Code and the manner 
        in which the use of interfaces and templates which might be 
        developed could lessen the burden of complying with such 
        procedures; and
            (2) any exemptions prescribed by the Secretary under 
        paragraph (5) or (6) of such section 5318(a) and the manner in 
        which interfaces and templates which might be developed could 
        be programmed to reflect any such exemption for a financial 
        institution, transaction, or class of transactions.
    (c) Prototype and Report Required.--
            (1) In general.--Before the end of the 1-year period 
        beginning on the date of the enactment of this Act, the 
        Secretary shall submit a report to the Congress containing a 
        detailed description of the findings and conclusions of the 
        Secretary in connection with the study required under 
        subsection (a), together with such recommendations for 
        legislative or administrative action as the Secretary may 
        determine to be appropriate.
            (2) Prototype.--Any recommendation on the feasibility of 
        developing and implementing interfaces and templates for use in 
        electronic communications shall be accompanied by prototypes of 
        such interfaces and templates that demonstrate such 
        feasibility.
    (d) Definitions.--For purposes of this section, the following 
definitions shall apply:
            (1) Interface.--The term ``interface'' means the point and 
        method of interaction between any 2 or more electronic data 
        storage and communication systems that permits and facilitates 
        active electronic communication between or among the systems, 
        including any procedures, codes, and protocols that enable the 
        systems to interact.
            (2) Template.--The term ``template'' means a preestablished 
        layout model using word processing or other authoring software 
        that ensures that data entered into it will adhere to a 
        consistent format and content scheme when used by all parties 
        engaged in electronic communications among each other.

SEC. 706. ANNUAL REPORT BY SECRETARY OF THE TREASURY.

    (a) Findings.--The Congress finds as follows:
            (1) Financial institutions have too little information 
        about money laundering and terrorist financing compliance in 
        other markets.
            (2) The current Financial Action Task Force designation 
        system does not adequately represent the progress countries are 
        making in combatting money laundering.
            (3) Lack of information about the compliance of countries 
        with anti-money laundering standards exposes United States 
        financial markets to excessive risk.
            (4) Failure to designate countries that fail to make 
        progress in combatting terrorist financing and money laundering 
        eliminates incentives for internal reform.
            (5) The Secretary of the Treasury has an affirmative duty 
        to provide to financial institutions and examiners the best 
        possible information on compliance with anti-money laundering 
        and terrorist financing initiatives in other markets.
    (b) Report.--Not later than March 1 of each year, the Secretary of 
the Treasury shall submit to the Congress a report that identifies the 
applicable standards of each country against money laundering and 
states whether that country is a country of primary money laundering 
concern under section 5318A of title 31, United States Code. The report 
shall include--
            (1) information on the effectiveness of each country in 
        meeting its standards against money laundering;
            (2) a determination of whether that the efforts of that 
        country to combat money laundering and terrorist financing are 
        adequate, improving, or inadequate; and
            (3) the efforts made by the Secretary to provide to the 
        government of each such country of concern technical assistance 
        to cease the activities that were the basis for the 
        determination that the country was of primary money laundering 
        concern.
    (c) Dissemination of Information in Report.--The Secretary of the 
Treasury shall make available to the Federal Financial Institutions 
Examination Council for incorporation into the examination process, in 
consultation with Federal banking agencies, and to financial 
institutions the information contained in the report submitted under 
subsection (a). Such information shall be made available to financial 
institutions without cost.
    (d) Definition.--For purposes of this section, the term ``financial 
institution'' has the meaning given that term in section 5312(a)(2) of 
title 31, United States Code.

SEC. 707. PRESERVATION OF MONEY SERVICES BUSINESSES.

