25–698 

115TH CONGRESS REPORT " ! HOUSE OF REPRESENTATIVES 1st Session 115–163 

PROVIDING FOR CONSIDERATION OF THE BILL (H.R. 10) TO CREATE HOPE 

AND OPPORTUNITY FOR INVESTORS, CONSUMERS, AND ENTREPRENEURS BY ENDING BAILOUTS AND TOO BIG TO FAIL, HOLDING 

WASHINGTON AND WALL STREET ACCOUNTABLE, ELIMINATING RED 

TAPE TO INCREASE ACCESS TO CAPITAL AND CREDIT, AND REPEALING 

THE PROVISIONS OF THE DODD-FRANK ACT THAT MAKE AMERICA LESS 

PROSPEROUS, LESS STABLE, AND LESS FREE, AND FOR OTHER PURPOSES 

JUNE 6, 2017.—Referred to the House Calendar and ordered to be printed 

Mr. BUCK, from the Committee on Rules, 

submitted the following 

R E P O R T 

[To accompany H. Res. 375] 

The Committee on Rules, having had under consideration House 

Resolution 375, by a record vote of 9 to 4, report the same to the 

House with the recommendation that the resolution be adopted. 

SUMMARY OF PROVISIONS OF THE RESOLUTION

The resolution provides for consideration of H.R. 10, the Financial CHOICE Act of 2017, under a structured rule. The resolution 

provides 90 minutes of general debate equally divided and controlled by the chair and ranking minority member of the Committee on Financial Services. The resolution waives all points of 

order against consideration of the bill. The resolution makes in 

order as original text for the purpose of amendment an amendment 

in the nature of a substitute printed in part A of this report and 

provides that it shall be considered as read. The resolution waives 

all points of order against that amendment in the nature of a substitute. The resolution makes in order only those further amendments printed in part B of this report. Each such amendment may 

be offered only in the order printed in this report, may be offered 

only by a Member designated in this report, shall be considered as 

read, shall be debatable for the time specified in this report equally 

divided and controlled by the proponent and an opponent, shall not 

be subject to amendment, and shall not be subject to a demand for 

division of the question in the House or in the Committee of the 

Whole. The resolution waives all points of order against the amendments printed in part B of this report. The resolution provides one 

motion to recommit with or without instructions. 

2 

EXPLANATION OF WAIVERS

The waiver of all points of order against consideration of the bill 

includes waivers of the following: 

• Section 311 of the Congressional Budget Act, which prohibits consideration of legislation that would cause revenues to 

be less than the level of total revenues for the first fiscal year 

or for the total of that first fiscal year and the ensuing fiscal 

years for which allocations are provided; and 

• Section 303 of the Congressional Budget Act, which prohibits consideration of legislation providing a change in revenues for a fiscal year until the budget resolution for that year 

has been agreed to. 

The waiver of all points of order against the amendment in the 

nature of a substitute, printed in part A of this report and made 

in order as original text, includes a waiver of clause 5(a) of rule 

XXI, which prohibits a bill carrying a tax or tariff measure from 

being reported by a committee not having jurisdiction to report tax 

or tariff measures. 

Although the resolution waives all points of order against the 

amendments printed in part B of this report, the Committee is not 

aware of any points of order. The waiver is prophylactic in nature. 

COMMITTEE VOTES

The results of each record vote on an amendment or motion to 

report, together with the names of those voting for and against, are 

printed below: 

Rules Committee record vote No. 59 

Motion by Mr. Cole to report the rule. Adopted: 9–4 

Majority Members Vote Minority Members Vote 

Mr. Cole ............................................................ Yea Ms. Slaughter .................................................. Nay 

Mr. Woodall ...................................................... Yea Mr. McGovern ................................................... Nay 

Mr. Burgess ...................................................... Yea Mr. Hastings of Florida ................................... Nay 

Mr. Collins ........................................................ Yea Mr. Polis ........................................................... Nay 

Mr. Byrne .......................................................... Yea 

Mr. Newhouse ................................................... Yea 

Mr. Buck ........................................................... Yea 

Ms. Cheney ....................................................... Yea 

Mr. Sessions, Chairman ................................... Yea 

PART A—TEXT OF THE AMENDMENT IN THE NATURE OF A SUBSTITUTE

MADE IN ORDER

Strike all after the enacting clause and insert the following: 

SECTION 1. SHORT TITLE; TABLE OF CONTENTS. 

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

CHOICE Act of 2017’’. 

(b) TABLE OF CONTENTS.—The table of contents for this Act is as 

follows: 

Sec. 1. Short title; table of contents. 

Sec. 2. Directed rulemaking repeals. 

TITLE I—ENDING ‘‘TOO BIG TO FAIL’’ AND BANK BAILOUTS 

Subtitle A—Repeal of the Orderly Liquidation Authority 

Sec. 111. Repeal of the orderly liquidation authority. 

3 

Subtitle B—Financial Institution Bankruptcy 

Sec. 121. General provisions relating to covered financial corporations. 

Sec. 122. Liquidation, reorganization, or recapitalization of a covered financial corporation. 

Sec. 123. Amendments to title 28, United States Code. 

Subtitle C—Ending Government Guarantees 

Sec. 131. Repeal of obligation guarantee program. 

Sec. 132. Repeal of systemic risk determination in resolutions. 

Sec. 133. Restrictions on use of the Exchange Stabilization Fund. 

Subtitle D—Eliminating Financial Market Utility Designations 

Sec. 141. Repeal of title VIII. 

Subtitle E—Reform of the Financial Stability Act of 2010 

Sec. 151. Repeal and modification of provisions of the Financial Stability Act of 

2010. 

Sec. 152. Operational risk capital requirements for banking organizations. 

TITLE II—DEMANDING ACCOUNTABILITY FROM WALL STREET 

Subtitle A—SEC Penalties Modernization 

Sec. 211. Enhancement of civil penalties for securities laws violations. 

Sec. 212. Updated civil money penalties of Public Company Accounting Oversight 

Board. 

Sec. 213. Updated civil money penalty for controlling persons in connection with insider trading. 

Sec. 214. Update of certain other penalties. 

Sec. 215. Monetary sanctions to be used for the relief of victims. 

Sec. 216. GAO report on use of civil money penalty authority by Commission. 

Subtitle B—FIRREA Penalties Modernization 

Sec. 221. Increase of civil and criminal penalties originally established in the Financial Institutions Reform, Recovery, and Enforcement Act of 1989. 

TITLE III—DEMANDING ACCOUNTABILITY FROM FINANCIAL REGULATORS 

AND DEVOLVING POWER AWAY FROM WASHINGTON 

Subtitle A—Cost-Benefit Analyses 

Sec. 311. Definitions. 

Sec. 312. Required regulatory analysis. 

Sec. 313. Rule of construction. 

Sec. 314. Public availability of data and regulatory analysis. 

Sec. 315. Five-year regulatory impact analysis. 

Sec. 316. Retrospective review of existing rules. 

Sec. 317. Judicial review. 

Sec. 318. Chief Economists Council. 

Sec. 319. Conforming amendments. 

Sec. 320. Other regulatory entities. 

Sec. 321. Avoidance of duplicative or unnecessary analyses. 

Subtitle B—Congressional Review of Federal Financial Agency Rulemaking 

Sec. 331. Congressional review. 

Sec. 332. Congressional approval procedure for major rules. 

Sec. 333. Congressional disapproval procedure for nonmajor rules. 

Sec. 334. Definitions. 

Sec. 335. Judicial review. 

Sec. 336. Effective date of certain rules. 

Sec. 337. Budgetary effects of rules subject to section 332 of the Financial CHOICE 

Act of 2017. 

Sec. 338. Nonapplicability to monetary policy. 

Subtitle C—Judicial Review of Agency Actions 

Sec. 341. Scope of judicial review of agency actions. 

Subtitle D—Leadership of Financial Regulators 

Sec. 351. Federal Deposit Insurance Corporation. 

Sec. 352. Federal Housing Finance Agency. 

4 

Subtitle E—Congressional Oversight of Appropriations 

Sec. 361. Bringing the Federal Deposit Insurance Corporation into the appropriations process. 

Sec. 362. Bringing the Federal Housing Finance Agency into the appropriations 

process. 

Sec. 363. Bringing the National Credit Union Administration into the appropriations process. 

Sec. 364. Bringing the Office of the Comptroller of the Currency into the appropriations process. 

Sec. 365. Bringing the non-monetary policy related functions of the Board of Governors of the Federal Reserve System into the appropriations process. 

Subtitle F—International Processes 

Sec. 371. Requirements for international processes. 

Subtitle G—Unfunded Mandates Reform 

Sec. 381. Definitions. 

Sec. 382. Application of the Unfunded Mandates Reform Act. 

Subtitle H—Enforcement Coordination 

Sec. 391. Policies to minimize duplication of enforcement efforts. 

Subtitle I—Penalties for Unauthorized Disclosures 

Sec. 392. Criminal penalty for unauthorized disclosures. 

Subtitle J—Stop Settlement Slush Funds 

Sec. 393. Limitation on donations made pursuant to settlement agreements to 

which certain departments or agencies are a party. 

TITLE IV—UNLEASHING OPPORTUNITIES FOR SMALL BUSINESSES, 

INNOVATORS, AND JOB CREATORS BY FACILITATING CAPITAL FORMATION 

Subtitle A—Small Business Mergers, Acquisitions, Sales, and Brokerage 

Simplification 

Sec. 401. Registration exemption for merger and acquisition brokers. 

Sec. 402. Effective date. 

Subtitle B—Encouraging Employee Ownership 

Sec. 406. Increased threshold for disclosures relating to compensatory benefit 

plans. 

Subtitle C—Small Company Disclosure Simplification 

Sec. 411. Exemption from XBRL requirements for emerging growth companies and 

other smaller companies. 

Sec. 412. Analysis by the SEC. 

Sec. 413. Report to Congress. 

Sec. 414. Definitions. 

Subtitle D—Securities and Exchange Commission Overpayment Credit 

Sec. 416. Refunding or crediting overpayment of section 31 fees. 

Subtitle E—Fair Access to Investment Research 

Sec. 421. Safe harbor for investment fund research. 

Subtitle F—Accelerating Access to Capital 

Sec. 426. Expanded eligibility for use of Form S–3. 

Subtitle G—Enhancing the RAISE Act 

Sec. 431. Certain accredited investor transactions. 

Subtitle H—Small Business Credit Availability 

Sec. 436. Business development company ownership of securities of investment advisers and certain financial companies. 

Sec. 437. Expanding access to capital for business development companies. 

Sec. 438. Parity for business development companies regarding offering and proxy 

rules. 

5 

Subtitle I—Fostering Innovation 

Sec. 441. Temporary exemption for low-revenue issuers. 

Subtitle J—Small Business Capital Formation Enhancement 

Sec. 446. Annual review of government-business forum on capital formation. 

Subtitle K—Helping Angels Lead Our Startups 

Sec. 451. Definition of angel investor group. 

Sec. 452. Clarification of general solicitation. 

Subtitle L—Main Street Growth 

Sec. 456. Venture exchanges. 

Subtitle M—Micro Offering Safe Harbor 

Sec. 461. Exemptions for micro-offerings. 

Subtitle N—Private Placement Improvement 

Sec. 466. Revisions to SEC Regulation D. 

Subtitle O—Supporting America’s Innovators 

Sec. 471. Investor limitation for qualifying venture capital funds. 

Subtitle P—Fix Crowdfunding 

Sec. 476. Crowdfunding exemption. 

Sec. 477. Exclusion of crowdfunding investors from shareholder cap. 

Sec. 478. Preemption of State law. 

Sec. 479. Treatment of funding portals. 

Subtitle Q—Corporate Governance Reform and Transparency 

Sec. 481. Definitions. 

Sec. 482. Registration of proxy advisory firms. 

Sec. 483. Commission annual report. 

Subtitle R—Senior Safe 

Sec. 491. Immunity. 

Sec. 492. Training required. 

Sec. 493. Relationship to State law. 

Subtitle S—National Securities Exchange Regulatory Parity 

Sec. 496. Application of exemption. 

Subtitle T—Private Company Flexibility and Growth 

Sec. 497. Shareholder threshold for registration. 

Subtitle U—Small Company Capital Formation Enhancements 

Sec. 498. JOBS Act-related exemption. 

Subtitle V—Encouraging Public Offerings 

Sec. 499. Expanding testing the waters and confidential submissions. 

TITLE V—REGULATORY RELIEF FOR MAIN STREET AND COMMUNITY 

FINANCIAL INSTITUTIONS 

Subtitle A—Preserving Access to Manufactured Housing 

Sec. 501. Mortgage originator definition. 

Sec. 502. High-Cost mortgage definition. 

Subtitle B—Mortgage Choice 

Sec. 506. Definition of points and fees. 

Subtitle C—Financial Institution Customer Protection 

Sec. 511. Requirements for deposit account termination requests and orders. 

Sec. 512. Amendments to the Financial Institutions Reform, Recovery, and Enforcement Act of 1989. 

6 

Subtitle D—Portfolio Lending and Mortgage Access 

Sec. 516. Safe harbor for certain loans held on portfolio. 

Subtitle E—Application of the Expedited Funds Availability Act 

Sec. 521. Application of the Expedited Funds Availability Act. 

Subtitle F—Small Bank Holding Company Policy Statement 

Sec. 526. Changes required to small bank holding company policy statement on assessment of financial and managerial factors. 

Subtitle G—Community Institution Mortgage Relief 

Sec. 531. Community financial institution mortgage relief. 

Subtitle H—Financial Institutions Examination Fairness and Reform 

Sec. 536. Timeliness of examination reports. 

Subtitle I—National Credit Union Administration Budget Transparency 

Sec. 541. Budget transparency for the NCUA. 

Subtitle J—Taking Account of Institutions With Low Operation Risk 

Sec. 546. Regulations appropriate to business models. 

Subtitle K—Federal Savings Association Charter Flexibility 

Sec. 551. Option for Federal savings associations to operate as a covered savings 

association. 

Subtitle L—SAFE Transitional Licensing 

Sec. 556. Eliminating barriers to jobs for loan originators. 

Subtitle M—Right to Lend 

Sec. 561. Small business loan data collection requirement. 

Subtitle N—Community Bank Reporting Relief 

Sec. 566. Short form call report. 

Subtitle O—Homeowner Information Privacy Protection 

Sec. 571. Study regarding privacy of information collected under the Home Mortgage Disclosure Act of 1975. 

Subtitle P—Home Mortgage Disclosure Adjustment 

Sec. 576. Depository institutions subject to maintenance of records and disclosure 

requirements. 

Subtitle Q—Protecting Consumers’ Access to Credit 

Sec. 581. Rate of interest after transfer of loan. 

Subtitle R—NCUA Overhead Transparency 

Sec. 586. Fund transparency. 

Subtitle S—Housing Opportunities Made Easier 

Sec. 591. Clarification of donated services to non-profits. 

TITLE VI—REGULATORY RELIEF FOR STRONGLY CAPITALIZED, WELL 

MANAGED BANKING ORGANIZATIONS 

Sec. 601. Capital election. 

Sec. 602. Regulatory relief. 

Sec. 603. Contingent capital study. 

Sec. 604. Study on altering the current prompt corrective action rules. 

Sec. 605. Definitions. 

TITLE VII—EMPOWERING AMERICANS TO ACHIEVE FINANCIAL 

INDEPENDENCE 

Subtitle A—Separation of Powers and Liberty Enhancements 

Sec. 711. Consumer Law Enforcement Agency. 

7 

Sec. 712. Bringing the Agency into the regular appropriations process. 

Sec. 713. Consumer Law Enforcement Agency Inspector General Reform. 

Sec. 714. Private parties authorized to compel the Agency to seek sanctions by filing civil actions; Adjudications deemed actions. 

Sec. 715. Civil investigative demands to be appealed to courts. 

Sec. 716. Agency dual mandate and economic analysis. 

Sec. 717. No deference to Agency interpretation. 

Subtitle B—Administrative Enhancements 

Sec. 721. Advisory opinions. 

Sec. 722. Reform of Consumer Financial Civil Penalty Fund. 

Sec. 723. Agency pay fairness. 

Sec. 724. Elimination of market monitoring functions. 

Sec. 725. Reforms to mandatory functional units. 

Sec. 726. Repeal of mandatory advisory board. 

Sec. 727. Elimination of supervision authority. 

Sec. 728. Transfer of old OTS building from OCC to GSA. 

Sec. 729. Limitation on Agency authority. 

Subtitle C—Policy Enhancements 

Sec. 731. Consumer right to financial privacy. 

Sec. 732. Repeal of Council authority to set aside Agency rules and requirement of 

safety and soundness considerations when issuing rules. 

Sec. 733. Removal of authority to regulate small-dollar credit. 

Sec. 734. Reforming indirect auto financing guidance. 

Sec. 735. Removal of Agency UDAAP authority. 

Sec. 736. Preservation of UDAP authority for Federal banking regulators. 

Sec. 737. Repeal of authority to restrict arbitration. 

TITLE VIII—CAPITAL MARKETS IMPROVEMENTS 

Subtitle A—SEC Reform, Restructuring, and Accountability 

Sec. 801. Authorization of appropriations. 

Sec. 802. Report on unobligated appropriations. 

Sec. 803. SEC Reserve Fund abolished. 

Sec. 804. Fees to offset appropriations. 

Sec. 805. Commission Federal construction funding prohibition. 

Sec. 806. Implementation of recommendations. 

Sec. 807. Office of Credit Ratings to report to the Division of Trading and Markets. 

Sec. 808. Office of Municipal Securities to report to the Division of Trading and 

Markets. 

Sec. 809. Independence of Commission Ombudsman. 

Sec. 810. Investor Advisory Committee improvements. 

Sec. 811. Duties of Investor Advocate. 

Sec. 812. Elimination of exemption of Small Business Capital Formation Advisory 

Committee from Federal Advisory Committee Act. 

Sec. 813. Internal risk controls. 

Sec. 814. Applicability of notice and comment requirements of the Administrative 

Procedure Act to guidance voted on by the Commission. 

Sec. 815. Limitation on pilot programs. 

Sec. 816. Procedure for obtaining certain intellectual property. 

Sec. 817. Process for closing investigations. 

Sec. 818. Enforcement Ombudsman. 

Sec. 819. Adequate notice. 

Sec. 820. Advisory committee on Commission’s enforcement policies and practices. 

Sec. 821. Process to permit recipient of Wells notification to appear before Commission staff in-person. 

Sec. 822. Publication of enforcement manual. 

Sec. 823. Private parties authorized to compel the Securities and Exchange Commission to seek sanctions by filing civil actions. 

Sec. 824. Certain findings required to approve civil money penalties against 

issuers. 

Sec. 825. Repeal of authority of the Commission to prohibit persons from serving 

as officers or directors. 

Sec. 826. Subpoena duration and renewal. 

Sec. 827. Elimination of automatic disqualifications. 

Sec. 828. Denial of award to culpable whistleblowers. 

Sec. 829. Clarification of authority to impose sanctions on persons associated with 

a broker or dealer. 

8 

Sec. 830. Complaint and burden of proof requirements for certain actions for breach 

of fiduciary duty. 

Sec. 831. Congressional access to information held by the Public Company Accounting Oversight Board. 

Sec. 832. Abolishing Investor Advisory Group. 

Sec. 833. Repeal of requirement for Public Company Accounting Oversight Board to 

use certain funds for merit scholarship program. 

Sec. 834. Reallocation of fines for violations of rules of municipal securities rulemaking board. 

Subtitle B—Eliminating Excessive Government Intrusion in the Capital Markets 

Sec. 841. Repeal of Department of Labor fiduciary rule and requirements prior to 

rulemaking relating to standards of conduct for brokers and dealers. 

Sec. 842. Exemption from risk retention requirements for nonresidential mortgage. 

Sec. 843. Frequency of shareholder approval of executive compensation. 

Sec. 844. Shareholder Proposals. 

Sec. 845. Prohibition on requiring a single ballot. 

Sec. 846. Requirement for municipal advisor for issuers of municipal securities. 

Sec. 847. Small issuer exemption from internal control evaluation. 

Sec. 848. Streamlining of applications for an exemption from the Investment Company Act of 1940. 

Sec. 849. Restriction on recovery of erroneously awarded compensation. 

Sec. 850. Exemptive authority for certain provisions relating to registration of nationally recognized statistical rating organizations. 

Sec. 851. Risk-based examinations of Nationally Recognized Statistical Rating Organizations. 

Sec. 852. Transparency of credit rating methodologies. 

Sec. 853. Repeal of certain attestation requirements relating to credit ratings. 

Sec. 854. Look-back review by NRSRO. 

Sec. 855. Approval of credit rating procedures and methodologies. 

Sec. 856. Exception for providing certain material information relating to a credit 

rating. 

Sec. 857. Repeals. 

Sec. 858. Exemption of and reporting by private equity fund advisers. 

Sec. 859. Records and reports of private funds. 

Sec. 860. Definition of accredited investor. 

Sec. 861. Repeal of certain provisions requiring a study and report to Congress. 

Sec. 862. Repeal. 

Subtitle C—Harmonization of Derivatives Rules 

Sec. 871. Commissions review and harmonization of rules relating to the regulation 

of over-the-counter swaps markets. 

Sec. 872. Treatment of transactions between affiliates. 

TITLE IX—REPEAL OF THE VOLCKER RULE AND OTHER PROVISIONS 

Sec. 901. Repeals. 

TITLE X—FED OVERSIGHT REFORM AND MODERNIZATION 

Sec. 1001. Requirements for policy rules of the Federal Open Market Committee. 

Sec. 1002. Federal Open Market Committee blackout period. 

Sec. 1003. Public transcripts of FOMC meetings. 

Sec. 1004. Membership of Federal Open Market Committee. 

Sec. 1005. Frequency of testimony of the Chairman of the Board of Governors of 

the Federal Reserve System to Congress. 

Sec. 1006. Vice Chairman for Supervision report requirement. 

Sec. 1007. Salaries, financial disclosures, and office staff of the Board of Governors 

of the Federal Reserve System. 

Sec. 1008. Amendments to powers of the Board of Governors of the Federal Reserve 

System. 

Sec. 1009. Interest rates on balances maintained at a Federal Reserve bank by depository institutions established by Federal Open Market Committee. 

Sec. 1010. Audit reform and transparency for the Board of Governors of the Federal 

Reserve System. 

Sec. 1011. Establishment of a Centennial Monetary Commission. 

9 

TITLE XI—IMPROVING INSURANCE COORDINATION THROUGH AN 

INDEPENDENT ADVOCATE 

Sec. 1101. Repeal of the Federal Insurance Office; Creation of the Office of the 

Independent Insurance Advocate. 

Sec. 1102. Treatment of covered agreements. 

TITLE XII—TECHNICAL CORRECTIONS 

Sec. 1201. Table of contents; Definitional corrections. 

Sec. 1202. Antitrust savings clause corrections. 

Sec. 1203. Title I corrections. 

Sec. 1204. Title III corrections. 

Sec. 1205. Title IV correction. 

Sec. 1206. Title VI corrections. 

Sec. 1207. Title VII corrections. 

Sec. 1208. Title IX corrections. 

Sec. 1209. Title X corrections. 

Sec. 1210. Title XII correction. 

Sec. 1211. Title XIV correction. 

Sec. 1212. Technical corrections to other statutes. 

SEC. 2. DIRECTED RULEMAKING REPEALS. 

With respect to any directed rulemaking required by a provision 

of law repealed by this Act, to the extent any rule was issued or 

revised pursuant to such directed rulemaking, such rule or revision 

shall have no force or effect. 

TITLE I—ENDING ‘‘TOO BIG TO FAIL’’ 

AND BANK BAILOUTS 

Subtitle A—Repeal of the Orderly 

Liquidation Authority 

SEC. 111. REPEAL OF THE ORDERLY LIQUIDATION AUTHORITY. 

(a) IN GENERAL.—Title II of the Dodd-Frank Wall Street Reform 

and Consumer Protection Act is hereby repealed and any Federal 

law amended by such title shall, on and after the effective date of 

this Act, be effective as if title II of the Dodd-Frank Wall Street 

Reform and Consumer Protection Act had not been enacted. 

(b) CONFORMING AMENDMENTS.— 

(1) DODD-FRANK WALL STREET REFORM AND CONSUMER PROTECTION ACT.—The Dodd-Frank Wall Street Reform and Consumer Protection Act is amended— 

(A) in the table of contents for such Act, by striking all 

items relating to title II; 

(B) in section 165(d)— 

(i) in paragraph (1), by striking ‘‘, the Council, and 

the Corporation’’ and inserting ‘‘and the Council’’; 

(ii) in paragraph (2), by striking ‘‘, the Council, and 

the Corporation’’ and inserting ‘‘and the Council’’; 

(iii) in paragraph (3), by striking ‘‘and the Corporation’’; 

(iv) in paragraph (4)— 

(I) by striking ‘‘and the Corporation jointly determine’’ and inserting ‘‘determines’’; 

(II) by striking ‘‘their’’ and inserting ‘‘its’’; 

(III) in subparagraph (A), by striking ‘‘and the 

Corporation’’; and 

10 

(IV) in subparagraph (B), by striking ‘‘and the 

Corporation’’; 

(v) in paragraph (5)— 

(I) in subparagraph (A), by striking ‘‘and the 

Corporation may jointly’’ and inserting ‘‘may’’; and 

(II) in subparagraph (B)— 

(aa) by striking ‘‘and the Corporation’’ each 

place such term appears; 

(bb) by striking ‘‘may jointly’’ and inserting 

‘‘may’’; 

(cc) by striking ‘‘have jointly’’ and inserting 

‘‘has’’; 

(vi) in paragraph (6), by striking ‘‘, a receiver appointed under title II,’’; and 

(vii) by amending paragraph (8) to read as follows: 

‘‘(8) RULES.—Not later than 12 months after enactment of 

this paragraph, the Board of Governors shall issue final rules 

implementing this section.’’; and 

(C) in section 716(g), by striking ‘‘or a covered financial 

company under title II’’. 

(2) FEDERAL DEPOSIT INSURANCE ACT.—Section 10(b)(3) of the 

Federal Deposit Insurance Act (12 U.S.C. 1820(b)(3)) is amended by striking ‘‘, or of such nonbank financial company supervised by the Board of Governors or bank holding company described in section 165(a) of the Financial Stability Act of 2010, 

for the purpose of implementing its authority to provide for orderly liquidation of any such company under title II of that 

Act’’. 

(3) FEDERAL RESERVE ACT.—Section 13(3) of the Federal Reserve Act is amended— 

(A) in subparagraph (B)— 

(i) in clause (ii), by striking ‘‘, resolution under title 

II of the Dodd-Frank Wall Street Reform and Consumer Protection Act, or’’ and inserting ‘‘or is subject 

to resolution under’’; and 

(ii) in clause (iii), by striking ‘‘, resolution under title 

II of the Dodd-Frank Wall Street Reform and Consumer Protection Act, or’’ and inserting ‘‘or resolution 

under’’; and 

(B) by striking subparagraph (E). 

Subtitle B—Financial Institution 

Bankruptcy 

SEC. 121. GENERAL PROVISIONS RELATING TO COVERED FINANCIAL 

CORPORATIONS. 

(a) DEFINITION.—Section 101 of title 11, United States Code, is 

amended by inserting the following after paragraph (9): 

‘‘(9A) The term ‘covered financial corporation’ means any corporation incorporated or organized under any Federal or State 

law, other than a stockbroker, a commodity broker, or an entity of the kind specified in paragraph (2) or (3) of section 109(b), 

that is— 

11 

‘‘(A) a bank holding company, as defined in section 2(a) 

of the Bank Holding Company Act of 1956; or 

‘‘(B) a corporation that exists for the primary purpose of 

owning, controlling and financing its subsidiaries, that has 

total consolidated assets of $50,000,000,000 or greater, and 

for which, in its most recently completed fiscal year— 

‘‘(i) annual gross revenues derived by the corporation and all of its subsidiaries from activities that are 

financial in nature (as defined in section 4(k) of the 

Bank Holding Company Act of 1956) and, if applicable, 

from the ownership or control of one or more insured 

depository institutions, represents 85 percent or more 

of the consolidated annual gross revenues of the corporation; or 

‘‘(ii) the consolidated assets of the corporation and 

all of its subsidiaries related to activities that are financial in nature (as defined in section 4(k) of the 

Bank Holding Company Act of 1956) and, if applicable, 

related to the ownership or control of one or more insured depository institutions, represents 85 percent or 

more of the consolidated assets of the corporation.’’. 

(b) APPLICABILITY OF CHAPTERS.—Section 103 of title 11, United 

States Code, is amended by adding at the end the following: 

‘‘(l) Subchapter V of chapter 11 of this title applies only in a case 

under chapter 11 concerning a covered financial corporation.’’. 

(c) WHO MAY BE A DEBTOR.—Section 109 of title 11, United 

States Code, is amended— 

(1) in subsection (b)— 

(A) in paragraph (2), by striking ‘‘or’’ at the end; 

(B) in paragraph (3)(B), by striking the period at the end 

and inserting ‘‘; or’’; and 

(C) by adding at the end the following: 

‘‘(4) a covered financial corporation.’’; and 

(2) in subsection (d)— 

(A) by striking ‘‘and’’ before ‘‘an uninsured State member 

bank’’; 

(B) by striking ‘‘or’’ before ‘‘a corporation’’; and 

(C) by inserting ‘‘, or a covered financial corporation’’ 

after ‘‘Federal Deposit Insurance Corporation Improvement 

Act of 1991’’. 

(d) CONVERSION TO CHAPTER 7.—Section 1112 of title 11, United 

States Code, is amended by adding at the end the following: 

‘‘(g) Notwithstanding section 109(b), the court may convert a case 

under subchapter V to a case under chapter 7 if— 

‘‘(1) a transfer approved under section 1185 has been consummated; 

‘‘(2) the court has ordered the appointment of a special trustee under section 1186; and 

‘‘(3) the court finds, after notice and a hearing, that conversion is in the best interest of the creditors and the estate.’’. 

(e)(1) Section 726(a)(1) of title 11, United States Code, is amended by inserting after ‘‘first,’’ the following: ‘‘in payment of any unpaid fees, costs, and expenses of a special trustee appointed under 

section 1186, and then’’. 

12 

(2) Section 1129(a) of title 11, United States Code, is amended 

by inserting after paragraph (16) the following: 

‘‘(17) In a case under subchapter V, all payable fees, costs, 

and expenses of the special trustee have been paid or the plan 

provides for the payment of all such fees, costs, and expenses 

on the effective date of the plan. 

‘‘(18) In a case under subchapter V, confirmation of the plan 

is not likely to cause serious adverse effects on financial stability in the United States.’’. 

(f) Section 322(b)(2) of title 11, United States Code, is amended 

by striking ‘‘The’’ and inserting ‘‘In cases under subchapter V, the 

United States trustee shall recommend to the court, and in all 

other cases, the’’. 

SEC. 122. LIQUIDATION, REORGANIZATION, OR RECAPITALIZATION OF 

A COVERED FINANCIAL CORPORATION. 

Chapter 11 of title 11, United States Code, is amended by adding 

at the end the following (and conforming the table of contents for 

such chapter accordingly): 

‘‘SUBCHAPTER V—LIQUIDATION, REORGANIZATION, OR RECAPITALIZATION OF A COVERED FINANCIAL CORPORATION 

‘‘§ 1181. Inapplicability of other sections 

‘‘Sections 303 and 321(c) do not apply in a case under this subchapter concerning a covered financial corporation. Section 365 

does not apply to a transfer under section 1185, 1187, or 1188. 

‘‘§ 1182. Definitions for this subchapter 

‘‘In this subchapter, the following definitions shall apply: 

‘‘(1) The term ‘Board’ means the Board of Governors of the 

Federal Reserve System. 

‘‘(2) The term ‘bridge company’ means a newly formed corporation to which property of the estate may be transferred 

under section 1185(a) and the equity securities of which may 

be transferred to a special trustee under section 1186(a). 

‘‘(3) The term ‘capital structure debt’ means all unsecured 

debt of the debtor for borrowed money for which the debtor is 

the primary obligor, other than a qualified financial contract 

and other than debt secured by a lien on property of the estate 

that is to be transferred to a bridge company pursuant to an 

order of the court under section 1185(a). 

‘‘(4) The term ‘contractual right’ means a contractual right of 

a kind defined in section 555, 556, 559, 560, or 561. 

‘‘(5) The term ‘qualified financial contract’ means any contract of a kind defined in paragraph (25), (38A), (47), or (53B) 

of section 101, section 741(7), or paragraph (4), (5), (11), or (13) 

of section 761. 

‘‘(6) The term ‘special trustee’ means the trustee of a trust 

formed under section 1186(a)(1). 

‘‘§ 1183. Commencement of a case concerning a covered financial corporation 

‘‘(a) A case under this subchapter concerning a covered financial 

corporation may be commenced by the filing of a petition with the 

13 

court by the debtor under section 301 only if the debtor states to 

the best of its knowledge under penalty of perjury in the petition 

that it is a covered financial corporation. 

‘‘(b) The commencement of a case under subsection (a) constitutes 

an order for relief under this subchapter. 

‘‘(c) The members of the board of directors (or body performing 

similar functions) of a covered financial company shall have no liability to shareholders, creditors, or other parties in interest for a 

good faith filing of a petition to commence a case under this subchapter, or for any reasonable action taken in good faith in contemplation of such a petition or a transfer under section 1185 or 

section 1186, whether prior to or after commencement of the case. 

‘‘(d) Counsel to the debtor shall provide, to the greatest extent 

practicable without disclosing the identity of the potential debtor, 

sufficient confidential notice to the chief judge of the court of appeals for the circuit embracing the district in which such counsel 

intends to file a petition to commence a case under this subchapter 

regarding the potential commencement of such case. The chief 

judge of such court shall randomly assign to preside over such case 

a bankruptcy judge selected from among the bankruptcy judges 

designated by the Chief Justice of the United States under section 

298 of title 28. 

‘‘§ 1184. Regulators 

‘‘The Board, the Securities Exchange Commission, the Office of 

the Comptroller of the Currency of the Department of the Treasury, the Commodity Futures Trading Commission, and the Federal 

Deposit Insurance Corporation may raise and may appear and be 

heard on any issue in any case or proceeding under this subchapter. 

‘‘§ 1185. Special transfer of property of the estate 

‘‘(a) On request of the trustee, and after notice and a hearing 

that shall occur not less than 24 hours after the order for relief, 

the court may order a transfer under this section of property of the 

estate, and the assignment of executory contracts, unexpired 

leases, and qualified financial contracts of the debtor, to a bridge 

company. Upon the entry of an order approving such transfer, any 

property transferred, and any executory contracts, unexpired 

leases, and qualified financial contracts assigned under such order 

shall no longer be property of the estate. Except as provided under 

this section, the provisions of section 363 shall apply to a transfer 

and assignment under this section. 

‘‘(b) Unless the court orders otherwise, notice of a request for an 

order under subsection (a) shall consist of electronic or telephonic 

notice of not less than 24 hours to— 

‘‘(1) the debtor; 

‘‘(2) the holders of the 20 largest secured claims against the 

debtor; 

‘‘(3) the holders of the 20 largest unsecured claims against 

the debtor; 

‘‘(4) counterparties to any debt, executory contract, unexpired 

lease, and qualified financial contract requested to be transferred under this section; 

‘‘(5) the Board; 

14 

‘‘(6) the Federal Deposit Insurance Corporation; 

‘‘(7) the Secretary of the Treasury and the Office of the 

Comptroller of the Currency of the Treasury; 

‘‘(8) the Commodity Futures Trading Commission; 

‘‘(9) the Securities and Exchange Commission; 

‘‘(10) the United States trustee or bankruptcy administrator; 

and 

‘‘(11) each primary financial regulatory agency, as defined in 

section 2(12) of the Dodd-Frank Wall Street Reform and Consumer Protection Act, with respect to any affiliate the equity 

securities of which are proposed to be transferred under this 

section. 

‘‘(c) The court may not order a transfer under this section unless 

the court determines, based upon a preponderance of the evidence, 

that— 

‘‘(1) the transfer under this section is necessary to prevent 

serious adverse effects on financial stability in the United 

States; 

‘‘(2) the transfer does not provide for the assumption of any 

capital structure debt by the bridge company; 

‘‘(3) the transfer does not provide for the transfer to the 

bridge company of any property of the estate that is subject to 

a lien securing a debt, executory contract, unexpired lease or 

agreement (including a qualified financial contract) of the debtor unless— 

‘‘(A)(i) the bridge company assumes such debt, executory 

contract, unexpired lease or agreement (including a qualified financial contract), including any claims arising in respect thereof that would not be allowed secured claims 

under section 506(a)(1) and after giving effect to such 

transfer, such property remains subject to the lien securing such debt, executory contract, unexpired lease or 

agreement (including a qualified financial contract); and 

‘‘(ii) the court has determined that assumption of such 

debt, executory contract, unexpired lease or agreement (including a qualified financial contract) by the bridge company is in the best interests of the estate; or 

‘‘(B) such property is being transferred to the bridge 

company in accordance with the provisions of section 363; 

‘‘(4) the transfer does not provide for the assumption by the 

bridge company of any debt, executory contract, unexpired 

lease or agreement (including a qualified financial contract) of 

the debtor secured by a lien on property of the estate unless 

the transfer provides for such property to be transferred to the 

bridge company in accordance with paragraph (3)(A) of this 

subsection; 

‘‘(5) the transfer does not provide for the transfer of the equity of the debtor; 

‘‘(6) the trustee has demonstrated that the bridge company 

is not likely to fail to meet the obligations of any debt, executory contract, qualified financial contract, or unexpired lease 

assumed and assigned to the bridge company; 

‘‘(7) the transfer provides for the transfer to a special trustee 

all of the equity securities in the bridge company and appointment of a special trustee in accordance with section 1186; 

15 

‘‘(8) after giving effect to the transfer, adequate provision has 

been made for the fees, costs, and expenses of the estate and 

special trustee; and 

‘‘(9) the bridge company will have governing documents, and 

initial directors and senior officers, that are in the best interest 

of creditors and the estate. 

‘‘(d) Immediately before a transfer under this section, the bridge 

company that is the recipient of the transfer shall— 

‘‘(1) not have any property, executory contracts, unexpired 

leases, qualified financial contracts, or debts, other than any 

property acquired or executory contracts, unexpired leases, or 

debts assumed when acting as a transferee of a transfer under 

this section; and 

‘‘(2) have equity securities that are property of the estate, 

which may be sold or distributed in accordance with this title. 

‘‘§ 1186. Special trustee 

‘‘(a)(1) An order approving a transfer under section 1185 shall require the trustee to transfer to a qualified and independent special 

trustee, who is appointed by the court, all of the equity securities 

in the bridge company that is the recipient of a transfer under section 1185 to hold in trust for the sole benefit of the estate, subject 

to satisfaction of the special trustee’s fees, costs, and expenses. The 

trust of which the special trustee is the trustee shall be a newly 

formed trust governed by a trust agreement approved by the court 

as in the best interests of the estate, and shall exist for the sole 

purpose of holding and administering, and shall be permitted to 

dispose of, the equity securities of the bridge company in accordance with the trust agreement. 

‘‘(2) In connection with the hearing to approve a transfer under 

section 1185, the trustee shall confirm to the court that the Board 

has been consulted regarding the identity of the proposed special 

trustee and advise the court of the results of such consultation. 

‘‘(b) The trust agreement governing the trust shall provide— 

‘‘(1) for the payment of the fees, costs, expenses, and indemnities of the special trustee from the assets of the debtor’s estate; 

‘‘(2) that the special trustee provide— 

‘‘(A) quarterly reporting to the estate, which shall be 

filed with the court; and 

‘‘(B) information about the bridge company reasonably 

requested by a party in interest to prepare a disclosure 

statement for a plan providing for distribution of any securities of the bridge company if such information is necessary to prepare such disclosure statement; 

‘‘(3) that for as long as the equity securities of the bridge 

company are held by the trust, the special trustee shall file a 

notice with the court in connection with— 

‘‘(A) any change in a director or senior officer of the 

bridge company; 

‘‘(B) any modification to the governing documents of the 

bridge company; and 

‘‘(C) any material corporate action of the bridge company, including— 

‘‘(i) recapitalization; 

16 

‘‘(ii) a material borrowing; 

‘‘(iii) termination of an intercompany debt or guarantee; 

‘‘(iv) a transfer of a substantial portion of the assets 

of the bridge company; or 

‘‘(v) the issuance or sale of any securities of the 

bridge company; 

‘‘(4) that any sale of any equity securities of the bridge company shall not be consummated until the special trustee 

consults with the Federal Deposit Insurance Corporation and 

the Board regarding such sale and discloses the results of such 

consultation with the court; 

‘‘(5) that, subject to reserves for payments permitted under 

paragraph (1) provided for in the trust agreement, the proceeds 

of the sale of any equity securities of the bridge company by 

the special trustee be held in trust for the benefit of or transferred to the estate; 

‘‘(6) the process and guidelines for the replacement of the 

special trustee; and 

‘‘(7) that the property held in trust by the special trustee is 

subject to distribution in accordance with subsection (c). 

‘‘(c)(1) The special trustee shall distribute the assets held in 

trust— 

‘‘(A) if the court confirms a plan in the case, in accordance 

with the plan on the effective date of the plan; or 

‘‘(B) if the case is converted to a case under chapter 7, as ordered by the court. 

‘‘(2) As soon as practicable after a final distribution under paragraph (1), the office of the special trustee shall terminate, except 

as may be necessary to wind up and conclude the business and financial affairs of the trust. 

‘‘(d) After a transfer to the special trustee under this section, the 

special trustee shall be subject only to applicable nonbankruptcy 

law, and the actions and conduct of the special trustee shall no 

longer be subject to approval by the court in the case under this 

subchapter. 

‘‘§ 1187. Temporary and supplemental automatic stay; assumed debt 

‘‘(a)(1) A petition filed under section 1183 operates as a stay, applicable to all entities, of the termination, acceleration, or modification of any debt, contract, lease, or agreement of the kind described 

in paragraph (2), or of any right or obligation under any such debt, 

contract, lease, or agreement, solely because of— 

‘‘(A) a default by the debtor under any such debt, contract, 

lease, or agreement; or 

‘‘(B) a provision in such debt, contract, lease, or agreement, 

or in applicable nonbankruptcy law, that is conditioned on— 

‘‘(i) the insolvency or financial condition of the debtor at 

any time before the closing of the case; 

‘‘(ii) the commencement of a case under this title concerning the debtor; 

‘‘(iii) the appointment of or taking possession by a trustee in a case under this title concerning the debtor or by 

a custodian before the commencement of the case; or 

17 

‘‘(iv) a credit rating agency rating, or absence or withdrawal of a credit rating agency rating— 

‘‘(I) of the debtor at any time after the commencement of the case; 

‘‘(II) of an affiliate during the period from the commencement of the case until 48 hours after such order 

is entered; 

‘‘(III) of the bridge company while the trustee or the 

special trustee is a direct or indirect beneficial holder 

of more than 50 percent of the equity securities of— 

‘‘(aa) the bridge company; or 

‘‘(bb) the affiliate, if all of the direct or indirect 

interests in the affiliate that are property of the 

estate are transferred under section 1185; or 

‘‘(IV) of an affiliate while the trustee or the special 

trustee is a direct or indirect beneficial holder of more 

than 50 percent of the equity securities of— 

‘‘(aa) the bridge company; or 

‘‘(bb) the affiliate, if all of the direct or indirect 

interests in the affiliate that are property of the 

estate are transferred under section 1185. 

‘‘(2) A debt, contract, lease, or agreement described in this paragraph is— 

‘‘(A) any debt (other than capital structure debt), executory 

contract, or unexpired lease of the debtor (other than a qualified financial contract); 

‘‘(B) any agreement under which the debtor issued or is obligated for debt (other than capital structure debt); 

‘‘(C) any debt, executory contract, or unexpired lease of an affiliate (other than a qualified financial contract); or 

‘‘(D) any agreement under which an affiliate issued or is obligated for debt. 

‘‘(3) The stay under this subsection terminates— 

‘‘(A) for the benefit of the debtor, upon the earliest of— 

‘‘(i) 48 hours after the commencement of the case; 

‘‘(ii) assumption of the debt, contract, lease, or agreement by the bridge company under an order authorizing a 

transfer under section 1185; 

‘‘(iii) a final order of the court denying the request for a 

transfer under section 1185; or 

‘‘(iv) the time the case is dismissed; and 

‘‘(B) for the benefit of an affiliate, upon the earliest of— 

‘‘(i) the entry of an order authorizing a transfer under 

section 1185 in which the direct or indirect interests in the 

affiliate that are property of the estate are not transferred 

under section 1185; 

‘‘(ii) a final order by the court denying the request for a 

transfer under section 1185; 

‘‘(iii) 48 hours after the commencement of the case if the 

court has not ordered a transfer under section 1185; or 

‘‘(iv) the time the case is dismissed. 

‘‘(4) Subsections (d), (e), (f), and (g) of section 362 apply to a stay 

under this subsection. 

‘‘(b) A debt, executory contract (other than a qualified financial 

contract), or unexpired lease of the debtor, or an agreement under 

18 

which the debtor has issued or is obligated for any debt, may be 

assumed by a bridge company in a transfer under section 1185 notwithstanding any provision in an agreement or in applicable nonbankruptcy law that— 

‘‘(1) prohibits, restricts, or conditions the assignment of the 

debt, contract, lease, or agreement; or 

‘‘(2) accelerates, terminates, or modifies, or permits a party 

other than the debtor to terminate or modify, the debt, contract, lease, or agreement on account of— 

‘‘(A) the assignment of the debt, contract, lease, or agreement; or 

‘‘(B) a change in control of any party to the debt, contract, lease, or agreement. 

‘‘(c)(1) A debt, contract, lease, or agreement of the kind described 

in subparagraph (A) or (B) of subsection (a)(2) may not be accelerated, terminated, or modified, and any right or obligation under 

such debt, contract, lease, or agreement may not be accelerated, 

terminated, or modified, as to the bridge company solely because 

of a provision in the debt, contract, lease, or agreement or in applicable nonbankruptcy law— 

‘‘(A) of the kind described in subsection (a)(1)(B) as applied 

to the debtor; 

‘‘(B) that prohibits, restricts, or conditions the assignment of 

the debt, contract, lease, or agreement; or 

‘‘(C) that accelerates, terminates, or modifies, or permits a 

party other than the debtor to terminate or modify, the debt, 

contract, lease or agreement on account of— 

‘‘(i) the assignment of the debt, contract, lease, or agreement; or 

‘‘(ii) a change in control of any party to the debt, contract, lease, or agreement. 

‘‘(2) If there is a default by the debtor under a provision other 

than the kind described in paragraph (1) in a debt, contract, lease 

or agreement of the kind described in subparagraph (A) or (B) of 

subsection (a)(2), the bridge company may assume such debt, contract, lease, or agreement only if the bridge company— 

‘‘(A) shall cure the default; 

‘‘(B) compensates, or provides adequate assurance in connection with a transfer under section 1185 that the bridge company will promptly compensate, a party other than the debtor 

to the debt, contract, lease, or agreement, for any actual pecuniary loss to the party resulting from the default; and 

‘‘(C) provides adequate assurance in connection with a transfer under section 1185 of future performance under the debt, 

contract, lease, or agreement, as determined by the court 

under section 1185(c)(4). 

‘‘§ 1188. Treatment of qualified financial contracts and affiliate contracts 

‘‘(a) Notwithstanding sections 362(b)(6), 362(b)(7), 362(b)(17), 

362(b)(27), 362(o), 555, 556, 559, 560, and 561, a petition filed 

under section 1183 operates as a stay, during the period specified 

in section 1187(a)(3)(A), applicable to all entities, of the exercise of 

a contractual right— 

19 

‘‘(1) to cause the modification, liquidation, termination, or acceleration of a qualified financial contract of the debtor or an 

affiliate; 

‘‘(2) to offset or net out any termination value, payment 

amount, or other transfer obligation arising under or in connection with a qualified financial contract of the debtor or an 

affiliate; or 

‘‘(3) under any security agreement or arrangement or other 

credit enhancement forming a part of or related to a qualified 

financial contract of the debtor or an affiliate. 

‘‘(b)(1) During the period specified in section 1187(a)(3)(A), the 

trustee or the affiliate shall perform all payment and delivery obligations under such qualified financial contract of the debtor or the 

affiliate, as the case may be, that become due after the commencement of the case. The stay provided under subsection (a) terminates as to a qualified financial contract of the debtor or an affiliate immediately upon the failure of the trustee or the affiliate, as 

the case may be, to perform any such obligation during such period. 

‘‘(2) Any failure by a counterparty to any qualified financial contract of the debtor or any affiliate to perform any payment or delivery obligation under such qualified financial contract, including 

during the pendency of the stay provided under subsection (a), 

shall constitute a breach of such qualified financial contract by the 

counterparty. 

‘‘(c) Subject to the court’s approval, a qualified financial contract 

between an entity and the debtor may be assigned to or assumed 

by the bridge company in a transfer under, and in accordance with, 

section 1185 if and only if— 

‘‘(1) all qualified financial contracts between the entity and 

the debtor are assigned to and assumed by the bridge company 

in the transfer under section 1185; 

‘‘(2) all claims of the entity against the debtor in respect of 

any qualified financial contract between the entity and the 

debtor (other than any claim that, under the terms of the 

qualified financial contract, is subordinated to the claims of 

general unsecured creditors) are assigned to and assumed by 

the bridge company; 

‘‘(3) all claims of the debtor against the entity under any 

qualified financial contract between the entity and the debtor 

are assigned to and assumed by the bridge company; and 

‘‘(4) all property securing or any other credit enhancement 

furnished by the debtor for any qualified financial contract described in paragraph (1) or any claim described in paragraph 

(2) or (3) under any qualified financial contract between the 

entity and the debtor is assigned to and assumed by the bridge 

company. 

‘‘(d) Notwithstanding any provision of a qualified financial contract or of applicable nonbankruptcy law, a qualified financial contract of the debtor that is assumed or assigned in a transfer under 

section 1185 may not be accelerated, terminated, or modified, after 

the entry of the order approving a transfer under section 1185, and 

any right or obligation under the qualified financial contract may 

not be accelerated, terminated, or modified, after the entry of the 

order approving a transfer under section 1185 solely because of a 

20 

condition described in section 1187(c)(1), other than a condition of 

the kind specified in section 1187(b) that occurs after property of 

the estate no longer includes a direct beneficial interest or an indirect beneficial interest through the special trustee, in more than 50 

percent of the equity securities of the bridge company. 

‘‘(e) Notwithstanding any provision of any agreement or in applicable nonbankruptcy law, an agreement of an affiliate (including 

an executory contract, an unexpired lease, qualified financial contract, or an agreement under which the affiliate issued or is obligated for debt) and any right or obligation under such agreement 

may not be accelerated, terminated, or modified, solely because of 

a condition described in section 1187(c)(1), other than a condition 

of the kind specified in section 1187(b) that occurs after the bridge 

company is no longer a direct or indirect beneficial holder of more 

than 50 percent of the equity securities of the affiliate, at any time 

after the commencement of the case if— 

‘‘(1) all direct or indirect interests in the affiliate that are 

property of the estate are transferred under section 1185 to the 

bridge company within the period specified in subsection (a); 

‘‘(2) the bridge company assumes— 

‘‘(A) any guarantee or other credit enhancement issued 

by the debtor relating to the agreement of the affiliate; and 

‘‘(B) any obligations in respect of rights of setoff, netting 

arrangement, or debt of the debtor that directly arises out 

of or directly relates to the guarantee or credit enhancement; and 

‘‘(3) any property of the estate that directly serves as collateral for the guarantee or credit enhancement is transferred to 

the bridge company. 

‘‘§ 1189. Licenses, permits, and registrations 

‘‘(a) Notwithstanding any otherwise applicable nonbankruptcy 

law, if a request is made under section 1185 for a transfer of property of the estate, any Federal, State, or local license, permit, or 

registration that the debtor or an affiliate had immediately before 

the commencement of the case and that is proposed to be transferred under section 1185 may not be accelerated, terminated, or 

modified at any time after the request solely on account of— 

‘‘(1) the insolvency or financial condition of the debtor at any 

time before the closing of the case; 

‘‘(2) the commencement of a case under this title concerning 

the debtor; 

‘‘(3) the appointment of or taking possession by a trustee in 

a case under this title concerning the debtor or by a custodian 

before the commencement of the case; or 

‘‘(4) a transfer under section 1185. 

‘‘(b) Notwithstanding any otherwise applicable nonbankruptcy 

law, any Federal, State, or local license, permit, or registration that 

the debtor had immediately before the commencement of the case 

that is included in a transfer under section 1185 shall be valid and 

all rights and obligations thereunder shall vest in the bridge company. 

21 

‘‘§ 1190. Exemption from securities laws 

‘‘For purposes of section 1145, a security of the bridge company 

shall be deemed to be a security of a successor to the debtor under 

a plan if the court approves the disclosure statement for the plan 

as providing adequate information (as defined in section 1125(a)) 

about the bridge company and the security. 

‘‘§ 1191. Inapplicability of certain avoiding powers 

‘‘A transfer made or an obligation incurred by the debtor to an 

affiliate prior to or after the commencement of the case, including 

any obligation released by the debtor or the estate to or for the 

benefit of an affiliate, in contemplation of or in connection with a 

transfer under section 1185 is not avoidable under section 544, 547, 

548(a)(1)(B), or 549, or under any similar nonbankruptcy law. 

‘‘§ 1192. Consideration of financial stability 

‘‘The court may consider the effect that any decision in connection with this subchapter may have on financial stability in the 

United States.’’. 

SEC. 123. AMENDMENTS TO TITLE 28, UNITED STATES CODE. 

(a) AMENDMENT TO CHAPTER 13.—Chapter 13 of title 28, United 

States Code, is amended by adding at the end the following: 

‘‘§ 298. Judge for a case under subchapter V of chapter 11 of 

title 11 

‘‘(a)(1) Notwithstanding section 295, the Chief Justice of the 

United States shall designate not fewer than 10 bankruptcy judges 

to be available to hear a case under subchapter V of chapter 11 of 

title 11. Bankruptcy judges may request to be considered by the 

Chief Justice of the United States for such designation. 

‘‘(2) Notwithstanding section 155, a case under subchapter V of 

chapter 11 of title 11 shall be heard under section 157 by a bankruptcy judge designated under paragraph (1), who shall be randomly assigned to hear such case by the chief judge of the court 

of appeals for the circuit embracing the district in which the case 

is pending. To the greatest extent practicable, the approvals required under section 155 should be obtained. 

‘‘(3) If the bankruptcy judge assigned to hear a case under paragraph (2) is not assigned to the district in which the case is pending, the bankruptcy judge shall be temporarily assigned to the district. 

‘‘(b) A case under subchapter V of chapter 11 of title 11, and all 

proceedings in the case, shall take place in the district in which the 

case is pending. 

‘‘(c) In this section, the term ‘covered financial corporation’ has 

the meaning given that term in section 101(9A) of title 11.’’. 

(b) AMENDMENT TO SECTION 1334 OF TITLE 28.—Section 1334 of 

title 28, United States Code, is amended by adding at the end the 

following: 

‘‘(f) This section does not grant jurisdiction to the district court 

after a transfer pursuant to an order under section 1185 of title 11 

of any proceeding related to a special trustee appointed, or to a 

bridge company formed, in connection with a case under subchapter V of chapter 11 of title 11.’’. 

22 

(c) TECHNICAL AND CONFORMING AMENDMENT.—The table of sections for chapter 13 of title 28, United States Code, is amended by 

adding at the end the following: 

‘‘298. Judge for a case under subchapter V of chapter 11 of title 11.’’. 

Subtitle C—Ending Government 

Guarantees 

SEC. 131. REPEAL OF OBLIGATION GUARANTEE PROGRAM. 

(a) IN GENERAL.—The following sections of the Dodd-Frank Wall 

Street Reform and Consumer Protection Act (12 U.S.C. 5301 et 

seq.) are repealed: 

(1) Section 1104. 

(2) Section 1105. 

(3) Section 1106. 

(b) CLERICAL AMENDMENT.—The table of contents under section 

1(b) of the Dodd-Frank Wall Street Reform and Consumer Protection Act is amended by striking the items relating to sections 1104, 

1105, and 1106. 

SEC. 132. REPEAL OF SYSTEMIC RISK DETERMINATION IN RESOLUTIONS. 

Section 13(c)(4)(G) of the Federal Deposit Insurance Act (12 

U.S.C. 1823(c)(4)(G)) is hereby repealed. 

SEC. 133. RESTRICTIONS ON USE OF THE EXCHANGE STABILIZATION 

FUND. 

(a) IN GENERAL.—Section 5302 of title 31, United States Code, is 

amended by adding at the end the following: 

‘‘(e) Amounts in the fund may not be used for the establishment 

of a guaranty program for any nongovernmental entity.’’. 

(b) CONFORMING AMENDMENT.—Section 131(b) of the Emergency 

Economic Stabilization Act of 2008 (12 U.S.C. 5236(b)) is amended 

by inserting ‘‘, or for the purposes of preventing the liquidation or 

insolvency of any entity’’ before the period. 

Subtitle D—Eliminating Financial Market 

Utility Designations 

SEC. 141. REPEAL OF TITLE VIII. 

(a) REPEAL.—Title VIII of the Dodd-Frank Wall Street Reform 

and Consumer Protection Act (12 U.S.C. 5461 et seq.) is repealed, 

and provisions of law amended by such title are restored and revived as if such title had never been enacted. 

(b) CLERICAL AMENDMENT.—The table of contents in section 1(b) 

of the Dodd-Frank Wall Street Reform and Consumer Protection 

Act is amended by striking the items relating to title VIII. 

23 

Subtitle E—Reform of the Financial 

Stability Act of 2010 

SEC. 151. REPEAL AND MODIFICATION OF PROVISIONS OF THE FINANCIAL STABILITY ACT OF 2010. 

(a) REPEALS.—The following provisions of the Financial Stability 

Act of 2010 are repealed, and the provisions of law amended or repealed by such provisions are restored or revived as if such provisions had not been enacted: 

(1) Subtitle B. 

(2) Section 113. 

(3) Section 114. 

(4) Section 115. 

(5) Section 116. 

(6) Section 117. 

(7) Section 119. 

(8) Section 120. 

(9) Section 121. 

(10) Section 161. 

(11) Section 162. 

(12) Section 164. 

(13) Section 166. 

(14) Section 167. 

(15) Section 168. 

(16) Section 170. 

(17) Section 172. 

(18) Section 174. 

(19) Section 175. 

(b) ADDITIONAL MODIFICATIONS.—The Financial Stability Act of 

2010 (12 U.S.C. 5311 et seq.) is amended— 

(1) in section 102(a), by striking paragraph (5); 

(2) in section 111— 

(A) in subsection (b)— 

(i) in paragraph (1)— 

(I) by striking ‘‘who shall each’’ and inserting 

‘‘who shall, except as provided below, each’’; and 

(II) by striking subparagraphs (B) through (J) 

and inserting the following: 

‘‘(B) each member of the Board of Governors, who shall 

collectively have 1 vote on the Council; 

‘‘(C) the Comptroller of the Currency; 

‘‘(D) the Director of the Consumer Law Enforcement 

Agency; 

‘‘(E) each member of the Commission, who shall collectively have 1 vote on the Council; 

‘‘(F) each member of the Corporation, who shall collectively have 1 vote on the Council; 

‘‘(G) each member of the Commodity Futures Trading 

Commission, who shall collectively have 1 vote on the 

Council; 

‘‘(H) the Director of the Federal Housing Finance Agency; 

24 

‘‘(I) each member of the National Credit Union Administration Board, who shall collectively have 1 vote on the 

Council; and 

‘‘(J) the Independent Insurance Advocate.’’; 

(ii) in paragraph (2)— 

(I) by striking subparagraphs (A) and (B); and 

(II) by redesignating subparagraphs (C), (D), 

and (E) as subparagraphs (A), (B), and (C), respectively; and 

(iii) by adding at the end the following: 

‘‘(4) VOTING BY MULTI-PERSON ENTITY.— 

‘‘(A) VOTING WITHIN THE ENTITY.—An entity described 

under subparagraph (B), (E), (F), (G), or (I) of paragraph 

(1) shall determine the entity’s Council vote by using the 

voting process normally applicable to votes by the entity’s 

members. 

‘‘(B) CASTING OF ENTITY VOTE.—The 1 collective Council 

vote of an entity described under subparagraph (A) shall 

be cast by the head of such agency or, in the event such 

head is unable to cast such vote, the next most senior 

member of the entity available.’’; 

(B) in subsection (c)(1), by striking ‘‘The independent 

member of the Council shall serve for a term of 6 years, 

and each nonvoting member described in subparagraphs 

(C), (D), and (E) of’’ and inserting ‘‘Each nonvoting members described under’’; 

(C) in subsection (e), by adding at the end the following: 

‘‘(3) STAFF ACCESS.—Any member of the Council may select 

to have one or more individuals on the member’s staff attend 

a meeting of the Council, including any meeting of representatives of the member agencies other than the members themselves. 

‘‘(4) CONGRESSIONAL OVERSIGHT.—All meetings of the Council, whether or not open to the public, shall be open to the attendance by members of the authorization and oversight committees of the House of Representatives and the Senate. 

‘‘(5) MEMBER AGENCY MEETINGS.—Any meeting of representatives of the member agencies other than the members themselves shall be open to attendance by staff of the authorization 

and oversight committees of the House of Representatives and 

the Senate.’’; 

(D) by striking subsection (g) (relating to the nonapplicability of FACA); 

(E) by inserting after subsection (f) the following: 

‘‘(g) OPEN MEETING REQUIREMENT.—The Council shall be an 

agency for purposes of section 552b of title 5, United States Code 

(commonly referred to as the ‘Government in the Sunshine Act’). 

‘‘(h) CONFIDENTIAL CONGRESSIONAL BRIEFINGS.—The Chairperson shall at regular times but not less than annually provide 

confidential briefings to the Committee on Financial Services of the 

House of Representatives and the Committee on Banking, Housing, 

and Urban Affairs of the Senate, which may in the discretion of the 

Chairman of the respective committee be attended by any combination of the committee’s members or staff.’’; and 

25 

(F) by redesignating subsections (h) through (j) as subsections (i) through (k), respectively; 

(3) in section 112— 

(A) in subsection (a)(2)— 

(i) in subparagraph (A), by striking ‘‘the Federal Insurance Office and, if necessary to assess risks to the 

United States financial system, direct the Office of Financial Research to’’ and inserting ‘‘and, if necessary 

to assess risks to the United States financial system,’’; 

(ii) by striking subparagraphs (B), (H), (I), and (J); 

(iii) by redesignating subparagraphs (C), (D), (E), 

(F), (G), (K), (L), (M), and (N) as subparagraphs (B), 

(C), (D), (E), (F), (G), (H), (I), and (J), respectively; 

(iv) in subparagraph (J), as so redesignated— 

(I) in clause (iii), by adding ‘‘and’’ at the end; 

(II) by striking clauses (iv) and (v); and 

(III) by redesignating clause (vi) as clause (iv); 

and 

(B) in subsection (d)— 

(i) in paragraph (1), by striking ‘‘the Office of Financial Research, member agencies, and the Federal Insurance Office’’ and inserting ‘‘member agencies’’; 

(ii) in paragraph (2), by striking ‘‘the Office of Financial Research, any member agency, and the Federal Insurance Office,’’ and inserting ‘‘member agencies’’; 

(iii) in paragraph (3)— 

(I) by striking ‘‘, acting through the Office of Financial Research,’’ each place it appears; and 

(II) in subparagraph (B), by striking ‘‘the Office 

of Financial Research or’’; and 

(iv) in paragraph (5)(A), by striking ‘‘, the Office of 

Financial Research,’’; 

(4) by amending section 118 to read as follows: 

‘‘SEC. 118. COUNCIL FUNDING. 

‘‘There is authorized to be appropriated to the Council $4,000,000 

for fiscal year 2017 and each fiscal year thereafter to carry out the 

duties of the Council.’’; 

(5) in section 163— 

(A) by striking subsection (a); 

(B) by redesignating subsection (b) as subsection (a); and 

(C) in subsection (a), as so redesignated— 

(i) by striking ‘‘or a nonbank financial company supervised by the Board of Governors’’ each place such 

term appears; 

(ii) in paragraph (4), by striking ‘‘In addition’’ and 

inserting the following: 

‘‘(A) IN GENERAL.—In addition’’; and 

(iii) by adding at the end the following: 

‘‘(B) EXCEPTION FOR QUALIFYING BANKING ORGANIZATION.—Subparagraph (A) shall not apply to a proposed acquisition by a qualifying banking organization, as defined 

under section 605 of the Financial CHOICE Act of 2017.’’; 

and 

(6) in section 165— 

26 

(A) by striking ‘‘nonbank financial companies supervised 

by the Board of Governors and’’ each place such term appears; 

(B) by striking ‘‘nonbank financial company supervised 

by the Board of Governors and’’ each place such term appears; 

(C) in subsection (a), by amending paragraph (2) to read 

as follows: 

‘‘(2) TAILORED APPLICATION.—In prescribing more stringent 

prudential standards under this section, the Board of Governors may differentiate among companies on an individual 

basis or by category, taking into consideration their capital 

structure, riskiness, complexity, financial activities (including 

the financial activities of their subsidiaries), size, and any 

other risk-related factors that the Board of Governors deems 

appropriate.’’; 

(D) in subsection (b)— 

(i) in paragraph (1)(B)(iv), by striking ‘‘, on its own 

or pursuant to a recommendation made by the Council 

in accordance with section 115,’’; 

(ii) in paragraph (2)— 

(I) by striking ‘‘foreign nonbank financial company supervised by the Board of Governors or’’; 

(II) by striking ‘‘shall—’’ and all that follows 

through ‘‘give due’’ and inserting ‘‘shall give due’’; 

(III) in subparagraph (A), by striking ‘‘; and’’ 

and inserting a period; and 

(IV) by striking subparagraph (B); 

(iii) in paragraph (3)— 

(I) in subparagraph (A)— 

(aa) by striking clause (i); 

(bb) by redesignating clauses (ii), (iii), and 

(iv) as clauses (i), (ii), and (iii), respectively; 

and 

(cc) in clause (iii), as so redesignated, by 

adding ‘‘and’’ at the end; 

(II) by striking subparagraphs (B) and (C); and 

(III) by redesignating subparagraph (D) as subparagraph (B); and 

(iv) in paragraph (4), by striking ‘‘a nonbank financial company supervised by the Board of Governors 

or’’; 

(E) in subsection (c)— 

(i) in paragraph (1), by striking ‘‘under section 

115(c)’’; and 

(ii) in paragraph (2)— 

(I) by amending subparagraph (A) to read as follows: 

‘‘(A) any recommendations of the Council;’’; and 

(II) in subparagraph (D), by striking ‘‘nonbank 

financial company supervised by the Board of 

Governors or’’; 

(F) in subsection (d)— 

27 

(i) by striking ‘‘a nonbank financial company supervised by the Board of Governors or’’ each place such 

term appears; 

(ii) in paragraph (1), by striking ‘‘periodically’’ and 

inserting ‘‘not more often than every 2 years’’; 

(iii) in paragraph (3)— 

(I) by striking ‘‘The Board’’ and inserting the following: 

‘‘(A) IN GENERAL.—The Board’’; 

(II) by striking ‘‘shall review’’ and inserting the 

following: ‘‘shall— 

‘‘(i) review’’; 

(III) by striking the period and inserting ‘‘; and’’; 

and 

(IV) by adding at the end the following: 

‘‘(ii) not later than the end of the 6-month period beginning on the date the bank holding company submits the resolution plan, provide feedback to the bank 

holding company on such plan. 

‘‘(B) DISCLOSURE OF ASSESSMENT FRAMEWORK.—The 

Board of Governors shall publicly disclose, including on the 

website of the Board of Governors, the assessment framework that is used to review information under this paragraph and shall provide the public with a notice and comment period before finalizing such assessment framework.’’. 

(iv) in paragraph (6), by striking ‘‘nonbank financial 

company supervised by the Board, any bank holding 

company,’’ and inserting ‘‘bank holding company’’; 

(G) in subsection (e)— 

(i) in paragraph (1), by striking ‘‘a nonbank financial 

company supervised by the Board of Governors or’’; 

(ii) in paragraph (3), by striking ‘‘the nonbank financial company supervised by the Board of Governors or’’ 

each place such term appears; and 

(iii) in paragraph (4), by striking ‘‘a nonbank financial company supervised by the Board of Governors 

or’’; 

(H) in subsection (g)(1), by striking ‘‘and any nonbank financial company supervised by the Board of Governors’’; 

(I) in subsection (h)— 

(i) by striking paragraph (1); 

(ii) by redesignating paragraphs (2), (3), and (4) as 

paragraphs (1), (2), and (3), respectively; 

(iii) in paragraph (1), as so redesignated, by striking 

‘‘paragraph (3)’’ each place such term appears and inserting ‘‘paragraph (2)’’; and 

(iv) in paragraph (2), as so redesignated— 

(I) in subparagraph (A), by striking ‘‘the 

nonbank financial company supervised by the 

Board of Governors or bank holding company described in subsection (a), as applicable’’ and inserting ‘‘a bank holding company described in subsection (a)’’; and 

28 

(II) in subparagraph (B), by striking ‘‘the 

nonbank financial company supervised by the 

Board of Governors or a bank holding company 

described in subsection (a), as applicable’’ and inserting ‘‘a bank holding company described in subsection (a)’’; 

(J) in subsection (i)— 

(i) in paragraph (1)— 

(I) in subparagraph (A), by striking ‘‘, in coordination with the appropriate primary financial regulatory agencies and the Federal Insurance Office,’’; 

(II) in subparagraph (B)— 

(aa) by amending clause (i) to read as follows: 

‘‘(i) shall— 

‘‘(I) issue regulations, after providing for public 

notice and comment, that provide for at least 3 

different sets of conditions under which the evaluation required by this subsection shall be conducted, including baseline, adverse, and severely 

adverse, and methodologies, including models 

used to estimate losses on certain assets, and the 

Board of Governors shall not carry out any such 

evaluation until 60 days after such regulations are 

issued; and 

‘‘(II) provide copies of such regulations to the 

Comptroller General of the United States and the 

Panel of Economic Advisors of the Congressional 

Budget Office before publishing such regulations;’’; 

(bb) in clause (ii), by striking ‘‘and nonbank 

financial companies’’; 

(cc) in clause (iv), by striking ‘‘and’’ at the 

end; 

(dd) in clause (v), by striking the period and 

inserting the following: ‘‘, including any results of a resubmitted test;’’; and 

(ee) by adding at the end the following: 

‘‘(vi) shall, in establishing the severely adverse condition under clause (i), provide detailed consideration 

of the model’s effects on financial stability and the cost 

and availability of credit; 

‘‘(vii) shall, in developing the models and methodologies and providing them for notice and comment under 

this subparagraph, publish a process to test the models and methodologies for their potential to magnify 

systemic and institutional risks instead of facilitating 

increased resiliency; 

‘‘(viii) shall design and publish a process to test and 

document the sensitivity and uncertainty associated 

with the model system’s data quality, specifications, 

and assumptions; and 

‘‘(ix) shall communicate the range and sources of uncertainty surrounding the models and methodologies.’’; 

and 

29 

(III) by adding at the end the following: 

‘‘(C) CCAR REQUIREMENTS.— ‘‘(i) PARAMETERS AND CONSEQUENCES APPLICABLE TO

CCAR.—The requirements of subparagraph (B) shall 

apply to CCAR. 

‘‘(ii) TWO-YEAR LIMITATION.—The Board of Governors 

may not subject a company to CCAR more than once 

every two years. 

‘‘(iii) MID-CYCLE RESUBMISSION.—If a company receives a quantitative objection to, or otherwise desires 

to amend the company’s capital plan, the company 

may file a new streamlined plan at any time after a 

capital planning exercise has been completed and before a subsequent capital planning exercise. 

‘‘(iv) LIMITATION ON QUALITATIVE CAPITAL PLANNING

OBJECTIONS.—In carrying out CCAR, the Board of 

Governors may not object to a company’s capital plan 

on the basis of qualitative deficiencies in the company’s capital planning process. 

‘‘(v) COMPANY INQUIRIES.—The Board of Governors 

shall establish and publish procedures for responding 

to inquiries from companies subject to CCAR, including establishing the time frame in which such responses will be made, and make such procedures publicly available. 

‘‘(vi) CCAR DEFINED.—For purposes of this subparagraph and subparagraph (E), the term ‘CCAR’ means 

the Comprehensive Capital Analysis and Review established by the Board of Governors.’’; and 

(ii) in paragraph (2)— 

(I) in subparagraph (A)— 

(aa) by striking ‘‘a bank holding company’’ 

and inserting ‘‘bank holding company’’; 

(bb) by striking ‘‘semiannual’’ and inserting 

‘‘annual’’; 

(cc) by striking ‘‘All other financial companies’’ and inserting ‘‘All other bank holding 

companies’’; and 

(dd) by striking ‘‘and are regulated by a primary Federal financial regulatory agency’’; 

(II) in subparagraph (B)— 

(aa) by striking ‘‘and to its primary financial regulatory agency’’; and 

(bb) by striking ‘‘primary financial regulatory agency’’ the second time it appears and 

inserting ‘‘Board of Governors’’; and 

(III) in subparagraph (C)— 

(aa) by striking ‘‘Each Federal primary financial regulatory agency, in coordination 

with the Board of Governors and the Federal 

Insurance Office,’’ and inserting ‘‘The Board of 

Governors’’; and 

(bb) by striking ‘‘consistent and comparable’’. 

(K) in subsection (j)— 

30 

(i) in paragraph (1), by striking ‘‘or a nonbank financial company supervised by the Board of Governors’’; 

and 

(ii) in paragraph (2), by striking ‘‘the factors described in subsections (a) and (b) of section 113 and 

any other’’ and inserting ‘‘any’’; 

(L) in subsection (k)(1), by striking ‘‘or nonbank financial 

company supervised by the Board of Governors’’; and 

(M) by adding at the end the following: 

‘‘(l) EXEMPTION FOR QUALIFYING BANKING ORGANIZATIONS.—This 

section shall not apply to a proposed acquisition by a qualifying 

banking organization, as defined under section 605 of the Financial 

CHOICE Act of 2017.’’. 

(c) TREATMENT OF OTHER RESOLUTION PLAN REQUIREMENTS.— 

(1) IN GENERAL.—With respect to an appropriate Federal 

banking agency that requires a banking organization to submit 

to the agency a resolution plan not described under section 

165(d) of the Dodd-Frank Wall Street Reform and Consumer 

Protection Act— 

(A) the agency shall comply with the requirements of 

paragraphs (3) and (4) of such section 165(d); 

(B) the agency may not require the submission of such 

a resolution plan more often than every 2 years; and 

(C) paragraphs (6) and (7) of such section 165(d) shall 

apply to such a resolution plan. 

(2) DEFINITIONS.—For purposes of this subsection, the terms 

‘‘appropriate Federal banking agency’’ and ‘‘banking organization’’ have the meaning given those terms, respectively, under 

section 105. 

(d) ACTIONS TO CREATE A BANK HOLDING COMPANY.—Section 

3(b)(1) of the Bank Holding Company Act of 1956 (12 U.S.C. 

1842(b)(1)) is amended— 

(1) by striking ‘‘Upon receiving’’ and inserting the following: 

‘‘(A) IN GENERAL.—Upon receiving’’; 

(2) by striking ‘‘Notwithstanding any other provision’’ and inserting the following: 

‘‘(B) IMMEDIATE ACTION.— ‘‘(i) IN GENERAL.—Notwithstanding any other provision’’; and 

(3) by adding at the end the following: 

‘‘(ii) EXCEPTION.—The Board may not take any action pursuant to clause (i) on an application that 

would cause any company to become a bank holding 

company unless such application involves the company 

acquiring a bank that is critically undercapitalized (as 

such term is defined under section 38(b) of the Federal 

Deposit Insurance Act).’’. 

(e) CONCENTRATION LIMITS APPLIED ONLY TO BANKING ORGANIZATIONS.—Section 14 of the Bank Holding Company Act of 1956 (12 

U.S.C. 1852) is amended— 

(1) by striking ‘‘financial company’’ each place such term appears and inserting ‘‘banking organization’’; 

(2) in subsection (a)— 

(A) by amending paragraph (2) to read as follows: 

‘‘(2) the term ‘banking organization’ means— 

31 

‘‘(A) an insured depository institution; 

‘‘(B) a bank holding company; 

‘‘(C) a savings and loan holding company; 

‘‘(D) a company that controls an insured depository institution; and 

‘‘(E) a foreign bank or company that is treated as a bank 

holding company for purposes of this Act; and’’; 

(B) in paragraph (3)— 

(i) in subparagraph (A)(ii), by adding ‘‘and’’ at the 

end; 

(ii) in subparagraph (B)(ii), by striking ‘‘; and’’ and 

inserting a period; and 

(iii) by striking subparagraph (C); and 

(3) in subsection (b), by striking ‘‘financial companies’’ and 

inserting ‘‘banking organizations’’. 

(f) CONFORMING AMENDMENT.—Section 3502(5) of title 44, United 

States Code, is amended by striking ‘‘the Office of Financial Research,’’. 

(g) CLERICAL AMENDMENT.—The table of contents under section 

1(b) of the Dodd-Frank Wall Street Reform and Consumer Protection Act is amended by striking the items relating to subtitle B of 

title I and 113, 114, 115, 116, 117, 119, 120, 121, 161, 162, 164, 

166, 167, 168, 170, 172, 174, and 175. 

SEC. 152. OPERATIONAL RISK CAPITAL REQUIREMENTS FOR BANKING 

ORGANIZATIONS. 

(a) IN GENERAL.—An appropriate Federal banking agency may 

not establish an operational risk capital requirement for banking 

organizations, unless such requirement— 

(1) is based on the risks posed by a banking organization’s 

current activities and businesses; 

(2) is appropriately sensitive to the risks posed by such current activities and businesses; 

(3) is determined under a forward-looking assessment of potential losses that may arise out of a banking organization’s 

current activities and businesses, which is not solely based on 

a banking organization’s historical losses; and 

(4) permits adjustments based on qualifying operational risk 

mitigants. 

(b) DEFINITIONS.—For purposes of this section, the terms ‘‘appropriate Federal banking agency’’ and ‘‘banking organization’’ have 

the meaning given those terms, respectively, under section 605. 

TITLE II—DEMANDING 

ACCOUNTABILITY FROM WALL STREET 

Subtitle A—SEC Penalties Modernization 

SEC. 211. ENHANCEMENT OF CIVIL PENALTIES FOR SECURITIES LAWS 

VIOLATIONS. 

(a) UPDATED CIVIL MONEY PENALTIES.— (1) SECURITIES ACT OF 1933.— (A) MONEY PENALTIES IN ADMINISTRATIVE ACTIONS.—Section 8A(g)(2) of the Securities Act of 1933 (15 U.S.C. 77h– 

1(g)(2)) is amended— 

32 

(i) in subparagraph (A)— (I) by striking ‘‘$7,500’’ and inserting ‘‘$10,000’’; 

and 

(II) by striking ‘‘$75,000’’ and inserting ‘‘$100,000’’; 

(ii) in subparagraph (B)— (I) by striking ‘‘$75,000’’ and inserting ‘‘$100,000’’; and 

(II) by striking ‘‘$375,000’’ and inserting ‘‘$500,000’’; and 

(iii) by striking subparagraph (C) and inserting the 

following: 

‘‘(C) THIRD TIER.— 

‘‘(i) IN GENERAL.—Notwithstanding subparagraphs 

(A) and (B), the amount of penalty for each such act 

or omission shall not exceed the amount specified in 

clause (ii) if— 

‘‘(I) the act or omission described in paragraph 

(1) involved fraud, deceit, manipulation, or deliberate or reckless disregard of a regulatory requirement; and 

‘‘(II) such act or omission directly or indirectly 

resulted in— 

‘‘(aa) substantial losses or created a significant risk of substantial losses to other persons; or 

‘‘(bb) substantial pecuniary gain to the person who committed the act or omission. 

‘‘(ii) MAXIMUM AMOUNT OF PENALTY.—The amount 

referred to in clause (i) is the greatest of— 

‘‘(I) $300,000 for a natural person or $1,450,000 

for any other person; 

‘‘(II) 3 times the gross amount of pecuniary gain 

to the person who committed the act or omission; 

or 

‘‘(III) the amount of losses incurred by victims 

as a result of the act or omission.’’. 

(B) MONEY PENALTIES IN CIVIL ACTIONS.—Section 

20(d)(2) of the Securities Act of 1933 (15 U.S.C. 77t(d)(2)) 

is amended— 

(i) in subparagraph (A)— (I) by striking ‘‘$5,000’’ and inserting ‘‘$10,000’’; 

and 

(II) by striking ‘‘$50,000’’ and inserting ‘‘$100,000’’; 

(ii) in subparagraph (B)— (I) by striking ‘‘$50,000’’ and inserting ‘‘$100,000’’; and 

(II) by striking ‘‘$250,000’’ and inserting 

‘‘$500,000’’; and 

(iii) by striking subparagraph (C) and inserting the 

following: 

‘‘(C) THIRD TIER.— 

‘‘(i) IN GENERAL.—Notwithstanding subparagraphs 

(A) and (B), the amount of penalty for each such violaVerDate Sep 11 2014 05:01 Jun 07, 2017 Jkt 025698 PO 00000 Frm 00032 Fmt 6659 Sfmt 6602 E:\HR\OC\HR163.XXX HR163
33 

tion shall not exceed the amount specified in clause (ii) 

if— 

‘‘(I) the violation described in paragraph (1) involved fraud, deceit, manipulation, or deliberate or 

reckless disregard of a regulatory requirement; 

and 

‘‘(II) such violation directly or indirectly resulted 

in substantial losses or created a significant risk 

of substantial losses to other persons. 

‘‘(ii) MAXIMUM AMOUNT OF PENALTY.—The amount 

referred to in clause (i) is the greatest of— 

‘‘(I) $300,000 for a natural person or $1,450,000 

for any other person; 

‘‘(II) 3 times the gross amount of pecuniary gain 

to such defendant as a result of the violation; or 

‘‘(III) the amount of losses incurred by victims 

as a result of the violation.’’. 

(2) SECURITIES EXCHANGE ACT OF 1934.— 

(A) MONEY PENALTIES IN CIVIL ACTIONS.—Section 

21(d)(3)(B) of the Securities Exchange Act of 1934 (15 

U.S.C. 78u(d)(3)(B)) is amended— 

(i) in clause (i)— 

(I) by striking ‘‘$5,000’’ and inserting ‘‘$10,000’’; 

and 

(II) by striking ‘‘$50,000’’ and inserting 

‘‘$100,000’’; 

(ii) in clause (ii)— 

(I) by striking ‘‘$50,000’’ and inserting 

‘‘$100,000’’; and 

(II) by striking ‘‘$250,000’’ and inserting 

‘‘$500,000’’; and 

(iii) by striking clause (iii) and inserting the following: 

‘‘(iii) THIRD TIER.— 

‘‘(I) IN GENERAL.—Notwithstanding clauses (i) and 

(ii), the amount of penalty for each such violation shall 

not exceed the amount specified in subclause (II) if— 

‘‘(aa) the violation described in subparagraph 

(A) involved fraud, deceit, manipulation, or deliberate or reckless disregard of a regulatory requirement; and 

‘‘(bb) such violation directly or indirectly resulted in substantial losses or created a significant risk of substantial losses to other persons. 

‘‘(II) MAXIMUM AMOUNT OF PENALTY.—The amount 

referred to in subclause (I) is the greatest of— 

‘‘(aa) $300,000 for a natural person or 

$1,450,000 for any other person; 

‘‘(bb) 3 times the gross amount of pecuniary 

gain to such defendant as a result of the violation; 

or 

‘‘(cc) the amount of losses incurred by victims as 

a result of the violation.’’. 

34 

(B) MONEY PENALTIES IN ADMINISTRATIVE ACTIONS.—Section 21B(b) of the Securities Exchange Act of 1934 (15 

U.S.C. 78u–2(b)) is amended— 

(i) in paragraph (1)— (I) by striking ‘‘$5,000’’ and inserting ‘‘$10,000’’; 

and 

(II) by striking ‘‘$50,000’’ and inserting ‘‘$100,000’’; 

(ii) in paragraph (2)— (I) by striking ‘‘$50,000’’ and inserting ‘‘$100,000’’; and 

(II) by striking ‘‘$250,000’’ and inserting ‘‘$500,000’’; and 

(iii) by striking paragraph (3) and inserting the following: 

‘‘(3) THIRD TIER.— 

‘‘(A) IN GENERAL.—Notwithstanding paragraphs (1) and 

(2), the amount of penalty for each such act or omission 

shall not exceed the amount specified in subparagraph (B) 

if— 

‘‘(i) the act or omission described in subsection (a) 

involved fraud, deceit, manipulation, or deliberate or 

reckless disregard of a regulatory requirement; and 

‘‘(ii) such act or omission directly or indirectly resulted in substantial losses or created a significant 

risk of substantial losses to other persons or resulted 

in substantial pecuniary gain to the person who committed the act or omission. 

‘‘(B) MAXIMUM AMOUNT OF PENALTY.—The amount referred to in subparagraph (A) is the greatest of— 

‘‘(i) $300,000 for a natural person or $1,450,000 for 

any other person; 

‘‘(ii) 3 times the gross amount of pecuniary gain to 

the person who committed the act or omission; or 

‘‘(iii) the amount of losses incurred by victims as a 

result of the act or omission.’’. 

(3) INVESTMENT COMPANY ACT OF 1940.— (A) MONEY PENALTIES IN ADMINISTRATIVE ACTIONS.—Section 9(d)(2) of the Investment Company Act of 1940 (15 

U.S.C. 80a–9(d)(2)) is amended— 

(i) in subparagraph (A)— (I) by striking ‘‘$5,000’’ and inserting ‘‘$10,000’’; 

and 

(II) by striking ‘‘$50,000’’ and inserting ‘‘$100,000’’; 

(ii) in subparagraph (B)— (I) by striking ‘‘$50,000’’ and inserting ‘‘$100,000’’; and 

(II) by striking ‘‘$250,000’’ and inserting ‘‘$500,000’’; and 

(iii) by striking subparagraph (C) and inserting the 

following: 

‘‘(C) THIRD TIER.— 

‘‘(i) IN GENERAL.—Notwithstanding subparagraphs 

(A) and (B), the amount of penalty for each such act 

35 

or omission shall not exceed the amount specified in 

clause (ii) if— 

‘‘(I) the act or omission described in paragraph 

(1) involved fraud, deceit, manipulation, or deliberate or reckless disregard of a regulatory requirement; and 

‘‘(II) such act or omission directly or indirectly 

resulted in substantial losses or created a significant risk of substantial losses to other persons or 

resulted in substantial pecuniary gain to the person who committed the act or omission. 

‘‘(ii) MAXIMUM AMOUNT OF PENALTY.—The amount 

referred to in clause (i) is the greatest of— 

‘‘(I) $300,000 for a natural person or $1,450,000 

for any other person; 

‘‘(II) 3 times the gross amount of pecuniary gain 

to the person who committed the act or omission; 

or 

‘‘(III) the amount of losses incurred by victims 

as a result of the act or omission.’’. 

(B) MONEY PENALTIES IN CIVIL ACTIONS.—Section 

42(e)(2) of the Investment Company Act of 1940 (15 U.S.C. 

80a–41(e)(2)) is amended— 

(i) in subparagraph (A)— (I) by striking ‘‘$5,000’’ and inserting ‘‘$10,000’’; 

and 

(II) by striking ‘‘$50,000’’ and inserting ‘‘$100,000’’; 

(ii) in subparagraph (B)— (I) by striking ‘‘$50,000’’ and inserting ‘‘$100,000’’; and 

(II) by striking ‘‘$250,000’’ and inserting ‘‘$500,000’’; and 

(iii) by striking subparagraph (C) and inserting the 

following: 

‘‘(C) THIRD TIER.— ‘‘(i) IN GENERAL.—Notwithstanding subparagraphs 

(A) and (B), the amount of penalty for each such violation shall not exceed the amount specified in clause (ii) 

if— 

‘‘(I) the violation described in paragraph (1) involved fraud, deceit, manipulation, or deliberate or 

reckless disregard of a regulatory requirement; 

and 

‘‘(II) such violation directly or indirectly resulted 

in substantial losses or created a significant risk 

of substantial losses to other persons. 

‘‘(ii) MAXIMUM AMOUNT OF PENALTY.—The amount 

referred to in clause (i) is the greatest of— 

‘‘(I) $300,000 for a natural person or $1,450,000 

for any other person; 

‘‘(II) 3 times the gross amount of pecuniary gain 

to such defendant as a result of the violation; or 

‘‘(III) the amount of losses incurred by victims 

as a result of the violation.’’. 

36 

(4) INVESTMENT ADVISERS ACT OF 1940.— (A) MONEY PENALTIES IN ADMINISTRATIVE ACTIONS.—Section 203(i)(2) of the Investment Advisers Act of 1940 (15 

U.S.C. 80b–3(i)(2)) is amended— 

(i) in subparagraph (A)— (I) by striking ‘‘$5,000’’ and inserting ‘‘$10,000’’; 

and 

(II) by striking ‘‘$50,000’’ and inserting ‘‘$100,000’’; 

(ii) in subparagraph (B)— (I) by striking ‘‘$50,000’’ and inserting ‘‘$100,000’’; and 

(II) by striking ‘‘$250,000’’ and inserting ‘‘$500,000’’; and 

(iii) by striking subparagraph (C) and inserting the 

following: 

‘‘(C) THIRD TIER.— 

‘‘(i) IN GENERAL.—Notwithstanding subparagraphs 

(A) and (B), the amount of penalty for each such act 

or omission shall not exceed the amount specified in 

clause (ii) if— 

‘‘(I) the act or omission described in paragraph 

(1) involved fraud, deceit, manipulation, or deliberate or reckless disregard of a regulatory requirement; and 

‘‘(II) such act or omission directly or indirectly 

resulted in substantial losses or created a significant risk of substantial losses to other persons or 

resulted in substantial pecuniary gain to the person who committed the act or omission. 

‘‘(ii) MAXIMUM AMOUNT OF PENALTY.—The amount 

referred to in clause (i) is the greatest of— ‘‘(I) $300,000 for a natural person or $1,450,000 

for any other person; 

‘‘(II) 3 times the gross amount of pecuniary gain 

to the person who committed the act or omission; 

or 

‘‘(III) the amount of losses incurred by victims 

as a result of the act or omission.’’. 

(B) MONEY PENALTIES IN CIVIL ACTIONS.—Section 

209(e)(2) of the Investment Advisers Act of 1940 (15 U.S.C. 

80b–9(e)(2)) is amended— 

(i) in subparagraph (A)— 

(I) by striking ‘‘$5,000’’ and inserting ‘‘$10,000’’; 

and 

(II) by striking ‘‘$50,000’’ and inserting 

‘‘$100,000’’; 

(ii) in subparagraph (B)— 

(I) by striking ‘‘$50,000’’ and inserting 

‘‘$100,000’’; and 

(II) by striking ‘‘$250,000’’ and inserting 

‘‘$500,000’’; and 

(iii) by striking subparagraph (C) and inserting the 

following: 

‘‘(C) THIRD TIER.— 

37 

‘‘(i) IN GENERAL.—Notwithstanding subparagraphs 

(A) and (B), the amount of penalty for each such violation shall not exceed the amount specified in clause (ii) 

if— 

‘‘(I) the violation described in paragraph (1) involved fraud, deceit, manipulation, or deliberate or 

reckless disregard of a regulatory requirement; 

and 

‘‘(II) such violation directly or indirectly resulted 

in substantial losses or created a significant risk 

of substantial losses to other persons. 

‘‘(ii) MAXIMUM AMOUNT OF PENALTY.—The amount 

referred to in clause (i) is the greatest of— 

‘‘(I) $300,000 for a natural person or $1,450,000 

for any other person; 

‘‘(II) 3 times the gross amount of pecuniary gain 

to such defendant as a result of the violation; or 

‘‘(III) the amount of losses incurred by victims 

as a result of the violation.’’. 

(b) PENALTIES FOR RECIDIVISTS.— 

(1) SECURITIES ACT OF 1933.— (A) MONEY PENALTIES IN ADMINISTRATIVE ACTIONS.—Section 8A(g)(2) of the Securities Act of 1933 (15 U.S.C. 77h– 

1(g)(2)) is amended by adding at the end the following: 

‘‘(D) FOURTH TIER.—Notwithstanding subparagraphs (A), 

(B), and (C), the maximum amount of penalty for each 

such act or omission shall be 3 times the otherwise applicable amount in such subparagraphs if, within the 5-year 

period preceding such act or omission, the person who 

committed the act or omission was criminally convicted for 

securities fraud or became subject to a judgment or order 

imposing monetary, equitable, or administrative relief in 

any Commission action alleging fraud by that person.’’. 

(B) MONEY PENALTIES IN CIVIL ACTIONS.—Section 

20(d)(2) of the Securities Act of 1933 (15 U.S.C. 77t(d)(2)) 

is amended by adding at the end the following: 

‘‘(D) FOURTH TIER.—Notwithstanding subparagraphs (A), 

(B), and (C), the maximum amount of penalty for each 

such violation shall be 3 times the otherwise applicable 

amount in such subparagraphs if, within the 5-year period 

preceding such violation, the defendant was criminally 

convicted for securities fraud or became subject to a judgment or order imposing monetary, equitable, or administrative relief in any Commission action alleging fraud by 

that defendant.’’. 

(2) SECURITIES EXCHANGE ACT OF 1934.— 

(A) MONEY PENALTIES IN CIVIL ACTIONS.—Section 

21(d)(3)(B) of the Securities Exchange Act of 1934 (15 

U.S.C. 78u(d)(3)(B)) is amended by adding at the end the 

following: 

‘‘(iv) FOURTH TIER.—Notwithstanding clauses (i), (ii), 

and (iii), the maximum amount of penalty for each 

such violation shall be 3 times the otherwise applicable amount in such clauses if, within the 5-year period 

preceding such violation, the defendant was criminally 

38 

convicted for securities fraud or became subject to a 

judgment or order imposing monetary, equitable, or 

administrative relief in any Commission action alleging fraud by that defendant.’’. 

(B) MONEY PENALTIES IN ADMINISTRATIVE ACTIONS.—Section 21B(b) of the Securities Exchange Act of 1934 (15 

U.S.C. 78u–2(b)) is amended by adding at the end the following: 

‘‘(4) FOURTH TIER.—Notwithstanding paragraphs (1), (2), and 

(3), the maximum amount of penalty for each such act or omission shall be 3 times the otherwise applicable amount in such 

paragraphs if, within the 5-year period preceding such act or 

omission, the person who committed the act or omission was 

criminally convicted for securities fraud or became subject to a 

judgment or order imposing monetary, equitable, or administrative relief in any Commission action alleging fraud by that 

person.’’. 

(3) INVESTMENT COMPANY ACT OF 1940.— (A) MONEY PENALTIES IN ADMINISTRATIVE ACTIONS.—Section 9(d)(2) of the Investment Company Act of 1940 (15 

U.S.C. 80a–9(d)(2)) is amended by adding at the end the 

following: 

‘‘(D) FOURTH TIER.—Notwithstanding subparagraphs (A), 

(B), and (C), the maximum amount of penalty for each 

such act or omission shall be 3 times the otherwise applicable amount in such subparagraphs if, within the 5-year 

period preceding such act or omission, the person who 

committed the act or omission was criminally convicted for 

securities fraud or became subject to a judgment or order 

imposing monetary, equitable, or administrative relief in 

any Commission action alleging fraud by that person.’’. 