    (a) Findings.--The Congress finds as follows:
            (1) Title III of the USA PATRIOT ACT provided United States 
        law enforcement agencies with new tools to combat terrorist 
        financing and money laundering.
            (2) The Financial Crimes Enforcement Network in the 
        Department of the Treasury (hereafter in this section referred 
        to as ``FinCEN'' ) has defined money services businesses to 
        include the following 5 distinct types of financial services 
        providers as well as the United States Postal Service:
                    (A) Currency dealers or exchanges.
                    (B) Check cashing services.
                    (C) Issuers of travelers' checks, money orders, or 
                stored value cards.
                    (D) Sellers or redeemers of travelers' checks, 
                money orders, or stored value cards.
                    (E) Money transmitters.
            (3) Money services businesses have had more difficulty in 
        obtaining and maintaining banking services since the passage of 
        the USA PATRIOT ACT.
            (4) On March 30, 2005, FinCEN and the Federal banking 
        agencies (as defined in section 3 of the Federal Deposit 
        Insurance Act) issued a joint statement recognizing the 
        importance of ensuring that money services businesses that 
        comply with the law have reasonable access to banking services.
            (5) On April 26, 2005, FinCEN offered guidance to money 
        service businesses on obtaining and maintaining banking 
        services by identifying and explaining to money services 
        businesses the types of information and documentation they are 
        expected to have, and to provide to, depository institutions 
        when conducting banking business.
            (6) At the same time, FinCEN and the Federal banking 
        agencies have issued joint guidance to depository institutions 
        to--
                    (A) clarify the requirements of subchapter II of 
                chapter 53 of title 31, United States Code, and related 
                provisions of law; and
                    (B) set forth the minimum steps that depository 
                institutions should take when providing banking 
                services to money services businesses.
            (7) It is in the interest of the United States and its 
        allies in the wars against terrorism and drugs to make certain 
        that the international transfer of funds is done in a rules-
        based, formal, and transparent manner and that individuals are 
        not forced into utilizing informal underground methods due to a 
        lack of services.
    (b) Sense of the Congress.--It is the sense of the Congress that 
depository institutions and money services businesses should follow the 
guidance offered by FinCEN for the purpose of giving money services 
businesses full access to banking services and ensuring that money 
services businesses remain in the mainstream financial system and can 
be full players in providing important financial services to their 
customers and be fully cooperative in the fight against terrorist 
financing and money laundering.

             TITLE VIII--CLERICAL AND TECHNICAL AMENDMENTS

SEC. 801. CLERICAL AMENDMENTS TO THE HOME OWNERS' LOAN ACT.

    (a) Amendment to Table of Contents.--The table of contents in 
section 1 of the Home Owners' Loan Act (12 U.S.C. 1461) is amended by 
striking the items relating to sections 5 and 6 and inserting the 
following new items:

``Sec. 5. Savings associations.
``Sec. 6. [Repealed.].''.
    (b) Clerical Amendments to Headings.--
            (1) The heading for section 4(a) of the Home Owners' Loan 
        Act (12 U.S.C. 1463(a)) is amended by striking ``(a) Federal 
        Savings Associations.--'' and inserting ``(a) General 
        Responsibilities of the Director.--''.
            (2) The section heading for section 5 of the Home Owners' 
        Loan Act (12 U.S.C. 1464) is amended to read as follows:

``SEC. 5. SAVINGS ASSOCIATIONS.''.

SEC. 802. TECHNICAL CORRECTIONS TO THE FEDERAL CREDIT UNION ACT.

    The Federal Credit Union Act (12 U.S.C. 1751 et seq.) is amended as 
follows:
            (1) In section 101(3), strike ``and'' after the semicolon.
            (2) In section 101(5), strike the terms ``account account'' 
        and ``account accounts'' each place any such term appears and 
        insert ``account''.
            (3) In section 107(a)(5)(E) (as so designated by section 
        303 of this Act), strike the period at the end and insert a 
        semicolon.
            (4) In paragraphs (6) and (7) of section 107(a) (as so 
        designated by section 303 of this Act), strike the period at 
        the end and insert a semicolon.
            (5) In section 107(a)(7)(D) (as so designated by section 
        303 of this Act), strike ``the Federal Savings and Loan 
        Insurance Corporation or''.
            (6) In section 107(a)(7)(E) (as so designated by section 
        303 of this Act), strike ``the Federal Home Loan Bank Board,'' 
        and insert ``the Federal Housing Finance Board,''.
            (7) In section 107(a)(9) (as so designated by section 303 
        of this Act), strike ``subchapter III'' and insert ``title 
        III''.
            (8) In section 107(a)(13) (as so designated by section 303 
        of this Act), strike the ``and'' after the semicolon at the 
        end.
            (9) In section 109(c)(2)(A)(i), strike ``(12 U.S.C. 
        4703(16))''.
            (10) In section 120(h), strike ``the Act approved July 30, 
        1947 (6 U.S.C., secs. 6-13),'' and insert ``chapter 93 of title 
        31, United States Code,''.
            (11) In section 201(b)(5), strike ``section 116 of''.
            (12) In section 202(h)(3), strike ``section 207(c)(1)'' and 
        insert ``section 207(k)(1)''.
            (13) In section 204(b), strike ``such others powers'' and 
        insert ``such other powers''.
            (14) In section 206(e)(3)(D), strike ``and'' after the 
        semicolon at the end.
            (15) In section 206(f)(1), strike ``subsection (e)(3)(B)'' 
        and insert ``subsection (e)(3)''.
            (16) In section 206(g)(7)(D), strike ``and subsection 
        (1)''.
            (17) In section 206(t)(2)(B), insert ``regulations'' after 
        ``as defined in''.
            (18) In section 206(t)(2)(C), strike ``material affect'' 
        and insert ``material effect''.
            (19) In section 206(t)(4)(A)(ii)(II), strike ``or'' after 
        the semicolon at the end.
            (20) In section 206A(a)(2)(A), strike ``regulator agency'' 
        and insert ``regulatory agency''.
            (21) In section 207(c)(5)(B)(i)(I), insert ``and'' after 
        the semicolon at the end.
            (22) In the heading for subparagraph (A) of section 
        207(d)(3), strike ``to'' and insert ``with''.
            (23) In section 207(f)(3)(A), strike ``category or 
        claimants'' and insert ``category of claimants''.
            (24) In section 209(a)(8), strike the period at the end and 
        insert a semicolon.
            (25) In section 216(n), insert ``any action'' before ``that 
        is required''.
            (26) In section 304(b)(3), strike ``the affairs or such 
        credit union'' and insert ``the affairs of such credit union''.
            (27) In section 310, strike ``section 102(e)'' and insert 
        ``section 102(d)''.

SEC. 803. OTHER TECHNICAL CORRECTIONS.

    (a) Section 1306 of title 18, United States Code, is amended by 
striking ``5136A'' and inserting ``5136B''.
    (b) Section 5239 of the Revised Statutes of the United States (12 
U.S.C. 93) is amended by redesignating the second of the 2 subsections 
designated as subsection (d) (as added by section 331(b)(3) of the 
Riegle Community Development and Regulatory Improvement Act of 1994) as 
subsection (e).

SEC. 804. REPEAL OF OBSOLETE PROVISIONS OF THE BANK HOLDING COMPANY ACT 
              OF 1956.

    (a) In General.--Section 2 of the Bank Holding Company Act of 1956 
(12 U.S.C. 1841) is amended--
            (1) in subsection (c)(2), by striking subparagraphs (I) and 
        (J); and
            (2) by striking subsection (m) and inserting the following 
        new subsection:
    ``(m) [Repealed]''.
    (b) Technical and Conforming Amendments.--Paragraphs (1) and (2) of 
section 4(h) of the Bank Holding Company Act of 1956 (12 U.S.C. 
1843(h)) are each amended by striking ``(G), (H), (I), or (J) of 
section 2(c)(2)'' and inserting ``(G), or (H) of section 2(c)(2)''.

        TITLE IX--FAIR DEBT COLLECTION PRACTICES ACT AMENDMENTS

SEC. 901. EXCEPTION FOR CERTAIN BAD CHECK ENFORCEMENT PROGRAMS.