(B) MONEY PENALTIES IN CIVIL ACTIONS.—Section 

42(e)(2) of the Investment Company Act of 1940 (15 U.S.C. 

80a–41(e)(2)) is amended by adding at the end the following: 

‘‘(D) FOURTH TIER.—Notwithstanding subparagraphs (A), 

(B), and (C), the maximum amount of penalty for each 

such violation shall be 3 times the otherwise applicable 

amount in such subparagraphs if, within the 5-year period 

preceding such violation, the defendant was criminally 

convicted for securities fraud or became subject to a judgment or order imposing monetary, equitable, or administrative relief in any Commission action alleging fraud by 

that defendant.’’. 

(4) INVESTMENT ADVISERS ACT OF 1940.— 

(A) MONEY PENALTIES IN ADMINISTRATIVE ACTIONS.—Section 203(i)(2) of the Investment Advisers Act of 1940 (15 

U.S.C. 80b–3(i)(2)) is amended by adding at the end the 

following: 

‘‘(D) FOURTH TIER.—Notwithstanding subparagraphs (A), 

(B), and (C), the maximum amount of penalty for each 

such act or omission shall be 3 times the otherwise applicable amount in such subparagraphs if, within the 5-year 

period preceding such act or omission, the person who 

committed the act or omission was criminally convicted for 

39 

securities fraud or became subject to a judgment or order 

imposing monetary, equitable, or administrative relief in 

any Commission action alleging fraud by that person.’’. 

(B) MONEY PENALTIES IN CIVIL ACTIONS.—Section 

209(e)(2) of the Investment Advisers Act of 1940 (15 U.S.C. 

80b–9(e)(2)) is amended by adding at the end the following: 

‘‘(D) FOURTH TIER.—Notwithstanding subparagraphs (A), 

(B), and (C), the maximum amount of penalty for each 

such violation shall be 3 times the otherwise applicable 

amount in such subparagraphs if, within the 5-year period 

preceding such violation, the defendant was criminally 

convicted for securities fraud or became subject to a judgment or order imposing monetary, equitable, or administrative relief in any Commission action alleging fraud by 

that defendant.’’. 

(c) VIOLATIONS OF INJUNCTIONS AND BARS.— 

(1) SECURITIES ACT OF 1933.—Section 20(d) of the Securities 

Act of 1933 (15 U.S.C. 77t(d)) is amended— 

(A) in paragraph (1), by inserting after ‘‘the rules or regulations thereunder,’’ the following: ‘‘a Federal court injunction or a bar obtained or entered by the Commission 

under this title,’’; and 

(B) by striking paragraph (4) and inserting the following: 

‘‘(4) SPECIAL PROVISIONS RELATING TO A VIOLATION OF AN IN- JUNCTION OR CERTAIN ORDERS.— ‘‘(A) IN GENERAL.—Each separate violation of an injunction or order described in subparagraph (B) shall be a separate offense, except that in the case of a violation through 

a continuing failure to comply with such injunction or 

order, each day of the failure to comply with the injunction 

or order shall be deemed a separate offense. 

‘‘(B) INJUNCTIONS AND ORDERS.—Subparagraph (A) shall 

apply with respect to any action to enforce— 

‘‘(i) a Federal court injunction obtained pursuant to 

this title; 

‘‘(ii) an order entered or obtained by the Commission 

pursuant to this title that bars, suspends, places limitations on the activities or functions of, or prohibits 

the activities of, a person; or 

‘‘(iii) a cease-and-desist order entered by the Commission pursuant to section 8A.’’. 

(2) SECURITIES EXCHANGE ACT OF 1934.—Section 21(d)(3) of 

the Securities Exchange Act of 1934 (15 U.S.C. 78u(d)(3)) is 

amended— 

(A) in subparagraph (A), by inserting after ‘‘the rules or 

regulations thereunder,’’ the following: ‘‘a Federal court injunction or a bar obtained or entered by the Commission 

under this title,’’; and 

(B) by striking subparagraph (D) and inserting the following: 

‘‘(D) SPECIAL PROVISIONS RELATING TO A VIOLATION OF AN IN- JUNCTION OR CERTAIN ORDERS.— 

‘‘(i) IN GENERAL.—Each separate violation of an injunction or order described in clause (ii) shall be a separate ofVerDate Sep 11 2014 05:01 Jun 07, 2017 Jkt 025698 PO 00000 Frm 00039 Fmt 6659 Sfmt 6602 E:\HR\OC\HR163.XXX HR163
40 

fense, except that in the case of a violation through a continuing failure to comply with such injunction or order, 

each day of the failure to comply with the injunction or 

order shall be deemed a separate offense. 

‘‘(ii) INJUNCTIONS AND ORDERS.—Clause (i) shall apply 

with respect to an action to enforce— 

‘‘(I) a Federal court injunction obtained pursuant to 

this title; 

‘‘(II) an order entered or obtained by the Commission pursuant to this title that bars, suspends, places 

limitations on the activities or functions of, or prohibits the activities of, a person; or 

‘‘(III) a cease-and-desist order entered by the Commission pursuant to section 21C.’’. 

(3) INVESTMENT COMPANY ACT OF 1940.—Section 42(e) of the 

Investment Company Act of 1940 (15 U.S.C. 80a–41(e)) is 

amended— 

(A) in paragraph (1), by inserting after ‘‘the rules or regulations thereunder,’’ the following: ‘‘a Federal court injunction or a bar obtained or entered by the Commission 

under this title,’’; and 

(B) by striking paragraph (4) and inserting the following: 

‘‘(4) SPECIAL PROVISIONS RELATING TO A VIOLATION OF AN INJUNCTION OR CERTAIN ORDERS.— 

‘‘(A) IN GENERAL.—Each separate violation of an injunction or order described in subparagraph (B) shall be a separate offense, except that in the case of a violation through 

a continuing failure to comply with such injunction or 

order, each day of the failure to comply with the injunction 

or order shall be deemed a separate offense. 

‘‘(B) INJUNCTIONS AND ORDERS.—Subparagraph (A) shall 

apply with respect to any action to enforce— 

‘‘(i) a Federal court injunction obtained pursuant to 

this title; 

‘‘(ii) an order entered or obtained by the Commission 

pursuant to this title that bars, suspends, places limitations on the activities or functions of, or prohibits 

the activities of, a person; or 

‘‘(iii) a cease-and-desist order entered by the Commission pursuant to section 9(f).’’. 

(4) INVESTMENT ADVISERS ACT OF 1940.—Section 209(e) of the 

Investment Advisers Act of 1940 (15 U.S.C. 80b–9(e)) is 

amended— 

(A) in paragraph (1), by inserting after ‘‘the rules or regulations thereunder,’’ the following: ‘‘a Federal court injunction or a bar obtained or entered by the Commission 

under this title,’’; and 

(B) by striking paragraph (4) and inserting the following: 

‘‘(4) SPECIAL PROVISIONS RELATING TO A VIOLATION OF AN INJUNCTION OR CERTAIN ORDERS.— 

‘‘(A) IN GENERAL.—Each separate violation of an injunction or order described in subparagraph (B) shall be a separate offense, except that in the case of a violation through 

a continuing failure to comply with such injunction or 

41 

order, each day of the failure to comply with the injunction 

or order shall be deemed a separate offense. 

‘‘(B) INJUNCTIONS AND ORDERS.—Subparagraph (A) shall 

apply with respect to any action to enforce— 

‘‘(i) a Federal court injunction obtained pursuant to 

this title; 

‘‘(ii) an order entered or obtained by the Commission 

pursuant to this title that bars, suspends, places limitations on the activities or functions of, or prohibits 

the activities of, a person; or 

‘‘(iii) a cease-and-desist order entered by the Commission pursuant to section 203(k).’’. 

(d) EFFECTIVE DATE.—The amendments made by this section 

shall apply with respect to conduct that occurs after the date of the 

enactment of this Act. 

SEC. 212. UPDATED CIVIL MONEY PENALTIES OF PUBLIC COMPANY 

ACCOUNTING OVERSIGHT BOARD. 

(a) IN GENERAL.—Section 105(c)(4)(D) of the Sarbanes-Oxley Act 

of 2002 (15 U.S.C. 7215(c)(4)(D)) is amended— 

(1) in clause (i)— 

(A) by striking ‘‘$100,000’’ and inserting ‘‘$200,000’’; and 

(B) by striking ‘‘$2,000,000’’ and inserting ‘‘$4,000,000’’; 

and 

(2) in clause (ii)— 

(A) by striking ‘‘$750,000’’ and inserting ‘‘$1,500,000’’; 

and 

(B) by striking ‘‘$15,000,000’’ and inserting 

‘‘$22,000,000’’. 

(b) EFFECTIVE DATE.—The amendments made by this section 

shall apply with respect to conduct that occurs after the date of the 

enactment of this Act. 

SEC. 213. UPDATED CIVIL MONEY PENALTY FOR CONTROLLING PERSONS IN CONNECTION WITH INSIDER TRADING. 

(a) IN GENERAL.—Section 21A(a)(3) of the Securities Exchange 

Act of 1934 (15 U.S.C. 78u–1(a)(3)) is amended by striking 

‘‘$1,000,000’’ and inserting ‘‘$2,500,000’’. 

(b) EFFECTIVE DATE.—The amendment made by this section shall 

apply with respect to conduct that occurs after the date of the enactment of this Act. 

SEC. 214. UPDATE OF CERTAIN OTHER PENALTIES. 

(a) IN GENERAL.—Section 32 of the Securities Exchange Act of 

1934 (15 U.S.C. 78ff) is amended— 

(1) in subsection (a), by striking ‘‘$5,000,000’’ and inserting 

‘‘$7,000,000’’; and 

(2) in subsection (c)— 

(A) in paragraph (1)— 

(i) in subparagraph (A), by striking ‘‘$2,000,000’’ and 

inserting ‘‘$4,000,000’’; and 

(ii) in subparagraph (B), by striking ‘‘$10,000’’ and 

inserting ‘‘$50,000’’; and 

(B) in paragraph (2)— 

(i) in subparagraph (A), by striking ‘‘$100,000’’ and 

inserting ‘‘$250,000’’; and 

42 

(ii) in subparagraph (B), by striking ‘‘$10,000’’ and 

inserting ‘‘$50,000’’. 

(b) EFFECTIVE DATE.—The amendments made by this section 

shall apply with respect to conduct that occurs after the date of the 

enactment of this Act. 

SEC. 215. MONETARY SANCTIONS TO BE USED FOR THE RELIEF OF 

VICTIMS. 

(a) IN GENERAL.—Section 308(a) of the Sarbanes-Oxley Act of 

2002 (15 U.S.C. 7246(a)) is amended to read as follows: 

‘‘(a) MONETARY SANCTIONS TO BE USED FOR THE RELIEF OF VICTIMS.— 

‘‘(1) IN GENERAL.—If, in any judicial or administrative action 

brought by the Commission under the securities laws, the 

Commission obtains a monetary sanction (as defined in section 

21F(a) of the Securities Exchange Act of 1934) against any person for a violation of such laws, or such person agrees, in settlement of any such action, to such monetary sanction, the 

amount of such monetary sanction shall, on the motion or at 

the direction of the Commission, be added to and become part 

of a disgorgement fund or other fund established for the benefit of the victims of such violation. 

‘‘(2) DEFINITION OF VICTIM.—In this subsection, the term ‘victim’ has the meaning given the term ‘crime victim’ in section 

3771(e) of title 18, United States Code.’’. 

(b) MONETARY SANCTION DEFINED.—Section 21F(a)(4)(A) of the 

Securities Exchange Act of 1934 (15 U.S.C. 78u–6(a)(4)(A)) is 

amended by striking ‘‘ordered’’ and inserting ‘‘required’’. 

(c) EFFECTIVE DATE.—The amendments made by this section 

apply with respect to any monetary sanction ordered or required to 

be paid before or after the date of enactment of this Act. 

SEC. 216. GAO REPORT ON USE OF CIVIL MONEY PENALTY AUTHORITY 

BY COMMISSION. 

(a) IN GENERAL.—Not later than 2 years after the date of the enactment of this Act, the Comptroller General of the United States 

shall submit to the Committee on Financial Services of the House 

of Representatives and the Committee on Banking, Housing, and 

Urban Affairs of the Senate a report on the use by the Commission 

of the authority to impose or obtain civil money penalties for violations of the securities laws during the period beginning on June 1, 

2010, and ending on the date of the enactment of this Act. 

(b) MATTERS REQUIRED TO BE INCLUDED.—The matters covered 

by the report required by subsection (a) shall include the following: 

(1) The types of violations for which civil money penalties 

were imposed or obtained. 

(2) The types of persons on whom civil money penalties were 

imposed or from whom such penalties were obtained. 

(3) The number and dollar amount of civil money penalties 

imposed or obtained, disaggregated as follows: 

(A) Penalties imposed in administrative actions and penalties obtained in judicial actions. 

(B) Penalties imposed on or obtained from issuers (individual and aggregate filers) and penalties imposed on or 

obtained from other persons. 

43 

(C) Penalties permitted to be retained for use by the 

Commission and penalties deposited in the general fund of 

the Treasury of the United States. 

(4) For penalties imposed on or obtained from issuers: 

(A) Whether the violations involved resulted in direct 

economic benefit to the issuers. 

(B) The impact of the penalties on the shareholders of 

the issuers. 

(c) DEFINITIONS.—In this section, the terms ‘‘Commission’’, 

‘‘issuer’’, and ‘‘securities laws’’ have the meanings given such terms 

in section 3(a) of the Securities Exchange Act of 1934 (15 U.S.C. 

78c(a)). 

Subtitle B—FIRREA Penalties 

Modernization 

SEC. 221. INCREASE OF CIVIL AND CRIMINAL PENALTIES ORIGINALLY 

ESTABLISHED IN THE FINANCIAL INSTITUTIONS REFORM, 

RECOVERY, AND ENFORCEMENT ACT OF 1989. 

(a) AMENDMENTS TO FIRREA.—Section 951(b) of the Financial 

Institutions Reform, Recovery, and Enforcement Act of 1989 (12 

U.S.C. 1833a(b)) is amended— 

(1) in paragraph (1), by striking ‘‘$1,000,000’’ and inserting 

‘‘$1,500,000’’; and 

(2) in paragraph (2), by striking ‘‘$1,000,000 per day or 

$5,000,000’’ and inserting ‘‘$1,500,000 per day or $7,500,000’’. 

(b) AMENDMENTS TO THE HOME OWNERS’ LOAN ACT.—The Home 

Owners’ Loan Act (12 U.S.C. 1461 et seq.) is amended— 

(1) in section 5(v)(6), by striking ‘‘$1,000,000’’ and inserting 

‘‘$1,500,000’’; and 

(2) in section 10— 

(A) in subsection (r)(3), by striking ‘‘$1,000,000’’ and inserting ‘‘$1,500,000’’; and 

(B) in subsection (i)(1)(B), by striking ‘‘$1,000,000’’ and 

inserting ‘‘$1,500,000’’. 

(c) AMENDMENTS TO THE FEDERAL DEPOSIT INSURANCE ACT.—The 

Federal Deposit Insurance Act (12 U.S.C. 1811 et seq.) is amended— 

(1) in section 7— 

(A) in subsection (a)(1), by striking ‘‘$1,000,000’’ and inserting ‘‘$1,500,000’’; and 

(B) in subsection (j)(16)(D), by striking ‘‘$1,000,000’’ each 

place such term appears and inserting ‘‘$1,500,000’’; 

(2) in section 8— 

(A) in subsection (i)(2)(D), by striking ‘‘$1,000,000’’ each 

place such term appears and inserting ‘‘$1,500,000’’; and 

(B) in subsection (j), by striking ‘‘$1,000,000’’ and inserting ‘‘$1,500,000’’; and 

(3) in section 19(b), by striking ‘‘$1,000,000’’ and inserting 

‘‘$1,500,000’’. 

(d) AMENDMENTS TO THE FEDERAL CREDIT UNION ACT.—The Federal Credit Union Act (12 U.S.C. 1751 et seq.) is amended— (1) in section 202(a)(3), by striking ‘‘$1,000,000’’ and inserting ‘‘$1,500,000’’; 

44 

(2) in section 205(d)(3), by striking ‘‘$1,000,000’’ and insert- ing ‘‘$1,500,000’’; and 

(3) in section 206— 

(A) in subsection (k)(2)(D), by striking ‘‘$1,000,000’’ each place such term appears and inserting ‘‘$1,500,000’’; and (B) in subsection (l), by striking ‘‘$1,000,000’’ and insert- ing ‘‘$1,500,000’’. 

(e) AMENDMENTS TO THE REVISED STATUTES OF THE UNITED

STATES.—Title LXII of the Revised Statutes of the United States is 

amended— 

(1) in section 5213(c), by striking ‘‘$1,000,000’’ and inserting ‘‘$1,500,000’’; and 

(2) in section 5239(b)(4), by striking ‘‘$1,000,000’’ each place such term appears and inserting ‘‘$1,500,000’’. 

(f) AMENDMENTS TO THE FEDERAL RESERVE ACT.—The Federal 

Reserve Act (12 U.S.C. 221 et seq.) is amended— 

(1) in the 6th undesignated paragraph of section 9, by striking ‘‘$1,000,000’’ and inserting ‘‘$1,500,000’’; 

(2) in section 19(l)(4), by striking ‘‘$1,000,000’’ each place 

such term appears and inserting ‘‘$1,500,000’’; and 

(3) in section 29(d), by striking ‘‘$1,000,000’’ each place such 

term appears and inserting ‘‘$1,500,000’’. 

(g) AMENDMENTS TO THE BANK HOLDING COMPANY ACT AMEND- MENTS OF 1970.—Section 106(b)(2)(F)(iv) of the Bank Holding Company Act Amendments of 1970 (12 U.S.C. 1978(b)(2)(F)(iv)) is 

amended by striking ‘‘$1,000,000’’ each place such term appears 

and inserting ‘‘$1,500,000’’. 

(h) AMENDMENTS TO THE BANK HOLDING COMPANY ACT OF

1956.—Section 8 of the Bank Holding Company Act of 1956 (12 

U.S.C. 1847) is amended— 

(1) in subsection (a)(2), by striking ‘‘$1,000,000’’ and insert- ing ‘‘$1,500,000’’; and (2) in subsection (d)(3), by striking ‘‘$1,000,000’’ and insert- ing ‘‘$1,500,000’’. 

(i) AMENDMENTS TO TITLE 18, UNITED STATES CODE.—Title 18, 

United States Code, is amended— 

(1) in section 215(a) of chapter 11, by striking ‘‘$1,000,000’’ and inserting ‘‘$1,500,000’’; 

(2) in chapter 31— (A) in section 656, by striking ‘‘$1,000,000’’ and inserting ‘‘$1,500,000’’; and 

(B) in section 657, by striking ‘‘$1,000,000’’ and inserting ‘‘$1,500,000’’; 

(3) in chapter 47— (A) in section 1005, by striking ‘‘$1,000,000’’ and insert- ing ‘‘$1,500,000’’; (B) in section 1006, by striking ‘‘$1,000,000’’ and insert- ing ‘‘$1,500,000’’; (C) in section 1007, by striking ‘‘$1,000,000’’ and insert- ing ‘‘$1,500,000’’; and 

(D) in section 1014, by striking ‘‘$1,000,000’’ and inserting ‘‘$1,500,000’’; and 

(4) in chapter 63— 

(A) in section 1341, by striking ‘‘$1,000,000’’ and inserting ‘‘$1,500,000’’; 

45 

(B) in section 1343, by striking ‘‘$1,000,000’’ and inserting ‘‘$1,500,000’’; and 

(C) in section 1344, by striking ‘‘$1,000,000’’ and inserting ‘‘$1,500,000’’. 

TITLE III—DEMANDING ACCOUNTABILITY FROM FINANCIAL REGULATORS AND DEVOLVING POWER 

AWAY FROM WASHINGTON 

Subtitle A—Cost-Benefit Analyses 

SEC. 311. DEFINITIONS. 

As used in this subtitle— 

(1) the term ‘‘agency’’ means the Board of Governors of the 

Federal Reserve System, the Consumer Law Enforcement 

Agency, the Commodity Futures Trading Commission, the Federal Deposit Insurance Corporation, the Federal Housing Finance Agency, the Office of the Comptroller of the Currency, 

the National Credit Union Administration, and the Securities 

and Exchange Commission; 

(2) the term ‘‘chief economist’’ means— 

(A) with respect to the Board of Governors of the Federal 

Reserve System, the Director of the Division of Research 

and Statistics, or an employee of the agency with comparable authority; 

(B) with respect to the Consumer Law Enforcement 

Agency, the Head of the Office of Economic Analysis, or an 

employee of the agency with comparable authority; 

(C) with respect to the Commodity Futures Trading 

Commission, the Chief Economist, or an employee of the 

agency with comparable authority; 

(D) with respect to the Federal Deposit Insurance Corporation, the Director of the Division of Insurance and Research, or an employee of the agency with comparable authority; 

(E) with respect to the Federal Housing Finance Agency, 

the Chief Economist, or an employee of the agency with 

comparable authority; 

(F) with respect to the Office of the Comptroller of the 

Currency, the Director for Policy Analysis, or an employee 

of the agency with comparable authority; 

(G) with respect to the National Credit Union Administration, the Chief Economist, or an employee of the agency 

with comparable authority; and 

(H) with respect to the Securities and Exchange Commission, the Director of the Division of Economic and Risk 

Analysis, or an employee of the agency with comparable 

authority; 

(3) the term ‘‘Council’’ means the Chief Economists Council 

established under section 318; and 

(4) the term ‘‘regulation’’— 

46 

(A) means an agency statement of general applicability 

and future effect that is designed to implement, interpret, 

or prescribe law or policy or to describe the procedure or 

practice requirements of an agency, including rules, orders 

of general applicability, interpretive releases, and other 

statements of general applicability that the agency intends 

to have the force and effect of law; and 

(B) does not include— 

(i) a regulation issued in accordance with the formal 

rulemaking provisions of section 556 or 557 of title 5, 

United States Code; 

(ii) a regulation that is limited to agency organization, management, or personnel matters; 

(iii) a regulation promulgated pursuant to statutory 

authority that expressly prohibits compliance with this 

provision; 

(iv) a regulation that is certified by the agency to be 

an emergency action, if such certification is published 

in the Federal Register; 

(v) a regulation that is promulgated by the Board of 

Governors of the Federal Reserve System or the Federal Open Market Committee under section 10A, 10B, 

13, 13A, or 19 of the Federal Reserve Act, or any of 

subsections (a) through (f) of section 14 of that Act; 

(vi) a regulation filed with the Securities and Exchange Commission by the Public Company Accounting Oversight Board, the Municipal Securities Rulemaking Board, or any national securities association 

registered under section 15A of the Securities Exchange Act of 1934 (15 U.S.C. 78o–3(a)) for which the 

board or association has itself conducted the cost-benefit analysis and otherwise complied with the requirements of section 312; or 

(vii) a regulation filed with the Securities and Exchange Commission by a national securities association registered under section 15A(k) of the Securities 

Exchange Act of 1934 (15 U.S.C. 78o–3(k)). 

SEC. 312. REQUIRED REGULATORY ANALYSIS. 

(a) REQUIREMENTS FOR NOTICES OF PROPOSED RULEMAKING.—An 

agency may not issue a notice of proposed rulemaking unless the 

agency includes in the notice of proposed rulemaking an analysis 

that contains, at a minimum, with respect to each regulation that 

is being proposed— 

(1) an identification of the need for the regulation and the 

regulatory objective, including identification of the nature and 

significance of the market failure, regulatory failure, or other 

problem that necessitates the regulation; 

(2) an explanation of why the private market or State, local, 

or tribal authorities cannot adequately address the identified 

market failure or other problem; 

(3) an analysis of the adverse impacts to regulated entities, 

other market participants, economic activity, or agency effectiveness that are engendered by the regulation and the magnitude of such adverse impacts; 

47 

(4) a quantitative and qualitative assessment of all anticipated direct and indirect costs and benefits of the regulation 

(as compared to a benchmark that assumes the absence of the 

regulation), including— 

(A) compliance costs; 

(B) effects on economic activity, net job creation (excluding jobs related to ensuring compliance with the regulation), efficiency, competition, and capital formation; 

(C) regulatory administrative costs; and 

(D) costs imposed by the regulation on State, local, or 

tribal governments or other regulatory authorities; 

(5) if quantified benefits do not outweigh quantitative costs, 

a justification for the regulation; 

(6) an identification and assessment of all available alternatives to the regulation, including modification of an existing 

regulation or statute, together with— 

(A) an explanation of why the regulation meets the objectives of the regulation more effectively than the alternatives, and if the agency is proposing multiple alternatives, an explanation of why a notice of proposed rulemaking, rather than an advanced notice of proposed rulemaking, is appropriate; and 

(B) if the regulation is not a pilot program, an explanation of why a pilot program is not appropriate; 

(7) if the regulation specifies the behavior or manner of compliance, an explanation of why the agency did not instead 

specify performance objectives; 

(8) an assessment of how the burden imposed by the regulation will be distributed among market participants, including 

whether consumers, investors, small businesses, or independent financial firms and advisors will be disproportionately 

burdened; 

(9) an assessment of the extent to which the regulation is inconsistent, incompatible, or duplicative with the existing regulations of the agency or those of other domestic and international regulatory authorities with overlapping jurisdiction; 

(10) a description of any studies, surveys, or other data relied upon in preparing the analysis; 

(11) an assessment of the degree to which the key assumptions underlying the analysis are subject to uncertainty; and 

(12) an explanation of predicted changes in market structure 

and infrastructure and in behavior by market participants, including consumers and investors, assuming that they will pursue their economic interests. 

(b) REQUIREMENTS FOR NOTICES OF FINAL RULEMAKING.— 

(1) IN GENERAL.—Notwithstanding any other provision of 

law, an agency may not issue a notice of final rulemaking with 

respect to a regulation unless the agency— 

(A) has issued a notice of proposed rulemaking for the 

relevant regulation; 

(B) has conducted and includes in the notice of final 

rulemaking an analysis that contains, at a minimum, the 

elements required under subsection (a); and 

48 

(C) includes in the notice of final rulemaking regulatory 

impact metrics selected by the chief economist to be used 

in preparing the report required pursuant to section 315. 

(2) CONSIDERATION OF COMMENTS.—The agency shall incorporate in the elements described in paragraph (1)(B) the data 

and analyses provided to the agency by commenters during the 

comment period, or explain why the data or analyses are not 

being incorporated. 

(3) COMMENT PERIOD.—An agency shall not publish a notice 

of final rulemaking with respect to a regulation, unless the 

agency— 

(A) has allowed at least 90 days from the date of publication in the Federal Register of the notice of proposed 

rulemaking for the submission of public comments; or 

(B) includes in the notice of final rulemaking an explanation of why the agency was not able to provide a 90-day 

comment period. 

(4) PROHIBITED RULES.— 

(A) IN GENERAL.—An agency may not publish a notice of 

final rulemaking if the agency, in its analysis under paragraph (1)(B), determines that the quantified costs are 

greater than the quantified benefits under subsection 

(a)(5). 

(B) PUBLICATION OF ANALYSIS.—If the agency is precluded by subparagraph (A) from publishing a notice of 

final rulemaking, the agency shall publish in the Federal 

Register and on the public website of the agency its analysis under paragraph (1)(B), and provide the analysis to 

each House of Congress. 

(C) CONGRESSIONAL WAIVER.—If the agency is precluded 

by subparagraph (A) from publishing a notice of final rulemaking, Congress, by joint resolution pursuant to the procedures set forth for joint resolutions in section 802 of title 

5, United States Code, may direct the agency to publish a 

notice of final rulemaking notwithstanding the prohibition 

contained in subparagraph (A). In applying section 802 of 

title 5, United States Code, for purposes of this paragraph, 

section 802(e)(2) shall not apply and the terms— 

(i) ‘‘joint resolution’’ or ‘‘joint resolution described in 

subsection (a)’’ means only a joint resolution introduced during the period beginning on the submission 

or publication date and ending 60 days thereafter (excluding days either House of Congress is adjourned for 

more than 3 days during a session of Congress), the 

matter after the resolving clause of which is as follows: ‘‘That Congress directs, notwithstanding the prohibition contained in section 312(b)(4)(A) of the Financial CHOICE Act of 2017, the ll to publish the notice of final rulemaking for the regulation or regulations that were the subject of the analysis submitted 

by the ll to Congress on ll.’’ (The blank spaces 

being appropriately filled in.); and 

(ii) ‘‘submission or publication date’’ means— 

49 

(I) the date on which the analysis under paragraph (1)(B) is submitted to Congress under paragraph (4)(B); or 

(II) if the analysis is submitted to Congress less 

than 60 session days or 60 legislative days before 

the date on which the Congress adjourns a session 

of Congress, the date on which the same or succeeding Congress first convenes its next session. 

SEC. 313. RULE OF CONSTRUCTION. 

Provided that an agency has first issued an advanced notice of 

proposed rulemaking in connection with a regulation, the agency is 

not required to comply with section 3506(c)(2) of title 44, United 

States Code, with respect to any information collection request— 

(1) that identifies the advanced notice of proposed rulemaking in such request; 

(2) that informs the person from whom the information is obtained or solicited that the provision of such information is voluntary; 

(3) that is necessary to comply with section 312; and 

(4) with respect to which the information collected will not 

be used for purposes other than compliance with this title. 

SEC. 314. PUBLIC AVAILABILITY OF DATA AND REGULATORY ANALYSIS. 

(a) IN GENERAL.—At or before the commencement of the public 

comment period with respect to a regulation, the agency shall 

make available on its public website sufficient information about 

the data, methodologies, and assumptions underlying the analyses 

performed pursuant to section 312 so that the analytical results of 

the agency are capable of being substantially reproduced, subject to 

an acceptable degree of imprecision or error. 

(b) CONFIDENTIALITY.—The agency shall comply with subsection 

(a) in a manner that preserves the nonpublic nature of confidential 

information, including confidential trade secrets, confidential commercial or financial information, and confidential information about 

positions, transactions, or business practices. 

SEC. 315. FIVE-YEAR REGULATORY IMPACT ANALYSIS. 

(a) IN GENERAL.—Not later than 5 years after the date of publication in the Federal Register of a notice of final rulemaking, the 

chief economist of the agency shall issue a report that examines the 

economic impact of the subject regulation, including the direct and 

indirect costs and benefits of the regulation. 

(b) REGULATORY IMPACT METRICS.—In preparing the report required by subsection (a), the chief economist shall employ the regulatory impact metrics included in the notice of final rulemaking 

pursuant to section 312(b)(1)(C). 

(c) REPRODUCIBILITY.—The report shall include the data, methodologies, and assumptions underlying the evaluation so that the 

agency’s analytical results are capable of being substantially reproduced, subject to an acceptable degree of imprecision or error. 

(d) CONFIDENTIALITY.—The agency shall comply with subsection 

(c) in a manner that preserves the nonpublic nature of confidential 

information, including confidential trade secrets, confidential commercial or financial information, and confidential information about 

positions, transactions, or business practices. 

50 

(e) REPORT.—The agency shall submit the report required by subsection (a) to the Committee on Banking, Housing, and Urban Affairs of the Senate and the Committee on Financial Services of the 

House of Representatives and post it on the public website of the 

agency. Notwithstanding the previous sentence, the Commodity Futures Trading Commission shall only submit its report to the Committee on Agriculture, Nutrition, and Forestry of the Senate and 

the Committee on Agriculture of the House of Representatives. 

SEC. 316. RETROSPECTIVE REVIEW OF EXISTING RULES. 

(a) REGULATORY IMPROVEMENT PLAN.—Not later than 1 year 

after the date of enactment of this Act and every 5 years thereafter, each agency shall develop, submit to the Committee on Banking, Housing, and Urban Affairs of the Senate and the Committee 

on Financial Services of the House of Representatives, and post on 

the public website of the agency a plan, consistent with law and 

its resources and regulatory priorities, under which the agency will 

modify, streamline, expand, or repeal existing regulations so as to 

make the regulatory program of the agency more effective or less 

burdensome in achieving the regulatory objectives. Notwithstanding the previous sentence, the Commodity Futures Trading 

Commission shall only submit its plan to the Committee on Agriculture, Nutrition, and Forestry of the Senate and the Committee 

on Agriculture of the House of Representatives. 

(b) IMPLEMENTATION PROGRESS REPORT.—Two years after the 

date of submission of each plan required under subsection (a), each 

agency shall develop, submit to the Committee on Banking, Housing, and Urban Affairs of the Senate and the Committee on Financial Services of the House of Representatives, and post on the public website of the agency a report of the steps that it has taken to 

implement the plan, steps that remain to be taken to implement 

the plan, and, if any parts of the plan will not be implemented, reasons for not implementing those parts of the plan. Notwithstanding 

the previous sentence, the Commodity Futures Trading Commission shall only submit its plan to the Committee on Agriculture, 

Nutrition, and Forestry of the Senate and the Committee on Agriculture of the House of Representatives. 

SEC. 317. JUDICIAL REVIEW. 

(a) IN GENERAL.—Notwithstanding any other provision of law, 

during the period beginning on the date on which a notice of final 

rulemaking for a regulation is published in the Federal Register 

and ending 1 year later, a person that is adversely affected or aggrieved by the regulation is entitled to bring an action in the 

United States Court of Appeals for the District of Columbia Circuit 

for judicial review of agency compliance with the requirements of 

section 312. 

(b) STAY.—The court may stay the effective date of the regulation 

or any provision thereof. 

(c) RELIEF.—If the court finds that an agency has not complied 

with the requirements of section 312, the court shall vacate the 

subject regulation, unless the agency shows by clear and convincing 

evidence that vacating the regulation would result in irreparable 

harm. Nothing in this section affects other limitations on judicial 

review or the power or duty of the court to dismiss any action or 

deny relief on any other appropriate legal or equitable ground. 

51 

SEC. 318. CHIEF ECONOMISTS COUNCIL. 

(a) ESTABLISHMENT.—There is established the Chief Economists 

Council. 

(b) MEMBERSHIP.—The Council shall consist of the chief economist of each agency. The members of the Council shall select the 

first chairperson of the Council. Thereafter the position of Chairperson shall rotate annually among the members of the Council. 

(c) MEETINGS.—The Council shall meet at the call of the Chairperson, but not less frequently than quarterly. 

(d) REPORT.—One year after the effective date of this Act and annually thereafter, the Council shall prepare and submit to the 

Committee on Banking, Housing, and Urban Affairs and the Committee on Agriculture, Nutrition, and Forestry of the Senate and 

the Committee on Financial Services and the Committee on Agriculture of the House of Representatives, and make publicly available on the Council’s website, a report on— 

(1) the benefits and costs of regulations adopted by the agencies during the past 12 months; 

(2) the regulatory actions planned by the agencies for the upcoming 12 months; 

(3) the cumulative effect of the existing regulations of the 

agencies on economic activity, innovation, international competitiveness of entities regulated by the agencies, and net job 

creation (excluding jobs related to ensuring compliance with 

the regulation); 

(4) the training and qualifications of the persons who prepared the cost-benefit analyses of each agency during the past 

12 months; 

(5) the sufficiency of the resources available to the chief 

economists during the past 12 months for the conduct of the 

activities required by this subtitle; and 

(6) recommendations for legislative or regulatory action to 

enhance the efficiency and effectiveness of financial regulation 

in the United States. 

SEC. 319. CONFORMING AMENDMENTS. 

Section 15(a) of the Commodity Exchange Act (7 U.S.C. 19(a)) is 

amended— 

(1) by striking paragraph (1); 

(2) in paragraph (2), by striking ‘‘(2)’’ and all that follows 

through ‘‘light of—’’ and inserting the following: 

‘‘(1) CONSIDERATIONS.—Before promulgating a regulation 

under this chapter or issuing an order (except as provided in 

paragraph (2)), the Commission shall take into consideration— 

’’; 

(3) in paragraph (1), as so redesignated— 

(A) in subparagraph (B), by striking ‘‘futures’’ and inserting ‘‘the relevant’’; 

(B) in subparagraph (C), by adding ‘‘and’’ at the end; 

(C) in subparagraph (D), by striking ‘‘; and’’ and inserting a period; and 

(D) by striking subparagraph (E); and 

(4) by redesignating paragraph (3) as paragraph (2). 

52 

SEC. 320. OTHER REGULATORY ENTITIES. 

Not later than 1 year after the date of enactment of this Act, the 

Securities and Exchange Commission shall provide to the Committee on Banking, Housing, and Urban Affairs of the Senate and 

the Committee on Financial Services of the House of Representatives, and make publicly available on the Commission’s website a 

report setting forth a plan for subjecting the Public Company Accounting Oversight Board, the Municipal Securities Rulemaking 

Board, and any national securities association registered under section 15A of the Securities Exchange Act of 1934 (15 U.S.C. 78o– 

4(a)), other than subsection (k) of such section 15A, to the requirements of this subtitle, other than direct representation on the 

Council. 

SEC. 321. AVOIDANCE OF DUPLICATIVE OR UNNECESSARY ANALYSES. 

An agency may perform the analyses required by this subtitle in 

conjunction with, or as a part of, any other agenda or analysis required by any other provision of law, if such other analysis satisfies 

the provisions of this subtitle. 

Subtitle B—Congressional Review of 

Federal Financial Agency Rulemaking 

SEC. 331. CONGRESSIONAL REVIEW. 

(a)(1)(A) Before a rule may take effect, an agency shall publish 

in the Federal Register a list of information on which the rule is 

based, including data, scientific and economic studies, and cost-benefit analyses, and identify how the public can access such information online, and shall submit to each House of the Congress and 

to the Comptroller General a report containing— 

(i) a copy of the rule; 

(ii) a concise general statement relating to the rule; 

(iii) a classification of the rule as a major or nonmajor rule, 

including an explanation of the classification specifically addressing each criteria for a major rule contained within subparagraphs (A) through (C) of section 334(2); 

(iv) a list of any other related regulatory actions intended to 

implement the same statutory provision or regulatory objective 

as well as the individual and aggregate economic effects of 

those actions; and 

(v) the proposed effective date of the rule. 

(B) On the date of the submission of the report under subparagraph (A), the agency shall submit to the Comptroller General and 

make available to each House of Congress— 

(i) a complete copy of the cost-benefit analysis of the rule, if 

any, including an analysis of any jobs added or lost, differentiating between public and private sector jobs; 

(ii) the agency’s actions pursuant to sections 603, 604, 605, 

607, and 609 of title 5, United States Code; 

(iii) the agency’s actions pursuant to sections 202, 203, 204, 

and 205 of the Unfunded Mandates Reform Act of 1995 and 

subtitle G; and 

(iv) any other relevant information or requirements under 

any other Act and any relevant Executive orders. 

53 

(C) Upon receipt of a report submitted under subparagraph (A), 

each House shall provide copies of the report to the chairman and 

ranking member of each standing committee with jurisdiction 

under the rules of the House of Representatives or the Senate to 

report a bill to amend the provision of law under which the rule 

is issued. 

(2)(A) The Comptroller General shall provide a report on each 

major rule to the committees of jurisdiction by the end of 15 calendar days after the submission or publication date. The report of 

the Comptroller General shall include an assessment of the agency’s compliance with procedural steps required by paragraph (1)(B) 

and an assessment of whether the major rule imposes any new limits or mandates on private-sector activity. 

(B) Agencies shall cooperate with the Comptroller General by 

providing information relevant to the Comptroller General’s report 

under subparagraph (A). 

(3) A major rule relating to a report submitted under paragraph 

(1) shall take effect upon enactment of a joint resolution of approval described in section 332 or as provided for in the rule following enactment of a joint resolution of approval described in section 332, whichever is later. 

(4) A nonmajor rule shall take effect as provided by section 333 

after submission to Congress under paragraph (1). 

(5) If a joint resolution of approval relating to a major rule is not 

enacted within the period provided in subsection (b)(2), then a joint 

resolution of approval relating to the same rule may not be considered under this subtitle in the same Congress by either the House 

of Representatives or the Senate. 

(b)(1) A major rule shall not take effect unless the Congress enacts a joint resolution of approval described under section 332. 

(2) If a joint resolution described in subsection (a) is not enacted 

into law by the end of 70 session days or legislative days, as applicable, beginning on the date on which the report referred to in subsection (a)(1)(A) is received by Congress (excluding days either 

House of Congress is adjourned for more than 3 days during a session of Congress), then the rule described in that resolution shall 

be deemed not to be approved and such rule shall not take effect. 

(c)(1) Notwithstanding any other provision of this section (except 

subject to paragraph (3)), a major rule may take effect for one 90- 

calendar-day period if the President makes a determination under 

paragraph (2) and submits written notice of such determination to 

the Congress. 

(2) Paragraph (1) applies to a determination made by the President by Executive order that the major rule should take effect because such rule is— 

(A) necessary because of an imminent threat to health or 

safety or other emergency; 

(B) necessary for the enforcement of criminal laws; 

(C) necessary for national security; or 

(D) issued pursuant to any statute implementing an international trade agreement. 

(3) An exercise by the President of the authority under this subsection shall have no effect on the procedures under section 332. 

(d)(1) In addition to the opportunity for review otherwise provided under this subtitle, in the case of any rule for which a report 

54 

was submitted in accordance with subsection (a)(1)(A) during the 

period beginning on the date occurring— 

(A) in the case of the Senate, 60 session days; or 

(B) in the case of the House of Representatives, 60 legislative 

days, 

before the date the Congress is scheduled to adjourn a session of 

Congress through the date on which the same or succeeding Congress first convenes its next session, sections 332 and 333 shall 

apply to such rule in the succeeding session of Congress. 

(2)(A) In applying sections 332 and 333 for purposes of such additional review, a rule described under paragraph (1) shall be treated 

as though— 

(i) such rule were published in the Federal Register on— 

(I) in the case of the Senate, the 15th session day; or 

(II) in the case of the House of Representatives, the 15th 

legislative day, 

after the succeeding session of Congress first convenes; and 

(ii) a report on such rule were submitted to Congress under 

subsection (a)(1) on such date. 

(B) Nothing in this paragraph shall be construed to affect the requirement under subsection (a)(1) that a report shall be submitted 

to Congress before a rule can take effect. 

(3) A rule described under paragraph (1) shall take effect as otherwise provided by law (including other subsections of this section). 

SEC. 332. CONGRESSIONAL APPROVAL PROCEDURE FOR MAJOR 

RULES. 

(a)(1) For purposes of this section, the term ‘‘joint resolution’’ 

means only a joint resolution addressing a report classifying a rule 

as major pursuant to section 331(a)(1)(A)(iii) that— 

(A) bears no preamble; 

(B) bears the following title (with blanks filled as appropriate): ‘‘Approving the rule submitted by lll relating to lll.’’; 

(C) includes after its resolving clause only the following (with 

blanks filled as appropriate): ‘‘That Congress approves the rule 

submitted by lll relating to lll.’’; and 

(D) is introduced pursuant to paragraph (2). 

(2) After a House of Congress receives a report classifying a rule 

as major pursuant to section 331(a)(1)(A)(iii), the majority leader of 

that House (or his or her respective designee) shall introduce (by 

request, if appropriate) a joint resolution described in paragraph 

(1)— 

(A) in the case of the House of Representatives, within 3 legislative days; and 

(B) in the case of the Senate, within 3 session days. 

(3) A joint resolution described in paragraph (1) shall not be subject to amendment at any stage of proceeding. 

(b) A joint resolution described in subsection (a) shall be referred 

in each House of Congress to the committees having jurisdiction 

over the provision of law under which the rule is issued. 

(c) In the Senate, if the committee or committees to which a joint 

resolution described in subsection (a) has been referred have not 

reported it at the end of 15 session days after its introduction, such 

committee or committees shall be automatically discharged from 

further consideration of the resolution and it shall be placed on the 

55 

calendar. A vote on final passage of the resolution shall be taken 

on or before the close of the 15th session day after the resolution 

is reported by the committee or committees to which it was referred, or after such committee or committees have been discharged 

from further consideration of the resolution. 

(d)(1) In the Senate, when the committee or committees to which 

a joint resolution is referred have reported, or when a committee 

or committees are discharged (under subsection (c)) from further 

consideration of a joint resolution described in subsection (a), it is 

at any time thereafter in order (even though a previous motion to 

the same effect has been disagreed to) for a motion to proceed to 

the consideration of the joint resolution, and all points of order 

against the joint resolution (and against consideration of the joint 

resolution) are waived. The motion is not subject to amendment, or 

to a motion to postpone, or to a motion to proceed to the consideration of other business. A motion to reconsider the vote by which 

the motion is agreed to or disagreed to shall not be in order. If a 

motion to proceed to the consideration of the joint resolution is 

agreed to, the joint resolution shall remain the unfinished business 

of the Senate until disposed of. 

(2) In the Senate, debate on the joint resolution, and on all debatable motions and appeals in connection therewith, shall be limited to not more than 2 hours, which shall be divided equally between those favoring and those opposing the joint resolution. A motion to further limit debate is in order and not debatable. An 

amendment to, or a motion to postpone, or a motion to proceed to 

the consideration of other business, or a motion to recommit the 

joint resolution is not in order. 

(3) In the Senate, immediately following the conclusion of the debate on a joint resolution described in subsection (a), and a single 

quorum call at the conclusion of the debate if requested in accordance with the rules of the Senate, the vote on final passage of the 

joint resolution shall occur. 

(4) Appeals from the decisions of the Chair relating to the application of the rules of the Senate to the procedure relating to a joint 

resolution described in subsection (a) shall be decided without debate. 

(e) In the House of Representatives, if any committee to which 

a joint resolution described in subsection (a) has been referred has 

not reported it to the House at the end of 15 legislative days after 

its introduction, such committee shall be discharged from further 

consideration of the joint resolution, and it shall be placed on the 

appropriate calendar. On the second and fourth Thursdays of each 

month it shall be in order at any time for the Speaker to recognize 

a Member who favors passage of a joint resolution that has appeared on the calendar for at least 5 legislative days to call up that 

joint resolution for immediate consideration in the House without 

intervention of any point of order. When so called up a joint resolution shall be considered as read and shall be debatable for 1 hour 

equally divided and controlled by the proponent and an opponent, 

and the previous question shall be considered as ordered to its passage without intervening motion. It shall not be in order to reconsider the vote on passage. If a vote on final passage of the joint resolution has not been taken by the third Thursday on which the 

56 

Speaker may recognize a Member under this subsection, such vote 

shall be taken on that day. 

(f)(1) If, before passing a joint resolution described in subsection 

(a), one House receives from the other a joint resolution having the 

same text, then— 

(A) the joint resolution of the other House shall not be referred to a committee; and 

(B) the procedure in the receiving House shall be the same 

as if no joint resolution had been received from the other 

House until the vote on passage, when the joint resolution received from the other House shall supplant the joint resolution 

of the receiving House. 

(2) This subsection shall not apply to the House of Representatives if the joint resolution received from the Senate is a revenue 

measure. 

(g) If either House has not taken a vote on final passage of the 

joint resolution by the last day of the period described in section 

331(b)(2), then such vote shall be taken on that day. 

(h) This section and section 333 are enacted by Congress— 

(1) as an exercise of the rulemaking power of the Senate and 

House of Representatives, respectively, and as such is deemed 

to be part of the rules of each House, respectively, but applicable only with respect to the procedure to be followed in that 

House in the case of a joint resolution described in subsection 

(a) and superseding other rules only where explicitly so; and 

(2) with full recognition of the Constitutional right of either 

House to change the rules (so far as they relate to the procedure of that House) at any time, in the same manner and to 

the same extent as in the case of any other rule of that House. 

SEC. 333. CONGRESSIONAL DISAPPROVAL PROCEDURE FOR 

NONMAJOR RULES. 

(a) For purposes of this section, the term ‘‘joint resolution’’ means 

only a joint resolution introduced in the period beginning on the 

date on which the report referred to in section 331(a)(1)(A) is received by Congress and ending 60 days thereafter (excluding days 

either House of Congress is adjourned for more than 3 days during 

a session of Congress), the matter after the resolving clause of 

which is as follows: ‘‘That Congress disapproves the nonmajor rule 

submitted by the lll relating to lll, and such rule shall 

have no force or effect.’’ (The blank spaces being appropriately 

filled in). 

(b) A joint resolution described in subsection (a) shall be referred 

to the committees in each House of Congress with jurisdiction. 

(c) In the Senate, if the committee to which is referred a joint 

resolution described in subsection (a) has not reported such joint 

resolution (or an identical joint resolution) at the end of 15 session 

days after the date of introduction of the joint resolution, such committee may be discharged from further consideration of such joint 

resolution upon a petition supported in writing by 30 Members of 

the Senate, and such joint resolution shall be placed on the calendar. 

(d)(1) In the Senate, when the committee to which a joint resolution is referred has reported, or when a committee is discharged 

(under subsection (c)) from further consideration of a joint resolution described in subsection (a), it is at any time thereafter in order 

57 

(even though a previous motion to the same effect has been disagreed to) for a motion to proceed to the consideration of the joint 

resolution, and all points of order against the joint resolution (and 

against consideration of the joint resolution) are waived. The motion is not subject to amendment, or to a motion to postpone, or to 

a motion to proceed to the consideration of other business. A motion to reconsider the vote by which the motion is agreed to or disagreed to shall not be in order. If a motion to proceed to the consideration of the joint resolution is agreed to, the joint resolution shall 

remain the unfinished business of the Senate until disposed of. 

(2) In the Senate, debate on the joint resolution, and on all debatable motions and appeals in connection therewith, shall be limited to not more than 10 hours, which shall be divided equally between those favoring and those opposing the joint resolution. A motion to further limit debate is in order and not debatable. An 

amendment to, or a motion to postpone, or a motion to proceed to 

the consideration of other business, or a motion to recommit the 

joint resolution is not in order. 

(3) In the Senate, immediately following the conclusion of the debate on a joint resolution described in subsection (a), and a single 

quorum call at the conclusion of the debate if requested in accordance with the rules of the Senate, the vote on final passage of the 

joint resolution shall occur. 

(4) Appeals from the decisions of the Chair relating to the application of the rules of the Senate to the procedure relating to a joint 

resolution described in subsection (a) shall be decided without debate. 

(e) In the Senate, the procedure specified in subsection (c) or (d) 

shall not apply to the consideration of a joint resolution respecting 

a nonmajor rule— 

(1) after the expiration of the 60 session days beginning with 

the applicable submission or publication date; or 

(2) if the report under section 331(a)(1)(A) was submitted 

during the period referred to in section 331(d)(1), after the expiration of the 60 session days beginning on the 15th session 

day after the succeeding session of Congress first convenes. 

(f) If, before the passage by one House of a joint resolution of 

that House described in subsection (a), that House receives from 

the other House a joint resolution described in subsection (a), then 

the following procedures shall apply: 

(1) The joint resolution of the other House shall not be referred to a committee. 

(2) With respect to a joint resolution described in subsection 

(a) of the House receiving the joint resolution— 

(A) the procedure in that House shall be the same as if 

no joint resolution had been received from the other 

House; but 

(B) the vote on final passage shall be on the joint resolution of the other House. 

SEC. 334. DEFINITIONS. 

For purposes of this subtitle: 

(1) The term ‘‘agency’’ has the meaning given such term 

under section 311. 

(2) The term ‘‘major rule’’ means any rule, including an interim final rule, that the Administrator of the Office of InforVerDate Sep 11 2014 05:01 Jun 07, 2017 Jkt 025698 PO 00000 Frm 00057 Fmt 6659 Sfmt 6602 E:\HR\OC\HR163.XXX HR163
58 

mation and Regulatory Affairs of the Office of Management 

and Budget finds has resulted in or is likely to result in— 

(A) an annual cost on the economy of $100,000,000 or 

more, adjusted annually for inflation; 

(B) a major increase in costs or prices for consumers, individual industries, Federal, State, or local government 

agencies, or geographic regions; or 

(C) significant adverse effects on competition, employment, investment, productivity, innovation, or on the ability of United States-based enterprises to compete with foreign-based enterprises in domestic and export markets. 

(3) The term ‘‘nonmajor rule’’ means any rule that is not a 

major rule. 

(4) The term ‘‘rule’’ has the meaning given such term in section 551 of title 5, United States Code, except that such term 

does not include— 

(A) any rule of particular applicability, including a rule 

that approves or prescribes for the future rates, wages, 

prices, services, or allowances therefore, corporate or financial structures, reorganizations, mergers, or acquisitions thereof, or accounting practices or disclosures bearing 

on any of the foregoing; 

(B) any rule relating to agency management or personnel; or 

(C) any rule of agency organization, procedure, or practice that does not substantially affect the rights or obligations of non-agency parties. 

(5) The term ‘‘submission date or publication date’’, except as 

otherwise provided in this subtitle, means— 

(A) in the case of a major rule, the date on which the 

Congress receives the report submitted under section 

331(a)(1)(A); and 

(B) in the case of a nonmajor rule, the later of— 

(i) the date on which the Congress receives the report submitted under section 331(a)(1)(A); and 

(ii) the date on which the nonmajor rule is published 

in the Federal Register, if so published. 

SEC. 335. JUDICIAL REVIEW. 

(a) No determination, finding, action, or omission under this subtitle shall be subject to judicial review. 

(b) Notwithstanding subsection (a), a court may determine 

whether a Federal financial agency has completed the necessary requirements under this subtitle for a rule to take effect. 

(c) The enactment of a joint resolution of approval under section 

332 shall not be interpreted to serve as a grant or modification of 

statutory authority by Congress for the promulgation of a rule, 

shall not extinguish or affect any claim, whether substantive or 

procedural, against any alleged defect in a rule, and shall not form 

part of the record before the court in any judicial proceeding concerning a rule except for purposes of determining whether or not 

the rule is in effect. 

SEC. 336. EFFECTIVE DATE OF CERTAIN RULES. 

Notwithstanding section 331— 

59 

(1) any rule that establishes, modifies, opens, closes, or conducts a regulatory program for a commercial, recreational, or 

subsistence activity related to hunting, fishing, or camping, or 

(2) any rule other than a major rule which the Federal financial agency for good cause finds (and incorporates the finding 

and a brief statement of reasons therefore in the rule issued) 

that notice and public procedure thereon are impracticable, unnecessary, or contrary to the public interest, 

shall take effect at such time as the Federal financial agency promulgating the rule determines. 

SEC. 337. BUDGETARY EFFECTS OF RULES SUBJECT TO SECTION 332 

OF THE FINANCIAL CHOICE ACT OF 2017. 

Section 257(b)(2) of the Balanced Budget and Emergency Deficit 

Control Act of 1985 is amended by adding at the end the following 

new subparagraph: 

‘‘(E) BUDGETARY EFFECTS OF RULES SUBJECT TO SECTION 332

OF THE FINANCIAL CHOICE ACT OF 2017.—Any rules subject to 

the congressional approval procedure set forth in section 332 

of the Financial CHOICE Act of 2017 affecting budget authority, outlays, or receipts shall be assumed to be effective unless 

it is not approved in accordance with such section.’’. 

SEC. 338. NONAPPLICABILITY TO MONETARY POLICY. 

Nothing in this subtitle shall apply to rules that concern monetary policy proposed or implemented by the Board of Governors of 

the Federal Reserve System or the Federal Open Market Committee. 

Subtitle C—Judicial Review of Agency 

Actions 

SEC. 341. SCOPE OF JUDICIAL REVIEW OF AGENCY ACTIONS. 

(a) IN GENERAL.—Notwithstanding any other provision of law, in 

any judicial review of an agency action pursuant to chapter 7 of 

title 5, United States Code, to the extent necessary to decision and 

when presented, the reviewing court shall determine the meaning 

or applicability of the terms of an agency action and decide de novo 

all relevant questions of law, including the interpretation of constitutional and statutory provisions, and rules made by an agency. 

If the reviewing court determines that a statutory or regulatory 

provision relevant to its decision contains a gap or ambiguity, the 

court shall not interpret that gap or ambiguity as an implicit delegation to the agency of legislative rule making authority and shall 

not rely on such gap or ambiguity as a justification either for interpreting agency authority expansively or for deferring to the agency’s interpretation on the question of law. Notwithstanding any 

other provision of law, this section shall apply in any action for judicial review of agency action authorized under any provision of 

law. No law may exempt any such civil action from the application 

of this section except by specific reference to this section. 

(b) AGENCY DEFINED.—For purposes of this section, the term 

‘‘agency’’ has the meaning given such term under section 311. 

60 

(c) EFFECTIVE DATE.—Subsection (a) shall take effect after the 

end of the 2-year period beginning on the date of the enactment of 

this Act. 

Subtitle D—Leadership of Financial 

Regulators 

SEC. 351. FEDERAL DEPOSIT INSURANCE CORPORATION. 

Section 2 of the Federal Deposit Insurance Act (12 U.S.C. 1812) 

is amended— 

(1) in subsection (a)(1), by striking ‘‘5 members’’ and all that 

follows through ‘‘3 of whom’’ and inserting the following: ‘‘5 

members, who’’; 

(2) by amending subsection (d) to read as follows: 

‘‘(d) VACANCY.—Any vacancy on the Board of Directors shall be 

filled in the manner in which the original appointment was made.’’; 

and 

(3) in subsection (f)— 

(A) by striking paragraph (2); and 

(B) by redesignating paragraph (3) as paragraph (2). 

SEC. 352. FEDERAL HOUSING FINANCE AGENCY. 

Section 1312(b)(2) of the Federal Housing Enterprises Financial 

Safety and Soundness Act of 1992 (12 U.S.C. 4512) is amended by 

striking ‘‘for cause’’. 

Subtitle E—Congressional Oversight of 

Appropriations 

SEC. 361. BRINGING THE FEDERAL DEPOSIT INSURANCE CORPORATION INTO THE APPROPRIATIONS PROCESS. 

(a) IN GENERAL.—Section 10(a) of the Federal Deposit Insurance 

Act (12 U.S.C. 1820(a)) is amended— 

(1) by striking ‘‘(a) The’’ and inserting the following: 

‘‘(a) POWERS.— ‘‘(1) IN GENERAL.—The’’; 

(2) by inserting ‘‘, subject to paragraph (2),’’ after ‘‘The Board 

of Directors of the Corporation’’; and 

(3) by adding at the end the following new paragraph: 

‘‘(2) APPROPRIATIONS REQUIREMENT.— ‘‘(A) OPERATING FUND.—There is established an Operating Fund, to which Congress shall provide annual appropriations to the Corporation, which shall be separate from 

the Deposit Insurance Fund. 

‘‘(B) RECOVERY OF COSTS OF ANNUAL APPROPRIATION.— The Corporation shall collect assessments and other fees, 

as provided under this Act, that are designed to recover 

the costs to the Government of the annual appropriation 

to the Corporation by Congress. Subject to subparagraph 

(E), the Corporation may only incur obligations, or allow 

and pay expenses, from the Operating Fund pursuant to 

an appropriations Act. 

‘‘(C) DEPOSITS.—Assessments and other fees described 

under subparagraph (B) for any fiscal year— 

61 

‘‘(i) shall be deposited in the Operating Fund; and 

‘‘(ii) except as provided in subparagraph (E), shall 

not be collected for any fiscal year except to the extent 

provided in advance in appropriation Acts. 

‘‘(D) CREDITS.—Amounts deposited in the Operating 

Fund during a fiscal year shall be credited as offsetting 

the amount appropriated to the Operating Fund for such 

fiscal year. 

‘‘(E) EXCEPTION FOR CERTAIN PROGRAMS.—This paragraph shall not apply to the Corporation’s Insurance Business Line Programs and Receivership Management Business Line Programs, as in existence on the date of enactment of this paragraph.’’. 

(b) CONFORMING AMENDMENT.—Subsection (d) of section 7 of the 

Federal Deposit Insurance Act (12 U.S.C. 1817) is amended to read 

as follows: 

‘‘(d) DEPOSIT INSURANCE FUND EXEMPT FROM APPORTIONMENT.— 

Notwithstanding any other provision of law, amounts received pursuant to any assessments or other fees that are deposited into the 

Deposit Insurance Fund shall not be subject to apportionment for 

the purposes of chapter 15 of title 31, United States Code, or under 

any other authority.’’. 

(c) EFFECTIVE DATE.—The amendments made by this section 

shall apply with respect to expenses paid and fees collected on or 

after October 1, 2017. 

SEC. 362. BRINGING THE FEDERAL HOUSING FINANCE AGENCY INTO 

THE APPROPRIATIONS PROCESS. 

(a) IN GENERAL.—Section 1316 of the Housing and Community 

Development Act of 1992 (12 U.S.C. 4516) is amended— 

(1) by amending subsection (a) to read as follows: 

‘‘(a) APPROPRIATIONS REQUIREMENT.— 

‘‘(1) RECOVERY OF COSTS OF ANNUAL APPROPRIATION.—The 

Agency shall collect assessments and other fees that are designed to recover the costs to the Government of the annual 

appropriation to the Agency by Congress. 

‘‘(2) OFFSETTING COLLECTIONS.—Assessments and other fees 

described under paragraph (1) for any fiscal year— 

‘‘(A) shall be deposited and credited as offsetting collections to the account providing appropriations to the Agency; and 

‘‘(B) shall not be collected for any fiscal year except to 

the extent provided in advance in appropriation Acts.’’; and 

(2) by striking subsection (f). 

(b) EFFECTIVE DATE.—The amendments made by this section 

shall apply with respect to expenses paid and assessments and 

other fees collected on or after October 1, 2017. 

SEC. 363. BRINGING THE NATIONAL CREDIT UNION ADMINISTRATION 

INTO THE APPROPRIATIONS PROCESS. 

(a) IN GENERAL.—Section 105 of the Federal Credit Union Act 

(12 U.S.C. 1755) is amended— 

(1) by amending subsections (a) and (b) to read as follows: 

‘‘(a) PAYMENT BY FEDERAL CREDIT UNIONS TO ADMINISTRATION.— 

Each insured credit union shall pay to the Administration an annual fee. 

62 

‘‘(b) DETERMINATIONS OF ASSESSMENT PERIODS AND PAYMENT

DATES.—The Board shall determine the periods for which the fee 

referred to under subsection (a) shall be assessed and the date for 

the payment of such fee or increments thereof.’’; 

(2) in subsection (c), by striking ‘‘operating’’; 

(3) by amending subsection (d) to read as follows: 

‘‘(d) APPROPRIATIONS REQUIREMENT.— ‘‘(1) RECOVERY OF COSTS OF ANNUAL APPROPRIATION.—The 

Administration shall collect fees other than those fees referred 

to under subsection (a) from each insured credit union, as provided under this Act, in an amount stated as a percentage of 

insured shares of each insured credit union (which percentage 

shall be the same for all insured credit unions). Such fees shall 

be designed to recover the costs to the Government of the annual appropriation to the Administration by Congress. 

‘‘(2) OFFSETTING COLLECTIONS.—Fees described under paragraph (1) for any fiscal year— 

‘‘(A) shall be deposited and credited as offsetting collections to the account providing appropriations to the Administration; and 

‘‘(B) shall not be collected for any fiscal year except to 

the extent provided in advance in appropriation Acts. 

‘‘(3) EXCEPTION FOR INSURANCE FUNCTIONS.—This subsection 

shall not apply to the National Credit Union Share Insurance 

Fund, including assessments and other fees that are deposited 

into, and amounts paid from, the National Credit Union Share 

Insurance Fund.’’; and 

(4) by striking subsection (e). 

(b) CONFORMING AMENDMENTS.—The Federal Credit Union Act 

(12 U.S.C. 1751 et seq.) is amended— 

(1) in section 120(j), by striking paragraph (3); 

(2) by amending section 128 to read as follows: 

‘‘SEC. 128. NATIONAL CREDIT UNION SHARE INSURANCE FUND EXEMPT FROM APPORTIONMENT. 

‘‘Notwithstanding any other provision of law, amounts received 

pursuant to any assessments or other fees that are deposited into 

the National Credit Union Share Insurance Fund or the Temporary 

Corporate Credit Union Stabilization Fund shall not be subject to 

apportionment for the purposes of chapter 15 of title 31, United 

States Code, or under any other authority.’’; and 

(3) in section 203(a), by striking ‘‘and for such administrative 

and other expenses incurred in carrying out the purposes of 

this title’’. 

(c) EFFECTIVE DATE.—The amendments made by this section 

shall apply with respect to expenses paid and fees collected on or 

after October 1, 2017. 

SEC. 364. BRINGING THE OFFICE OF THE COMPTROLLER OF THE CURRENCY INTO THE APPROPRIATIONS PROCESS. 

(a) IN GENERAL.—Section 5240A of the Revised Statutes of the 

United States (12 U.S.C. 16) is amended— 

(1) by striking ‘‘Sec. 5240A. The Comptroller of the Currency 

may collect an assessment, fee, or other charge from any entity 

described in section 3(q)(1) of the Federal Deposit Insurance 

Act (12 U.S.C. 1813(q)(1)), as the Comptroller determines is 

necessary or appropriate to carry out the responsibilities of the 

63 

Office of the Comptroller of the Currency. In establishing the 

amount of an assessment, fee, or charge collected from an entity under this section,’’ and inserting the following: 

‘‘SEC. 5240A. COLLECTION OF FEES; APPROPRIATIONS REQUIREMENT. 

‘‘(a) IN GENERAL.—In establishing the amount of an assessment, 

fee, or charge collected from an entity under subsection (b),’’; 

(2) by striking ‘‘Funds derived’’ and all that follows through 

the end of the section; and 

(3) by adding at the end the following: 

‘‘(b) APPROPRIATIONS REQUIREMENT.— 

‘‘(1) RECOVERY OF COSTS OF ANNUAL APPROPRIATION.—The 

Comptroller of the Currency shall impose and collect assessments, fees, or other charges that are designed to recover the 

costs to the Government of the annual appropriation to the Office of the Comptroller of the Currency by Congress. 

‘‘(2) OFFSETTING COLLECTIONS.—Assessments and other fees 

described under paragraph (1) for any fiscal year— 

‘‘(A) shall be deposited and credited as offsetting collections to the account providing appropriations to the Office 

of the Comptroller of the Currency; and 

‘‘(B) shall not be collected for any fiscal year except to 

the extent provided in advance in appropriation Acts.’’. 

(b) CONFORMING AMENDMENT.—Section 5240 (12 U.S.C. 481 et 

seq.) of the Revised Statutes of the United States is amended by 

striking the fourth undesignated paragraph. 

(c) EFFECTIVE DATE.—The amendments made by this section 

shall apply with respect to expenses paid and fees collected on or 

after October 1, 2017. 

SEC. 365. BRINGING THE NON-MONETARY POLICY RELATED FUNCTIONS OF THE BOARD OF GOVERNORS OF THE FEDERAL 

RESERVE SYSTEM INTO THE APPROPRIATIONS PROCESS. 

(a) IN GENERAL.—The Federal Reserve Act is amended by inserting after section 11B the following: 

‘‘SEC. 11C. APPROPRIATIONS REQUIREMENT FOR NON-MONETARY 

POLICY RELATED ADMINISTRATIVE COSTS. 

‘‘(a) APPROPRIATIONS REQUIREMENT.— 

‘‘(1) RECOVERY OF COSTS OF ANNUAL APPROPRIATION.—The 

Board of Governors of the Federal Reserve System and the 

Federal reserve banks shall collect assessments and other fees, 

as provided under this Act, that are designed to recover the 

costs to the Government of the annual appropriation to the 

Board of Governors of the Federal Reserve System by Congress. The Board of Governors of the Federal Reserve System 

and the Federal reserve banks may only incur obligations or 

allow and pay expenses with respect to non-monetary policy related administrative costs pursuant to an appropriations Act. 

‘‘(2) OFFSETTING COLLECTIONS.—Assessments and other fees 

described under paragraph (1) for any fiscal year— 

‘‘(A) shall be deposited and credited as offsetting collections to the account providing appropriations to the Board 

of Governors of the Federal Reserve System; and 

‘‘(B) shall not be collected for any fiscal year except to 

the extent provided in advance in appropriation Acts. 

64 

‘‘(3) LIMITATION.—This subsection shall only apply to the 

non-monetary policy related administrative costs of the Board 

of Governors of the Federal Reserve System. 

‘‘(b) DEFINITIONS.—For purposes of this section: 

‘‘(1) MONETARY POLICY.—The term ‘monetary policy’ means a 

strategy for producing a generally acceptable exchange medium 

that supports the productive employment of economic resources 

by reliably serving as both a unit of account and store of value. 

‘‘(2) NON-MONETARY POLICY RELATED ADMINISTRATIVE

COSTS.—The term ‘non-monetary policy related administrative 

costs’ means administrative costs not related to the conduct of 

monetary policy, and includes— 

‘‘(A) direct operating expenses for supervising and regulating entities supervised and regulated by the Board of 

Governors of the Federal Reserve System, including conducting examinations, conducting stress tests, communicating with the entities regarding supervisory matters 

and laws, and regulations; 

‘‘(B) operating expenses for activities integral to carrying 

out supervisory and regulatory responsibilities, such as 

training staff in the supervisory function, research and 

analysis functions including library subscription services, 

and collecting and processing regulatory reports filed by 

supervised institutions; and 

‘‘(C) support, overhead, and pension expenses related to 

the items described under subparagraphs (A) and (B).’’. 

(b) EFFECTIVE DATE.—The amendments made by this section 

shall apply with respect to expenses paid and fees collected on or 

after October 1, 2017. 

Subtitle F—International Processes 

SEC. 371. REQUIREMENTS FOR INTERNATIONAL PROCESSES. 

(a) BOARD OF GOVERNORS REQUIREMENTS.—Section 11 of the 

Federal Reserve Act (12 U.S.C. 248), as amended by section 

1007(a), is further amended by adding at the end the following new 

subsection: 

‘‘(w) INTERNATIONAL PROCESSES.— 

‘‘(1) NOTICE OF PROCESS; CONSULTATION.—At least 30 calendar days before any member or employee of the Board of 

Governors of the Federal Reserve System participates in a 

process of setting financial standards as a part of any foreign 

or multinational entity, the Board of Governors shall— 

‘‘(A) issue a notice of the process, including the subject 

matter, scope, and goals of the process, to the Committee 

on Financial Services of the House of Representatives and 

the Committee on Banking, Housing, and Urban Affairs of 

the Senate; 

‘‘(B) make such notice available to the public, including 

on the website of the Board of Governors; and 

‘‘(C) solicit public comment, and consult with the committees described under subparagraph (A), with respect to 

the subject matter, scope, and goals of the process. 

65 

‘‘(2) PUBLIC REPORTS ON PROCESS.—After the end of any process described under paragraph (1), the Board of Governors 

shall issue a public report on the topics that were discussed 

during the process and any new or revised rulemakings or policy changes that the Board of Governors believes should be implemented as a result of the process and make the report available on the website of the Board of Governors. 

‘‘(3) NOTICE OF AGREEMENTS; CONSULTATION.—At least 90 

calendar days before any member or employee of the Board of 

Governors of the Federal Reserve System participates in a 

process of setting financial standards as a part of any foreign 

or multinational entity, the Board of Governors shall— 

‘‘(A) issue a notice of agreement to the Committee on Financial Services of the House of Representatives and the 

Committee on Banking, Housing, and Urban Affairs of the 

Senate; 

‘‘(B) make such notice available to the public, including 

on the website of the Board of Governors; and 

‘‘(C) consult with the committees described under subparagraph (A) with respect to the nature of the agreement 

and any anticipated effects such agreement will have on 

the economy. 

‘‘(4) DEFINITION.—For purposes of this subsection, the term 

‘process’ shall include any official proceeding or meeting on financial regulation of a recognized international organization 

with authority to set financial standards on a global or regional level, including the Financial Stability Board, the Basel 

Committee on Banking Supervision (or a similar organization), 

and the International Association of Insurance Supervisors (or 

a similar organization).’’. 

(b) FDIC REQUIREMENTS.—The Federal Deposit Insurance Act 

(12 U.S.C. 1811 et seq.) is amended by adding at the end the following new section: 

‘‘SEC. 51. INTERNATIONAL PROCESSES. 

‘‘(a) NOTICE OF PROCESS; CONSULTATION.—At least 30 calendar 

days before the Board of Directors participates in a process of setting financial standards as a part of any foreign or multinational 

entity, the Board of Directors shall— 

‘‘(1) issue a notice of the process, including the subject matter, scope, and goals of the process, to the Committee on Financial Services of the House of Representatives and the Committee on Banking, Housing, and Urban Affairs of the Senate; 

‘‘(2) make such notice available to the public, including on 

the website of the Corporation; and 

‘‘(3) solicit public comment, and consult with the committees 

described under paragraph (1), with respect to the subject matter, scope, and goals of the process. 

‘‘(b) PUBLIC REPORTS ON PROCESS.—After the end of any process 

described under subsection (a), the Board of Directors shall issue 

a public report on the topics that were discussed at the process and 

any new or revised rulemakings or policy changes that the Board 

of Directors believes should be implemented as a result of the process and make the report available on the website of the Corporation. 

66 

‘‘(c) NOTICE OF AGREEMENTS; CONSULTATION.—At least 90 calendar days before the Board of Directors participates in a process 

of setting financial standards as a part of any foreign or multinational entity, the Board of Directors shall— 

‘‘(1) issue a notice of agreement to the Committee on Financial Services of the House of Representatives and the Committee on Banking, Housing, and Urban Affairs of the Senate; 

‘‘(2) make such notice available to the public, including on 

the website of the Corporation; and 

‘‘(3) consult with the committees described under paragraph 

(1) with respect to the nature of the agreement and any anticipated effects such agreement will have on the economy. 

‘‘(d) DEFINITION.—For purposes of this section, the term ‘process’ 

shall include any official proceeding or meeting on financial regulation of a recognized international organization with authority to set 

financial standards on a global or regional level, including the Financial Stability Board, the Basel Committee on Banking Supervision (or a similar organization), and the International Association 

of Insurance Supervisors (or a similar organization).’’. 

(c) TREASURY REQUIREMENTS.—Section 325 of title 31, United 

States Code, is amended by adding at the end the following new 

subsection: 

‘‘(d) INTERNATIONAL PROCESSES.— 

‘‘(1) NOTICE OF PROCESS; CONSULTATION.—At least 30 calendar days before the Secretary participates in a process of setting financial standards as a part of any foreign or multinational entity, the Secretary shall— 

‘‘(A) issue a notice of the process, including the subject 

matter, scope, and goals of the process, to the Committee 

on Financial Services of the House of Representatives and 

the Committee on Banking, Housing, and Urban Affairs of 

the Senate; 

‘‘(B) make such notice available to the public, including 

on the website of the Department of the Treasury; and 

‘‘(C) solicit public comment, and consult with the committees described under subparagraph (A), with respect to 

the subject matter, scope, and goals of the process. 

‘‘(2) PUBLIC REPORTS ON PROCESS.—After the end of any process described under paragraph (1), the Secretary shall issue a 

public report on the topics that were discussed at the process 

and any new or revised rulemakings or policy changes that the 

Secretary believes should be implemented as a result of the 

process and make the report available on the website of the 

Department of the Treasury. 

‘‘(3) NOTICE OF AGREEMENTS; CONSULTATION.—At least 90 

calendar days before the Secretary participates in a process of 

setting financial standards as a part of any foreign or multinational entity, the Secretary shall— 

‘‘(A) issue a notice of agreement to the Committee on Financial Services of the House of Representatives and the 

Committee on Banking, Housing, and Urban Affairs of the 

Senate; 

‘‘(B) make such notice available to the public, including 

on the website of the Department of the Treasury; and 

67 

‘‘(C) consult with the committees described under subparagraph (A) with respect to the nature of the agreement 

and any anticipated effects such agreement will have on 

the economy. 

‘‘(4) DEFINITION.—For purposes of this subsection, the term 

‘process’ shall include any official proceeding or meeting on financial regulation of a recognized international organization 

with authority to set financial standards on a global or regional level, including the Financial Stability Board, the Basel 

Committee on Banking Supervision (or a similar organization), 

and the International Association of Insurance Supervisors (or 

a similar organization).’’. 

(d) OCC REQUIREMENTS.—Chapter one of title LXII of the Revised Statutes of the United States (12 U.S.C. 21 et seq.) is amended— 

(1) by adding at the end the following new section: 

‘‘SEC. 5156B. INTERNATIONAL PROCESSES. 

‘‘(a) NOTICE OF PROCESS; CONSULTATION.—At least 30 calendar 

days before the Comptroller of the Currency participates in a process of setting financial standards as a part of any foreign or multinational entity, the Comptroller of the Currency shall— 

‘‘(1) issue a notice of the process, including the subject matter, scope, and goals of the process, to the Committee on Financial Services of the House of Representatives and the Committee on Banking, Housing, and Urban Affairs of the Senate; 

‘‘(2) make such notice available to the public, including on 

the website of the Office of the Comptroller of the Currency; 

and 

‘‘(3) solicit public comment, and consult with the committees 

described under paragraph (1), with respect to the subject matter, scope, and goals of the process. 

‘‘(b) PUBLIC REPORTS ON PROCESS.—After the end of any process 

described under subsection (a), the Comptroller of the Currency 

shall issue a public report on the topics that were discussed at the 

process and any new or revised rulemakings or policy changes that 

the Comptroller of the Currency believes should be implemented as 

a result of the process. 

‘‘(c) NOTICE OF AGREEMENTS; CONSULTATION.—At least 90 calendar days before the Comptroller of the Currency participates in 

a process of setting financial standards as a part of any foreign or 

multinational entity, the Comptroller of the Currency shall— 

‘‘(1) issue a notice of agreement to the Committee on Financial Services of the House of Representatives and the Committee on Banking, Housing, and Urban Affairs of the Senate; 

‘‘(2) make such notice available to the public, including on 

the website of the Office of the Comptroller of the Currency; 

and 

‘‘(3) consult with the committees described under paragraph 

(1) with respect to the nature of the agreement and any anticipated effects such agreement will have on the economy. 

‘‘(d) DEFINITION.—For purposes of this section, the term ‘process’ 

shall include any official proceeding or meeting on financial regulation of a recognized international organization with authority to set 

financial standards on a global or regional level, including the Financial Stability Board, the Basel Committee on Banking SuperVerDate Sep 11 2014 05:01 Jun 07, 2017 Jkt 025698 PO 00000 Frm 00067 Fmt 6659 Sfmt 6602 E:\HR\OC\HR163.XXX HR163
68 

vision (or a similar organization), and the International Association 

of Insurance Supervisors (or a similar organization).’’; and 

(2) in the table of contents for such chapter, by adding at the 

end the following new item: 

‘‘5156B. International processes.’’. 

(e) SECURITIES AND EXCHANGE COMMISSION REQUIREMENTS.— 

Section 4 of the Securities Exchange Act of 1934 (15 U.S.C. 78d), 

as amended by section 818(a), is further amended by adding at the 

end the following new subsection: 

‘‘(k) INTERNATIONAL PROCESSES.— 

‘‘(1) NOTICE OF PROCESS; CONSULTATION.—At least 30 calendar days before the Commission participates in a process of 

setting financial standards as a part of any foreign or multinational entity, the Commission shall— 

‘‘(A) issue a notice of the process, including the subject 

matter, scope, and goals of the process, to the Committee 

on Financial Services of the House of Representatives and 

the Committee on Banking, Housing, and Urban Affairs of 

the Senate; 

‘‘(B) make such notice available to the public, including 

on the website of the Commission; and 

‘‘(C) solicit public comment, and consult with the committees described under subparagraph (A), with respect to 

the subject matter, scope, and goals of the process. 

‘‘(2) PUBLIC REPORTS ON PROCESS.—After the end of any process described under paragraph (1), the Commission shall issue 

a public report on the topics that were discussed at the process 

and any new or revised rulemakings or policy changes that the 

Commission believes should be implemented as a result of the 

process and make the report available on the website of the 

Commission. 

‘‘(3) NOTICE OF AGREEMENTS; CONSULTATION.—At least 90 

calendar days before the Commission participates in a process 

of setting financial standards as a part of any foreign or multinational entity, the Commission shall— 

‘‘(A) issue a notice of agreement to the Committee on Financial Services of the House of Representatives and the 

Committee on Banking, Housing, and Urban Affairs of the 

Senate; 

‘‘(B) make such notice available to the public, including 

on the website of the Commission; and 

‘‘(C) consult with the committees described under subparagraph (A) with respect to the nature of the agreement 

and any anticipated effects such agreement will have on 

the economy. 

‘‘(4) DEFINITION.—For purposes of this subsection, the term 

‘process’ shall include any official proceeding or meeting on financial regulation of a recognized international organization 

with authority to set financial standards on a global or regional level, including the Financial Stability Board, the Basel 

Committee on Banking Supervision (or a similar organization), 

and the International Association of Insurance Supervisors (or 

a similar organization).’’. 

69 

(f) COMMODITY FUTURES TRADING COMMISSION REQUIREMENTS.— 

Section 2 of the Commodity Exchange Act (7 U.S.C. 2) is amended 

by adding at the end the following: 

‘‘(k) INTERNATIONAL PROCESSES.— 

‘‘(1) NOTICE OF PROCESS; CONSULTATION.—At least 30 calendar days before the Commission participates in a process of 

setting financial standards as a part of any foreign or multinational entity, the Commission shall— 

‘‘(A) issue a notice of the process, including the subject 

matter, scope, and goals of the process, to— 

‘‘(i) the Committee on Agriculture of the House of 

Representatives; and 

‘‘(ii) the Committee on Agriculture, Nutrition, and 

Forestry of the Senate; 

‘‘(B) make such notice available to the public, including 

on the website of the Commission; and 

‘‘(C) solicit public comment, and consult with the committees described under subparagraph (A), with respect to 

the subject matter, scope, and goals of the process. 

‘‘(2) PUBLIC REPORTS ON PROCESS.—After the end of any process described under paragraph (1), the Commission shall issue 

a public report on the topics that were discussed during the 

process and any new or revised rulemakings or policy changes 

that the Commission believes should be implemented as a result of the process and make the report available on the 

website of the Commission. 

‘‘(3) NOTICE OF AGREEMENTS; CONSULTATION.—At least 90 

calendar days before the Commission participates in a process 

of setting financial standards as a part of any foreign or multinational entity, the Commission shall— 

‘‘(A) issue a notice of agreement to— 

‘‘(i) the Committee on Agriculture of the House of 

Representatives; and 

‘‘(ii) the Committee on Agriculture, Nutrition, and 

Forestry of the Senate; 

‘‘(B) make such notice available to the public, including 

on the website of the Commission; and 

‘‘(C) consult with the committees described under subparagraph (A) with respect to the nature of the agreement 

and any anticipated effects such agreement will have on 

the economy. 

‘‘(4) DEFINITION.—For purposes of this subsection, the term 

‘process’ shall include any official proceeding or meeting on financial regulation of a recognized international organization 

with authority to set financial standards on a global or regional level, including the Financial Stability Board, the Basel 

Committee on Banking Supervision (or a similar organization), 

and the International Association of Insurance Supervisors (or 

a similar organization).’’. 

Subtitle G—Unfunded Mandates Reform 

SEC. 381. DEFINITIONS. 

For purposes of this subtitle: 

70 

(1) AGENCY.—The term ‘‘agency’’ has the meaning given such 

term under section 311. 

(2) DIRECT COSTS.—The term ‘‘direct costs’’ has the meaning 

given such term under section 421(3) of the Congressional 

Budget and Impoundment Control Act of 1974 (2 U.S.C. 

658(3)), except that— 

(A) in the case of a Federal intergovernmental mandate, 

the term means the aggregate estimated amounts that all 

State, local, and Tribal governments would incur or be required to spend or would be prohibited from raising in revenues in order to comply with the Federal intergovernmental mandate; and 

(B) in the case of a Federal private sector mandate, the 

term means the aggregate estimated amounts that the private sector will be required to spend or could forgo in profits, including costs passed on to consumers or other entities taking into account, to the extent practicable, behavioral changes, in order to comply with the Federal private 

sector mandate. 

(3) OTHER DEFINITIONS.—Except as provided under paragraphs (1) and (2), the definitions under section 421 of the 

Congressional Budget and Impoundment Control Act of 1974 

shall apply to this subtitle. 

SEC. 382. APPLICATION OF THE UNFUNDED MANDATES REFORM ACT. 

(a) IN GENERAL.—The Unfunded Mandates Reform Act of 1995 (2 

U.S.C. 1501 et seq.) shall apply to the Board of Governors of the 

Federal Reserve System, the Consumer Law Enforcement Agency, 

the Commodity Futures Trading Commission, the Federal Deposit 

Insurance Corporation, the Federal Housing Finance Agency, the 

Office of the Comptroller of the Currency, the National Credit 

Union Administration, and the Securities and Exchange Commission. 

(b) STATEMENTS TO ACCOMPANY SIGNIFICANT REGULATORY AC- TIONS.— 

(1) IN GENERAL.—Unless otherwise expressly prohibited by 

law, before promulgating any general notice of proposed rulemaking or any final rule, or within six months after promulgating any final rule that was not preceded by a general notice 

of proposed rulemaking, if the proposed rulemaking or final 

rule includes a Federal mandate that may result in an annual 

effect on State, local, or Tribal governments, or to the private 

sector, in the aggregate of $100,000,000 or more in any 1 year, 

the agency shall prepare a written statement containing the 

following: 

(A) The text of the draft proposed rulemaking or final 

rule, together with the information required under subsections (a) and (b)(1) of section 312, as applicable, including an explanation of the manner in which the proposed 

rulemaking or final rule is consistent with the statutory 

requirement and avoids undue interference with State, 

local, and Tribal governments in the exercise of their governmental functions. 

(B) Estimates by the agency, if and to the extent that 

the agency determines that accurate estimates are reasonably feasible, of— 

71 

(i) the future compliance costs of the Federal mandate; and 

(ii) any disproportionate budgetary effects of the 

Federal mandate upon any particular regions of the 

nation or particular State, local, or Tribal governments, urban or rural or other types of communities, 

or particular segments of the private sector. 

(C)(i) A detailed description of the extent of the agency’s 

prior consultation with the private sector and elected representatives (under subsection (c) and section 204 of the 

Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1534) of 

the affected State, local, and tribal governments. 

(ii) A detailed summary of the comments and concerns 

that were presented by the private sector and State, local, 

or Tribal governments either orally or in writing to the 

agency. 

(iii) A detailed summary of the agency’s evaluation of 

those comments and concerns. 

(D) A detailed summary of how the agency complied 

with section 312, as applicable. 

(2) PREVENTION OF DUPLICATIVE REQUIREMENTS.—If an agency is required to prepare a written statement under both paragraph (1) and section 202(a) of the Unfunded Mandates Reform 

Act of 1995 (2 U.S.C. 1532(a)), the agency shall prepare only 

one written statement that consolidates and meets the requirements of such paragraph and such section. 

(c) STATE, LOCAL, AND TRIBAL GOVERNMENT AND PRIVATE SECTOR

INPUT.— 

(1) IN GENERAL.—Each agency shall, to the extent permitted 

in law, develop an effective process to permit impacted parties 

within the private sector (including small businesses) to provide meaningful and timely input in the development of regulatory proposals containing significant Federal mandates. 

(2) PREVENTION OF DUPLICATIVE PROCESSES.—If an agency is 

required to develop a process under both paragraph (1) and 

section 204(a) of the Unfunded Mandates Reform Act of 1995 

(2 U.S.C. 1534(a)), the agency shall develop only one process 

that consolidates and meets the requirements of such paragraph and such section. 

(3) GUIDELINES.—For appropriate implementation of this 

subsection and of section 204 of the Unfunded Mandates Reform Act, consistent with applicable laws and regulations, the 

following guidelines shall be followed: — 

(A) Consultations shall take place as early as possible, 

before issuance of a notice of proposed rulemaking, continue through the final rule stage, and be integrated explicitly into the rulemaking process. 

(B) Agencies shall consult with a wide variety of State, 

local, and Tribal officials and impacted parties within the 

private sector (including small businesses). Geographic, political, and other factors that may differentiate varying 

points of view should be considered. 

(C) Agencies should estimate benefits and costs to assist 

with these consultations. The scope of the consultation 

72 

should reflect the cost and significance of the Federal mandate being considered. 

(D) Agencies shall, to the extent practicable— 

(i) seek out the views of State, local, and Tribal governments, and impacted parties within the private sector (including small businesses), on costs, benefits, and 

risks; and 

(ii) solicit ideas about alternative methods of compliance and potential flexibilities, and input on whether 

the Federal regulation will harmonize with and not 

duplicate similar laws in other levels of government. 

(E) Consultations shall address the cumulative impact of 

regulations on the affected entities. 

(F) Agencies may accept electronic submissions of comments by relevant parties but may not use those comments 

as the sole method of satisfying the guidelines in this subsection. 

(d) OFFICE OF INFORMATION AND REGULATORY AFFAIRS RESPONSIBILITIES.— 

(1) IN GENERAL.—The Administrator of the Office of Information and Regulatory Affairs shall provide meaningful guidance 

and oversight so that each agency’s regulations for which a 

written statement is required under subsection (b) and section 

202 of the Unfunded Mandates Reform Act of 1995 (2 U.S.C. 

1532) are consistent with the principles and requirements of 

this title, as well as other applicable laws, and do not conflict 

with the policies or actions of another Federal agency (as the 

term ‘‘agency’’ is defined under section 551 of title 5, United 

States Code). If the Administrator determines that an agency’s 

regulations for which a written statement is required under 

subsection (b) and section 202 of the Unfunded Mandates Reform Act of 1995 do not comply with such principles and requirements, are not consistent with other applicable laws, or 

conflict with the policies or actions of another Federal agency 

(as the term ‘‘agency’’ is defined under section 551 of title 5, 

United States Code), the Administrator shall identify areas of 

noncompliance, notify the agency, and request that the agency 

comply before the agency finalizes the regulation concerned. 

(2) ANNUAL STATEMENTS TO CONGRESS ON AGENCY COMPLIANCE.—The Administrator of the Office of Information and 

Regulatory Affairs shall submit to the Director of the Office of 

Management and Budget for inclusion in the annual report required by section 208 of the Unfunded Mandates Reform Act 

of 1995 (2 U.S.C. 1538) a written report detailing compliance 

by each agency with the requirements of this title that relate 

to regulations for which a written statement is required by 

subsection (b) and section 202 of the Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1532), including activities undertaken at the request of the Administrator to improve compliance, during the preceding reporting period. The report shall 

also contain an appendix detailing compliance by each agency 

with subsection (c) and section 204 of the Unfunded Mandates 

Reform Act. 

(e) EXPANDED JUDICIAL REVIEW.— 

73 

(1) AGENCY STATEMENTS ON SIGNIFICANT REGULATORY AC- TIONS.— 

(A) IN GENERAL.—Compliance or noncompliance by any 

agency with the provisions of subsection (b) and sections 

202, 203(a)(1) and (2), and 205 of the Unfunded Mandates 

Reform Act of 1995 shall be subject to judicial review in 

accordance with this subsection. 

(B) LIMITED REVIEW OF AGENCY COMPLIANCE OR NON- COMPLIANCE.— (i) SCOPE OF REVIEW UNDER TITLE 5.—Agency compliance or noncompliance with the provisions of subsection (b) and sections 202, 203(a)(1) and (2), and 205 

of the Unfunded Mandates Reform Act of 1995 shall 

be subject to judicial review under section 706(1) of 

title 5, United States Code, and as provided under 

clause (ii). 

(ii) COURT MAY COMPEL PREPARATION OF WRITTEN

STATEMENT.—If an agency fails to prepare the written 

statement (including the preparation of the estimates, 

analyses, statements, or descriptions) under subsection (b) and section 202 of the Unfunded Mandates 

Reform Act, prepare a written plan under paragraphs 

(1) and (2) of section 203 of the Unfunded Mandates 

Reform Act, or comply with section 205 of the Unfunded Mandates Reform Act, a court may compel the 

agency to prepare such written statement, prepare 

such written plan, or comply with such section. 

(C) REVIEW OF AGENCY RULES.—In any judicial review 

under any other Federal law of an agency rule for which 

compliance with this subtitle is required, the inadequacy 

or failure to prepare required material, or to comply with 

provisions of subsection (b) and sections 202, 203(a)(1) and 

(2), and 205 of the Unfunded Mandates Reform Act of 1995 

may be used as a basis for staying, enjoining, invalidating 

or otherwise affecting such agency rule. 

(D) CERTAIN INFORMATION AS PART OF RECORD.—Any information generated under subsection (b) and sections 202, 

203(a)(1) and (2), and 205 of the Unfunded Mandates Reform Act of 1995 that is part of the rulemaking record for 

judicial review under the provisions of any other Federal 

law may be considered as part of the record for judicial review conducted under such other provisions of Federal law. 

(E) APPLICATION OF OTHER FEDERAL LAW.—For any petition under subparagraph (B) the provisions of such other 

Federal law shall control all other matters, such as exhaustion of administrative remedies, the time for and 

manner of seeking review and venue, except that if such 

other Federal law does not provide a limitation on the time 

for filing a petition for judicial review that is less than 180 

days, such limitation shall be 180 days after a final rule 

is promulgated by the appropriate agency. 

(F) EFFECTIVE DATE.—This paragraph shall apply to any 

agency rule for which a general notice of proposed rulemaking is promulgated on or after the date of the enactment of this Act. 

74 

(2) JUDICIAL REVIEW AND RULE OF CONSTRUCTION.—Except as 

provided in paragraph (1)— 

(A) any estimate, analysis, statement, description, or report prepared under this subtitle, any compliance or noncompliance with the provisions of this subtitle, and any determination concerning the applicability of the provisions 

of this subtitle shall not be subject to judicial review; and 

(B) no provision of this subtitle shall be construed to create any right or benefit, substantive or procedural, enforceable by any person in any administrative or judicial action. 

Subtitle H—Enforcement Coordination 

SEC. 391. POLICIES TO MINIMIZE DUPLICATION OF ENFORCEMENT 

EFFORTS. 

(a) IN GENERAL.—Each agency (as defined under section 311) 

shall, not later than the end of the 90-day period beginning on the 

date of the enactment of this Act, implement policies and procedures— 

(1) to minimize duplication of efforts with other Federal or 

State authorities when bringing an administrative or judicial 

action against an individual or entity; 

(2) to establish when joint investigations, administrative actions, or judicial actions or the coordination of law enforcement 

activities are necessary and appropriate and in the public interest; and 

(3) to, in the course of a joint investigation, administrative 

action, or judicial action, establish a lead agency to avoid duplication of efforts and unnecessary burdens and to ensure consistent enforcement, as necessary and appropriate and in the 

public interest. 

(b) RULE OF CONSTRUCTION.—Nothing in this section may be construed to preempt State law or mandate coordination by a State 

authority. 

Subtitle I—Penalties for Unauthorized 

Disclosures 

SEC. 392. CRIMINAL PENALTY FOR UNAUTHORIZED DISCLOSURES. 

Section 165 of the Financial Stability Act of 2010 (12 U.S.C. 

5365), as amended by section 151(b)(6)(M), is further amended by 

adding at the end the following: 

‘‘(m) CRIMINAL PENALTY FOR UNAUTHORIZED DISCLOSURES.— 

‘‘(1) IN GENERAL.—Any officer or employee of a Federal department or agency, who by virtue of such officer or employee’s 

employment or official position, has possession of, or access to, 

agency records which contain individually identifiable information submitted pursuant to the requirements of this section, 

the disclosure of which is prohibited by Federal statute, rule, 

or regulation, and who knowing that disclosure of the specific 

material is so prohibited, willfully discloses the material in any 

manner to any person or agency not entitled to receive it, shall 

be guilty of a misdemeanor and fined not more than $5,000. 