    (a) In General.--The Fair Debt Collection Practices Act (15 U.S.C. 
1692 et seq.) is amended--
            (1) by redesignating section 818 as section 819; and
            (2) by inserting after section 817 the following new 
        section:
``Sec. 818. Exception for certain bad check enforcement programs 
              operated by private entities
    ``(a) In General.--If--
            ``(1) a State or district attorney establishes, within the 
        jurisdiction of such State or district attorney and with 
        respect to alleged bad check violations that do not involve a 
        check described in subsection (c), a pretrial diversion program 
        for alleged bad check offenders who agree to participate 
        voluntarily in such program to avoid criminal prosecution and 
        are not described in subsection (b);
            ``(2) a private entity, that is subject to an 
        administrative support services contract with a State or 
        district attorney and operates under the direction, supervision 
        and control of such State or district attorney, operates the 
        pretrial diversion program described in paragraph (1); and
            ``(3) in the course of performing duties delegated to it by 
        a State or district attorney under the contract, the private 
        entity referred to in paragraph (2)--
                    ``(A) complies with the penal laws of the State;
                    ``(B) conforms with the terms of the contract and 
                directives of the State or district attorney;
                    ``(C) does not exercise independent prosecutorial 
                discretion;
                    ``(D) contacts any alleged offender referred to in 
                paragraph (1) for purposes of participating in a 
                program referred to in such paragraph only--
                            ``(i) as a result of any determination by 
                        the State or district attorney that sufficient 
                        evidence of a bad check violation under State 
                        law exists and that contact with the alleged 
                        offender for purposes of participation in the 
                        program is appropriate; or
                            ``(ii) as otherwise permitted in response 
                        to evidence of a bad check;
                    ``(E) includes as part of an initial written 
                communication with an alleged offender a clear and 
                conspicuous statement that--
                            ``(i) the alleged offender may dispute the 
                        validity of any alleged bad check violation 
                        through a procedure established and supervised 
                        by the State or district attorney, together 
                        with an explanation of how such a dispute may 
                        be initiated; and
                            ``(ii) where the alleged offender knows, or 
                        has reasonable cause to believe, that the 
                        alleged bad check violation is the result of 
                        theft or forgery of the check, identity theft, 
                        or other fraud that is not the result of the 
                        alleged offender's conduct, the alleged 
                        offender may file a crime report with the 
                        appropriate law enforcement agency and have 
                        further contacts or restitution efforts 
                        suspended until the question of the theft or 
                        forgery of the check, identity theft, or other 
                        fraud has been resolved, together with clear 
                        instructions on how to file such crime report; 
                        and
                    ``(F) charges only fees in connection with services 
                under the contract that--
                            ``(i) have been authorized by the contract 
                        with the State or district attorney; and
                            ``(ii) conform with the schedule of 
                        reasonable charges for such services which 
                        shall be established by the National District 
                        Attorney's Association, after consultation with 
                        the Commission and representatives of 
                        interested business and consumer organizations,
the private entity shall be treated as an officer of the State and 
excluded from the definition of debt collector, pursuant to the 
exception provided in section 803(6)(C), with respect to the entity's 
operation of the program described in paragraph (1) under the contract 
described in paragraph (2).
    ``(b) Certain Offenders Excluded.--An alleged bad check offender is 
described in this subsection if a private entity described in 
subsection (a)(2) can determine from available records that such 
offender--
            ``(1) was convicted of a bad check offense in the 3 years 
        prior to issuing the bad check under consideration; or
            ``(2) participated in a pretrial diversion program in the 
        18 months prior to issuing the bad check under consideration.
    ``(c) Certain Checks Excluded.--A check is described in this 
subsection if the check involves, or is subsequently found to involve--
            ``(1) a postdated check presented in connection with a 
        payday loan, or other similar transaction, where the holder of 
        the check knew that the issuer had insufficient funds at the 
        time the check was made, drawn or delivered;
            ``(2) a stop payment order where the issuer acted in good 
        faith and with reasonable cause in stopping payment on the 
        check;
            ``(3) a check dishonored because of an adjustment to the 
        issuer's account by the financial institution holding such 
        account without providing notice to the person at the time the 
        check was made, drawn or delivered;
            ``(4) a check for partial payment of a debt where the 
        holder had previously accepted partial payment for such debt;
            ``(5) a check issued by a person who was not competent, or 
        was not of legal age, to enter into a legal contractual 
        obligation at the time the check was made, drawn or delivered; 
        or
            ``(6) a check issued to pay an obligation arising from a 
        transaction that was illegal in the jurisdiction of the State 
        or district attorney at the time the check was made, drawn or 
        delivered.
    ``(d) Definitions.--For purposes of this section, the following 
definitions shall apply:
            ``(1) State or district attorney.--The term `State or 
        district attorney' means the chief elected or appointed 
        prosecuting attorney in a district, county (as defined in 
        section 2 of title 1, United States Code), municipality, or 
        comparable jurisdiction, including State attorneys general who 
        act as chief elected or appointed prosecuting attorneys in a 
        district, county (as so defined), municipality or comparable 
        jurisdiction, who may be referred to by a variety of titles 
        such as district attorneys, prosecuting attorneys, 
        commonwealth's attorneys, solicitors, county attorneys, and 
        state's attorneys, and who are responsible for the prosecution 
        of State crimes and violations of jurisdiction-specific local 
        ordinances.
            ``(2) Check.--The term `check' has the same meaning as in 
        section 3(6) of the Check Clearing for the 21st Century Act.
            ``(3) Bad check.--The term `bad check' means any check 
        that--
                    ``(A) the issuer knew, or should have known, would 
                not be paid upon presentment because the issuer--
                            ``(i) had no account with the drawee 
                        financial institution at the time the check was 
                        made, drawn, or delivered;
                            ``(ii) had closed the account upon with the 
                        check was made or drawn prior to the time the 
                        check was made, drawn, or delivered; or
                            ``(iii) used a false or altered check, or 
                        false or altered check account number; or
                    ``(B) was refused payment by the financial 
                institution or other drawee for lack of sufficient 
                funds and the issuer failed to pay the full amount of 
                the check, together with reasonable costs as permitted 
                by State law--
                            ``(i) after receiving written notice from 
                        the holder of the check that payment was 
                        refused by the drawee financial institution to 
                        the extent that the timing and mode of delivery 
                        of such written notice is in compliance with 
                        the applicable State law for determining 
                        criminal liability for bad check offenses; or
                            ``(ii) in a case in which there are no 
                        applicable State law requirements as described 
                        in clause (i), within 30 days of receiving 
                        written notice, mailed to the issuer by 
                        certified mail to the address printed on the 
                        check, or given at the time the check was made, 
                        drawn or delivered or, otherwise, at the 
                        address where the alleged offender resides or 
                        is found, from the holder of the check that 
                        payment of 1 or more checks was refused by the 
                        drawee financial institution.''.
    (b) Clerical Amendment.--The table of sections for the Fair Debt 
Collection Practices Act is amended--
            (1) by redesignating the item relating to section 818 as 
        section 819; and
            (2) by inserting after the item relating to section 817 the 
        following new item:

``818. Exception for certain bad check enforcement programs operated by 
                            private entities.''.

SEC. 902. OTHER AMENDMENTS.

    (a) Legal Pleadings.--Section 809 of the Fair Debt Collection 
Practices Act (15 U.S.C. 1692g) is amended by adding at the end the 
following new subsection:
    ``(d) Legal Pleadings.--A communication in the form of a formal 
pleading in a civil action shall not be treated as an initial 
communication for purposes of subsection (a).''.
    (b) Notice Provisions.--Section 809 of the Fair Debt Collection 
Practices Act (15 U.S.C. 1692g) is amended by adding after subsection 
(d) (as added by subsection (a) of this section) the following new 
subsection:
    ``(e) Notice Provisions.--The sending or delivery of any form or 
notice which does not request the payment of a debt and is expressly 
required by any other Federal or State law or regulation, including the 
Internal Revenue Code of 1986, title V of Gramm-Leach-Bliley Act, and 
any data security breach notice and privacy law shall not be treated as 
a communication in connection with debt collection. ''.
    (c) Establishment of Right to Collect Within the First 30 Days.--
Section 809(b) of the Fair Debt Collection Practices Act (15 U.S.C. 
1692g(b)) is amended by striking ``If the consumer'' and inserting 
``Collection activities and communications may continue during any 30-
day period referred to in subsection (a). However, if the consumer''.

            Passed the House of Representatives March 8, 2006.

            Attest:

                                                                 Clerk.
```