75 

‘‘(2) OBTAINING RECORDS UNDER FALSE PRETENSES.—Any person who knowingly and willfully requests or obtains information described under paragraph (1) from a Federal department 

or agency under false pretenses shall be guilty of a misdemeanor and fined not more than $5,000. 

‘‘(3) TREATMENT OF DETERMINATIONS.—For purposes of this 

subsection, a determination made under subsection (d) or (i) 

based on individually identifiable information submitted pursuant to the requirements of this section shall be deemed individually identifiable information, the disclosure of which is prohibited by Federal statute.’’. 

Subtitle J—Stop Settlement Slush Funds 

SEC. 393. LIMITATION ON DONATIONS MADE PURSUANT TO SETTLEMENT AGREEMENTS TO WHICH CERTAIN DEPARTMENTS 

OR AGENCIES ARE A PARTY. 

(a) LIMITATION ON REQUIRED DONATIONS.—No settlement to 

which a department or agency is a party may direct or provide for 

a payment to any person who is not a victim of the alleged wrongdoing. 

(b) PENALTY.—Any Executive branch official or agent thereof who 

enters into or enforces a settlement in violation of subsection (a), 

shall be subject to the same penalties that would apply in the case 

of a violation of section 3302 of title 31, United States Code. 

(c) EFFECTIVE DATE.—Subsections (a) and (b) apply only in the 

case of a settlement agreement concluded on or after the date of 

enactment of this Act. 

(d) DEFINITIONS.— 

(1) The term ‘‘department or agency’’— 

(A) has the meaning given the term ‘‘agency’’ under section 311; and 

(B) means the Department of Housing and Urban Development, the Department of Justice, and the Rural Housing 

Service of the Department of Agriculture. 

(2) The term ‘‘settlement agreement’’ means a settlement 

agreement resolving a civil action or potential civil action, a 

plea agreement, a deferred prosecution agreement, or a nonprosecution agreement. 

(3) The term ‘‘payment’’ means a payment or loan. 

(4) The term ‘‘payment to any person who is not a victim’’ 

means any payment other than a payment— 

(A) to a person who is party to the lawsuit or settlement; 

(B) that provides restitution for or otherwise directly 

remedies actual harm (including to the environment) directly and proximately caused by the party making the 

payment as a result of that party’s alleged wrongdoing; 

(C) that constitutes payment for services rendered in 

connection with the case; or 

(D) made pursuant to section 3663 of title 18, United 

States Code. 

76 

TITLE IV—UNLEASHING OPPORTUNITIES FOR SMALL BUSINESSES, 

INNOVATORS, AND JOB CREATORS BY 

FACILITATING CAPITAL FORMATION 

Subtitle A—Small Business Mergers, Acquisitions, Sales, and Brokerage Simplification 

SEC. 401. REGISTRATION EXEMPTION FOR MERGER AND ACQUISITION 

BROKERS. 

Section 15(b) of the Securities Exchange Act of 1934 (15 U.S.C. 

78o(b)) is amended by adding at the end the following: 

‘‘(13) REGISTRATION EXEMPTION FOR MERGER AND ACQUISI- TION BROKERS.— ‘‘(A) IN GENERAL.—Except as provided in subparagraph 

(B), an M&A broker shall be exempt from registration 

under this section. 

‘‘(B) EXCLUDED ACTIVITIES.—An M&A broker is not exempt from registration under this paragraph if such 

broker does any of the following: 

‘‘(i) Directly or indirectly, in connection with the 

transfer of ownership of an eligible privately held company, receives, holds, transmits, or has custody of the 

funds or securities to be exchanged by the parties to 

the transaction. 

‘‘(ii) Engages on behalf of an issuer in a public offering of any class of securities that is registered, or is 

required to be registered, with the Commission under 

section 12 or with respect to which the issuer files, or 

is required to file, periodic information, documents, 

and reports under subsection (d). 

‘‘(iii) Engages on behalf of any party in a transaction 

involving a public shell company. 

‘‘(C) DISQUALIFICATIONS.—An M&A broker is not exempt 

from registration under this paragraph if such broker is 

subject to— 

‘‘(i) suspension or revocation of registration under 

paragraph (4); 

‘‘(ii) a statutory disqualification described in section 

3(a)(39); 

‘‘(iii) a disqualification under the rules adopted by 

the Commission under section 926 of the Investor Protection and Securities Reform Act of 2010 (15 U.S.C. 

77d note); or 

‘‘(iv) a final order described in paragraph (4)(H). 

‘‘(D) RULE OF CONSTRUCTION.—Nothing in this paragraph shall be construed to limit any other authority of 

the Commission to exempt any person, or any class of persons, from any provision of this title, or from any provision 

of any rule or regulation thereunder. 

‘‘(E) DEFINITIONS.—In this paragraph: 

77 

‘‘(i) CONTROL.—The term ‘control’ means the power, 

directly or indirectly, to direct the management or 

policies of a company, whether through ownership of 

securities, by contract, or otherwise. There is a presumption of control for any person who— 

‘‘(I) is a director, general partner, member or 

manager of a limited liability company, or officer 

exercising executive responsibility (or has similar 

status or functions); 

‘‘(II) has the right to vote 20 percent or more of 

a class of voting securities or the power to sell or 

direct the sale of 20 percent or more of a class of 

voting securities; or 

‘‘(III) in the case of a partnership or limited liability company, has the right to receive upon dissolution, or has contributed, 20 percent or more of 

the capital. 

‘‘(ii) ELIGIBLE PRIVATELY HELD COMPANY.—The term 

‘eligible privately held company’ means a privately 

held company that meets both of the following conditions: 

‘‘(I) The company does not have any class of securities registered, or required to be registered, 

with the Commission under section 12 or with respect to which the company files, or is required to 

file, periodic information, documents, and reports 

under subsection (d). 

‘‘(II) In the fiscal year ending immediately before the fiscal year in which the services of the 

M&A broker are initially engaged with respect to 

the securities transaction, the company meets either or both of the following conditions (determined in accordance with the historical financial 

accounting records of the company): 

‘‘(aa) The earnings of the company before 

interest, taxes, depreciation, and amortization 

are less than $25,000,000. 

‘‘(bb) The gross revenues of the company are 

less than $250,000,000. 

‘‘(iii) M&A BROKER.—The term ‘M&A broker’ means 

a broker, and any person associated with a broker, engaged in the business of effecting securities transactions solely in connection with the transfer of ownership of an eligible privately held company, regardless 

of whether the broker acts on behalf of a seller or 

buyer, through the purchase, sale, exchange, issuance, 

repurchase, or redemption of, or a business combination involving, securities or assets of the eligible privately held company, if the broker reasonably believes 

that— 

‘‘(I) upon consummation of the transaction, any 

person acquiring securities or assets of the eligible 

privately held company, acting alone or in concert, 

will control and, directly or indirectly, will be active in the management of the eligible privately 

78 

held company or the business conducted with the 

assets of the eligible privately held company; and 

‘‘(II) if any person is offered securities in exchange for securities or assets of the eligible privately held company, such person will, prior to becoming legally bound to consummate the transaction, receive or have reasonable access to the 

most recent fiscal year-end financial statements of 

the issuer of the securities as customarily prepared by the management of the issuer in the normal course of operations and, if the financial 

statements of the issuer are audited, reviewed, or 

compiled, any related statement by the independent accountant, a balance sheet dated not 

more than 120 days before the date of the offer, 

and information pertaining to the management, 

business, results of operations for the period covered by the foregoing financial statements, and 

material loss contingencies of the issuer. 

‘‘(iv) PUBLIC SHELL COMPANY.—The term ‘public 

shell company’ is a company that at the time of a 

transaction with an eligible privately held company— 

‘‘(I) has any class of securities registered, or required to be registered, with the Commission 

under section 12 or that is required to file reports 

pursuant to subsection (d); 

‘‘(II) has no or nominal operations; and 

‘‘(III) has— 

‘‘(aa) no or nominal assets; 

‘‘(bb) assets consisting solely of cash and 

cash equivalents; or 

‘‘(cc) assets consisting of any amount of cash 

and cash equivalents and nominal other assets. 

‘‘(F) INFLATION ADJUSTMENT.— 

‘‘(i) IN GENERAL.—On the date that is 5 years after 

the date of the enactment of this paragraph, and every 

5 years thereafter, each dollar amount in subparagraph (E)(ii)(II) shall be adjusted by— 

‘‘(I) dividing the annual value of the Employment Cost Index For Wages and Salaries, Private 

Industry Workers (or any successor index), as 

published by the Bureau of Labor Statistics, for 

the calendar year preceding the calendar year in 

which the adjustment is being made by the annual value of such index (or successor) for the calendar year ending December 31, 2012; and 

‘‘(II) multiplying such dollar amount by the 

quotient obtained under subclause (I). 

‘‘(ii) ROUNDING.—Each dollar amount determined 

under clause (i) shall be rounded to the nearest multiple of $100,000.’’. 

79 

SEC. 402. EFFECTIVE DATE. 

This subtitle and any amendment made by this subtitle shall 

take effect on the date that is 90 days after the date of the enactment of this Act. 

Subtitle B—Encouraging Employee 

Ownership 

SEC. 406. INCREASED THRESHOLD FOR DISCLOSURES RELATING TO 

COMPENSATORY BENEFIT PLANS. 

Not later than 60 days after the date of the enactment of this 

Act, the Securities and Exchange Commission shall revise section 

230.701(e) of title 17, Code of Federal Regulations, so as to increase 

from $5,000,000 to $20,000,000 the aggregate sales price or amount 

of securities sold during any consecutive 12-month period in excess 

of which the issuer is required under such section to deliver an additional disclosure to investors. The Commission shall index for inflation such aggregate sales price or amount every 5 years to reflect 

the change in the Consumer Price Index for All Urban Consumers 

published by the Bureau of Labor Statistics, rounding to the nearest $1,000,000. 

Subtitle C—Small Company Disclosure 

Simplification 

SEC. 411. EXEMPTION FROM XBRL REQUIREMENTS FOR EMERGING 

GROWTH COMPANIES AND OTHER SMALLER COMPANIES. 

(a) EXEMPTION FOR EMERGING GROWTH COMPANIES.—Emerging 

growth companies are exempted from the requirements to use Extensible Business Reporting Language (XBRL) for financial statements and other periodic reporting required to be filed with the 

Commission under the securities laws. Such companies may elect 

to use XBRL for such reporting. 

(b) EXEMPTION FOR OTHER SMALLER COMPANIES.—Issuers with 

total annual gross revenues of less than $250,000,000 are exempt 

from the requirements to use XBRL for financial statements and 

other periodic reporting required to be filed with the Commission 

under the securities laws. Such issuers may elect to use XBRL for 

such reporting. An exemption under this subsection shall continue 

in effect until— 

(1) the date that is five years after the date of enactment of 

this Act; or 

(2) the date that is two years after a determination by the 

Commission, by order after conducting the analysis required by 

section 3, that the benefits of such requirements to such 

issuers outweigh the costs, but no earlier than three years 

after enactment of this Act. 

(c) MODIFICATIONS TO REGULATIONS.—Not later than 60 days 

after the date of enactment of this Act, the Commission shall revise 

its regulations under parts 229, 230, 232, 239, 240, and 249 of title 

17, Code of Federal Regulations, to reflect the exemptions set forth 

in subsections (a) and (b). 

80 

SEC. 412. ANALYSIS BY THE SEC. 

The Commission shall conduct an analysis of the costs and benefits to issuers described in section 411(b) of the requirements to use 

XBRL for financial statements and other periodic reporting required to be filed with the Commission under the securities laws. 

Such analysis shall include an assessment of— 

(1) how such costs and benefits may differ from the costs and 

benefits identified by the Commission in the order relating to 

interactive data to improve financial reporting (dated January 

30, 2009; 74 Fed. Reg. 6776) because of the size of such issuers; 

(2) the effects on efficiency, competition, capital formation, 

and financing and on analyst coverage of such issuers (including any such effects resulting from use of XBRL by investors); 

(3) the costs to such issuers of— 

(A) submitting data to the Commission in XBRL; 

(B) posting data on the website of the issuer in XBRL; 

(C) software necessary to prepare, submit, or post data 

in XBRL; and 

(D) any additional consulting services or filing agent 

services; 

(4) the benefits to the Commission in terms of improved ability to monitor securities markets, assess the potential outcomes of regulatory alternatives, and enhance investor participation in corporate governance and promote capital formation; 

and 

(5) the effectiveness of standards in the United States for 

interactive filing data relative to the standards of international 

counterparts. 

SEC. 413. REPORT TO CONGRESS. 

Not later than one year after the date of enactment of this Act, 

the Commission shall provide the Committee on Financial Services 

of the House of Representatives and the Committee on Banking, 

Housing, and Urban Affairs of the Senate a report regarding— 

(1) the progress in implementing XBRL reporting within the 

Commission; 

(2) the use of XBRL data by Commission officials; 

(3) the use of XBRL data by investors; 

(4) the results of the analysis required by section 412; and 

(5) any additional information the Commission considers relevant for increasing transparency, decreasing costs, and increasing efficiency of regulatory filings with the Commission. 

SEC. 414. DEFINITIONS. 

As used in this subtitle, the terms ‘‘Commission’’, ‘‘emerging 

growth company’’, ‘‘issuer’’, and ‘‘securities laws’’ have the meanings given such terms in section 3 of the Securities Exchange Act 

of 1934 (15 U.S.C. 78c). 

81 

Subtitle D—Securities and Exchange 

Commission Overpayment Credit 

SEC. 416. REFUNDING OR CREDITING OVERPAYMENT OF SECTION 31 

FEES. 

(a) IN GENERAL.—Section 31 of the Securities Exchange Act of 

1934 (15 U.S.C. 78ee) is amended by adding at the end the following: 

‘‘(n) OVERPAYMENT.—If a national securities exchange or national 

securities association pays to the Commission an amount in excess 

of fees and assessments due under this section and informs the 

Commission of such amount paid in excess within 10 years of the 

date of the payment, the Commission shall offset future fees and 

assessments due by such exchange or association in an amount 

equal to such excess amount.’’. 

(b) APPLICABILITY.—The amendment made by this section shall 

apply to any fees and assessments paid before, on, or after the date 

of enactment of this section. 

Subtitle E—Fair Access to Investment 

Research 

SEC. 421. SAFE HARBOR FOR INVESTMENT FUND RESEARCH. 

(a) EXPANSION OF THE SAFE HARBOR.—Not later than the end of 

the 45-day period beginning on the date of enactment of this Act, 

the Securities and Exchange Commission shall propose, and not 

later than the end of the 120-day period beginning on such date, 

the Commission shall adopt, upon such terms, conditions, or requirements as the Commission may determine necessary or appropriate in the public interest, for the protection of investors, and for 

the promotion of capital formation, revisions to section 230.139 of 

title 17, Code of Federal Regulations, to provide that a covered investment fund research report that is published or distributed by 

a broker or dealer— 

(1) shall be deemed, for purposes of sections 2(a)(10) and 5(c) 

of the Securities Act of 1933 (15 U.S.C. 77b(a)(10), 77e(c)), not 

to constitute an offer for sale or an offer to sell a security that 

is the subject of an offering pursuant to a registration statement that is effective, even if the broker or dealer is participating or will participate in the registered offering of the covered investment fund’s securities; and 

(2) shall be deemed to satisfy the conditions of subsection 

(a)(1) or (a)(2) of section 230.139 of title 17, Code of Federal 

Regulations, or any successor provisions, for purposes of the 

Commission’s rules and regulations under the Federal securities laws and the rules of any self-regulatory organization. 

(b) IMPLEMENTATION OF SAFE HARBOR.—In implementing the 

safe harbor pursuant to subsection (a), the Commission shall— 

(1) not, in the case of a covered investment fund with a class 

of securities in substantially continuous distribution, condition 

the safe harbor on whether the broker’s or dealer’s publication 

or distribution of a covered investment fund research report 

constitutes such broker’s or dealer’s initiation or reinitiation of 

82 

research coverage on such covered investment fund or its securities; 

(2) not— 

(A) require the covered investment fund to have been 

registered as an investment company under the Investment Company Act of 1940 (15 U.S.C. 80a–1 et seq.) or 

subject to the reporting requirements of section 13 or 15(d) 

of the Securities Exchange Act of 1934 (15 U.S.C. 78m, 

78o(d)) for any period exceeding the period of time referenced under paragraph (a)(1)(i)(A)(1) of section 230.139 

of title 17, Code of Federal Regulations; or 

(B) impose a minimum float provision exceeding that referenced in paragraph (a)(1)(i)(A)(1)(i) of section 230.139 of 

title 17, Code of Federal Regulations; 

(3) provide that a self-regulatory organization may not maintain or enforce any rule that would— 

(A) prohibit the ability of a member to publish or distribute a covered investment fund research report solely 

because the member is also participating in a registered 

offering or other distribution of any securities of such covered investment fund; or 

(B) prohibit the ability of a member to participate in a 

registered offering or other distribution of securities of a 

covered investment fund solely because the member has 

published or distributed a covered investment fund research report about such covered investment fund or its 

securities; and 

(4) provide that a covered investment fund research report 

shall not be subject to section 24(b) of the Investment Company Act of 1940 (15 U.S.C. 80a–24(b)) or the rules and regulations thereunder, except that such report may still be subject 

to such section and the rules and regulations thereunder to the 

extent that it is otherwise not subject to the content standards 

in the rules of any self-regulatory organization related to research reports, including those contained in the rules governing communications with the public regarding investment 

companies or substantially similar standards. 

(c) RULES OF CONSTRUCTION.—Nothing in this Act shall be construed as in any way limiting— 

(1) the applicability of the antifraud or antimanipulation provisions of the Federal securities laws and rules adopted thereunder to a covered investment fund research report, including 

section 17 of the Securities Act of 1933 (15 U.S.C. 77q), section 

34(b) of the Investment Company Act of 1940 (15 U.S.C. 80a– 

33), and sections 9 and 10 of the Securities Exchange Act of 

1934 (15 U.S.C. 78i, 78j); or 

(2) the authority of any self-regulatory organization to examine or supervise a member’s practices in connection with such 

member’s publication or distribution of a covered investment 

fund research report for compliance with applicable provisions 

of the Federal securities laws or self-regulatory organization 

rules related to research reports, including those contained in 

rules governing communications with the public. 

(d) INTERIM EFFECTIVENESS OF SAFE HARBOR.— 

83 

(1) IN GENERAL.—From and after the 120-day period beginning on the date of enactment of this Act, if the Commission 

has not adopted revisions to section 230.139 of title 17, Code 

of Federal Regulations, as required by subsection (a), and until 

such time as the Commission has done so, a broker or dealer 

distributing or publishing a covered investment fund research 

report after such date shall be able to rely on the provisions 

of section 230.139 of title 17, Code of Federal Regulations, and 

the broker or dealer’s publication of such report shall be 

deemed to satisfy the conditions of subsection (a)(1) or (a)(2) of 

section 230.139 of title 17, Code of Federal Regulations, if the 

covered investment fund that is the subject of such report satisfies the reporting history requirements (without regard to 

Form S–3 or Form F–3 eligibility) and minimum float provisions of such subsections for purposes of the Commission’s 

rules and regulations under the Federal securities laws and 

the rules of any self-regulatory organization, as if revised and 

implemented in accordance with subsections (a) and (b). 

(2) STATUS OF COVERED INVESTMENT FUND.—After such period and until the Commission has adopted revisions to section 

230.139 and FINRA has revised rule 2210, for purposes of subsection (c)(7)(O) of such rule, a covered investment fund shall 

be deemed to be a security that is listed on a national securities exchange and that is not subject to section 24(b) of the Investment Company Act of 1940 (15 U.S.C. 80a–24(b)). Communications concerning only covered investment funds that fall 

within the scope of such section shall not be required to be 

filed with FINRA. 

(e) DEFINITIONS.—For purposes of this section: 

(1) The term ‘‘covered investment fund research report’’ 

means a research report published or distributed by a broker 

or dealer about a covered investment fund or any securities 

issued by the covered investment fund, but not including a research report to the extent that it is published or distributed 

by the covered investment fund or any affiliate of the covered 

investment fund. 

(2) The term ‘‘covered investment fund’’ means— 

(A) an investment company registered under, or that has 

filed an election to be treated as a business development 

company under, the Investment Company Act of 1940 and 

that has filed a registration statement under the Securities Act of 1933 for the public offering of a class of its securities, which registration statement has been declared effective by the Commission; and 

(B) a trust or other person— 

(i) issuing securities in an offering registered under 

the Securities Act of 1933 and which class of securities 

is listed for trading on a national securities exchange; 

(ii) the assets of which consist primarily of commodities, currencies, or derivative instruments that reference commodities or currencies, or interests in the 

foregoing; and 

(iii) that provides in its registration statement under 

the Securities Act of 1933 that a class of its securities 

84 

are purchased or redeemed, subject to conditions or 

limitations, for a ratable share of its assets. 

(3) The term ‘‘FINRA’’ means the Financial Industry Regulatory Authority. 

(4) The term ‘‘research report’’ has the meaning given that 

term under section 2(a)(3) of the Securities Act of 1933 (15 

U.S.C. 77b(a)(3)), except that such term shall not include an 

oral communication. 

(5) The term ‘‘self-regulatory organization’’ has the meaning 

given to that term under section 3(a)(26) of the Securities Exchange Act of 1934 (15 U.S.C. 78c(a)(26)). 

Subtitle F—Accelerating Access to Capital 

SEC. 426. EXPANDED ELIGIBILITY FOR USE OF FORM S–3. 

Not later than 45 days after the date of the enactment of this 

Act, the Securities and Exchange Commission shall revise Form S– 

3— 

(1) so as to permit securities to be registered pursuant to 

General Instruction I.B.1. of such form provided that either— 

(A) the aggregate market value of the voting and nonvoting common equity held by non-affiliates of the registrant is $75,000,000 or more; or 

(B) the registrant has at least one class of common equity securities listed and registered on a national securities exchange; and 

(2) so as to remove the requirement of paragraph (c) from 

General Instruction I.B.6. of such form. 

Subtitle G—Enhancing the RAISE Act 

SEC. 431. CERTAIN ACCREDITED INVESTOR TRANSACTIONS. 

Section 4 of the Securities Act of 1933 (15 U.S.C. 77d) is amended— 

(1) by amending subsection (d) to read as follows: 

‘‘(d)(1) The transactions referred to in subsection (a)(7) are transactions where— 

‘‘(A) each purchaser is an accredited investor, as that term 

is defined in section 230.501(a) of title 17, Code of Federal Regulations (or any successor thereto); and 

‘‘(B) if any securities sold in reliance on subsection (a)(7) are 

offered by means of any general solicitation or general advertising, all such sales are made through a platform available 

only to accredited investors. 

‘‘(2) Securities sold in reliance on subsection (a)(7) shall be 

deemed to have been acquired in a transaction not involving any 

public offering. 

‘‘(3) The exemption provided by this subsection shall not be available for a transaction where the seller is— 

‘‘(A) an issuer, its subsidiaries or parent; 

‘‘(B) an underwriter acting on behalf of the issuer, its subsidiaries or parent, which receives compensation from the 

issuer with respect to such sale; or 

‘‘(C) a dealer. 

85 

‘‘(4) A transaction meeting the requirements of this subsection 

shall be deemed not to be a distribution for purposes of section 

2(a)(11).’’; and 

(2) by striking subsection (e). 

Subtitle H—Small Business Credit 

Availability 

SEC. 436. BUSINESS DEVELOPMENT COMPANY OWNERSHIP OF SECURITIES OF INVESTMENT ADVISERS AND CERTAIN FINANCIAL COMPANIES. 

(a) IN GENERAL.—Section 60 of the Investment Company Act of 

1940 (15 U.S.C. 80a–59) is amended— 

(1) by striking ‘‘Notwithstanding’’ and inserting ‘‘(a) Notwithstanding’’; 

(2) by striking ‘‘except that the Commission shall not’’ and 

inserting the following: ‘‘except that— 

‘‘(1) section 12 shall not apply to the purchasing, otherwise 

acquiring, or holding by a business development company of 

any security issued by, or any other interest in the business of, 

any person who is an investment adviser registered under title 

II of this Act, who is an investment adviser to an investment 

company, or who is an eligible portfolio company; and 

‘‘(2) the Commission shall not’’; 

(3) by adding at the end the following: 

‘‘(b) Nothing in this section shall prevent the Commission from 

issuing rules to address potential conflicts of interest between business development companies and investment advisers.’’. 

(b) DEFINITION OF ELIGIBLE PORTFOLIO COMPANY.—Section 

2(a)(46)(B) of the Investment Company Act of 1940 (15 U.S.C. 80a– 

2(a)(46)(B)) is amended by inserting before the semicolon the following: ‘‘(unless it is described in paragraph (2), (3), (4), (5), (6), or 

(9) of such section)’’. 

(c) INVESTMENT THRESHOLD.—Section 55(a) of the Investment 

Company Act of 1940 is amended by inserting before the colon the 

following: ‘‘, provided that no more than 50 percent of its total assets are assets described in section 3(c)’’. 

SEC. 437. EXPANDING ACCESS TO CAPITAL FOR BUSINESS DEVELOPMENT COMPANIES. 

(a) IN GENERAL.—Section 61(a) of the Investment Company Act 

of 1940 (15 U.S.C. 80a–60(a)) is amended— 

(1) by redesignating paragraphs (2) through (4) as paragraphs (3) through (5), respectively; 

(2) by striking paragraph (1) and inserting the following: 

‘‘(1) Except as provided in paragraph (2), the asset coverage 

requirements of subparagraphs (A) and (B) of section 18(a)(1) 

(and any related rule promulgated under this Act) applicable 

to business development companies shall be 200 percent. 

‘‘(2) The asset coverage requirements of subparagraphs (A) 

and (B) of section 18(a)(1) and of subparagraphs (A) and (B) of 

section 18(a)(2) (and any related rule promulgated under this 

Act) applicable to a business development company shall be 

150 percent if— 

86 

‘‘(A) within five business days of the approval of the 

adoption of the asset coverage requirements described in 

clause (ii), the business development company discloses 

such approval and the date of its effectiveness in a Form 

8–K filed with the Commission and in a notice on its 

website and discloses in its periodic filings made under 

section 13 of the Securities and Exchange Act of 1934 (15 

U.S.C. 78m)— 

‘‘(i) the aggregate value of the senior securities 

issued by such company and the asset coverage percentage as of the date of such company’s most recent 

financial statements; and 

‘‘(ii) that such company has adopted the asset coverage requirements of this subparagraph and the effective date of such requirements; 

‘‘(B) with respect to a business development company 

that issues equity securities that are registered on a national securities exchange, the periodic filings of the company under section 13(a) of the Securities Exchange Act of 

1934 (15 U.S.C. 78m) include disclosures reasonably designed to ensure that shareholders are informed of— 

‘‘(i) the amount of indebtedness and asset coverage 

ratio of the company, determined as of the date of the 

financial statements of the company dated on or most 

recently before the date of such filing; and 

‘‘(ii) the principal risk factors associated with such 

indebtedness, to the extent such risk is incurred by 

the company; and 

‘‘(C)(i) the application of this paragraph to the company 

is approved by the required majority (as defined in section 

57(o)) of the directors of or general partners of such company who are not interested persons of the business development company, which application shall become effective 

on the date that is 1 year after the date of the approval, 

and, with respect to a business development company that 

issues equity securities that are not registered on a national securities exchange, the company extends, to each 

person who is a shareholder as of the date of the approval, 

an offer to repurchase the equity securities held by such 

person as of such approval date, with 25 percent of such 

securities to be repurchased in each of the four quarters 

following such approval date; or 

‘‘(ii) the company obtains, at a special or annual meeting 

of shareholders or partners at which a quorum is present, 

the approval of more than 50 percent of the votes cast of 

the application of this paragraph to the company, which 

application shall become effective on the date immediately 

after the date of the approval.’’; 

(3) in paragraph (3) (as redesignated), by inserting ‘‘or which 

is a stock’’ after ‘‘indebtedness’’; 

(4) in subparagraph (A) of paragraph (4) (as redesignated)— 

(A) in the matter preceding clause (i), by striking ‘‘voting’’; and 

(B) by amending clause (iii) to read as follows: 

87 

‘‘(iii) the exercise or conversion price at the date of 

issuance of such warrants, options, or rights is not less 

than— 

‘‘(I) the market value of the securities issuable 

upon the exercise of such warrants, options, or 

rights at the date of issuance of such warrants, 

options, or rights; or 

‘‘(II) if no such market value exists, the net 

asset value of the securities issuable upon the exercise of such warrants, options, or rights at the 

date of issuance of such warrants, options, or 

rights; and’’; and 

(5) by adding at the end the following: 

‘‘(6)(A) Except as provided in subparagraph (B), the following 

shall not apply to a business development company: 

‘‘(i) Subparagraphs (C) and (D) of section 18(a)(2). 

‘‘(ii) Subparagraph (E) of section 18(a)(2), to the extent 

such subparagraph requires any priority over any other 

class of stock as to distribution of assets upon liquidation. 

‘‘(iii) With respect to a senior security which is a stock, 

subsections (c) and (i) of section 18. 

‘‘(B) Subparagraph (A) shall not apply with respect to preferred stock issued to a person who is not known by the company to be a qualified institutional buyer (as defined in section 

3(a) of the Securities Exchange Act of 1934).’’. 

(b) CONFORMING AMENDMENTS.—The Investment Company Act of 

1940 (15 U.S.C. 80a–1 et seq.) is amended— 

(1) in section 57— 

(A) in subsection (j)(1), by striking ‘‘section 61(a)(3)(B)’’ 

and inserting ‘‘section 61(a)(4)(B)’’; and 

(B) in subsection (n)(2), by striking ‘‘section 61(a)(3)(B)’’ 

and inserting ‘‘section 61(a)(4)(B)’’; and 

(2) in section 63(3), by striking ‘‘section 61(a)(3)’’ and inserting ‘‘section 61(a)(4)’’. 

SEC. 438. PARITY FOR BUSINESS DEVELOPMENT COMPANIES REGARDING OFFERING AND PROXY RULES. 

(a) REVISION TO RULES.—Not later than 1 year after the date of 

enactment of this Act, the Securities and Exchange Commission 

shall revise any rules to the extent necessary to allow a business 

development company that has filed an election pursuant to section 

54 of the Investment Company Act of 1940 (15 U.S.C. 80a–53) to 

use the securities offering and proxy rules that are available to 

other issuers that are required to file reports under section 13 or 

section 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 

78m; 78o(d)). Any action that the Commission takes pursuant to 

this subsection shall include the following: 

(1) The Commission shall revise rule 405 under the Securities Act of 1933 (17 C.F.R. 230.405)— 

(A) to remove the exclusion of a business development 

company from the definition of a well-known seasoned 

issuer provided by that rule; and 

(B) to add registration statements filed on Form N–2 to 

the definition of automatic shelf registration statement 

provided by that rule. 

88 

(2) The Commission shall revise rules 168 and 169 under the 

Securities Act of 1933 (17 C.F.R. 230.168 and 230.169) to remove the exclusion of a business development company from 

an issuer that can use the exemptions provided by those rules. 

(3) The Commission shall revise rules 163 and 163A under 

the Securities Act of 1933 (17 C.F.R. 230.163 and 230.163A) to 

remove a business development company from the list of 

issuers that are ineligible to use the exemptions provided by 

those rules. 

(4) The Commission shall revise rule 134 under the Securities Act of 1933 (17 C.F.R. 230.134) to remove the exclusion of 

a business development company from that rule. 

(5) The Commission shall revise rules 138 and 139 under the 

Securities Act of 1933 (17 C.F.R. 230.138 and 230.139) to specifically include a business development company as an issuer 

to which those rules apply. 

(6) The Commission shall revise rule 164 under the Securities Act of 1933 (17 C.F.R. 230.164) to remove a business development company from the list of issuers that are excluded from 

that rule. 

(7) The Commission shall revise rule 433 under the Securities Act of 1933 (17 C.F.R. 230.433) to specifically include a 

business development company that is a well-known seasoned 

issuer as an issuer to which that rule applies. 

(8) The Commission shall revise rule 415 under the Securities Act of 1933 (17 C.F.R. 230.415)— 

(A) to state that the registration for securities provided 

by that rule includes securities registered by a business 

development company on Form N–2; and 

(B) to provide an exception for a business development 

company from the requirement that a Form N–2 registrant 

must furnish the undertakings required by item 34.4 of 

Form N–2. 

(9) The Commission shall revise rule 497 under the Securities Act of 1933 (17 C.F.R. 230.497) to include a process for a 

business development company to file a form of prospectus that 

is parallel to the process for filing a form of prospectus under 

rule 424(b). 

(10) The Commission shall revise rules 172 and 173 under 

the Securities Act of 1933 (17 C.F.R. 230.172 and 230.173) to 

remove the exclusion of an offering of a business development 

company from those rules. 

(11) The Commission shall revise rule 418 under the Securities Act of 1933 (17 C.F.R. 230.418) to provide that a business 

development company that would otherwise meet the eligibility 

requirements of General Instruction I.A of Form S–3 shall be 

exempt from paragraph (a)(3) of that rule. 

(12) The Commission shall revise rule 14a–101 under the Securities Exchange Act of 1934 (17 C.F.R. 240.14a–101) to provide that a business development company that would otherwise meet the requirements of General Instruction I.A of Form 

S–3 shall be deemed to meet the requirements of Form S–3 for 

purposes of Schedule 14A. 

89 

(13) The Commission shall revise rule 103 under Regulation 

FD (17 C.F.R. 243.103) to provide that paragraph (a) of that 

rule applies for purposes of Form N–2. 

(b) REVISION TO FORM N–2.—Not later than 1 year after the date 

of enactment of this Act, the Commission shall revise Form N–2— 

(1) to include an item or instruction that is similar to item 

12 on Form S–3 to provide that a business development company that would otherwise meet the requirements of Form S– 

3 shall incorporate by reference its reports and documents filed 

under the Securities Exchange Act of 1934 into its registration 

statement filed on Form N–2; and 

(2) to include an item or instruction that is similar to the instruction regarding automatic shelf offerings by well-known 

seasoned issuers on Form S–3 to provide that a business development company that is a well-known seasoned issuer may file 

automatic shelf offerings on Form N–2. 

(c) TREATMENT IF REVISIONS NOT COMPLETED IN TIMELY MANNER.—If the Commission fails to complete the revisions required by 

subsections (a) and (b) by the time required by such subsections, 

a business development company shall be entitled to treat such revisions as having been completed in accordance with the actions required to be taken by the Commission by such subsections until 

such time as such revisions are completed by the Commission. 

(d) RULE OF CONSTRUCTION.—Any reference in this section to a 

rule or form means such rule or form or any successor rule or form. 

Subtitle I—Fostering Innovation 

SEC. 441. TEMPORARY EXEMPTION FOR LOW-REVENUE ISSUERS. 

Section 404 of the Sarbanes-Oxley Act of 2002 (15 U.S.C. 7262) 

is amended by adding at the end the following: 

‘‘(d) TEMPORARY EXEMPTION FOR LOW-REVENUE ISSUERS.— 

‘‘(1) LOW-REVENUE EXEMPTION.—Subsection (b) shall not 

apply with respect to an audit report prepared for an issuer 

that— 

‘‘(A) ceased to be an emerging growth company on the 

last day of the fiscal year of the issuer following the fifth 

anniversary of the date of the first sale of common equity 

securities of the issuer pursuant to an effective registration statement under the Securities Act of 1933; 

‘‘(B) had average annual gross revenues of less than 

$50,000,000 as of its most recently completed fiscal year; 

and 

‘‘(C) is not a large accelerated filer. 

‘‘(2) EXPIRATION OF TEMPORARY EXEMPTION.—An issuer 

ceases to be eligible for the exemption described under paragraph (1) at the earliest of— 

‘‘(A) the last day of the fiscal year of the issuer following 

the tenth anniversary of the date of the first sale of common equity securities of the issuer pursuant to an effective 

registration statement under the Securities Act of 1933; 

‘‘(B) the last day of the fiscal year of the issuer during 

which the average annual gross revenues of the issuer exceed $50,000,000; or 

90 

‘‘(C) the date on which the issuer becomes a large accelerated filer. 

‘‘(3) DEFINITIONS.—For purposes of this subsection: 

‘‘(A) AVERAGE ANNUAL GROSS REVENUES.—The term ‘average annual gross revenues’ means the total gross revenues of an issuer over its most recently completed three 

fiscal years divided by three. 

‘‘(B) EMERGING GROWTH COMPANY.—The term ‘emerging 

growth company’ has the meaning given such term under 

section 3 of the Securities Exchange Act of 1934 (15 U.S.C. 

78c). 

‘‘(C) LARGE ACCELERATED FILER.—The term ‘large accelerated filer’ has the meaning given that term under section 240.12b–2 of title 17, Code of Federal Regulations, or 

any successor thereto.’’. 

Subtitle J—Small Business Capital 

Formation Enhancement 

SEC. 446. ANNUAL REVIEW OF GOVERNMENT-BUSINESS FORUM ON 

CAPITAL FORMATION. 

Section 503 of the Small Business Investment Incentive Act of 

1980 (15 U.S.C. 80c–1) is amended by adding at the end the following: 

‘‘(e) The Commission shall— 

‘‘(1) review the findings and recommendations of the forum; 

and 

‘‘(2) each time the forum submits a finding or recommendation to the Commission, promptly issue a public statement— 

‘‘(A) assessing the finding or recommendation of the 

forum; and 

‘‘(B) disclosing the action, if any, the Commission intends to take with respect to the finding or recommendation.’’. 

Subtitle K—Helping Angels Lead Our 

Startups 

SEC. 451. DEFINITION OF ANGEL INVESTOR GROUP. 

As used in this subtitle, the term ‘‘angel investor group’’ means 

any group that— 

(1) is composed of accredited investors interested in investing 

personal capital in early-stage companies; 

(2) holds regular meetings and has defined processes and 

procedures for making investment decisions, either individually or among the membership of the group as a whole; and 

(3) is neither associated nor affiliated with brokers, dealers, 

or investment advisers. 

SEC. 452. CLARIFICATION OF GENERAL SOLICITATION. 

(a) IN GENERAL.—Not later than 6 months after the date of enactment of this Act, the Securities and Exchange Commission shall 

revise Regulation D of its rules (17 C.F.R. 230.500 et seq.) to require that in carrying out the prohibition against general solicitaVerDate Sep 11 2014 05:01 Jun 07, 2017 Jkt 025698 PO 00000 Frm 00090 Fmt 6659 Sfmt 6602 E:\HR\OC\HR163.XXX HR163
91 

tion or general advertising contained in section 230.502(c) of title 

17, Code of Federal Regulations, the prohibition shall not apply to 

a presentation or other communication made by or on behalf of an 

issuer which is made at an event— 

(1) sponsored by— 

(A) the United States or any territory thereof, by the 

District of Columbia, by any State, by a political subdivision of any State or territory, or by any agency or public 

instrumentality of any of the foregoing; 

(B) a college, university, or other institution of higher 

education; 

(C) a nonprofit organization; 

(D) an angel investor group; 

(E) a venture forum, venture capital association, or trade 

association; or 

(F) any other group, person or entity as the Securities 

and Exchange Commission may determine by rule; 

(2) where any advertising for the event does not reference 

any specific offering of securities by the issuer; 

(3) the sponsor of which— 

(A) does not make investment recommendations or provide investment advice to event attendees; 

(B) does not engage in an active role in any investment 

negotiations between the issuer and investors attending 

the event; 

(C) does not charge event attendees any fees other than 

administrative fees; and 

(D) does not receive any compensation with respect to 

such event that would require registration of the sponsor 

as a broker or a dealer under the Securities Exchange Act 

of 1934, or as an investment advisor under the Investment 

Advisers Act of 1940; and 

(4) where no specific information regarding an offering of securities by the issuer is communicated or distributed by or on 

behalf of the issuer, other than— 

(A) that the issuer is in the process of offering securities 

or planning to offer securities; 

(B) the type and amount of securities being offered; 

(C) the amount of securities being offered that have already been subscribed for; and 

(D) the intended use of proceeds of the offering. 

(b) RULE OF CONSTRUCTION.—Subsection (a) may only be construed as requiring the Securities and Exchange Commission to 

amend the requirements of Regulation D with respect to presentations and communications, and not with respect to purchases or 

sales. 

Subtitle L—Main Street Growth 

SEC. 456. VENTURE EXCHANGES. 

(a) SECURITIES EXCHANGE ACT OF 1934.—Section 6 of the Securities Exchange Act of 1934 (15 U.S.C. 78f) is amended by adding at 

the end the following: 

‘‘(m) VENTURE EXCHANGE.— 

92 

‘‘(1) REGISTRATION.— ‘‘(A) IN GENERAL.—A national securities exchange may 

elect to be treated (or for a listing tier of such exchange 

to be treated) as a venture exchange by notifying the Commission of such election, either at the time the exchange 

applies to be registered as a national securities exchange 

or after registering as a national securities exchange. 

‘‘(B) DETERMINATION TIME PERIOD.—With respect to a securities exchange electing to be treated (or for a listing tier 

of such exchange to be treated) as a venture exchange— 

‘‘(i) at the time the exchange applies to be registered 

as a national securities exchange, such application and 

election shall be deemed to have been approved by the 

Commission unless the Commission denies such application before the end of the 6-month period beginning 

on the date the Commission received such application; 

and 

‘‘(ii) after registering as a national securities exchange, such election shall be deemed to have been approved by the Commission unless the Commission denies such approval before the end of the 6-month period beginning on the date the Commission received 

notification of such election. 

‘‘(2) POWERS AND RESTRICTIONS.—A venture exchange— 

‘‘(A) may only constitute, maintain, or provide a market 

place or facilities for bringing together purchasers and sellers of venture securities; 

‘‘(B) may determine the increment to be used for quoting 

and trading venture securities on the exchange; 

‘‘(C) shall disseminate last sale and quotation information on terms that are fair and reasonable and not unreasonably discriminatory; 

‘‘(D) may choose to carry out periodic auctions for the 

sale of a venture security instead of providing continuous 

trading of the venture security; and 

‘‘(E) may not extend unlisted trading privileges to any 

venture security. 

‘‘(3) EXEMPTIONS FROM CERTAIN NATIONAL SECURITY EX- CHANGE REGULATIONS.—A venture exchange shall not be required to— 

‘‘(A) comply with any of sections 242.600 through 

242.612 of title 17, Code of Federal Regulations; 

‘‘(B) comply with any of sections 242.300 through 

242.303 of title 17, Code of Federal Regulations; 

‘‘(C) submit any data to a securities information processor; or 

‘‘(D) use decimal pricing. 

‘‘(4) TREATMENT OF CERTAIN EXEMPTED SECURITIES.—A security that is exempt from registration pursuant to section 3(b) 

of the Securities Act of 1933 shall be exempt from section 12(a) 

of this title with respect to the trading of such security on a 

venture exchange, if the issuer of such security is in compliance with all disclosure obligations of such section 3(b) and the 

regulations issued under such section. 

‘‘(5) DEFINITIONS.—For purposes of this subsection: 

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‘‘(A) EARLY-STAGE, GROWTH COMPANY.— 

‘‘(i) IN GENERAL.—The term ‘early-stage, growth 

company’ means an issuer— 

‘‘(I) that has not made an initial public offering 

of any securities of the issuer; and 

‘‘(II) with a market capitalization of 

$1,000,000,000 (as such amount is indexed for inflation every 5 years by the Commission to reflect 

the change in the Consumer Price Index for All 

Urban Consumers published by the Bureau of 

Labor Statistics, setting the threshold to the nearest $1,000,000) or less. 

‘‘(ii) TREATMENT WHEN MARKET CAPITALIZATION EXCEEDS THRESHOLD.— 

‘‘(I) IN GENERAL.—In the case of an issuer that 

is an early-stage, growth company the securities 

of which are traded on a venture exchange, such 

issuer shall not cease to be an early-stage, growth 

company by reason of the market capitalization of 

such issuer exceeding the threshold specified in 

clause (i)(II) until the end of the period of 24 consecutive months during which the market capitalization of such issuer exceeds $2,000,000,000 (as 

such amount is indexed for inflation every 5 years 

by the Commission to reflect the change in the 

Consumer Price Index for All Urban Consumers 

published by the Bureau of Labor Statistics, setting the threshold to the nearest $1,000,000). 

‘‘(II) EXEMPTIONS.—If an issuer would cease to 

be an early-stage, growth company under subclause (I), the venture exchange may, at the request of the issuer, exempt the issuer from the 

market capitalization requirements of this subparagraph for the 1-year period that begins on the 

day after the end of the 24-month period described 

in such subclause. The venture exchange may, at 

the request of the issuer, extend the exemption for 

1 additional year. 

‘‘(B) VENTURE SECURITY.—The term ‘venture security’ 

means— 

‘‘(i) securities of an early-stage, growth company 

that are exempt from registration pursuant to section 

3(b) of the Securities Act of 1933; and 

‘‘(ii) securities of an emerging growth company.’’. 

(b) SECURITIES ACT OF 1933.—Section 18(b)(1) of the Securities 

Act of 1933 (15 U.S.C. 77r(b)(1)) is amended— 

(1) in subparagraph (B), by striking ‘‘or’’ at the end; 

(2) in subparagraph (C), by striking the period and inserting 

‘‘; or’’; and 

(3) by adding at the end the following: 

‘‘(D) a venture security, as defined under section 6(m)(5) 

of the Securities Exchange Act of 1934.’’. 

(c) SENSE OF CONGRESS.—It is the sense of the Congress that the 

Securities and Exchange Commission should— 

94 

(1) when necessary or appropriate in the public interest and 

consistent with the protection of investors, make use of the 

Commission’s general exemptive authority under section 36 of 

the Securities Exchange Act of 1934 (15 U.S.C. 78mm) with respect to the provisions added by this section; and 

(2) if the Commission determines appropriate, create an Office of Venture Exchanges within the Commission’s Division of 

Trading and Markets. 

(d) RULE OF CONSTRUCTION.—Nothing in this section or the 

amendments made by this section shall be construed to impair or 

limit the construction of the antifraud provisions of the securities 

laws (as defined in section 3(a) of the Securities Exchange Act of 

1934 (15 U.S.C. 78c(a))) or the authority of the Securities and Exchange Commission under those provisions. 

(e) EFFECTIVE DATE FOR TIERS OF EXISTING NATIONAL SECURITIES EXCHANGES.—In the case of a securities exchange that is registered as a national securities exchange under section 6 of the Securities Exchange Act of 1934 (15 U.S.C. 78f) on the date of the enactment of this Act, any election for a listing tier of such exchange 

to be treated as a venture exchange under subsection (m) of such 

section shall not take effect before the date that is 180 days after 

such date of enactment. 

Subtitle M—Micro Offering Safe Harbor 

SEC. 461. EXEMPTIONS FOR MICRO-OFFERINGS. 

(a) IN GENERAL.—Section 4 of the Securities Act of 1933 (15 

U.S.C. 77d) is amended— 

(1) in subsection (a), by adding at the end the following: 

‘‘(8) transactions meeting the requirements of subsection 

(e).’’; and 

(2) as amended by section 431(2), by inserting after subsection (d) the following: 

‘‘(e) CERTAIN MICRO-OFFERINGS.—The transactions referred to in 

subsection (a)(8) are transactions involving the sale of securities by 

an issuer (including all entities controlled by or under common control with the issuer) that meet all of the following requirements: 

‘‘(1) PRE-EXISTING RELATIONSHIP.—Each purchaser has a substantive pre-existing relationship with an officer of the issuer, 

a director of the issuer, or a shareholder holding 10 percent or 

more of the shares of the issuer. 

‘‘(2) 35 OR FEWER PURCHASERS.—There are no more than, or 

the issuer reasonably believes that there are no more than, 35 

purchasers of securities from the issuer that are sold in reliance on the exemption provided under subsection (a)(8) during 

the 12-month period preceding such transaction. 

‘‘(3) SMALL OFFERING AMOUNT.—The aggregate amount of all 

securities sold by the issuer, including any amount sold in reliance on the exemption provided under subsection (a)(8), during 

the 12-month period preceding such transaction, does not exceed $500,000.’’. 

(b) EXEMPTION UNDER STATE REGULATIONS.—Section 18(b)(4) of 

the Securities Act of 1933 (15 U.S.C. 77r(b)(4)) is amended— 

(1) in subparagraph (F), by striking ‘‘or’’ at the end; 

95 

(2) in subparagraph (G), by striking the period and inserting 

‘‘; or’’; and 

(3) by adding at the end the following: 

‘‘(H) section 4(a)(8).’’. 

Subtitle N—Private Placement 

Improvement 

SEC. 466. REVISIONS TO SEC REGULATION D. 

Not later than 45 days following the date of the enactment of 

this Act, the Securities and Exchange Commission shall revise Regulation D (17 C.F.R. 501 et seq.) in accordance with the following: 

(1) The Commission shall revise Form D filing requirements 

to require an issuer offering or selling securities in reliance on 

an exemption provided under Rule 506 of Regulation D to file 

with the Commission a single notice of sales containing the information required by Form D for each new offering of securities no earlier than 15 days after the date of the first sale of 

securities in the offering. The Commission shall not require 

such an issuer to file any notice of sales containing the information required by Form D except for the single notice described in the previous sentence. 

(2) The Commission shall make the information contained in 

each Form D filing available to the securities commission (or 

any agency or office performing like functions) of each State 

and territory of the United States and the District of Columbia. 

(3) The Commission shall not condition the availability of 

any exemption for an issuer under Rule 506 of Regulation D 

(17 C.F.R. 230.506) on the issuer’s or any other person’s filing 

with the Commission of a Form D or any similar report. 

(4) The Commission shall not require issuers to submit written general solicitation materials to the Commission in connection with a Rule 506(c) offering, except when the Commission 

requests such materials pursuant to the Commission’s authority under section 8A or section 20 of the Securities Act of 1933 

(15 U.S.C. 77h–1 or 77t) or section 9, 10(b), 21A, 21B, or 21C 

of the Securities Exchange Act of 1934 (15 U.S.C. 78i, 78j(b), 

78u–1, 78u–2, or 78u–3). 

(5) The Commission shall not extend the requirements contained in Rule 156 to private funds. 

(6) The Commission shall revise Rule 501(a) of Regulation D 

to provide that a person who is a ‘‘knowledgeable employee’’ of 

a private fund or the fund’s investment adviser, as defined in 

Rule 3c–5(a)(4) (17 C.F.R. 270.3c–5(a)(4)), shall be an accredited investor for purposes of a Rule 506 offering of a private 

fund with respect to which the person is a knowledgeable employee. 

96 

Subtitle O—Supporting America’s 

Innovators 

SEC. 471. INVESTOR LIMITATION FOR QUALIFYING VENTURE CAPITAL 

FUNDS. 

Section 3(c)(1) of the Investment Company Act of 1940 (15 U.S.C. 

80a–3(c)(1)) is amended— 

(1) by inserting after ‘‘one hundred persons’’ the following: 

‘‘(or, with respect to a qualifying venture capital fund, 500 persons)’’; and 

(2) by adding at the end the following: 

‘‘(C) The term ‘qualifying venture capital fund’ means 

any venture capital fund (as defined pursuant to section 

203(l)(1) of the Investment Advisers Act of 1940 (15 U.S.C. 

80b–3(l)(1)) with no more than $50,000,000 in aggregate 

capital contributions and uncalled committed capital, as 

such dollar amount is annually adjusted by the Commission to reflect the change in the Consumer Price Index for 

All Urban Consumers published by the Bureau of Labor 

Statistics of the Department of Labor.’’. 

Subtitle P—Fix Crowdfunding 

SEC. 476. CROWDFUNDING EXEMPTION. 

(a) SECURITIES ACT OF 1933.—Section 4(a) of the Securities Act 

of 1933 (15 U.S.C. 77d) is amended by striking paragraph (6) and 

inserting the following: 

‘‘(6) transactions involving the offer or sale of securities by 

an issuer, provided that— 

‘‘(A) in the case of a transaction involving an intermediary between the issuer and the investor, such intermediary complies with the requirements under section 

4A(a); and 

‘‘(B) in the case of a transaction not involving an intermediary between the issuer and the investor, the issuer 

complies with the requirements under section 4A(b).’’. 

(b) REQUIREMENTS TO QUALIFY FOR CROWDFUNDING EXEMPTION.—Section 4A of the Securities Act of 1933 (15 U.S.C. 77d–1) 

is amended to read as follows: 

‘‘SEC. 4A. REQUIREMENTS WITH RESPECT TO CERTAIN SMALL TRANSACTIONS. 

‘‘(a) REQUIREMENTS ON INTERMEDIARIES.—For purposes of section 

4(a)(6), a person acting as an intermediary in a transaction involving the offer or sale of securities shall comply with the requirements of this subsection if the intermediary— 

‘‘(1) warns investors, including on the intermediary’s website 

used for the offer and sale of such securities, of the speculative 

nature generally applicable to investments in startups, emerging businesses, and small issuers, including risks in the secondary market related to illiquidity; 

‘‘(2) warns investors that they are subject to the restriction 

on sales requirement described under subsection (e); 

97 

‘‘(3) takes reasonable measures to reduce the risk of fraud 

with respect to such transaction; 

‘‘(4) registers with the Commission and the Financial Industry Regulatory Authority, including by providing the Commission with the intermediary’s physical address, website address, 

and the names of the intermediary and employees of the intermediary, and keep such information up-to-date; 

‘‘(5) provides the Commission with continuous investor-level 

access to the intermediary’s website; 

‘‘(6) requires each potential investor to answer questions 

demonstrating— 

‘‘(A) an understanding of the level of risk generally applicable to investments in startups, emerging businesses, 

and small issuers; 

‘‘(B) an understanding of the risk of illiquidity; and 

‘‘(C) such other areas as the Commission may determine 

appropriate by rule or regulation, including information relating to the owners’ and management’s experience, and 

any related party transactions and conflicts of interest; 

‘‘(7) carries out a background check on the issuer’s principals; 

‘‘(8) provides the Commission and potential investors with 

notice of the offering not less than 10 days prior to such offering, not later than the first day securities are offered to potential investors, including— 

‘‘(A) the issuer’s name, legal status, physical address, 

and website address; 

‘‘(B) the names of the issuer’s principals; 

‘‘(C) the stated purpose and intended use of the proceeds 

of the offering sought by the issuer; and 

‘‘(D) the target offering amount and the deadline to 

reach the target offering amount; 

‘‘(9) outsources cash-management functions to a qualified 

third party custodian, such as a broker or dealer registered 

under section 15(b)(1) of the Securities Exchange Act of 1934, 

a trust company, or an insured depository institution; 

‘‘(10) makes available on the intermediary’s website a method of communication that permits the issuer and investors to 

communicate with one another; and 

‘‘(11) provides the Commission with a notice upon completion 

of the offering, which shall include the aggregate offering 

amount and the number of purchasers. 

‘‘(b) REQUIREMENTS ON ISSUERS IF NO INTERMEDIARY.—For purposes of section 4(a)(6), an issuer who offers or sells securities without an intermediary shall comply with the requirements of this 

subsection if the issuer— 

‘‘(1) warns investors, including on the issuer’s website, of the 

speculative nature generally applicable to investments in 

startups, emerging businesses, and small issuers, including 

risks in the secondary market related to illiquidity; 

‘‘(2) warns investors that they are subject to the restriction 

on sales requirement described under subsection (e); 

‘‘(3) takes reasonable measures to reduce the risk of fraud 

with respect to such transaction; 

‘‘(4) provides the Commission with the issuer’s physical address, website address, and the names of the principals and 

98 

employees of the issuers, and keeps such information up-todate; 

‘‘(5) provides the Commission with continuous investor-level 

access to the issuer’s website; 

‘‘(6) requires each potential investor to answer questions 

demonstrating— 

‘‘(A) an understanding of the level of risk generally applicable to investments in startups, emerging businesses, 

and small issuers; 

‘‘(B) an understanding of the risk of illiquidity; and 

‘‘(C) such other areas as the Commission may determine 

appropriate by rule or regulation; 

‘‘(7) provides the Commission with notice of the offering not 

less than 10 days prior to such offering, not later than the first 

day securities are offered to potential investors, including— 

‘‘(A) the stated purpose and intended use of the proceeds 

of the offering sought by the issuer; and 

‘‘(B) the target offering amount and the deadline to 

reach the target offering amount; 

‘‘(8) outsources cash-management functions to a qualified 

third party custodian, such as a broker or dealer registered 

under section 15(b)(1) of the Securities Exchange Act of 1934, 

a trust company, or an insured depository institution; 

‘‘(9) makes available on the issuer’s website a method of communication that permits the issuer and investors to communicate with one another; 

‘‘(10) does not offer personalized investment advice; 

‘‘(11) provides the Commission with a notice upon completion 

of the offering, which shall include the aggregate offering 

amount and the number of purchasers; and 

‘‘(c) VERIFICATION OF INCOME.—For purposes of section 4(a)(6), an 

issuer or intermediary may rely on certifications as to annual income provided by the person to whom the securities are sold to 

verify the investor’s income. 

‘‘(d) INFORMATION AVAILABLE TO STATES.—The Commission shall 

make the notices described under subsections (a)(9), (a)(13), (b)(8), 

and (b)(13) and the information described under subsections (a)(4) 

and (b)(4) available to the States. 

‘‘(e) RESTRICTION ON SALES.—With respect to a transaction involving the issuance of securities described under section 4(a)(6), a 

purchaser may not transfer such securities during the 1-year period beginning on the date of purchase, unless such securities are 

sold to— 

‘‘(1) the issuer of such securities; or 

‘‘(2) an accredited investor. 

‘‘(f) CONSTRUCTION.— 

‘‘(1) NO REGISTRATION AS BROKER.—With respect to a transaction described under section 4(a)(6) involving an intermediary, such intermediary shall not be required to register as 

a broker under section 15(a)(1) of the Securities Exchange Act 

of 1934 solely by reason of participation in such transaction. 

‘‘(2) NO PRECLUSION OF OTHER CAPITAL RAISING.—Nothing in 

this section or section 4(a)(6) shall be construed as preventing 

an issuer from raising capital through methods not described 

under section 4(a)(6).’’. 

99 

(c) RULEMAKING.—Not later than 180 days after the date of enactment of this Act, the Securities and Exchange Commission shall 

issue or revise such rules as may be necessary to carry out section 

4A of the Securities Act of 1933, ans amended by this Act. In 

issuing or revising such rules, the Commission shall consider the 

costs and benefits of the action. 

(d) DISQUALIFICATION.—Not later than 180 days after the date of 

enactment of this Act, the Securities and Exchange Commission 

shall by rule or regulation establish disqualification provisions 

under which an issuer shall not be eligible to utilize the exemption 

under section 4(a)(6) of the Securities Act of 1933 (as amended by 

this Act) based on the disciplinary history of the issuer or its predecessors, affiliates, officers, directors, or persons fulfilling similar 

roles. The Commission shall also establish disqualification provisions under which an intermediary shall not be eligible to act as 

an intermediary in connection with an offering utilizing the exemption under section 4(a)(6) of the Securities Act of 1933 based on the 

disciplinary history of the intermediary or its predecessors, affiliates, officers, directors, or persons fulfilling similar roles. Such provisions shall be substantially similar to the disqualification provisions contained in the regulations adopted in accordance with section 926 of the Dodd-Frank Wall Street Reform and Consumer Protection Act (15 U.S.C. 77d note). 

SEC. 477. EXCLUSION OF CROWDFUNDING INVESTORS FROM SHAREHOLDER CAP. 

Section 12(g)(5) of the Securities Exchange Act of 1934 (15 U.S.C. 

78l(g)(5)) is amended— 

(1) by striking ‘‘(5) For the purposes’’ and inserting: 

‘‘(5) DEFINITIONS.— 

‘‘(A) IN GENERAL.—For the purposes’’; and 

(2) by adding at the end the following: 

‘‘(B) EXCLUSION FOR PERSONS HOLDING CERTAIN SECURITIES.—For purposes of this subsection, securities held by 

persons who purchase such securities in transactions described under section 4(a)(6) of the Securities Act of 1933 

shall not be deemed to be ‘held of record’.’’. 

SEC. 478. PREEMPTION OF STATE LAW. 

(a) IN GENERAL.—Section 18(b)(4)(C) of the Securities Act of 1933 

(15 U.S.C. 77r(b)(4)(C)) is amended by striking ‘‘section 4(6)’’ and 

inserting ‘‘section 4(a)(6)’’. 

(b) CLARIFICATION OF THE PRESERVATION OF STATE ENFORCEMENT AUTHORITY.— 

(1) IN GENERAL.—The amendments made by section 305(a) of 

the Jumpstart Our Business Startups Act, as amended by subsection (a), relate solely to State registration, documentation, 

and offering requirements, as described under section 18(a) of 

Securities Act of 1933 (15 U.S.C. 77r(a)), and shall have no impact or limitation on other State authority to take enforcement 

action with regard to an issuer, intermediary, or any other person or entity using the exemption from registration provided 

by section 4(a)(6) of such Act. Notwithstanding monetary penalties or sanctions, a State may not impose any filing or fee 

under such authority. 

100 

(2) CLARIFICATION OF STATE JURISDICTION OVER UNLAWFUL

CONDUCT OF INTERMEDIARIES, ISSUERS, AND CUSTODIANS.—Section 18(c)(1) of the Securities Act of 1933 is amended by striking ‘‘in connection with securities or securities transactions’’ 

and all that follows and inserting the following: ‘‘in connection 

with securities or securities transactions, with respect to— 

‘‘(A) fraud or deceit; 

‘‘(B) unlawful conduct by a broker or dealer; and 

‘‘(C) with respect to a transaction described under section 4(a)(6), unlawful conduct by an intermediary, issuer, 

or custodian.’’. 

SEC. 479. TREATMENT OF FUNDING PORTALS. 

Section 5312(c) of title 31, United States Code, is amended by 

adding at the end the following: 

‘‘(2) FUNDING PORTALS NOT INCLUDED IN DEFINITION.—The 

term ‘financial institution’ (as defined in subsection (a)) does 

not include a funding portal (as defined under section 3(a) of 

the Securities Exchange Act of 1934 (15 U.S.C. 78c(a))).’’. 

Subtitle Q—Corporate Governance Reform 

and Transparency 

SEC. 481. DEFINITIONS. 

(a) SECURITIES EXCHANGE ACT OF 1934.—Section 3(a) of the Securities Exchange Act of 1934 (15 U.S.C. 78c(a)) is amended by 

adding at the end the following new paragraphs: 

‘‘(83) PROXY ADVISORY FIRM.—The term ‘proxy advisory firm’ 

means any person who is primarily engaged in the business of 

providing proxy voting research, analysis, or recommendations 

to clients, which conduct constitutes a solicitation within the 

meaning of section 14 and the Commission’s rules and regulations thereunder, except to the extent that the person is exempted by such rules and regulations from requirements otherwise applicable to persons engaged in a solicitation. 

‘‘(84) PERSON ASSOCIATED WITH A PROXY ADVISORY FIRM.— 

The term ‘person associated with’ a proxy advisory firm means 

any partner, officer, or director of a proxy advisory firm (or any 

person occupying a similar status or performing similar functions), any person directly or indirectly controlling, controlled 

by, or under common control with a proxy advisory firm, or any 

employee of a proxy advisory firm, except that persons associated with a proxy advisory firm whose functions are clerical or 

ministerial shall not be included in the meaning of such term. 

The Commission may by rules and regulations classify, for purposes or any portion or portions of this Act, persons, including 

employees controlled by a proxy advisory firm.’’. 

(b) APPLICABLE DEFINITIONS.—As used in this subtitle— 

(1) the term ‘‘Commission’’ means the Securities and Exchange Commission; and 

(2) the term ‘‘proxy advisory firm’’ has the same meaning as 

in section 3(a)(83) of the Securities Exchange Act of 1934, as 

added by this subtitle. 

101 

SEC. 482. REGISTRATION OF PROXY ADVISORY FIRMS. 

(a) AMENDMENT.—The Securities Exchange Act of 1934 is amended by inserting after section 15G the following new section: 

‘‘SEC. 15H. REGISTRATION OF PROXY ADVISORY FIRMS. 

‘‘(a) CONDUCT PROHIBITED.—It shall be unlawful for a proxy advisory firm to make use of the mails or any means or instrumentality 

of interstate commerce to provide proxy voting research, analysis, 

or recommendations to any client, unless such proxy advisory firm 

is registered under this section. 

‘‘(b) REGISTRATION PROCEDURES.— 

‘‘(1) APPLICATION FOR REGISTRATION.— 

‘‘(A) IN GENERAL.—A proxy advisory firm must file with 

the Commission an application for registration, in such 

form as the Commission shall require, by rule or regulation, and containing the information described in subparagraph (B). 

‘‘(B) REQUIRED INFORMATION.—An application for registration under this section shall contain information regarding— 

‘‘(i) a certification that the applicant has adequate financial and managerial resources to consistently provide proxy advice based on accurate information; 

‘‘(ii) the procedures and methodologies that the applicant uses in developing proxy voting recommendations, including whether and how the applicant considers the size of a company when making proxy voting recommendations; 

‘‘(iii) the organizational structure of the applicant; 

‘‘(iv) whether or not the applicant has in effect a 

code of ethics, and if not, the reasons therefor; 

‘‘(v) any potential or actual conflict of interest relating to the ownership structure of the applicant or the 

provision of proxy advisory services by the applicant, 

including whether the proxy advisory firm engages in 

services ancillary to the provision of proxy advisory 

services such as consulting services for corporate 

issuers, and if so the revenues derived therefrom; 

‘‘(vi) the policies and procedures in place to manage 

conflicts of interest under subsection (f); and 

‘‘(vii) any other information and documents concerning the applicant and any person associated with 

such applicant as the Commission, by rule, may prescribe as necessary or appropriate in the public interest or for the protection of investors. 

‘‘(2) REVIEW OF APPLICATION.— 

‘‘(A) INITIAL DETERMINATION.—Not later than 90 days 

after the date on which the application for registration is 

filed with the Commission under paragraph (1) (or within 

such longer period as to which the applicant consents) the 

Commission shall— 

‘‘(i) by order, grant registration; or 

‘‘(ii) institute proceedings to determine whether registration should be denied. 

‘‘(B) CONDUCT OF PROCEEDINGS.— 

102 

‘‘(i) CONTENT.—Proceedings referred to in subparagraph (A)(ii) shall— 

‘‘(I) include notice of the grounds for denial 

under consideration and an opportunity for hearing; and 

‘‘(II) be concluded not later than 120 days after 

the date on which the application for registration 

is filed with the Commission under paragraph (1). 

‘‘(ii) DETERMINATION.—At the conclusion of such proceedings, the Commission, by order, shall grant or 

deny such application for registration. 

‘‘(iii) EXTENSION AUTHORIZED.—The Commission 

may extend the time for conclusion of such proceedings for not longer than 90 days, if it finds good 

cause for such extension and publishes its reasons for 

so finding, or for such longer period as to which the 

applicant consents. 

‘‘(C) GROUNDS FOR DECISION.—The Commission shall 

grant registration under this subsection— 

‘‘(i) if the Commission finds that the requirements of 

this section are satisfied; and 

‘‘(ii) unless the Commission finds (in which case the 

Commission shall deny such registration) that— 

‘‘(I) the applicant has failed to certify to the 

Commission’s satisfaction that it has adequate financial and managerial resources to consistently 

provide proxy advice based on accurate information and to materially comply with the procedures 

and methodologies disclosed under paragraph 

(1)(B) and with subsections (f) and (g); or 

‘‘(II) if the applicant were so registered, its registration would be subject to suspension or revocation under subsection (e). 

‘‘(3) PUBLIC AVAILABILITY OF INFORMATION.—Subject to section 24, the Commission shall make the information and documents submitted to the Commission by a proxy advisory firm 

in its completed application for registration, or in any amendment submitted under paragraph (1) or (2) of subsection (c), 

publicly available on the Commission’s website, or through another comparable, readily accessible means. 

‘‘(c) UPDATE OF REGISTRATION.— 

‘‘(1) UPDATE.—Each registered proxy advisory firm shall 

promptly amend and update its application for registration 

under this section if any information or document provided 

therein becomes materially inaccurate, except that a registered 

proxy advisory firm is not required to amend the information 

required to be filed under subsection (b)(1)(B)(i) by filing information under this paragraph, but shall amend such information in the annual submission of the organization under paragraph (2) of this subsection. 

‘‘(2) CERTIFICATION.—Not later than 90 calendar days after 

the end of each calendar year, each registered proxy advisory 

firm shall file with the Commission an amendment to its registration, in such form as the Commission, by rule, may preVerDate Sep 11 2014 05:01 Jun 07, 2017 Jkt 025698 PO 00000 Frm 00102 Fmt 6659 Sfmt 6602 E:\HR\OC\HR163.XXX HR163
103 

scribe as necessary or appropriate in the public interest or for 

the protection of investors— 

‘‘(A) certifying that the information and documents in 

the application for registration of such registered proxy advisory firm continue to be accurate in all material respects; 

and 

‘‘(B) listing any material change that occurred to such 

information or documents during the previous calendar 

year. 

‘‘(d) CENSURE, DENIAL, OR SUSPENSION OF REGISTRATION; NOTICE

AND HEARING.—The Commission, by order, shall censure, place 

limitations on the activities, functions, or operations of, suspend for 

a period not exceeding 12 months, or revoke the registration of any 

registered proxy advisory firm if the Commission finds, on the 

record after notice and opportunity for hearing, that such censure, 

placing of limitations, suspension, or revocation is necessary for the 

protection of investors and in the public interest and that such registered proxy advisory firm, or any person associated with such an 

organization, whether prior to or subsequent to becoming so associated— 

‘‘(1) has committed or omitted any act, or is subject to an 

order or finding, enumerated in subparagraph (A), (D), (E), (H), 

or (G) of section 15(b)(4), has been convicted of any offense 

specified in section 15(b)(4)(B), or is enjoined from any action, 

conduct, or practice specified in subparagraph (C) of section 

15(b)(4), during the 10-year period preceding the date of commencement of the proceedings under this subsection, or at any 

time thereafter; 

‘‘(2) has been convicted during the 10-year period preceding 

the date on which an application for registration is filed with 

the Commission under this section, or at any time thereafter, 

of— 

‘‘(A) any crime that is punishable by imprisonment for 

one or more years, and that is not described in section 

15(b)(4)(B); or 

‘‘(B) a substantially equivalent crime by a foreign court 

of competent jurisdiction; 

‘‘(3) is subject to any order of the Commission barring or suspending the right of the person to be associated with a registered proxy advisory firm; 

‘‘(4) fails to furnish the certifications required under subsections (b)(2)(C)(ii)(I) and (c)(2); 

‘‘(5) has engaged in one or more prohibited acts enumerated 

in paragraph (1); or 

‘‘(6) fails to maintain adequate financial and managerial resources to consistently offer advisory services with integrity, 

including by failing to comply with subsections (f) or (g). 

‘‘(e) TERMINATION OF REGISTRATION.— 

‘‘(1) VOLUNTARY WITHDRAWAL.—A registered proxy advisory 

firm may, upon such terms and conditions as the Commission 

may establish as necessary in the public interest or for the protection of investors, which terms and conditions shall include 

at a minimum that the registered proxy advisory firm will no 

longer conduct such activities as to bring it within the definition of proxy advisory firm in section 3(a)(83) of the Securities 

104 

Exchange Act of 1934, withdraw from registration by filing a 

written notice of withdrawal to the Commission. 

‘‘(2) COMMISSION AUTHORITY.—In addition to any other authority of the Commission under this title, if the Commission 

finds that a registered proxy advisory firm is no longer in existence or has ceased to do business as a proxy advisory firm, 

the Commission, by order, shall cancel the registration under 

this section of such registered proxy advisory firm. 

‘‘(f) MANAGEMENT OF CONFLICTS OF INTEREST.— ‘‘(1) ORGANIZATION POLICIES AND PROCEDURES.—Each registered proxy advisory firm shall establish, maintain, and enforce written policies and procedures reasonably designed, taking into consideration the nature of the business of such registered proxy advisory firm and associated persons, to address 

and manage any conflicts of interest that can arise from such 

business. 

‘‘(2) COMMISSION AUTHORITY.—The Commission shall issue 

final rules to prohibit, or require the management and disclosure of, any conflicts of interest relating to the offering of proxy 

advisory services by a registered proxy advisory firm, including, without limitation, conflicts of interest relating to— 

‘‘(A) the manner in which a registered proxy advisory 

firm is compensated by the client, or any affiliate of the 

client, for providing proxy advisory services; 

‘‘(B) the provision of consulting, advisory, or other services by a registered proxy advisory firm, or any person associated with such registered proxy advisory firm, to the 

client; 

‘‘(C) business relationships, ownership interests, or any 

other financial or personal interests between a registered 

proxy advisory firm, or any person associated with such 

registered proxy advisory firm, and any client, or any affiliate of such client; 

‘‘(D) transparency around the formulation of proxy voting policies; 

‘‘(E) the execution of proxy votes if such votes are based 

upon recommendations made by the proxy advisory firm in 

which someone other than the issuer is a proponent; 

‘‘(F) issuing recommendations where proxy advisory 

firms provide advisory services to a company; and 

‘‘(G) any other potential conflict of interest, as the Commission deems necessary or appropriate in the public interest or for the protection of investors. 

‘‘(g) RELIABILITY OF PROXY ADVISORY FIRM SERVICES.— 

‘‘(1) IN GENERAL.—Each registered proxy advisory firm shall 

have staff sufficient to produce proxy voting recommendations 

that are based on accurate and current information. Each registered proxy advisory firm shall detail procedures sufficient to 

permit companies receiving proxy advisory firm recommendations access in a reasonable time to the draft recommendations, with an opportunity to provide meaningful comment 

thereon, including the opportunity to present details to the person responsible for developing the recommendation in person 

or telephonically. Each registered proxy advisory firm shall 

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105 

racy of voting information used in making recommendations 

from the subjects of the proxy advisory firm’s voting recommendations, and shall resolve those complaints in a timely 

fashion and in any event prior to voting on the matter to which 

the recommendation relates. 

‘‘(2) DRAFT RECOMMENDATIONS DEFINED.—For purposes of 

this subsection, the term ‘draft recommendations’— 

‘‘(A) means the overall conclusions of proxy voting recommendations prepared for the clients of a proxy advisory 

firm, including any public data cited therein, any company 

information or substantive analysis impacting the recommendation, and the specific voting recommendations on 

individual proxy ballot issues; and 

‘‘(B) does not include the entirety of the proxy advisory 

firm’s final report to its clients. 

‘‘(h) DESIGNATION OF COMPLIANCE OFFICER.—Each registered 

proxy advisory firm shall designate an individual responsible for 

administering the policies and procedures that are required to be 

established pursuant to subsections (f) and (g), and for ensuring 

compliance with the securities laws and the rules and regulations 

thereunder, including those promulgated by the Commission pursuant to this section. 

‘‘(i) PROHIBITED CONDUCT.— ‘‘(1) PROHIBITED ACTS AND PRACTICES.—The Commission 

shall issue final rules to prohibit any act or practice relating 

to the offering of proxy advisory services by a registered proxy 

advisory firm that the Commission determines to be unfair or 

coercive, including any act or practice relating to— 

‘‘(A) conditioning a voting recommendation or other 

proxy advisory firm recommendation on the purchase by 

an issuer or an affiliate thereof of other services or products, of the registered proxy advisory firm or any person 

associated with such registered proxy advisory firm; and 

‘‘(B) modifying a voting recommendation or otherwise departing from its adopted systematic procedures and methodologies in the provision of proxy advisory services, based 

on whether an issuer, or affiliate thereof, subscribes or will 

subscribe to other services or product of the registered 

proxy advisory firm or any person associated with such organization. 

‘‘(2) RULE OF CONSTRUCTION.—Nothing in paragraph (1), or 

in any rules or regulations adopted thereunder, may be construed to modify, impair, or supersede the operation of any of 

the antitrust laws (as defined in the first section of the Clayton 

Act, except that such term includes section 5 of the Federal 

Trade Commission Act, to the extent that such section 5 applies to unfair methods of competition). 

‘‘(j) STATEMENTS OF FINANCIAL CONDITION.—Each registered 

proxy advisory firm shall, on a confidential basis, file with the 

Commission, at intervals determined by the Commission, such financial statements, certified (if required by the rules or regulations 

of the Commission) by an independent public auditor, and information concerning its financial condition, as the Commission, by rule, 

may prescribe as necessary or appropriate in the public interest or 

for the protection of investors. 

106 

‘‘(k) ANNUAL REPORT.—Each registered proxy advisory firm shall, 

at the beginning of each fiscal year of such firm, report to the Commission on the number of shareholder proposals its staff reviewed 

in the prior fiscal year, the number of recommendations made in 

the prior fiscal year, the number of staff who reviewed and made 

recommendations on such proposals in the prior fiscal year, and the 

number of recommendations made in the prior fiscal year where 

the proponent of such recommendation was a client of or received 

services from the proxy advisory firm. 

‘‘(l) TRANSPARENT POLICIES.—Each registered proxy advisory firm 

shall file with the Commission and make publicly available its 

methodology for the formulation of proxy voting policies and voting 

recommendations. 

‘‘(m) RULES OF CONSTRUCTION.— 

‘‘(1) NO WAIVER OF RIGHTS, PRIVILEGES, OR DEFENSES.—Registration under and compliance with this section does not constitute a waiver of, or otherwise diminish, any right, privilege, 

or defense that a registered proxy advisory firm may otherwise 

have under any provision of State or Federal law, including 

any rule, regulation, or order thereunder. 

‘‘(2) NO PRIVATE RIGHT OF ACTION.—Nothing in this section 

may be construed as creating any private right of action, and 

no report filed by a registered proxy advisory firm in accordance with this section or section 17 shall create a private right 

of action under section 18 or any other provision of law. 

‘‘(n) REGULATIONS.— 

‘‘(1) NEW PROVISIONS.—Such rules and regulations as are required by this section or are otherwise necessary to carry out 

this section, including the application form required under subsection (a)— 

‘‘(A) shall be issued by the Commission, not later than 

180 days after the date of enactment of this section; and 

‘‘(B) shall become effective not later than 1 year after the 

date of enactment of this section. 

‘‘(2) REVIEW OF EXISTING REGULATIONS.—Not later than 270 

days after the date of enactment of this section, the Commission shall— 

‘‘(A) review its existing rules and regulations which affect the operations of proxy advisory firms; 

‘‘(B) amend or revise such rules and regulations in accordance with the purposes of this section, and issue such 

guidance, as the Commission may prescribe as necessary 

or appropriate in the public interest or for the protection 

of investors; and 

‘‘(C) direct Commission staff to withdraw the Egan Jones 

Proxy Services (May 27, 2004) and Institutional Shareholder Services, Inc. (September 15, 2004) no-action letters. 

‘‘(o) APPLICABILITY.—This section, other than subsection (n), 

which shall apply on the date of enactment of this section, shall 

apply on the earlier of— 

‘‘(1) the date on which regulations are issued in final form 

under subsection (n)(1); or 

‘‘(2) 270 days after the date of enactment of this section.’’. 

107 

(b) CONFORMING AMENDMENT.—Section 17(a)(1) of the Securities 

Exchange Act of 1934 (15 U.S.C. 78q(a)(1)) is amended by inserting 

‘‘proxy advisory firm,’’ after ‘‘nationally recognized statistical rating 

organization,’’. 

SEC. 483. COMMISSION ANNUAL REPORT. 

The Commission shall make an annual report publicly available 

on the Commission’s Internet website. Such report shall, with respect to the year to which the report relates— 

(1) identify applicants for registration under section 15H of 

the Securities Exchange Act of 1934, as added by this subtitle; 

(2) specify the number of and actions taken on such applications; 

(3) specify the views of the Commission on the state of competition, transparency, policies and methodologies, and conflicts of interest among proxy advisory firms; 

(4) include the determination of the Commission with regard 

to— 

(A) the quality of proxy advisory services issued by proxy 

advisory firms; 

(B) the financial markets; 

(C) competition among proxy advisory firms; 

(D) the incidence of undisclosed conflicts of interest by 

proxy advisory firms; 

(E) the process for registering as a proxy advisory firm; 

and 

(F) such other matters relevant to the implementation of 

this subtitle and the amendments made by this subtitle, as 

the Commission determines necessary to bring to the attention of the Congress; 

(5) identify problems, if any, that have resulted from the implementation of this subtitle and the amendments made by 

this subtitle; and 

(6) recommend solutions, including any legislative or regulatory solutions, to any problems identified under paragraphs 

(4) and (5). 

Subtitle R—Senior Safe 

SEC. 491. IMMUNITY. 

(a) DEFINITIONS.—In this subtitle— 

(1) the term ‘‘Bank Secrecy Act Officer’’ means an individual 

responsible for ensuring compliance with the requirements 

mandated by subchapter II of chapter 53 of title 31, United 

States Code; 

(2) the term ‘‘broker-dealer’’ means a broker or dealer, as 

those terms are defined, respectively, in section 3(a) of the Securities Exchange Act of 1934 (15 U.S.C. 78c(a)); 

(3) the term ‘‘covered agency’’ means— 

(A) a State financial regulatory agency, including a State 

securities or law enforcement authority and a State insurance regulator; 

(B) each of the Federal financial institutions regulatory 

agencies; 

(C) the Securities and Exchange Commission; 

108 

(D) a law enforcement agency; 

(E) and State or local agency responsible for administering adult protective service laws; and 

(F) a State attorney general. 

(4) the term ‘‘covered financial institution’’ means— 

(A) a credit union; 

(B) a depository institution; 

(C) an investment advisor; 

(D) a broker-dealer; 

(E) an insurance company; 

(F) a State attorney general; and 

(G) a transfer agent. 

(5) the term ‘‘credit union’’ means a Federal credit union, 

State credit union, or State-chartered credit union, as those 

terms are defined in section 101 of the Federal Credit Union 

Act (12 U.S.C. 1752); 

(6) the term ‘‘depository institution’’ has the meaning given 

the term in section 3(c) of the Federal Deposit Insurance Act 

(12 U.S.C. 1813(c)); 

(7) the term ‘‘exploitation’’ means the fraudulent or otherwise illegal, unauthorized, or improper act or process of an individual, including a caregiver or fiduciary, that— 

(A) uses the resources of a senior citizen for monetary 

personal benefit, profit, or gain; or 

(B) results in depriving a senior citizen of rightful access 

to or use of benefits, resources, belongings or assets; 

(8) the term ‘‘Federal financial institutions regulatory agencies’’ has the meaning given the term in section 1003 of the 

Federal Financial Institutions Examination Council Act of 

1978 (12 U.S.C. 3302); 

(9) the term ‘‘investment adviser’’ has the meaning given the 

term in section 202 of the Investment Advisers Act of 1940 (15 

U.S.C. 80b–2); 

(10) the term ‘‘insurance company’’ has the meaning given 

the term in section 2(a) of the Investment Company Act of 

1940 (15 U.S.C. 80a–2(a)); 

(11) the term ‘‘registered representative’’ means an individual who represents a broker-dealer in effecting or attempting to affect a purchase or sale of securities; 

(12) the term ‘‘senior citizen’’ means an individual who is not 

less than 65 years of age; 

(13) the term ‘‘State insurance regulator’’ has the meaning 

given such term in section 315 of the Gramm-Leach-Bliley Act 

(15 U.S.C. 6735); 

(14) the term ‘‘State securities or law enforcement authority’’ 

has the meaning given the term in section 24(f)(4) of the Securities Exchange Act of 1934 (15 U.S.C. 78x(f)(4)); and 

(15) the term ‘‘transfer agent’’ has the meaning given the 

term in section 3(a) of the Securities Exchange Act of 1934 (15 

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

(b) IMMUNITY FROM SUIT.— 

(1) IMMUNITY FOR INDIVIDUALS.—An individual who has received the training described in section 492 shall not be liable, 

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closing the possible exploitation of a senior citizen to a covered 

agency if the individual, at the time of the disclosure— 

(A) served as a supervisor, compliance officer (including 

a Bank Secrecy Act Officer), or registered representative 

for a covered financial institution; and 

(B) made the disclosure with reasonable care including 

reasonable efforts to avoid disclosure other than to a covered agency. 

(2) IMMUNITY FOR COVERED FINANCIAL INSTITUTIONS.—A covered financial institution shall not be liable, including in any 

civil or administrative proceeding, for a disclosure made by an 

individual described in paragraph (1) if— 

(A) the individual was employed by, or, in the case of a 

registered representative, affiliated or associated with, the 

covered financial institution at the time of the disclosure; 

and 

(B) before the time of the disclosure, the covered financial institution provided the training described in section 

492 to each individual described in section 492(a). 

SEC. 492. TRAINING REQUIRED. 

(a) IN GENERAL.—A covered financial institution may provide 

training described in subsection (b)(1) to each officer or employee 

of, or registered representative affiliated or associated with, the 

covered financial institution who— 

(1) is described in section 491(b)(1)(A); 

(2) may come into contact with a senior citizen as a regular 

part of the duties of the officer, employee, or registered representative; or 

(3) may review or approve the financial documents, records, 

or transactions of a senior citizen in connection with providing 

financial services to a senior citizen. 

(b) TRAINING.— 

(1) IN GENERAL.—The training described in this paragraph 

shall— 

(A) instruct any individual attending the training on 

how to identify and report the suspected exploitation of a 

senior citizen; 

(B) discuss the need to protect the privacy and respect 

the integrity of each individual customer of a covered financial institution; and 

(C) be appropriate to the job responsibilities of the individual attending the training. 

(2) TIMING.—The training required under subsection (a) shall 

be provided as soon as reasonably practicable but not later 

than 1 year after the date on which an officer, employee, or 

registered representative begins employment with or becomes 

affiliated or associated with the covered financial institution. 

(3) BANK SECRECY ACT OFFICER.—An individual who is designated as a compliance officer under an anti-money laundering program established pursuant to section 5318(h) of title 

31, United States Code, shall be deemed to have received the 

training described under this subsection. 

110 

SEC. 493. RELATIONSHIP TO STATE LAW. 

Nothing in this Act shall be construed to preempt or limit any 

provision of State law, except only to the extent that section 491 

provides a greater level of protection against liability to an individual described in section 491(b)(1) or to a covered financial institution described in section 491(b)(2) than is provided under State 

law. 

Subtitle S—National Securities Exchange 

Regulatory Parity 

SEC. 496. APPLICATION OF EXEMPTION. 

Section 18(b)(1) of the Securities Act of 1933 (15 U.S.C. 

77r(b)(1)), as amended by section 456(b), is further amended— 

(1) by striking subparagraph (A); 

(2) in subparagraph (B), by striking ‘‘that the Commission 

determines by rule (on its own initiative or on the basis of a 

petition) are substantially similar to the listing standards applicable to securities described in subparagraph (A)’’ and inserting ‘‘that have been approved by the Commission’’; 

(3) in subparagraph (C), by striking ‘‘or (B)’’; and 

(4) by redesignating subparagraphs (B), (C), and (D) as subparagraphs (A), (B), and (C), respectively. 

Subtitle T—Private Company Flexibility 

and Growth 

SEC. 497. SHAREHOLDER THRESHOLD FOR REGISTRATION. 

The Securities Exchange Act of 1934 (15 U.S.C. 78a et seq.) is 

amended— 

(1) in section 12(g)— 

(A) in paragraph (1)— 

(i) by striking ‘‘shall—’’ and all that follows through 

‘‘register such security’’ and inserting ‘‘shall, not later 

than 120 days after the last day of its first fiscal year 

ended after the effective date of this subsection on 

which the issuer has total assets exceeding 

$10,000,000 (or such greater amount of assets as the 

Commission may establish by rule) and a class of equity security (other than an exempted security) held of 

record by 2,000 or more persons (or such greater number of persons as the Commission may establish by 

rule), register such security’’; and 

(ii) by adding at the end the following: ‘‘The dollar 

figure in this paragraph shall be indexed for inflation 

every 5 years by the Commission to reflect the change 

in the Consumer Price Index for All Urban Consumers 

published by the Bureau of Labor Statistics, rounded 

to the nearest $100,000.’’; and 

(B) in paragraph (4), by striking ‘‘300 persons’’ and all 

that follows through ‘‘1,200 persons persons’’ and inserting 

‘‘1,200 persons’’; and 

111 

(2) in section 15(d)(1), by striking ‘‘300 persons’’ and all that 

follows through ‘‘1,200 persons persons’’ and inserting ‘‘1,200 

persons’’. 

Subtitle U—Small Company Capital 

Formation Enhancements 

SEC. 498. JOBS ACT-RELATED EXEMPTION. 

Section 3(b) of the Securities Act of 1933 (15 U.S.C. 77c(b)) is 

amended— 

(1) in paragraph (2)(A), by striking ‘‘$50,000,000’’ and inserting ‘‘$75,000,000, adjusted for inflation by the Commission 

every 2 years to the nearest $10,000 to reflect the change in 

the Consumer Price Index for All Urban Consumers published 

by the Bureau of Labor Statistics’’; and 

(2) in paragraph (5)— 

(A) by striking ‘‘such amount as’’ and inserting: ‘‘such 

amount, in addition to the adjustment for inflation provided for under such paragraph (2)(A), as’’; and 

(B) by striking ‘‘such amount, it’’ and inserting ‘‘such 

amount, in addition to the adjustment for inflation provided for under such paragraph (2)(A), it’’. 

Subtitle V—Encouraging Public Offerings 

SEC. 499. EXPANDING TESTING THE WATERS AND CONFIDENTIAL SUBMISSIONS. 

The Securities Act of 1933 (15 U.S.C. 77a et seq.) is amended— 

(1) in section 5(d), by striking ‘‘an emerging growth company 

or any person authorized to act on behalf of an emerging 

growth company’’ and inserting ‘‘an issuer or any person authorized to act on behalf of an issuer’’; and 

(2) in section 6(e)— 

(A) in the heading, by striking ‘‘EMERGING GROWTH

COMPANIES’’ and inserting ‘‘DRAFT REGISTRATION STATEMENTS’’; and 

(B) by amending paragraph (1) to read as follows: 

‘‘(1) IN GENERAL.—Any issuer, prior to its initial public offering date, may confidentially submit to the Commission a draft 

registration statement, for confidential nonpublic review by the 

staff of the Commission prior to public filing, provided that the 

initial confidential submission and all amendments thereto 

shall be publicly filed with the Commission not later than 15 

days before the date on which the issuer conducts a road show, 

as such term is defined in section 230.433(h)(4) of title 17, 

Code of Federal Regulations, or any successor thereto.’’. 

112 

TITLE V—REGULATORY RELIEF FOR 

MAIN STREET AND COMMUNITY FINANCIAL INSTITUTIONS 

Subtitle A—Preserving Access to 

Manufactured Housing 

SEC. 501. MORTGAGE ORIGINATOR DEFINITION. 

Section 103 of the Truth in Lending Act (15 U.S.C. 1602) is 

amended— 

(1) by redesignating the second subsection (cc) and subsection (dd) as subsections (dd) and (ee), respectively; and 

(2) in paragraph (2)(C) of subsection (dd), as so redesignated, 

by striking ‘‘an employee of a retailer of manufactured homes 

who is not described in clause (i) or (iii) of subparagraph (A) 

and who does not advise a consumer on loan terms (including 

rates, fees, and other costs)’’ and inserting ‘‘a retailer of manufactured or modular homes or its employees unless such retailer or its employees receive compensation or gain for engaging in activities described in subparagraph (A) that is in excess 

of any compensation or gain received in a comparable cash 

transaction’’. 

SEC. 502. HIGH-COST MORTGAGE DEFINITION. 

Section 103 of the Truth in Lending Act (15 U.S.C. 1602), as 

amended by section 501, is further amended— 

(1) by redesignating subsection (aa) (relating to disclosure of 

greater amount or percentage), as so designated by section 

1100A of the Consumer Financial Protection Act of 2010, as 

subsection (bb); 

(2) by redesignating subsection (bb) (relating to high cost 

mortgages), as so designated by section 1100A of the Consumer 

Financial Protection Act of 2010, as subsection (aa), and moving such subsection to immediately follow subsection (z); and 

(3) in subsection (aa)(1)(A), as so redesignated— 

(A) in clause (i)(I), by striking ‘‘(8.5 percentage points, if 

the dwelling is personal property and the transaction is for 

less than $50,000)’’ and inserting ‘‘(10 percentage points if 

the dwelling is personal property or is a transaction that 

does not include the purchase of real property on which a 

dwelling is to be placed, and the transaction is for less 

than $75,000 (as such amount is adjusted by the Consumer Law Enforcement Agency to reflect the change in 

the Consumer Price Index))’’; and 

(B) in clause (ii)— 

(i) in subclause (I), by striking ‘‘or’’ at the end; and 

(ii) by adding at the end the following: 

‘‘(III) in the case of a transaction for less than 

$75,000 (as such amount is adjusted by the Consumer Law Enforcement Agency to reflect the 

change in the Consumer Price Index) in which the 

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113 

chase of real property on which a dwelling is to be 

placed) the greater of 5 percent of the total transaction amount or $3,000 (as such amount is adjusted by the Consumer Law Enforcement Agency 

to reflect the change in the Consumer Price 

Index); or’’. 

Subtitle B—Mortgage Choice 

SEC. 506. DEFINITION OF POINTS AND FEES. 

(a) AMENDMENT TO SECTION 103 OF TILA.—Paragraph (4) of section 103(aa) of the Truth in Lending Act, as redesignated by section 502, is amended— 

(1) by striking ‘‘paragraph (1)(B)’’ and inserting ‘‘paragraph 

(1)(A) and section 129C’’; 

(2) in subparagraph (C)— 

(A) by inserting ‘‘and insurance’’ after ‘‘taxes’’; 

(B) in clause (ii), by inserting ‘‘, except as retained by a 

creditor or its affiliate as a result of their participation in 

an affiliated business arrangement (as defined in section 

3(7) of the Real Estate Settlement Procedures Act of 1974 

(12 U.S.C. 2602(7)),’’ after ‘‘compensation’’; and 

(C) by striking clause (iii) and inserting the following: 

‘‘(iii) the charge is— 

‘‘(I) a bona fide third-party charge not retained by 

the mortgage originator, creditor, or an affiliate of the 

creditor or mortgage originator; or 

‘‘(II) a charge set forth in section 106(e)(1);’’; and 

(3) in subparagraph (D)— 

(A) by striking ‘‘accident,’’; and 

(B) by striking ‘‘or any payments’’ and inserting ‘‘and 

any payments’’. 

(b) AMENDMENT TO SECTION 129C OF TILA.—Section 129C of the 

Truth in Lending Act (15 U.S.C. 1639c) is amended— 

(1) in subsection (a)(5)(C), by striking ‘‘103’’ and all that follows through ‘‘or mortgage originator’’ and inserting 

‘‘103(aa)(4)’’; and 

(2) in subsection (b)(2)(C)(i), by striking ‘‘103’’ and all that 

follows through ‘‘or mortgage originator)’’ and inserting 

‘‘103(aa)(4)’’. 

Subtitle C—Financial Institution Customer 

Protection 

SEC. 511. REQUIREMENTS FOR DEPOSIT ACCOUNT TERMINATION REQUESTS AND ORDERS. 

(a) TERMINATION REQUESTS OR ORDERS MUST BE MATERIAL.— 

(1) IN GENERAL.—An appropriate Federal banking agency 

may not formally or informally request or order a depository 

institution to terminate a specific customer account or group of 

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114 

ing relationship with a specific customer or group of customers 

unless— 

(A) the agency has a material reason for such request or 

order; and 

(B) such reason is not based solely on reputation risk. 

(2) TREATMENT OF NATIONAL SECURITY THREATS.—If an appropriate Federal banking agency believes a specific customer 

or group of customers is, or is acting as a conduit for, an entity 

which— 

(A) poses a threat to national security, 

(B) is involved in terrorist financing, 

(C) is an agency of the government of Iran, North Korea, 

Syria, or any country listed from time to time on the State 

Sponsors of Terrorism list, 

(D) is located in, or is subject to the jurisdiction of, any 

country specified in subparagraph (C), or 

(E) does business with any entity described in subparagraph (C) or (D), unless the appropriate Federal banking 

agency determines that the customer or group of customers has used due diligence to avoid doing business with 

any entity described in subparagraph (C) or (D), 

such belief shall satisfy the requirement under paragraph (1). 

(b) NOTICE REQUIREMENT.— (1) IN GENERAL.—If an appropriate Federal banking agency 

formally or informally requests or orders a depository institution to terminate a specific customer account or a group of customer accounts, the agency shall— 

(A) provide such request or order to the institution in 

writing; and 

(B) accompany such request or order with a written justification for why such termination is needed, including 

any specific laws or regulations the agency believes are 

being violated by the customer or group of customers, if 

any. 

(2) JUSTIFICATION REQUIREMENT.—A justification described 

under paragraph (1)(B) may not be based solely on the reputation risk to the depository institution. 

(c) CUSTOMER NOTICE.— (1) NOTICE REQUIRED.—Except as provided under paragraph 

(2), if an appropriate Federal banking agency orders a depository institution to terminate a specific customer account or a 

group of customer accounts, the depository institution shall inform the customer or customers of the justification for the customer’s account termination described under subsection (b). 

(2) NOTICE PROHIBITED IN CASES OF NATIONAL SECURITY.—If 

an appropriate Federal banking agency requests or orders a 

depository institution to terminate a specific customer account 

or a group of customer accounts based on a belief that the customer or customers pose a threat to national security, or are 

otherwise described under subsection (a)(2), neither the depository institution nor the appropriate Federal banking agency 

may inform the customer or customers of the justification for 

the customer’s account termination. 

(d) REPORTING REQUIREMENT.—Each appropriate Federal banking agency shall issue an annual report to the Congress stating— 

115 

(1) the aggregate number of specific customer accounts that 

the agency requested or ordered a depository institution to terminate during the previous year; and 

(2) the legal authority on which the agency relied in making 

such requests and orders and the frequency on which the agency relied on each such authority. 

(e) DEFINITIONS.—For purposes of this section: 

(1) APPROPRIATE FEDERAL BANKING AGENCY.—The term ‘‘appropriate Federal banking agency’’ means— 

(A) the appropriate Federal banking agency, as defined 

under section 3 of the Federal Deposit Insurance Act (12 

U.S.C. 1813); and 

(B) the National Credit Union Administration, in the 

case of an insured credit union. 

(2) DEPOSITORY INSTITUTION.—The term ‘‘depository institution’’ means— 

(A) a depository institution, as defined under section 3 

of the Federal Deposit Insurance Act (12 U.S.C. 1813); and 

(B) an insured credit union. 

SEC. 512. AMENDMENTS TO THE FINANCIAL INSTITUTIONS REFORM, 

RECOVERY, AND ENFORCEMENT ACT OF 1989. 

Section 951 of the Financial Institutions Reform, Recovery, and 

Enforcement Act of 1989 (12 U.S.C. 1833a) is amended— 

(1) in subsection (c)(2), by striking ‘‘affecting a federally insured financial institution’’ and inserting ‘‘against a federally 

insured financial institution or by a federally insured financial 

institution against an unaffiliated third person’’; and 

(2) in subsection (g)— 

(A) in the heading, by striking ‘‘SUBPOENAS’’ and inserting ‘‘INVESTIGATIONS’’; and 

(B) by amending paragraph (1)(C) to read as follows: 

‘‘(C) summon witnesses and require the production of 

any books, papers, correspondence, memoranda, or other 

records which the Attorney General deems relevant or material to the inquiry, if the Attorney General— 

‘‘(i) requests a court order from a court of competent 

jurisdiction for such actions and offers specific and 

articulable facts showing that there are reasonable 

grounds to believe that the information or testimony 

sought is relevant and material for conducting an investigation under this section; or 

‘‘(ii) either personally or through delegation no lower 

than the Deputy Attorney General, issues and signs a 

subpoena for such actions and such subpoena is supported by specific and articulable facts showing that 

there are reasonable grounds to believe that the information or testimony sought is relevant for conducting 

an investigation under this section.’’. 

116 

Subtitle D—Portfolio Lending and 

Mortgage Access 

SEC. 516. SAFE HARBOR FOR CERTAIN LOANS HELD ON PORTFOLIO. 

(a) IN GENERAL.—Section 129C of the Truth in Lending Act (15 

U.S.C. 1639c) is amended by adding at the end the following: 

‘‘(j) SAFE HARBOR FOR CERTAIN LOANS HELD ON PORTFOLIO.— ‘‘(1) SAFE HARBOR FOR CREDITORS THAT ARE DEPOSITORY IN- STITUTIONS.— ‘‘(A) IN GENERAL.—A creditor that is a depository institution shall not be subject to suit for failure to comply with 

subsection (a), (c)(1), or (f)(2) of this section or section 

129H with respect to a residential mortgage loan, and the 

banking regulators shall treat such loan as a qualified 

mortgage, if— 

‘‘(i) the creditor has, since the origination of the 

loan, held the loan on the balance sheet of the creditor; and 

‘‘(ii) all prepayment penalties with respect to the 

loan comply with the limitations described under subsection (c)(3). 

‘‘(B) EXCEPTION FOR CERTAIN TRANSFERS.—In the case of 

a depository institution that transfers a loan originated by 

that institution to another depository institution by reason 

of the bankruptcy or failure of the originating depository 

institution or the purchase of the originating depository institution, the depository institution transferring such loan 

shall be deemed to have complied with the requirement 

under subparagraph (A)(i). 

‘‘(2) SAFE HARBOR FOR MORTGAGE ORIGINATORS.—A mortgage 

originator shall not be subject to suit for a violation of section 

129B(c)(3)(B) for steering a consumer to a residential mortgage 

loan if— 

‘‘(A) the creditor of such loan is a depository institution 

and has informed the mortgage originator that the creditor 

intends to hold the loan on the balance sheet of the creditor for the life of the loan; and 

‘‘(B) the mortgage originator informs the consumer that 

the creditor intends to hold the loan on the balance sheet 

of the creditor for the life of the loan. 

‘‘(3) DEFINITIONS.—For purposes of this subsection: 

‘‘(A) BANKING REGULATORS.—The term ‘banking regulators’ means the Federal banking agencies, the Consumer 

Law Enforcement Agency, and the National Credit Union 

Administration. 

‘‘(B) DEPOSITORY INSTITUTION.—The term ‘depository institution’ has the meaning given that term under section 

19(b)(1) of the Federal Reserve Act (12 U.S.C. 505(b)(1)). 

‘‘(C) FEDERAL BANKING AGENCIES.—The term ‘Federal 

banking agencies’ has the meaning given that term under 

section 3 of the Federal Deposit Insurance Act.’’. 

(b) RULE OF CONSTRUCTION.—Nothing in the amendment made 

by this section may be construed as preventing a balloon loan from 

qualifying for the safe harbor provided under section 129C(j) of the 

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Truth in Lending Act if the balloon loan otherwise meets all of the 

requirements under such subsection (j), regardless of whether the 

balloon loan meets the requirements described under clauses (i) 

through (iv) of section 129C(b)(2)(E) of such Act. 

Subtitle E—Application of the Expedited 

Funds Availability Act 

SEC. 521. APPLICATION OF THE EXPEDITED FUNDS AVAILABILITY 

ACT. 

(a) IN GENERAL.—The Expedited Funds Availability Act (12 

U.S.C. 4001 et seq.) is amended— 

(1) in section 602(20) (12 U.S.C. 4001(20)) by inserting ‘‘, located in the United States,’’ after ‘‘ATM’’; 

(2) in section 602(21) (12 U.S.C. 4001(21)) by inserting 

‘‘American Samoa, the Commonwealth of the Northern Mariana Islands,’’ after ‘‘Puerto Rico,’’; 

(3) in section 602(23) (12 U.S.C. 4001(23)) by inserting 

‘‘American Samoa, the Commonwealth of the Northern Mariana Islands,’’ after ‘‘Puerto Rico,’’; and 

(4) in section 603(d)(2)(A) (12 U.S.C. 4002(d)(2)(A)), by inserting ‘‘American Samoa, the Commonwealth of the Northern 

Mariana Islands,’’ after ‘‘Puerto Rico,’’. 

(b) EFFECTIVE DATE.—This section shall take effect on January 

1, 2017. 

Subtitle F—Small Bank Holding Company 

Policy Statement 

SEC. 526. CHANGES REQUIRED TO SMALL BANK HOLDING COMPANY 

POLICY STATEMENT ON ASSESSMENT OF FINANCIAL AND 

MANAGERIAL FACTORS. 

(a) 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 revise the Small Bank Holding 

Company Policy Statement on Assessment of Financial and Managerial Factors (12 C.F.R. part 225—appendix C) to raise the consolidated asset threshold under such policy statement from 

$1,000,000,000 (as adjusted by Public Law 113–250) to 

$10,000,000,000. 

(b) CONFORMING AMENDMENT.—Subparagraph (C) of section 

171(b)(5) of the Dodd-Frank Wall Street Reform and Consumer 

Protection Act (12 U.S.C. 5371(b)(5)) is amended to read as follows: 

‘‘(C) any bank holding company or savings and loan 

holding company that is subject to the application of the 

Small Bank Holding Company Policy Statement on Assessment of Financial and Managerial Factors of the Board of 

Governors (12 C.F.R. part 225—appendix C).’’. 

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Subtitle G—Community Institution 

Mortgage Relief 

SEC. 531. COMMUNITY FINANCIAL INSTITUTION MORTGAGE RELIEF. 

(a) EXEMPTION FROM ESCROW REQUIREMENTS FOR LOANS HELD

BY SMALLER CREDITORS.—Section 129D of the Truth in Lending 

Act (15 U.S.C. 1639d) is amended— 

(1) by adding at the end the following: 

‘‘(k) SAFE HARBOR FOR LOANS HELD BY SMALLER CREDITORS.— 

‘‘(1) IN GENERAL.—A creditor shall not be in violation of subsection (a) with respect to a loan if— 

‘‘(A) the creditor has consolidated assets of 

$10,000,000,000 or less; and 

‘‘(B) the creditor holds the loan on the balance sheet of 

the creditor for the 3-year period beginning on the date of 

the origination of the loan. 

‘‘(2) EXCEPTION FOR CERTAIN TRANSFERS.—In the case of a 

creditor that transfers a loan to another person by reason of 

the bankruptcy or failure of the creditor, the purchase of the 

creditor, or a supervisory act or recommendation from a State 

or Federal regulator, the creditor shall be deemed to have complied with the requirement under paragraph (1)(B).’’; and 

(2) by striking the term ‘‘Board’’ each place such term appears and inserting ‘‘Consumer Law Enforcement Agency’’. 

(b) MODIFICATION TO EXEMPTION FOR SMALL SERVICERS OF

MORTGAGE LOANS.—Section 6 of the Real Estate Settlement Procedures Act of 1974 (12 U.S.C. 2605) is amended by adding at the 

end the following: 

‘‘(n) SMALL SERVICER EXEMPTION.—The Consumer Law Enforcement Agency shall, by regulation, provide exemptions to, or adjustments for, the provisions of this section for a servicer that annually 

services 20,000 or fewer mortgage loans, in order to reduce regulatory burdens while appropriately balancing consumer protections.’’. 

Subtitle H—Financial Institutions 

Examination Fairness and Reform 

SEC. 536. TIMELINESS OF EXAMINATION REPORTS. 

(a) IN GENERAL.—The Federal Financial Institutions Examination Council Act of 1978 (12 U.S.C. 3301 et seq.) is amended by 

adding at the end the following: 

‘‘SEC. 1012. TIMELINESS OF EXAMINATION REPORTS. 

‘‘(a) IN GENERAL.— 

‘‘(1) FINAL EXAMINATION REPORT.—A Federal financial institutions regulatory agency shall provide a final examination report to a financial institution not later than 60 days after the 

later of— 

‘‘(A) the exit interview for an examination of the institution; or 

‘‘(B) the provision of additional information by the institution relating to the examination. 

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‘‘(2) EXIT INTERVIEW.—If a financial institution is not subject 

to a resident examiner program, the exit interview shall occur 

not later than the end of the 9-month period beginning on the 

commencement of the examination, except that such period 

may be extended by the Federal financial institutions regulatory agency by providing written notice to the institution and 

the Independent Examination Review Director describing with 

particularity the reasons that a longer period is needed to complete the examination. 

‘‘(b) EXAMINATION MATERIALS.—Upon the request of a financial 

institution, the Federal financial institutions regulatory agency 

shall include with the final report an appendix listing all examination or other factual information relied upon by the agency in support of a material supervisory determination. 

‘‘SEC. 1013. EXAMINATION STANDARDS. 

‘‘(a) IN GENERAL.—In the examination of a financial institution— 

‘‘(1) a commercial loan shall not be placed in non-accrual status solely because the collateral for such loan has deteriorated 

in value; 

‘‘(2) a modified or restructured commercial loan shall be removed from non-accrual status if the borrower demonstrates 

the ability to perform on such loan over a maximum period of 

6 months, except that with respect to loans on a quarterly, 

semiannual, or longer repayment schedule such period shall be 

a maximum of 3 consecutive repayment periods; 

‘‘(3) a new appraisal on a performing commercial loan shall 

not be required unless an advance of new funds is involved; 

and 

‘‘(4) in classifying a commercial loan in which there has been 

deterioration in collateral value, the amount to be classified 

shall be the portion of the deficiency relating to the decline in 

collateral value and repayment capacity of the borrower. 

‘‘(b) WELL CAPITALIZED INSTITUTIONS.—The Federal financial institutions regulatory agencies may not require a financial institution that is well capitalized to raise additional capital in lieu of an 

action prohibited under subsection (a). 

‘‘(c) CONSISTENT LOAN CLASSIFICATIONS.—The Federal financial 

institutions regulatory agencies shall develop and apply identical 

definitions and reporting requirements for non-accrual loans. 

‘‘SEC. 1014. OFFICE OF INDEPENDENT EXAMINATION REVIEW. 

‘‘(a) ESTABLISHMENT.—There is established in the Council an Office of Independent Examination Review (the ‘Office’). 

‘‘(b) HEAD OF OFFICE.—There is established the position of the 

Independent Examination Review Director (the ‘Director’), as the 

head of the Office. The Director shall be appointed by the Council 

and shall be independent from any member agency of the Council. 

‘‘(c) STAFFING.—The Director is authorized to hire staff to support 

the activities of the Office. 

‘‘(d) DUTIES.—The Director shall— 

‘‘(1) receive and, at the Director’s discretion, investigate complaints from financial institutions, their representatives, or another entity acting on behalf of such institutions, concerning 

examinations, examination practices, or examination reports; 

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‘‘(2) hold meetings, at least once every three months and in 

locations designed to encourage participation from all sections 

of the United States, with financial institutions, their representatives, or another entity acting on behalf of such institutions, to discuss examination procedures, examination practices, or examination policies; 

‘‘(3) review examination procedures of the Federal financial 

institutions regulatory agencies to ensure that the written examination policies of those agencies are being followed in practice and adhere to the standards for consistency established by 

the Council; 

‘‘(4) conduct a continuing and regular review of examination 

quality assurance for all examination types conducted by the 

Federal financial institutions regulatory agencies; 

‘‘(5) adjudicate any supervisory appeal initiated under section 1015; and 

‘‘(6) report annually to the Committee on Financial Services 

of the House of Representatives, the Committee on Banking, 

Housing, and Urban Affairs of the Senate, and the Council, on 

the reviews carried out pursuant to paragraphs (3) and (4), including compliance with the requirements set forth in section 

1012 regarding timeliness of examination reports, and the 

Council’s recommendations for improvements in examination 

procedures, practices, and policies. 

‘‘(e) CONFIDENTIALITY.—The Director shall keep confidential all 

meetings with, discussions with, and information provided by financial institutions. 

‘‘SEC. 1015. RIGHT TO INDEPENDENT REVIEW OF MATERIAL SUPERVISORY DETERMINATIONS. 

‘‘(a) IN GENERAL.—A financial institution shall have the right to 

obtain an independent review of a material supervisory determination contained in a final report of examination. 

‘‘(b) NOTICE.— ‘‘(1) TIMING.—A financial institution seeking review of a material supervisory determination under this section shall file a 

written notice with the Independent Examination Review Director (the ‘Director’) within 60 days after receiving the final 

report of examination that is the subject of such review. 

‘‘(2) IDENTIFICATION OF DETERMINATION.—The written notice 

shall identify the material supervisory determination that is 

the subject of the independent examination review, and a 

statement of the reasons why the institution believes that the 

determination is incorrect or should otherwise be modified. 

‘‘(3) INFORMATION TO BE PROVIDED TO INSTITUTION.—Any information relied upon by the agency in the final report that is 

not in the possession of the financial institution may be requested by the financial institution and shall be delivered 

promptly by the agency to the financial institution. 

‘‘(c) RIGHT TO HEARING.— 

‘‘(1) IN GENERAL.—The Director shall determine the merits of 

the appeal on the record or, at the financial institution’s election, shall refer the appeal to an Administrative Law Judge to 

conduct a confidential hearing pursuant to the procedures set 

forth under sections 556 and 557 of title 5, United States Code, 

which hearing shall take place not later than 60 days after the 

121 

petition for review was received by the Director, and to issue 

a proposed decision to the Director based upon the record established at such hearing. 

‘‘(2) STANDARD OF REVIEW.—In rendering a determination or 

recommendation under this subsection, neither the Administrative Law Judge nor the Director shall defer to the opinions 

of the examiner or agency, but shall conduct a de novo review 

to independently determine the appropriateness of the agency’s 

decision based upon the relevant statutes, regulations, and 

other appropriate guidance, as well as evidence adduced at any 

hearing. 

‘‘(d) FINAL DECISION.—A decision by the Director on an independent review under this section shall— 

‘‘(1) be made not later than 60 days after the record has been 

closed; and 

‘‘(2) be deemed final agency action and shall bind the agency 

whose supervisory determination was the subject of the review 

and the financial institution requesting the review. 

‘‘(e) RIGHT TO JUDICIAL REVIEW.—A financial institution shall 

have the right to petition for review of final agency action under 

this section by filing a Petition for Review within 60 days of the 

Director’s decision in the United States Court of Appeals for the 

District of Columbia Circuit or the Circuit in which the financial 

institution is located. 

‘‘(f) REPORT.—The Director shall report annually to the Committee on Financial Services of the House of Representatives and 

the Committee on Banking, Housing, and Urban Affairs of the Senate on actions taken under this section, including the types of 

issues that the Director has reviewed and the results of those reviews. In no case shall such a report contain information about individual financial institutions or any confidential or privileged information shared by financial institutions. 

‘‘(g) RETALIATION PROHIBITED.—A Federal financial institutions 

regulatory agency may not— 

‘‘(1) retaliate against a financial institution, including service 

providers, or any institution-affiliated party (as defined under 

section 3 of the Federal Deposit Insurance Act), for exercising 

appellate rights under this section; or 

‘‘(2) delay or deny any agency action that would benefit a financial institution or any institution-affiliated party on the 

basis that an appeal under this section is pending under this 

section. 

‘‘(h) RULE OF CONSTRUCTION.—Nothing in this section may be 

construed— 

‘‘(1) to affect the right of a Federal financial institutions regulatory agency to take enforcement or other supervisory actions related to a material supervisory determination under review under this section; or 

‘‘(2) to prohibit the review under this section of a material 

supervisory determination with respect to which there is an 

ongoing enforcement or other supervisory action.’’. 

(b) ADDITIONAL AMENDMENTS.— 

(1) RIEGLE COMMUNITY DEVELOPMENT AND REGULATORY IMPROVEMENT ACT OF 1994.—Section 309 of the Riegle Community 

122 

Development and Regulatory Improvement Act of 1994 (12 

U.S.C. 4806) is amended— 

(A) in subsection (a), by inserting after ‘‘appropriate Federal banking agency’’ the following: ‘‘, the Consumer Law 

Enforcement Agency,’’; 

(B) in subsection (b)— 

(i) in paragraph (2), by striking ‘‘the appellant from 

retaliation by agency examiners’’ and inserting ‘‘the insured depository institution or insured credit union 

from retaliation by the agencies referred to in subsection (a)’’; and 

(ii) by adding at the end the following flush-left text: 

‘‘For purposes of this subsection and subsection (e), retaliation includes delaying consideration of, or withholding approval of, any request, notice, or application that otherwise would have been approved, but for the exercise of the institution’s or credit union’s 

rights under this section.’’; 

(C) in subsection (e)(2)— 

(i) in subparagraph (B), by striking ‘‘and’’ at the end; 

(ii) in subparagraph (C), by striking the period and 

inserting ‘‘; and’’; and 

(iii) by adding at the end the following: 

‘‘(D) ensure that appropriate safeguards exist for protecting the insured depository institution or insured credit 

union from retaliation by any agency referred to in subsection (a) for exercising its rights under this subsection.’’; 

and 

(D) in subsection (f)(1)(A)— 

(i) in clause (ii), by striking ‘‘and’’ at the end; 

(ii) in clause (iii), by striking ‘‘and’’ at the end; and 

(iii) by adding at the end the following: 

‘‘(iv) any issue specifically listed in an exam report 

as a matter requiring attention by the institution’s 

management or board of directors; and 

‘‘(v) any suspension or removal of an institution’s 

status as eligible for expedited processing of applications, requests, notices, or filings on the grounds of a 

supervisory or compliance concern, regardless of 

whether that concern has been cited as a basis for another material supervisory determination or matter requiring attention in an examination report, provided 

that the conduct at issue did not involve violation of 

any criminal law; and’’. 

(2) FEDERAL CREDIT UNION ACT.—Section 205(j) of the Federal Credit Union Act (12 U.S.C. 1785(j)) is amended by inserting ‘‘the Consumer Law Enforcement Agency,’’ before ‘‘the Administration’’ each place such term appears. 

(3) FEDERAL FINANCIAL INSTITUTIONS EXAMINATION COUNCIL

ACT OF 1978.—The Federal Financial Institutions Examination 

Council Act of 1978 (12 U.S.C. 3301 et seq.) is amended— 

(A) in section 1003, by amending paragraph (1) to read 

as follows: 

‘‘(1) the term ‘Federal financial institutions regulatory agencies’— 

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‘‘(A) means the Office of the Comptroller of the Currency, the Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation, and the 

National Credit Union Administration; and 

‘‘(B) for purposes of sections 1012, 1013, 1014, and 1015, 

includes the Consumer Law Enforcement Agency;’’; and 

(B) in section 1005, by striking ‘‘One-fifth’’ and inserting 

‘‘One-fourth’’. 

Subtitle I—National Credit Union 

Administration Budget Transparency 

SEC. 541. BUDGET TRANSPARENCY FOR THE NCUA. 

Section 209(b) of the Federal Credit Union Act (12 U.S.C. 1789) 

is amended— 

(1) by redesignating paragraphs (1) and (2) as paragraphs (2) 

and (3), respectively; 

(2) by inserting before paragraph (2), as so redesignated, the 

following: 

‘‘(1) on an annual basis and prior to the submission of the 

detailed business-type budget required under paragraph (2)— 

‘‘(A) make publicly available and cause to be printed in 

the Federal Register a draft of such detailed business-type 

budget; and 

‘‘(B) hold a public hearing, with public notice provided of 

such hearing, wherein the public can submit comments on 

the draft of such detailed business-type budget;’’; and 

(3) in paragraph (2), as so redesignated— 

(A) by inserting ‘‘detailed’’ after ‘‘submit a’’; and 

(B) by inserting ‘‘, and where such budget shall address 

any comments submitted by the public pursuant to paragraph (1)(B)’’ after ‘‘Control Act’’. 

Subtitle J—Taking Account of Institutions 

With Low Operation Risk 

SEC. 546. REGULATIONS APPROPRIATE TO BUSINESS MODELS. 

(a) IN GENERAL.—For any regulatory action occurring after the 

date of the enactment of this Act, each Federal financial institutions regulatory agency shall— 

(1) take into consideration the risk profile and business models of each type of institution or class of institutions subject to 

the regulatory action; 

(2) determine the necessity, appropriateness, and impact of 

applying such regulatory action to such institutions or classes 

of institutions; and 

(3) tailor such regulatory action in a manner that limits the 

regulatory compliance impact, cost, liability risk, and other 

burdens, as appropriate, for the risk profile and business model 

of the institution or class of institutions involved. 

(b) OTHER CONSIDERATIONS.—In carrying out the requirements of 

subsection (a), each Federal financial institutions regulatory agency 

shall consider— 

124 

(1) the impact that such regulatory action, both by itself and 

in conjunction with the aggregate effect of other regulations, 

has on the ability of the applicable institution or class of institutions to serve evolving and diverse customer needs; 

(2) the potential impact of examination manuals, regulatory 

actions taken with respect to third-party service providers, or 

other regulatory directives that may be in conflict or inconsistent with the tailoring of such regulatory action described in 

subsection (a)(3); and 

(3) the underlying policy objectives of the regulatory action 

and statutory scheme involved. 

(c) NOTICE OF PROPOSED AND FINAL RULEMAKING.—Each Federal 

financial institutions regulatory agency shall disclose in every notice of proposed rulemaking and in any final rulemaking for a regulatory action how the agency has applied subsections (a) and (b). 

(d) REPORTS TO CONGRESS.— 

(1) INDIVIDUAL AGENCY REPORTS.— 

(A) IN GENERAL.—Not later than 1 year after the date of 

the enactment of this Act and annually thereafter, each 

Federal financial institutions regulatory agency shall 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 specific actions 

taken to tailor the regulatory actions of the agency pursuant to the requirements of this Act. 

(B) APPEARANCE BEFORE THE COMMITTEES.—The head of 

each Federal financial institution regulatory agency shall 

appear before the Committee on Financial Services of the 

House of Representatives and the Committee on Banking, 

Housing, and Urban Affairs of the Senate after each report 

is made pursuant to subparagraph (A) to testify on the 

contents of such report. 

(2) FIEC REPORTS.— (A) IN GENERAL.—Not later than 3 months after each report is submitted under paragraph (1), the Financial Institutions Examination Council shall 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— 

(i) the extent to which regulatory actions tailored 

pursuant to this Act result in different treatment of 

similarly situated institutions of diverse charter types; 

and 

(ii) the reasons for such differential treatment. 

(B) APPEARANCE BEFORE THE COMMITTEES.—The Chairman of the Financial Institutions Examination Council 

shall appear before the Committee on Financial Services of 

the House of Representatives and the Committee on Banking, Housing, and Urban Affairs of the Senate after each 

report is made pursuant to subparagraph (A) to testify on 

the contents of such report. 

(e) LIMITED LOOK-BACK APPLICATION.— (1) IN GENERAL.—Each Federal financial institutions regulatory agency shall conduct a review of all regulations adopted 

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125 

fore the date of the introduction of this Act in the House of 

Representatives and ending on the date of the enactment of 

this Act, and apply the requirements of this Act to such regulations. 

(2) REVISION.—If the application of the requirements of this 

Act to any such regulation requires such regulation to be revised, the applicable Federal financial institutions regulatory 

agency shall revise such regulation within 3 years of the enactment of this Act. 

(f) DEFINITIONS.—In this Act, the following definitions shall 

apply: 

(1) FEDERAL FINANCIAL INSTITUTIONS REGULATORY AGENCIES.—The term ‘‘Federal financial institutions regulatory 

agencies’’ means the Office of the Comptroller of the Currency, 

the Board of Governors of the Federal Reserve System, the 

Federal Deposit Insurance Corporation, the National Credit 

Union Administration, and the Consumer Law Enforcement 

Agency. 

(2) REGULATORY ACTION.—The term ‘‘regulatory action’’ 

means any proposed, interim, or final rule or regulation, guidance, or published interpretation. 

Subtitle K—Federal Savings Association 

Charter Flexibility 

SEC. 551. OPTION FOR FEDERAL SAVINGS ASSOCIATIONS TO OPERATE 

AS A COVERED SAVINGS ASSOCIATION. 

The Home Owners’ Loan Act is amended by inserting after section 5 (12 U.S.C. 1464) the following: 

‘‘SEC. 5A. ELECTION TO OPERATE AS A COVERED SAVINGS ASSOCIATION. 

‘‘(a) DEFINITION.—In this section, the term ‘covered savings association’ means a Federal savings association that makes an election 

approved under subsection (b). 

‘‘(b) ELECTION.— 

‘‘(1) IN GENERAL.—Upon issuance of the rules described in 

subsection (f), a Federal savings association may elect to operate as a covered savings association by submitting a notice to 

the Comptroller of such election. 

‘‘(2) APPROVAL.—A Federal savings association shall be 

deemed to be approved to operate as a covered savings association on the date that is 60 days after the date on which the 

Comptroller receives the notice under paragraph (1), unless the 

Comptroller notifies the Federal savings association otherwise. 

‘‘(c) RIGHTS AND DUTIES.—Notwithstanding any other provision of 

law and except as otherwise provided in this section, a covered savings association shall— 

‘‘(1) have the same rights and privileges as a national bank 

that has its main office situated in the same location as the 

home office of the covered savings association; and 

‘‘(2) be subject to the same duties, restrictions, penalties, liabilities, conditions, and limitations that would apply to such 

a national bank. 

126 

‘‘(d) TREATMENT OF COVERED SAVINGS ASSOCIATIONS.—A covered 

savings association shall be treated as a Federal savings association for the purposes— 

‘‘(1) of governance of the covered savings association, including incorporation, bylaws, boards of directors, shareholders, 

and distribution of dividends; 

‘‘(2) of consolidation, merger, dissolution, conversion (including conversion to a stock bank or to another charter), conservatorship, and receivership; and 

‘‘(3) determined by regulation of the Comptroller. 

‘‘(e) EXISTING BRANCHES.—A covered savings association may 

continue to operate any branch or agency the covered savings association operated on the date on which an election under subsection 

(b) is approved. 

‘‘(f) RULEMAKING.—The Comptroller shall issue rules to carry out 

this section— 

‘‘(1) that establish streamlined standards and procedures 

that clearly identify required documentation or timelines for an 

election under subsection (b); 

‘‘(2) that require a Federal savings association that makes an 

election under subsection (b) to identify specific assets and subsidiaries— 

‘‘(A) that do not conform to the requirements for assets 

and subsidiaries of a national bank; and 

‘‘(B) that are held by the Federal savings association on 

the date on which the Federal savings association submits 

a notice of such election; 

‘‘(3) that establish— 

‘‘(A) a transition process for bringing such assets and 

subsidiaries into conformance with the requirements for a 

national bank; and 

‘‘(B) procedures for allowing the Federal savings association to provide a justification for grandfathering such assets and subsidiaries after electing to operate as a covered 

savings association; 

‘‘(4) that establish standards and procedures to allow a covered savings association to terminate an election under subsection (b) after an appropriate period of time or to make a 

subsequent election; 

‘‘(5) that clarify requirements for the treatment of covered 

savings associations, including the provisions of law that apply 

to covered savings associations; and 

‘‘(6) as the Comptroller deems necessary and in the interests 

of safety and soundness.’’. 

Subtitle L—SAFE Transitional Licensing 

SEC. 556. ELIMINATING BARRIERS TO JOBS FOR LOAN ORIGINATORS. 

(a) IN GENERAL.—The S.A.F.E. Mortgage Licensing Act of 2008 

(12 U.S.C. 5101 et seq.) is amended by adding at the end the following: 

127 

‘‘SEC. 1518. EMPLOYMENT TRANSITION OF LOAN ORIGINATORS. 

‘‘(a) TEMPORARY AUTHORITY TO ORIGINATE LOANS FOR LOAN

ORIGINATORS MOVING FROM A DEPOSITORY INSTITUTION TO A NONDEPOSITORY INSTITUTION.— 

‘‘(1) IN GENERAL.—Upon employment by a State-licensed 

mortgage company, an individual who is a registered loan 

originator shall be deemed to have temporary authority to act 

as a loan originator in an application State for the period described in paragraph (2) if the individual— 

‘‘(A) has not had an application for a loan originator license denied, or had such a license revoked or suspended 

in any governmental jurisdiction; 

‘‘(B) has not been subject to or served with a cease and 

desist order in any governmental jurisdiction or as described in section 1514(c); 

‘‘(C) has not been convicted of a felony that would preclude licensure under the law of the application State; 

‘‘(D) has submitted an application to be a State-licensed 

loan originator in the application State; and 

‘‘(E) was registered in the Nationwide Mortgage Licensing System and Registry as a loan originator during the 

12-month period preceding the date of submission of the 

information required under section 1505(a). 

‘‘(2) PERIOD.—The period described in paragraph (1) shall 

begin on the date that the individual submits the information 

required under section 1505(a) and shall end on the earliest 

of— 

‘‘(A) the date that the individual withdraws the application to be a State-licensed loan originator in the application State; 

‘‘(B) the date that the application State denies, or issues 

a notice of intent to deny, the application; 

‘‘(C) the date that the application State grants a State 

license; or 

‘‘(D) the date that is 120 days after the date on which 

the individual submits the application, if the application is 

listed on the Nationwide Mortgage Licensing System and 

Registry as incomplete. 

‘‘(b) TEMPORARY AUTHORITY TO ORIGINATE LOANS FOR STATE-LI- CENSED LOAN ORIGINATORS MOVING INTERSTATE.— ‘‘(1) IN GENERAL.—A State-licensed loan originator shall be 

deemed to have temporary authority to act as a loan originator 

in an application State for the period described in paragraph 

(2) if the State-licensed loan originator— 

‘‘(A) meets the requirements of subparagraphs (A), (B), 

(C), and (D) of subsection (a)(1); 

‘‘(B) is employed by a State-licensed mortgage company 

in the application State; and 

‘‘(C) was licensed in a State that is not the application 

State during the 30-day period preceding the date of submission of the information required under section 1505(a) 

in connection with the application submitted to the application State. 

‘‘(2) PERIOD.—The period described in paragraph (1) shall 

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128 

mits the information required under section 1505(a) in connection with the application submitted to the application State 

and end on the earliest of— 

‘‘(A) the date that the State-licensed loan originator 

withdraws the application to be a State-licensed loan originator in the application State; 

‘‘(B) the date that the application State denies, or issues 

a notice of intent to deny, the application; 

‘‘(C) the date that the application State grants a State 

license; or 

‘‘(D) the date that is 120 days after the date on which 

the State-licensed loan originator submits the application, 

if the application is listed on the Nationwide Mortgage Licensing System and Registry as incomplete. 

‘‘(c) APPLICABILITY.— 

‘‘(1) Any person employing an individual who is deemed to 

have temporary authority to act as a loan originator in an application State pursuant to this section shall be subject to the 

requirements of this title and to applicable State law to the 

same extent as if such individual was a State-licensed loan 

originator licensed by the application State. 

‘‘(2) Any individual who is deemed to have temporary authority to act as a loan originator in an application State pursuant 

to this section and who engages in residential mortgage loan 

origination activities shall be subject to the requirements of 

this title and to applicable State law to the same extent as if 

such individual was a State-licensed loan originator licensed by 

the application State. 

‘‘(d) DEFINITIONS.—In this section, the following definitions shall 

apply: 

‘‘(1) STATE-LICENSED MORTGAGE COMPANY.—The term ‘Statelicensed mortgage company’ means an entity licensed or registered under the law of any State to engage in residential 

mortgage loan origination and processing activities. 

‘‘(2) APPLICATION STATE.—The term ‘application State’ means 

a State in which a registered loan originator or a State-licensed loan originator seeks to be licensed.’’. 

(b) TABLE OF CONTENTS AMENDMENT.—The table of contents in 

section 1(b) of the Housing and Economic Recovery Act of 2008 (42 

U.S.C. 4501 note) is amended by inserting after the item relating 

to section 1517 the following: 

‘‘Sec. 1518. Employment transition of loan originators.’’. 

(c) AMENDMENT TO CIVIL LIABILITY OF THE CONSUMER LAW ENFORCEMENT AGENCY AND OTHER OFFICIALS.—Section 1513 of the 

S.A.F.E. Mortgage Licensing Act of 2008 (12 U.S.C. 5112) is 

amended by striking ‘‘are loan originators or are applying for licensing or registration as loan originators’’ and inserting ‘‘are applying for licensing or registration using the Nationwide Mortgage 

Licensing System and Registry’’. 

129 

Subtitle M—Right to Lend 

SEC. 561. SMALL BUSINESS LOAN DATA COLLECTION REQUIREMENT. 

(a) REPEAL.—Section 704B of the Equal Credit Opportunity Act 

(15 U.S.C. 1691c–2) is repealed. 

(b) CONFORMING AMENDMENTS.—Section 701(b) of the Equal 

Credit Opportunity Act (15 U.S.C. 1691(b)) is amended— 

(1) in paragraph (3), by inserting ‘‘or’’ at the end; 

(2) in paragraph (4), by striking ‘‘; or’’ and inserting a period; 

and 

(3) by striking paragraph (5). 

(c) CLERICAL AMENDMENT.—The table of sections for title VII of 

the Consumer Credit Protection Act is amended by striking the 

item relating to section 704B. 

Subtitle N—Community Bank Reporting 

Relief 

SEC. 566. SHORT FORM CALL REPORT. 

(a) IN GENERAL.—Section 7(a) of the Federal Deposit Insurance 

Act (12 U.S.C. 1817(a)) is amended by adding at the end the following: 

‘‘(12) SHORT FORM REPORTING.— 

‘‘(A) IN GENERAL.—The appropriate Federal banking 

agencies shall issue regulations allowing for a reduced reporting requirement for covered depository institutions 

when making the first and third report of condition for a 

year, as required pursuant to paragraph (3). 

‘‘(B) COVERED DEPOSITORY INSTITUTION DEFINED.—For 

purposes of this paragraph, the term ‘covered depository 

institution’ means an insured depository institution that— 

‘‘(i) is well capitalized (as defined under section 

38(b)); and 

‘‘(ii) satisfies such other criteria as the appropriate 

Federal banking agencies determine appropriate.’’. 

(b) REPORT TO CONGRESS.—Not later than 180 days after the 

date of the enactment of this Act, and every 365 days thereafter 

until the appropriate Federal banking agencies (as defined under 

section 3 of the Federal Deposit Insurance Act) have issued the regulations required under section 7(a)(12)(A) of the Federal Deposit 

Insurance Act, such agencies shall submit to the Committee on Financial Services of the House of Representatives and the Committee on Banking, Housing, and Urban Affairs of the Senate a report describing the progress made in issuing such regulations. 

Subtitle O—Homeowner Information 

Privacy Protection 

SEC. 571. STUDY REGARDING PRIVACY OF INFORMATION COLLECTED 

UNDER THE HOME MORTGAGE DISCLOSURE ACT OF 1975. 

(a) STUDY.—The Comptroller General of the United States shall 

conduct a study to determine whether the data required to be pubVerDate Sep 11 2014 05:01 Jun 07, 2017 Jkt 025698 PO 00000 Frm 00129 Fmt 6659 Sfmt 6602 E:\HR\OC\HR163.XXX HR163
130 

lished, made available, or disclosed under the final rule, in connection with other publicly available data sources, including data 

made publicly available under Regulation C (12 C.F.R. 1003) before 

the effective date of the final rule, could allow for or increase the 

probability of— 

(1) exposure of the identity of mortgage applicants or mortgagors through reverse engineering; 

(2) exposure of mortgage applicants or mortgagors to identity 

theft or the loss of sensitive personal financial information; 

(3) the marketing or sale of unfair or deceptive financial 

products to mortgage applicants or mortgagors based on such 

data; 

(4) personal financial loss or emotional distress resulting 

from the exposure of mortgage applicants or mortgagors to 

identify theft or the loss of sensitive personal financial information; and 

(5) the potential legal liability facing the Consumer Law Enforcement Agency and market participants in the event the 

data required to be published, made available, or disclosed 

under the final rule leads or contributes to identity theft or the 

capture of sensitive personal financial information. 

(b) REPORT.—The Comptroller General of the United States shall 

submit to the Committee on Financial Services of the House of 

Representatives and the Committee on Banking, Housing, and 

Urban Affairs of the Senate a report that includes— 

(1) the findings and conclusions of the Comptroller General 

with respect to the study required under subsection (a); and 

(2) any recommendations for legislative or regulatory actions 

that— 

(A) would enhance the privacy of a consumer when accessing mortgage credit; and 

(B) are consistent with consumer protections and safe 

and sound banking operations. 

(c) SUSPENSION OF DATA SHARING REQUIREMENTS.—Notwithstanding any other provision of law, including the final rule— 

(1) depository institutions shall not be required to publish, 

disclose, or otherwise make available to the public, pursuant to 

the Home Mortgage Disclosure Act of 1975 (or regulations 

issued under such Act) any data that was not required to be 

published, disclosed, or otherwise made available pursuant to 

such Act (or regulations issued under such Act) on the day before the date of the enactment of the Dodd-Frank Wall Street 

Reform and Consumer Protection Act; and 

(2) the Consumer Law Enforcement Agency and the Financial Institutions Examination Council shall not publish, disclose, or otherwise make available to the public any such information received from a depository institution pursuant to the 

final rule, except as required by law. 

(d) TEMPORARY SUSPENSION OF DATA REPORTING REQUIREMENTS..—Notwithstanding any other provision of law, the effective 

date for new reporting requirements contained in the final rule 

shall be January 1, 2019. 

(e) DEFINITIONS.—For purposes of this section: 

131 

(1) DEPOSITORY INSTITUTION.—The term ‘‘depository institution’’ has the meaning given that term under section 303 of the 

Home Mortgage Disclosure Act of 1975 (12 U.S.C. 2802). 

(2) FINAL RULE.—The term ‘‘final rule’’ means the final rule 

issued by the Bureau of Consumer Financial Protection titled 

‘‘Home Mortgage Disclosure (Regulation C)’’ (October 28, 2015; 

80 Fed. Reg. 66128). 

Subtitle A—Home Mortgage Disclosure 

Adjustment 

SEC. 576. DEPOSITORY INSTITUTIONS SUBJECT TO MAINTENANCE OF 

RECORDS AND DISCLOSURE REQUIREMENTS. 

(a) IN GENERAL.—Section 304 of the Home Mortgage Disclosure 

Act of 1975 (12 U.S.C. 2803) is amended— 

(1) by redesignating subsection (i) as paragraph (2) and adjusting the margin appropriately; and 

(2) by inserting before such paragraph (2) the following: 

‘‘(i) EXEMPTIONS.— 

‘‘(1) IN GENERAL.—With respect to a depository institution, 

the requirements of subsections (a) and (b) shall not apply— 

‘‘(A) with respect to closed-end mortgage loans, if such 

depository institution originated less than 100 closed-end 

mortgage loans in each of the two preceding calendar 

years; and 

‘‘(B) with respect to open-end lines of credit, if such depository institution originated less than 200 open-end lines 

of credit in each of the two preceding calendar years.’’. 

(b) TECHNICAL CORRECTION.—Section 304(i)(2) of such Act, as redesignated by subsection (a), is amended by striking ‘‘section 

303(2)(A)’’ and inserting ‘‘section 303(3)(A)’’. 

Subtitle B—Protecting Consumers’ Access 

to Credit 

SEC. 581. RATE OF INTEREST AFTER TRANSFER OF LOAN. 

(a) AMENDMENT TO THE REVISED STATUTES.—Section 5197 of the 

Revised Statutes of the United States (12 U.S.C. 85) is amended 

by adding at the end the following new sentence: ‘‘A loan that is 

valid when made as to its maximum rate of interest in accordance 

with this section shall remain valid with respect to such rate regardless of whether the loan is subsequently sold, assigned, or otherwise transferred to a third party, and may be enforced by such 

third party notwithstanding any State law to the contrary.’’. 

(b) AMENDMENT TO THE HOME OWNERS’ LOAN ACT.—Section 

4(g)(1) of the Home Owners’ Loan Act (12 U.S.C. 1463(g)(1)) is 

amended by adding at the end the following new sentence: ‘‘A loan 

that is valid when made as to its maximum rate of interest in accordance with this subsection shall remain valid with respect to 

such rate regardless of whether the loan is subsequently sold, assigned, or otherwise transferred to a third party, and may be enforced by such third party notwithstanding any State law to the 

contrary.’’. 

132 

(c) AMENDMENT TO THE FEDERAL CREDIT UNION ACT.—Section 

205(g)(1) of the Federal Credit Union Act (12 U.S.C. 1785(g)(1)) is 

amended by adding at the end the following new sentence: ‘‘A loan 

that is valid when made as to its maximum rate of interest in accordance with this subsection shall remain valid with respect to 

such rate regardless of whether the loan is subsequently sold, assigned, or otherwise transferred to a third party, and may be enforced by such third party notwithstanding any State law to the 

contrary.’’. 

(d) AMENDMENT TO THE FEDERAL DEPOSIT INSURANCE ACT.—Section 27(a) of the Federal Deposit Insurance Act (12 U.S.C. 

1831d(a)) is amended by adding at the end the following new sentence: ‘‘A loan that is valid when made as to its maximum rate of 

interest in accordance with this section shall remain valid with respect to such rate regardless of whether the loan is subsequently 

sold, assigned, or otherwise transferred to a third party, and may 

be enforced by such third party notwithstanding any State law to 

the contrary.’’. 

Subtitle C—NCUA Overhead Transparency 

SEC. 586. FUND TRANSPARENCY. 

Section 203 of the Federal Credit Union Act (12 U.S.C. 1783) is 

amended by adding at the end the following: 

‘‘(g) FUND TRANSPARENCY.— 

‘‘(1) IN GENERAL.—The Board shall accompany each annual 

budget submitted pursuant to section 209(b) with a report containing— 

‘‘(A) a detailed analysis of how the expenses of the Administration are assigned between prudential activities 

and insurance-related activities and the extent to which 

those expenses are paid from the fees collected pursuant to 

section 105 or from the Fund; and 

‘‘(B) the Board’s supporting rationale for any proposed 

use of amounts in the Fund contained in such budget, including detailed breakdowns and supporting rationales for 

any such proposed use related to titles of this Act other 

than this title. 

‘‘(2) PUBLIC DISCLOSURE.—The Board shall make each report 

described under paragraph (1) available to the public and 

available on the Board’s website.’’. 

Subtitle D—Housing Opportunities Made 

Easier 

SEC. 591. CLARIFICATION OF DONATED SERVICES TO NON-PROFITS. 

Section 129E(i) of the Truth in Lending Act (15 U.S.C. 1639e(i)) 

is amended by adding at the end the following: 

‘‘(4) RULE OF CONSTRUCTION RELATED TO APPRAISAL DONATIONS.—For purposes of paragraph (1), if a fee appraiser voluntarily donates appraisal services to an organization described 

in section 170(c)(2) of the Internal Revenue Code of 1986, such 

133 

voluntary donation shall be deemed customary and reasonable.’’. 

TITLE VI—REGULATORY RELIEF FOR 

STRONGLY CAPITALIZED, WELL MANAGED BANKING ORGANIZATIONS 

SEC. 601. CAPITAL ELECTION. 

(a) IN GENERAL.—A banking organization may make an election 

under this section to be treated as a qualifying banking organization for purposes of the regulatory relief described under section 

602. 

(b) REQUIREMENTS.—A banking organization may qualify to be 

treated as a qualifying banking organization if— 

(1) the banking organization has an average leverage ratio of 

at least 10 percent; 

(2) with respect to a depository institution holding company, 

each insured depository institution subsidiary of the holding 

company simultaneously makes the election described under 

subsection (a); and 

(3) with respect to an insured depository institution, any parent depository institution holding company of the institution simultaneously makes the election described under subsection 

(a). 

(c) ELECTION PROCESS.—To make an election under this section, 

a banking organization shall submit an election to the appropriate 

Federal banking agency (and any applicable State bank supervisor 

that regulates the banking organization) containing— 

(1) a notice of such election; 

(2) the banking organization’s average leverage ratio, as well 

as the organization’s quarterly leverage ratio for each of the 

most recently completed four calendar quarters; 

(3) if the banking organization is a depository institution 

holding company, the information described under paragraph 

(2) for each of the organization’s insured depository institution 

subsidiaries; and 

(4) if the banking organization is an insured depository institution, the information described under paragraph (2) for any 

parent depository institution holding company of the institution. 

(d) EFFECTIVE DATE OF ELECTION.— 

(1) IN GENERAL.—An election made under this section shall 

take effect at the end of the 30-day period beginning on the 

date that the appropriate Federal banking agency receives the 

application described under subsection (c), unless the appropriate Federal banking agency determines that the banking organization has not met the requirements described under subsection (b). 

(2) NOTICE OF FAILURE TO MEET REQUIREMENTS.—If the appropriate Federal banking agency determines that a banking 

organization submitting an election notice under subsection (c) 

does not meet the requirements described under subsection (b), 

the agency shall— 

134 

(A) notify the banking organization (and any applicable 

State bank supervisor that regulates the banking organization), in writing, of such determination as soon as possible after such determination is made, but in no case later 

than the end of the 30-day period beginning on the date 

that the appropriate Federal banking agency receives the 

election; and 

(B) include in such notification the specific reasons for 

such determination and steps that the banking organization can take to meet such requirements. 

(e) TREATMENT OF CERTAIN NEW BANKING ORGANIZATIONS.—In 

the case of a banking organization that is a newly-chartered insured depository institution or a banking organization that becomes a banking organization because it controls a newly-chartered 

insured depository institution, such banking organization may be 

treated as a qualifying banking organization immediately upon becoming a banking organization, if— 

(1) an election to be treated as a qualifying banking organization was included in the application filed with the appropriate Federal banking agency in connection with becoming a 

banking organization; and 

(2) as of the date the banking organization becomes a banking organization, the banking organization’s tangible equity divided by the banking organization’s leverage exposure, expressed as a percentage, is at least 10 percent. 

(f) FAILURE TO MAINTAIN QUARTERLY LEVERAGE RATIO AND LOSS

OF ELECTION.— 

(1) EFFECT OF FAILURE TO MAINTAIN QUARTERLY LEVERAGE

RATIO.— 

(A) IN GENERAL.—If, with respect to the most recently 

completed calendar quarter, the appropriate Federal banking agency determines that a qualifying banking organization’s quarterly leverage ratio is below 10 percent— 

(i) the appropriate Federal banking agency shall notify the qualifying banking organization and any applicable State bank supervisor that regulates the banking organization of such determination; 

(ii) the appropriate Federal banking agency may 

prohibit the banking organization from making a capital distribution; and 

(iii) the banking organization shall, within 3 months 

of the first such determination, submit a capital restoration plan to the appropriate Federal banking agency. 

(B) LOSS OF ELECTION AFTER ONE-YEAR REMEDIATION PERIOD.—If a banking organization described under subparagraph (A) does not, within the 1-year period beginning on 

the date of such determination, raise the organization’s 

quarterly leverage ratio for a calendar quarter ending in 

such 1-year period to at least 10 percent, the banking organization’s election under this section shall be terminated, and the appropriate Federal banking agency shall 

notify any applicable State bank supervisor that regulates 

the banking organization of such termination. 

135 

(C) EFFECT OF SUBSIDIARY ON PARENT ORGANIZATION.— With respect to a qualifying banking organization described under subparagraph (A) that is an insured depository institution, any parent depository institution holding 

company of the qualifying banking organization shall— 

(i) if the appropriate Federal banking agency determines it appropriate, be prohibited from making a capital distribution (other than a capital contribution to 

such qualifying banking organization described under 

subparagraph (A)); and 

(ii) if the qualifying banking organization has an 

election terminated under subparagraph (B), any such 

parent depository institution holding company shall 

also have its election under this section terminated. 

(2) IMMEDIATE LOSS OF ELECTION IF THE QUARTERLY LEVER- AGE RATIO FALLS BELOW 6 PERCENT.— (A) IN GENERAL.—If, with respect to the most recently 

completed calendar quarter, the appropriate Federal banking agency determines that a qualifying banking organization’s quarterly leverage ratio is below 6 percent, the banking organization’s election under this section shall be terminated, and the appropriate Federal banking agency 

shall notify any applicable State bank supervisor that regulates the banking organization of such termination. 

(B) EFFECT OF SUBSIDIARY ON PARENT ORGANIZATION.— With respect to a qualifying banking organization described under subparagraph (A) that is an insured depository institution, any parent depository institution holding 

company of the qualifying banking organization shall also 

have its election under this section terminated. 

(3) ABILITY TO MAKE FUTURE ELECTIONS.—If a banking organization has an election under this section terminated, the 

banking organization may not apply for another election under 

this section until the banking organization has maintained a 

quarterly leverage ratio of at least 10 percent for 8 consecutive 

calendar quarters. 

SEC. 602. REGULATORY RELIEF. 

(a) IN GENERAL.—A qualifying banking organization shall be exempt from the following: 

(1) Any Federal law, rule, or regulation addressing capital or 

liquidity requirements or standards. 

(2) Any Federal law, rule, or regulation that permits an appropriate Federal banking agency to object to a capital distribution. 

(3) Any consideration by an appropriate Federal banking 

agency of the following: 

(A) Any risk the qualifying banking organization may 

pose to ‘‘the stability of the financial system of the United 

States’’, under section 5(c)(2) of the Bank Holding Company Act of 1956. 

(B) The ‘‘extent to which a proposed acquisition, merger, 

or consolidation would result in greater or more concentrated risks to the stability of the United States banking or financial system’’, under section 3(c)(7) of the Bank 

Holding Company Act of 1956, so long as the banking orVerDate Sep 11 2014 05:01 Jun 07, 2017 Jkt 025698 PO 00000 Frm 00135 Fmt 6659 Sfmt 6602 E:\HR\OC\HR163.XXX HR163
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ganization, after such proposed acquisition, merger, or consolidation, would maintain a quarterly leverage ratio of at 

least 10 percent. 

(C) Whether the performance of an activity by the banking organization could possibly pose a ‘‘risk to the stability 

of the United States banking or financial system’’, under 

section 4(j)(2)(A) of the Bank Holding Company Act of 

1956. 

(D) Whether the acquisition of control of shares of a 

company engaged in an activity described in section 

4(j)(1)(A) of the Bank Holding Company Act of 1956 could 

possibly pose a ‘‘risk to the stability of the United States 

banking or financial system’’, under section 4(j)(2)(A) of the 

Bank Holding Company Act of 1956, so long as the banking organization, after acquiring control of such company, 

would maintain a quarterly leverage ratio of at least 10 

percent. 

(E) Whether a merger would pose a ‘‘risk to the stability 

of the United States banking or financial system’’, under 

section 18(c)(5) of the Federal Deposit Insurance Act, so 

long as the banking organization, after such proposed 

merger, would maintain a quarterly leverage ratio of at 

least 10 percent. 

(F) Any risk the qualifying banking organization may 

pose to ‘‘the stability of the financial system of the United 

States’’, under section 10(b)(4) of the Home Owners’ Loan 

Act. 

(4) Subsections (i)(8) and (k)(6)(B)(ii) of section 4 and section 

14 of the Bank Holding Company Act of 1956. 

(5) Section 18(c)(13) of the Federal Deposit Insurance Act. 

(6) Section 163 of the Financial Stability Act of 2010. 

(7) Section 10(e)(2)(E) of the Home Owners’ Loan Act. 

(8) Any Federal law, rule, or regulation implementing standards of the type provided for in subsections (b), (c), (d), (e), (g), 

(h), (i), and (j) of section 165 of the Financial Stability Act of 

2010. 

(9) Any Federal law, rule, or regulation providing limitations 

on mergers, consolidations, or acquisitions of assets or control, 

to the extent such limitations relate to capital or liquidity 

standards or concentrations of deposits or assets, so long as the 

banking organization, after such proposed merger, consolidation, or acquisition, would maintain a quarterly leverage ratio 

of at least 10 percent. 

(b) QUALIFYING BANKING ORGANIZATIONS TREATED AS WELL CAPITALIZED.—A qualifying banking organization shall be deemed to be 

‘‘well capitalized’’ for purposes of— 

(1) section 216 of the Federal Credit Union Act; and 

(2) sections 29, 38, 44, and 46 of the Federal Deposit Insurance Act. 

(c) TREATMENT OF CERTAIN RISK-WEIGHTED ASSET REQUIRE- MENTS FOR QUALIFYING BANKING ORGANIZATIONS.— (1) ACQUISITION SIZE CRITERIA TREATMENT.—A qualifying 

banking organization shall be deemed to meet the criteria described under section 4(j)(4)(D) of the Bank Holding Company 

Act of 1956, so long as after the proposed transaction the acVerDate Sep 11 2014 05:01 Jun 07, 2017 Jkt 025698 PO 00000 Frm 00136 Fmt 6659 Sfmt 6602 E:\HR\OC\HR163.XXX HR163
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quiring qualifying banking organization would maintain a 

quarterly leverage ratio of at least 10 percent. 

(2) USE OF LEVERAGE EXPOSURE.—With respect to a qualifying banking organization, in determining whether a proposal 

qualifies with the criteria described under subparagraphs 

(A)(iii) and (B)(i) of section 4(j)(4) of the Bank Holding Company Act of 1956, the Board of Governors of the Federal Reserve System shall consider the leverage exposure of an insured depository institution instead of the total risk-weighted 

assets of such institution. 

SEC. 603. CONTINGENT CAPITAL STUDY. 

(a) STUDY.—The Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation, and the Office of 

the Comptroller of the Currency shall each carry out a study, 

which shall include holding public hearings, on how to design a requirement that banking organizations issue contingent capital with 

a market-based conversion trigger. 

(b) REPORT.—Not later than the end of the 1-year period beginning on the date of the enactment of this Act, each agency described under subsection (a) shall submit a report to the Congress 

containing— 

(1) all findings and determinations made by the agency in 

carrying out the study required under subsection (a); and 

(2) the agency’s recommendations on how the Congress 

should design a requirement that banking organizations issue 

contingent capital with a market-based conversion trigger. 

SEC. 604. STUDY ON ALTERING THE CURRENT PROMPT CORRECTIVE 

ACTION RULES. 

(a) STUDY.—The Comptroller General of the United States shall 

conduct a study to assess the benefits and feasibility of altering the 

current prompt corrective action rules and replacing the Baselbased capital ratios with the nonperforming asset coverage ratio or 

NACR as the trigger for specific required supervisory interventions. 

The Comptroller General shall ensure that such study includes the 

following: 

(1) An assessment of the performance of an NACR forwardlooking measure of a banking organization’s solvency condition 

relative to the regulatory capital ratios currently used by 

prompt corrective action rules. 

(2) An analysis of the performance of alternative definitions 

of nonperforming assets. 

(3) An assessment of the impact of two alternative intervention thresholds: 

(A) An initial (high) intervention threshold, below which 

appropriate Federal banking agency examiners are required to intervene and assess a banking organization’s 

condition and prescribe remedial measures. 

(B) A lower threshold, below which banking organizations must increase their capital, seek an acquirer, or face 

mandatory resolution within 90 days. 

(b) REPORT.—Not later than the end of the 1-year period beginning on the date of the enactment of this Act, the Comptroller General shall submit a report to the Congress containing— 

138 

(1) all findings and determinations made in carrying out the 

study required under subsection (a); and 

(2) recommendations on the most suitable definition of nonperforming assets, as well as the two numerical thresholds 

that trigger specific required supervisory interventions. 

SEC. 605. DEFINITIONS. 

For purposes of this title: 

(1) APPROPRIATE FEDERAL BANKING AGENCY.—The term ‘‘appropriate Federal banking agency’’— 

(A) has the meaning given such term under section 3 of 

the Federal Deposit Insurance Act; and 

(B) means the National Credit Union Administration, in 

the case of an insured credit union. 

(2) BANKING ORGANIZATION.—The term ‘‘banking organization’’ means— 

(A) an insured depository institution; 

(B) an insured credit union; 

(C) a depository institution holding company; 

(D) a company that is treated as a bank holding company for purposes of section 8 of the International Banking 

Act; and 

(E) a U.S. intermediate holding company established by 

a foreign banking organization pursuant to section 252.153 

of title 12, Code of Federal Regulations. 

(3) FOREIGN EXCHANGE SWAP .—The term ‘‘foreign exchange 

swap’’ has the meaning given that term under section 1a of the 

Commodity Exchange Act. 

(4) INSURED CREDIT UNION.—The term ‘‘insured credit union’’ 

has the meaning given that term under section 101 of the Federal Credit Union Act. 

(5) LEVERAGE EXPOSURE.—The term ‘‘leverage exposure’’— 

(A) with respect to a banking organization other than an 

insured credit union or a traditional banking organization, 

has the meaning given the term ‘‘total leverage exposure’’ 

under section 3.10(c)(4)(ii), 217.10(c)(4), or 324.10(c)(4) of 

title 12, Code of Federal Regulations, as applicable, as in 

effect on the date of the enactment of this Act; 

(B) with respect to a traditional banking organization 

other than an insured credit union, means total assets 

(minus any items deducted from common equity tier 1 capital) as calculated in accordance with generally accepted 

accounting principles and as reported on the traditional 

banking organization’s applicable regulatory filing with the 

banking organization’s appropriate Federal banking agency; and 

(C) with respect to a banking organization that is an insured credit union, has the meaning given the term ‘‘total 

assets’’ under section 702.2 of title 12, Code of Federal 

Regulations, as in effect on the date of the enactment of 

this Act. 

(6) LEVERAGE RATIO DEFINITIONS.— 

(A) AVERAGE LEVERAGE RATIO.—With respect to a banking organization, the term ‘‘average leverage ratio’’ means 

the average of the banking organization’s quarterly leverVerDate Sep 11 2014 05:01 Jun 07, 2017 Jkt 025698 PO 00000 Frm 00138 Fmt 6659 Sfmt 6602 E:\HR\OC\HR163.XXX HR163
139 

age ratios for each of the most recently completed four calendar quarters. 

(B) QUARTERLY LEVERAGE RATIO.—With respect to a 

banking organization and a calendar quarter, the term 

‘‘quarterly leverage ratio’’ means the organization’s tangible equity divided by the organization’s leverage exposure, expressed as a percentage, on the last day of such 

quarter. 

(7) NACR.—The term ‘‘NACR’’ means— 

(A) book equity less nonperforming assets plus loan loss 

reserves, divided by 

(B) total banking organization assets. 

(8) NONPERFORMING ASSETS.—The term ‘‘nonperforming assets’’ means— 

(A) 20 percent of assets that are past due 30 to 89 days, 

plus 

(B) 50 percent of assets that are past due 90 days or 

more, plus 

(C) 100 percent of nonaccrual assets and other real estate owned. 

(9) QUALIFYING BANKING ORGANIZATION.—The term ‘‘qualifying banking organization’’ means a banking organization that 

has made an election under section 601 and with respect to 

which such election is in effect. 

(10) SECURITY-BASED SWAP .—The term ‘‘security-based 

swap’’ has the meaning given that term under section 3 of the 

Securities Exchange Act of 1934. 

(11) SWAP.—The term ‘‘swap’’ has the meaning given that 

term under section 1a of the Commodity Exchange Act. 

(12) TANGIBLE EQUITY.—The term ‘‘tangible equity’’— 

(A) with respect to a banking organization other than a 

credit union, means the sum of— 

(i) common equity tier 1 capital; 

(ii) additional tier 1 capital consisting of instruments issued on or before the date of enactment of 

this Act; and 

(iii) with respect to a depository institution holding 

company that had less than $15,000,000,000 in total 

consolidated assets as of December 31, 2009, or March 

31, 2010, or a banking organization that was a mutual 

holding company as of May 19, 2010, trust preferred 

securities issued prior to May 19, 2010, to the extent 

such organization was permitted, as of the date of the 

enactment of this Act, to consider such securities as 

tier 1 capital under existing regulations of the appropriate Federal banking agency; and 

(B) with respect to a banking organization that is a credit union, has the meaning given the term ‘‘net worth’’ 

under section 702.2 of title 12, Code of Federal Regulations, as in effect on the date of the enactment of this Act. 

(13) TRADITIONAL BANKING ORGANIZATION.—The term ‘‘traditional banking organization’’ means a banking organization 

that— 

(A) has zero trading assets and zero trading liabilities; 

140 

(B) does not engage in swaps or security-based swaps, 

other than swaps or security-based swaps referencing interest rates or foreign exchange swaps; and 

(C) has a total notional exposure of swaps and securitybased swaps of not more than $8,000,000,000. 

(14) OTHER BANKING TERMS.—The terms ‘‘insured depository 

institution’’ and ‘‘depository institution holding company’’ have 

the meaning given those terms, respectively, under section 3 of 

the Federal Deposit Insurance Act. 

(15) OTHER CAPITAL TERMS.—With respect to a banking organization, the terms ‘‘additional tier 1 capital’’ and ‘‘common equity tier 1 capital’’ have the meaning given such terms, respectively, under section 3.20, 217.20, or 324.20 of title 12, Code of 

Federal Regulations, as applicable, as in effect on the date of 

the enactment of this Act. 

TITLE VII—EMPOWERING AMERICANS 

TO ACHIEVE FINANCIAL INDEPENDENCE 

Subtitle A—Separation of Powers and 

Liberty Enhancements 

SEC. 711. CONSUMER LAW ENFORCEMENT AGENCY. 

(a) MAKING THE BUREAU AN INDEPENDENT CONSUMER LAW ENFORCEMENT AGENCY.—The Consumer Financial Protection Act of 

2010 (12 U.S.C. 5481 et seq.) is amended— 

(1) in section 1011— 

(A) in the heading of such section, by striking ‘‘BUREAU OF CONSUMER FINANCIAL PROTECTION’’ 

and inserting ‘‘CONSUMER LAW ENFORCEMENT 

AGENCY’’; 

(B) in subsection (a)— 

(i) in the heading of such subsection, by striking 

‘‘BUREAU’’ and inserting ‘‘AGENCY’’; 

(ii) by striking ‘‘in the Federal Reserve System,’’; 

(iii) by striking ‘‘independent bureau’’ and inserting 

‘‘independent agency’’; and 

(iv) by striking ‘‘ ‘Bureau of Consumer Financial Protection’ ’’ and inserting ‘‘ ‘Consumer Law Enforcement 

Agency’ (hereinafter in this section referred to as the 

‘Agency’)’’; 

(C) in subsection (b)(5), by amending subparagraph (A) 

to read as follows: 

‘‘(A) shall be appointed by the President; and’’; 

(D) in subsection (c), by striking paragraph (3); 

(E) in subsection (e), by striking ‘‘, including in cities in 

which the Federal reserve banks, or branches of such 

banks, are located,’’; and 

(F) by striking ‘‘Bureau’’ each place such term appears 

and inserting ‘‘Agency’’; and 

(2) in section 1012— 

141 

(A) in subsection (a)(10), by striking ‘‘examinations,’’; 

and 

(B) by striking subsection (c). 

(b) DEEMING OF NAME.—Any reference in a law, regulation, document, paper, or other record of the United States to the Bureau of 

Consumer Financial Protection shall be deemed a reference to the 

Consumer Law Enforcement Agency. 

(c) CONFORMING AMENDMENTS.— (1) DODD-FRANK WALL STREET REFORM AND CONSUMER PRO- TECTION ACT.—The Dodd-Frank Wall Street Reform and Consumer Protection Act (12 U.S.C. 5301 et seq.) is amended— 

(A) in the table of contents in section 1(b)— 

(i) by striking ‘‘Bureau of Consumer Financial Protection’’ each place such term appears and inserting 

‘‘Consumer Law Enforcement Agency’’; and 

(ii) in the table of contents relating to title X, in the 

items relating to subtitle B, subtitle C, and section 

1027, by striking ‘‘Bureau’’ each place such term appears and inserting ‘‘Agency’’; 

(B) in section 2, by amending paragraph (4) to read as 

follows: 

‘‘(4) AGENCY.—The term ‘Agency’ means the Consumer Law 

Enforcement Agency established under title X.’’; 

(C) in section 342 by striking ‘‘Bureau’’ each place such 

term appears in headings and text and inserting ‘‘Agency’’; 

(D) in section 1400(b)— 

(i) by striking ‘‘Bureau of Consumer Financial Protection’’ and inserting ‘‘Consumer Law Enforcement 

Agency’’; and 

(ii) in the subsection heading, by striking ‘‘BUREAU

OF CONSUMER FINANCIAL PROTECTION’’ and inserting 

‘‘CONSUMER LAW ENFORCEMENT AGENCY’’; 

(E) in section 1411(a)(1), by striking ‘‘Bureau’’ and inserting ‘‘Agency’’; and 

(F) in section 1447, by striking ‘‘Director of the Bureau’’ 

each place such term appears and inserting ‘‘Director of 

the Consumer Law Enforcement Agency’’. 

(2) ALTERNATIVE MORTGAGE TRANSACTION PARITY ACT OF

1982.—The Alternative Mortgage Transaction Parity Act of 

1982 (12 U.S.C. 3801 et seq.) is amended— 

(A) by striking ‘‘Bureau of Consumer Financial Protection’’ each place such term appears and inserting ‘‘Consumer Law Enforcement Agency’’; and 

(B) in the subsection heading of subsection (d) of section 

804 (12 U.S.C. 3803(d)), by striking ‘‘BUREAU’’ and inserting ‘‘AGENCY’’. 

(3) ELECTRONIC FUND TRANSFER ACT.—The Electronic Fund 

Transfer Act (15 U.S.C. 1693 et seq.) is amended— 

(A) by amending the second paragraph (4) (defining the 

term ‘‘Bureau’’) to read as follows: 

‘‘(4) the term ‘Agency’ means the Consumer Law Enforcement Agency;’’; 

(B) in section 916(d)(1), by striking ‘‘Bureau of Consumer 

Financial Protection’’ and inserting ‘‘Consumer Law Enforcement Agency’’; and 

142 

(C) by striking ‘‘Bureau’’ each place that term appears in 

heading or text and inserting ‘‘Agency’’. 

(4) EQUAL CREDIT OPPORTUNITY ACT.—The Equal Credit Opportunity Act (15 U.S.C. 1691 et seq.) is amended— 

(A) in section 702 (15 U.S.C. 1691a), by amending subsection (c) to read as follows: 

‘‘(c) The term ‘Agency’ means the Consumer Law Enforcement 

Agency.’’; and 

(B) by striking ‘‘Bureau’’ each place that term appears in 

heading or text and inserting ‘‘Agency’’. 

(5) EXPEDITED FUNDS AVAILABILITY ACT.—The Expedited 

Funds Availability Act (12 U.S.C. 4001 et seq.) is amended— 

(A) by striking ‘‘Bureau of Consumer Financial Protection’’ each place such term appears and inserting ‘‘Consumer Law Enforcement Agency’’; and 

(B) in the heading of section 605(f)(1), by striking 

‘‘BOARD AND BUREAU’’ and inserting ‘‘BOARD AND AGENCY’’. 

(6) FAIR AND ACCURATE CREDIT TRANSACTIONS ACT OF 2003.— 

The Fair and Accurate Credit Transactions Act of 2003 (Public 

Law 108–159) is amended by striking ‘‘Bureau’’ each place 

such term appears in heading and text and inserting ‘‘Agency’’. 

(7) FAIR CREDIT REPORTING ACT.—The Fair Credit Reporting 

Act (15 U.S.C. 1681 et seq.) is amended— 

(A) by amending section 603(w) to read as follows: 

‘‘(w) AGENCY.—The term ‘Agency’ means the Consumer Law Enforcement Agency.’’; and 

(B) by striking ‘‘Bureau’’ each place such term appears, 

other than in sections 626 and 603(v), and inserting ‘‘Agency’’. 

(8) FAIR DEBT COLLECTION PRACTICES ACT.—The Fair Debt 

Collection Practices Act (15 U.S.C. 1692 et seq.) is amended— 

(A) by amending section 803(1) to read as follows: 

‘‘(1) The term ‘Agency’ means the Consumer Law Enforcement Agency.’’; and 

(B) by striking ‘‘Bureau’’ each place such term appears 

in heading or text and inserting ‘‘Agency’’. 

(9) FEDERAL DEPOSIT INSURANCE ACT.—The Federal Deposit 

Insurance Act (12 U.S.C. 1811 et seq.) is amended— 

(A) in the second paragraph (6) (with the heading ‘‘Referral to bureau of consumer financial protection’’) of section 8(t) (12 U.S.C. 1818(t))— 

(i) in the paragraph heading, by striking ‘‘BUREAU

OF CONSUMER FINANCIAL PROTECTION’’; and inserting 

‘‘CONSUMER LAW ENFORCEMENT AGENCY’’; and 

(ii) by striking ‘‘Bureau of Consumer Financial Protection’’ and inserting ‘‘Consumer Law Enforcement 

Agency’’; 

(B) by amending clause (vi) of section 11(t)(2)(A) (12 

U.S.C. 1821(t)(2)(A)(vi)) to read as follows: 

‘‘(vi) The Consumer Law Enforcement Agency.’’; 

(C) in section 18(x) (12 U.S.C. 1828(x)), by striking ‘‘Bureau of Consumer Financial Protection’’ each place such 

term appears and inserting ‘‘Consumer Law Enforcement 

Agency’’; 

143 

(D) by striking ‘‘Bureau’’ each place such term appears 

and inserting ‘‘Agency’’; and 

(E) in section 43(e) (12 U.S.C. 1831t(e)), by amending 

paragraph (5) to read as follows: 

‘‘(5) AGENCY.—The term ‘Agency’ means the Consumer Law 

Enforcement Agency.’’. 

(10) FEDERAL FINANCIAL INSTITUTIONS EXAMINATION COUNCIL

ACT OF 1978.—The Federal Financial Institutions Examination 

Council Act of 1978 (12 U.S.C. 3301 et seq.) is amended— 

(A) in section 1004(a)(4), by striking ‘‘Consumer Financial Protection Bureau’’ and inserting ‘‘Consumer Law Enforcement Agency’’; and 

(B) in section 1011, by striking ‘‘Bureau of Consumer Financial Protection’’ and inserting ‘‘Consumer Law Enforcement Agency’’. 

(11) FINANCIAL INSTITUTIONS REFORM, RECOVERY, AND ENFORCEMENT ACT OF 1989.—The Financial Institutions Reform, 

Recovery, and Enforcement Act of 1989 (Public Law 101–73; 

103 Stat. 183) is amended— 

(A) in section 1112(b) (12 U.S.C. 3341), by striking ‘‘Bureau of Consumer Financial Protection’’ and inserting 

‘‘Consumer Law Enforcement Agency’’; 

(B) in section 1124 (12 U.S.C. 3353), by striking ‘‘Bureau 

of Consumer Financial Protection’’ each place such term 

appears and inserting ‘‘Consumer Law Enforcement Agency’’; 

(C) in section 1125 (12 U.S.C. 3354), by striking ‘‘Bureau 

of Consumer Financial Protection’’ each place such term 

appears and inserting ‘‘Consumer Law Enforcement Agency’’; and 

(D) in section 1206(a) (12 U.S.C. 1833b(a)), by striking 

‘‘Federal Housing Finance Board’’ and all that follows 

through ‘‘Farm Credit Administration’’ and inserting ‘‘Federal Housing Finance Agency, the Consumer Law Enforcement Agency, and the Farm Credit Administration’’. 

(12) FINANCIAL LITERACY AND EDUCATION IMPROVEMENT

ACT.—Section 513 of the Financial Literacy and Education Improvement Act (20 U.S.C. 9702) is amended by striking ‘‘Bureau of Consumer Financial Protection’’ each place such term 

appears and inserting ‘‘Consumer Law Enforcement Agency’’. 

(13) GRAMM-LEACH-BLILEY ACT.—Title V of the GrammLeach-Bliley Act (15 U.S.C. 6801 et seq.) is amended— 

(A) by striking ‘‘Bureau of Consumer Financial Protection’’ each place such term appears and inserting ‘‘Consumer Law Enforcement Agency’’; and 

(B) in section 505(a)(8) (15 U.S.C. 6805(a)(8)), by striking 

‘‘Bureau’’ and inserting ‘‘Agency’’. 

(14) HOME MORTGAGE DISCLOSURE ACT OF 1975.—The Home 

Mortgage Disclosure Act of 1975 (12 U.S.C. 2801 et seq.) is 

amended— 

(A) by striking ‘‘Bureau of Consumer Financial Protection’’ each place such term appears and inserting ‘‘Consumer Law Enforcement Agency’’; 

(B) by striking ‘‘Bureau’’ each place such term appears 

and inserting ‘‘Agency’’; and 

144 

(C) in section 303, by amending paragraph (1) to read as 

follows: 

‘‘(1) the term ‘Agency’ means the Consumer Law Enforcement Agency;’’. 

(15) HOMEOWNERS PROTECTION ACT OF 1998.—Section 10(a)(4) 

of the Homeowners Protection Act of 1998 (12 U.S.C. 

4909(a)(4)) is amended by striking ‘‘Bureau of Consumer Financial Protection’’ and inserting ‘‘Consumer Law Enforcement 

Agency’’. 

(16) HOME OWNERSHIP AND EQUITY PROTECTION ACT OF

1994.—Section 158(a) of the Home Ownership and Equity Protection Act of 1994 (15 U.S.C. 1601 note) is amended by striking ‘‘Bureau’’ and inserting ‘‘Consumer Law Enforcement Agency’’. 

(17) INTERSTATE LAND SALES FULL DISCLOSURE ACT.—The 

Interstate Land Sales Full Disclosure Act (12 U.S.C. 1701 et 

seq.) is amended— 

(A) by striking ‘‘Bureau of Consumer Financial Protection’’ each place such term appears and inserting ‘‘Agency’’; 

(B) in section 1402, by amending paragraph (12) to read 

as follows: 

‘‘(12) ‘Agency’ means the Consumer Law Enforcement Agency.’’; and 

(C) in section 1416, by striking ‘‘Bureau’’ each place such 

term appears and inserting ‘‘Agency’’. 

(18) REAL ESTATE SETTLEMENT PROCEDURES ACT OF 1974.— 

The Real Estate Settlement Procedures Act of 1974 (12 U.S.C. 

2601 et seq.) is amended— 

(A) by striking ‘‘Bureau of Consumer Financial Protection’’ each place such term appears and inserting ‘‘Consumer Law Enforcement Agency’’; 

(B) by striking ‘‘Bureau’’ each place such term appears 

and inserting ‘‘Agency’’; and 

(C) in section 3, by amending paragraph (9) to read as 

follows: 

‘‘(9) the term ‘Agency’ means the Consumer Law Enforcement Agency.’’. 

(19) REVISED STATUES OF THE UNITED STATES.—Section 

5136C(b)(3)(B) of the Revised Statutes of the United States (12 

U.S.C. 25b(b)(3)(B)) is amended by striking ‘‘Bureau of Consumer Financial Protection’’ and inserting ‘‘Consumer Law Enforcement Agency’’. 

(20) RIGHT TO FINANCIAL PRIVACY ACT OF 1978.—The Right to 

Financial Privacy Act of 1978 (12 U.S.C. 3401 et seq.) is 

amended— 

(A) by amending subparagraph (B) of section 1101(7) (12 

U.S.C. 3401(7)(B)) to read as follows: 

‘‘(B) the Consumer Law Enforcement Agency;’’; and 

(B) by striking ‘‘Bureau of Consumer Financial Protection’’ each place such term appears in heading or text and 

inserting ‘‘Consumer Law Enforcement Agency’’. 

(21) S.A.F.E. MORTGAGE LICENSING ACT OF 2008.—The 

S.A.F.E. Mortgage Licensing Act of 2008 (12 U.S.C. 5101 et 

seq.) is amended— 

145 

(A) in section 1507, by striking ‘‘Bureau, and the Bureau 

of Consumer Financial Protection’’ each place such term 

appears and inserting ‘‘Consumer Law Enforcement Agency’’; 

(B) by striking ‘‘Bureau of Consumer Financial Protection’’ each place such term appears and inserting ‘‘Consumer Law Enforcement Agency’’; 

(C) by striking ‘‘Bureau’’ each place such appears, other 

than in sections 1505(a)(1), 1507(a)(2)(A), and 1511(b), and 

inserting ‘‘Agency’’; 

(D) in section 1503, by amending paragraph (1) to read 

as follows: 

‘‘(1) AGENCY.—The term ‘Agency’ means the Consumer Law 

Enforcement Agency.’’; 

(E) in the heading of section 1508, by striking ‘‘BUREAU OF CONSUMER FINANCIAL PROTECTION’’ 

and inserting ‘‘CONSUMER LAW ENFORCEMENT 

AGENCY’’; and 

(F) in the heading of section 1514, by striking ‘‘BUREAU’’ and inserting ‘‘AGENCY’’. 

(22) TELEMARKETING AND CONSUMER FRAUD AND ABUSE PRE- VENTION ACT.—The Telemarketing and Consumer Fraud and 

Abuse Prevention Act (15 U.S.C. 6101 et seq.) is amended by 

striking ‘‘Bureau of Consumer Financial Protection’’ each place 

such term appears in heading or text and inserting ‘‘Consumer 

Law Enforcement Agency’’. 

(23) TITLE 5, UNITED STATES CODE.—Title 5, United States 

Code, is amended— 

(A) in section 552a(w)— 

(i) in the subsection heading, by striking ‘‘BUREAU

OF CONSUMER FINANCIAL PROTECTION’’ and inserting 

‘‘CONSUMER LAW ENFORCEMENT AGENCY’’; 

(ii) by striking ‘‘Bureau of Consumer Financial Protection’’ and inserting ‘‘Consumer Law Enforcement 

Agency’’; 

(B) in section 609(d)(2), by striking ‘‘Consumer Financial 

Protection Bureau of the Federal Reserve System’’ and inserting ‘‘Consumer Law Enforcement Agency’’; and 

(C) in section 3132(a)(1)(D), by inserting ‘‘the Consumer 

Law Enforcement Agency,’’ before ‘‘and the National Credit 

Union Administration’’. 

(24) TITLE 10, UNITED STATES CODE.— 

(A) SECTION 987.—Section 987(h)(3)(E) of title 10, United 

States Code, is amended by striking ‘‘Bureau of Consumer 

Financial Protection’’ and inserting ‘‘Consumer Law Enforcement Agency’’. 

(B) NDAA FY 2015.—Section 557(a) of the Carl Levin and 

Howard P. ‘‘Buck’’ McKeon National Defense Authorization 

Act for Fiscal Year 2015 (Public Law 113–29; 128 Stat. 

3381; 10 U.S.C. 1144 note), is amended by striking ‘‘Consumer Financial Protection Bureau’’ each place such term 

appears and inserting ‘‘Consumer Law Enforcement Agency’’. 

(25) TITLE 44, UNITED STATES CODE.—Title 44, United States 

Code, is amended— 

146 

(A) in section 3502(5), by striking ‘‘the Bureau of Consumer Financial Protection,’’; and 

(B) in section 3513(c), by striking ‘‘Bureau of Consumer 

Financial Protection’’ and inserting ‘‘Consumer Law Enforcement Agency’’. 

(26) TRUTH IN LENDING ACT.—The Truth in Lending Act (15 

U.S.C. 1601 et seq.) is amended— 

(A) by amending section 103(b) (15 U.S.C. 1602(b)) to 

read as follows: 

‘‘(b) AGENCY.—The term ‘Agency’ means the Consumer Law Enforcement Agency.’’; 

(B) by amending section 103(c) (15 U.S.C. 1602(c)) to 

read as follows: 

‘‘(c) BOARD.—The term ‘Board’ means the Board of Governors of 

the Federal Reserve System.’’; and 

(C) in section 128(f) (15 U.S.C. 1638(f)), by striking 

‘‘Board’’ each place such term appears and inserting ‘‘Agency’’; 

(D) in sections 129B (15 U.S.C. 1639b) and 129C (15 

U.S.C. 1639c), by striking ‘‘Board’’ each place such term 

appears and inserting ‘‘Agency’’; 

(E) in section 140A (15 U.S.C. 1651), by striking ‘‘in consultation with the Bureau’’ and inserting ‘‘in consultation 

with the Federal Trade Commission’’; 

(F) by striking ‘‘Bureau’’ each place such term appears 

in heading or text and inserting ‘‘Agency’’; and 

(G) by striking ‘‘BUREAU’’ and inserting ‘‘AGENCY’’ in the 

paragraph headings for— 

(i) section 122(d)(2) (15 U.S.C. 1632(d)(2)); 

(ii) section 127(c)(5) (15 U.S.C. 1637(c)(5)); 

(iii) section 127(r)(3) (15 U.S.C. 1637(r)(3)); and 

(iv) section 127A(a)(14) (15 U.S.C. 1637a(a)(14)). 

(27) TRUTH IN SAVINGS ACT.—The Truth in Savings Act (12 

U.S.C. 4301 et seq.) is amended— 

(A) by amending paragraph (4) of section 274 (12 U.S.C. 

4313(4)) to read as follows: 

‘‘(4) AGENCY.—The term ‘Agency’ means the Consumer Law 

Enforcement Agency.’’; 

(B) by striking ‘‘National Credit Union Administration 

Bureau’’ each place such term appears and inserting ‘‘National Credit Union Administration Board’’; and 

(C) by striking ‘‘Bureau’’ each place such term appears 

and inserting ‘‘Agency’’, except in section 233(b)(4)(B). 

SEC. 712. BRINGING THE AGENCY INTO THE REGULAR APPROPRIATIONS PROCESS. 

Section 1017 of the Consumer Financial Protection Act of 2010 

(12 U.S.C. 5497) is amended— 

(1) in subsection (a)— 

(A) by amending the heading of such subsection to read 

as follows: ‘‘BUDGET, FINANCIAL MANAGEMENT, AND

AUDIT.—’’; 

(B) by striking paragraphs (1), (2), and (3); 

(C) by redesignating paragraphs (4) and (5) as paragraphs (1) and (2), respectively; and 

147 

(D) by striking subparagraphs (E) and (F) of paragraph 

(1), as so redesignated; 

(2) by striking subsections (b) and (c); 

(3) by redesignating subsections (d) and (e) as subsections (b) 

and (c), respectively; and 

(4) in subsection (c), as so redesignated— 

(A) by striking paragraphs (1), (2), and (3) and inserting 

the following: 

‘‘(1) AUTHORIZATION OF APPROPRIATIONS.—There is authorized to be appropriated to the Agency for each of fiscal years 

2017 and 2018 an amount equal to the aggregate amount of 

funds transferred by the Board of Governors to the Bureau of 

Consumer Financial Protection during fiscal year 2015.’’; and 

(B) by redesignating paragraph (4) as paragraph (2). 

SEC. 713. CONSUMER LAW ENFORCEMENT AGENCY INSPECTOR GENERAL REFORM. 

(a) APPOINTMENT OF INSPECTOR GENERAL.—The Inspector General Act of 1978 (5 U.S.C. App.) is amended— 

(1) in section 8G— 

(A) in subsection (a)(2), by striking ‘‘and the Bureau of 

Consumer Financial Protection’’; 

(B) in subsection (c), by striking ‘‘For purposes of implementing this section’’ and all that follows through the end 

of the subsection; and 

(C) in subsection (g)(3), by striking ‘‘and the Bureau of 

Consumer Financial Protection’’; and 

(2) in section 12— 

(A) in paragraph (1), by inserting ‘‘the Consumer Law 

Enforcement Agency;’’ after ‘‘the President of the ExportImport Bank;’’; and 

(B) in paragraph (2), by inserting ‘‘the Consumer Law 

Enforcement Agency,’’ after ‘‘the Export-Import Bank,’’. 

(b) REQUIREMENTS FOR THE INSPECTOR GENERAL FOR THE CON- SUMER LAW ENFORCEMENT AGENCY.— 

(1) ESTABLISHMENT.—Section 1011 of the Consumer Financial Protection Act of 2010 (12 U.S.C. 5491), as amended by 

section 311, is further amended by adding at the end the following: 

‘‘(f) INSPECTOR GENERAL.—There is established the position of 

the Inspector General of the Agency.’’; and 

(2) HEARINGS.—Section 1016 of the Consumer Financial Protection Act of 2010 (12 U.S.C. 5496) is amended by inserting 

after subsection (c) the following: 

‘‘(d) ADDITIONAL REQUIREMENT FOR INSPECTOR GENERAL.—On a 

separate occasion from that described in subsection (a), the Inspector General of the Agency shall appear before each of the Committee on Banking, Housing, and Urban Affairs of the Senate and 

the Committee on Financial Services of the House of Representatives at semi-annual hearings no less frequently than twice annually, at a date determined by the chairman of the respective committee, to testify regarding the reports required under subsection 

(b) and the reports required under section 5 of the Inspector General Act of 1978 (5 U.S.C. App.).’’. 

(3) PARTICIPATION IN THE COUNCIL OF INSPECTORS GENERAL

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148 

Frank Wall Street Reform and Consumer Protection Act is 

amended by adding at the end the following: 

‘‘(J) The Consumer Law Enforcement Agency.’’. 

(4) DEADLINE FOR APPOINTMENT.—Not later than 60 days 

after the date of the enactment of this Act, the President shall 

appoint an Inspector General for the Consumer Law Enforcement Agency in accordance with section 3 of the Inspector General Act of 1978 (5 U.S.C. App.). 

(c) TRANSITION PERIOD.—The Inspector General of the Board of 

Governors of the Federal Reserve System and the Bureau of Consumer Financial Protection shall serve in that position until the 

confirmation of an Inspector General for the Consumer Law Enforcement Agency. At that time, the Inspector General of the Board 

of Governors of the Federal Reserve System and the Bureau of 

Consumer Financial Protection shall become the Inspector General 

of the Board of Governors of the Federal Reserve System. 

SEC. 714. PRIVATE PARTIES AUTHORIZED TO COMPEL THE AGENCY 

TO SEEK SANCTIONS BY FILING CIVIL ACTIONS; ADJUDICATIONS DEEMED ACTIONS. 

Section 1053 of the Consumer Financial Protection Act of 2010 

(12 U.S.C. 5563) is amended by adding at the end the following: 

‘‘(f) PRIVATE PARTIES AUTHORIZED TO COMPEL THE AGENCY TO

SEEK SANCTIONS BY FILING CIVIL ACTIONS.— 

‘‘(1) TERMINATION OF ADMINISTRATIVE PROCEEDING.—In the 

case of any person who is a party to a proceeding brought by 

the Agency under this section, to which chapter 5 of title 5, 

United States Code, applies, and against whom an order imposing a cease and desist order or a penalty may be issued at 

the conclusion of the proceeding, that person may, not later 

than 20 days after receiving notice of such proceeding, and at 

that person’s discretion, require the Agency to terminate the 

proceeding. 

‘‘(2) CIVIL ACTION AUTHORIZED.—If a person requires the 

Agency to terminate a proceeding pursuant to paragraph (1), 

the Agency may bring a civil action against that person for the 

same remedy that might be imposed. 

‘‘(g) ADJUDICATIONS DEEMED ACTIONS.—Any administrative adjudication commenced under this section shall be deemed an ‘action’ 

for purposes of section 1054(g).’’. 

SEC. 715. CIVIL INVESTIGATIVE DEMANDS TO BE APPEALED TO 

COURTS. 

Section 1052 of the Consumer Financial Protection Act of 2010 

(12 U.S.C. 5562) is amended— 

(1) in subsection (c)— 

(A) in paragraph (2), by inserting after ‘‘shall state’’ the 

following: ‘‘with specificity’’; and 

(B) by adding at the end the following: 

‘‘(14) MEETING REQUIREMENT.—The recipient of a civil investigative demand shall meet and confer with an Agency investigator within 30 calendar days after receipt of the demand to 

discuss and attempt to resolve all issues regarding compliance 

with the civil investigative demand, unless the Agency grants 

an extension requested by such recipient.’’; 

(2) in subsection (f)— 

(A) by amending paragraph (1) to read as follows: 

149 

‘‘(1) IN GENERAL.—Not later than 45 days after the service of 

any civil investigative demand upon any person under subsection (c), or at any time before the return date specified in 

the demand, whichever period is shorter, or within such period 

exceeding 45 days after service or in excess of such return date 

as may be prescribed in writing, subsequent to service, by any 

Agency investigator named in the demand, such person may 

file, in the district court of the United States for any judicial 

district in which such person resides, is found, or transacts 

business, a petition for an order modifying or setting aside the 

demand.’’; and 

(B) in paragraph (2), by striking ‘‘at the Bureau’’; and 

(3) in subsection (h)— 

(A) by striking ‘‘(1) IN GENERAL.—’’; and 

(B) by striking paragraph (2). 

SEC. 716. AGENCY DUAL MANDATE AND ECONOMIC ANALYSIS. 

(a) PURPOSE.—Section 1021(a) of the Consumer Financial Protection Act of 2010 (12 U.S.C. 5511(a)) is amended by adding at the 

end the following: ‘‘In addition, the Director shall seek to implement and, where applicable, enforce Federal consumer financial 

law consistently for the purpose of strengthening participation in 

markets by covered persons, without Government interference or 

subsidies, to increase competition and enhance consumer choice.’’. 

(b) OFFICE OF ECONOMIC ANALYSIS.— 

(1) IN GENERAL.—Section 1013 of the Consumer Financial 

Protection Act of 2010 (12 U.S.C. 5493), as amended by section 

725, is further amended by adding at the end the following: 

‘‘(h) OFFICE OF ECONOMIC ANALYSIS.— 

‘‘(1) ESTABLISHMENT.—The Director shall, not later than the 

end of the 60-day period beginning on the date of the enactment of this subsection, establish an Office of Economic Analysis. 

‘‘(2) DIRECT REPORTING.—The head of the Office of Economic 

Analysis shall report directly to the Director. 

‘‘(3) REVIEW AND ASSESSMENT OF PROPOSED RULES AND REGULATIONS.—The Office of Economic Analysis shall— 

‘‘(A) review all proposed rules and regulations, including 

regulatory guidance, of the Agency; 

‘‘(B) assess the impact of such rules and regulations, including regulatory guidance, on consumer choice, price, 

and access to credit products; and 

‘‘(C) publish a report on such reviews and assessments 

in the Federal Register. 

‘‘(4) MEASURING EXISTING RULES AND REGULATIONS.—The Office of Economic Analysis shall— 

‘‘(A) review each rule and regulation issued by the Agency after 1, 2, 6, and 11 years of the date such rule became 

effective; 

‘‘(B) measure the rule or regulation’s success in solving 

the problem that the rule or regulation was intended to 

solve when issued; and 

‘‘(C) publish a report on such review and measurement 

in the Federal Register. 

150 

‘‘(5) COST-BENEFIT ANALYSIS RELATED TO ADMINISTRATIVE ENFORCEMENT AND CIVIL ACTIONS.—The Office of Economic Analysis shall— 

‘‘(A) carry out a cost-benefit analysis of any proposed administrative enforcement action, civil lawsuit, or consent 

order of the Agency; and 

‘‘(B) assess the impact of such complaint, lawsuit, or 

order on consumer choice, price, and access to credit products.’’. 

(2) CONSIDERATION OF REVIEW AND ASSESSMENT; RULEMAKING REQUIREMENTS.—Section 1022(b) of the Consumer Financial Protection Act of 2010 (12 U.S.C. 5512(b)) is amended 

by adding at the end the following: 

‘‘(5) CONSIDERATION OF REVIEW AND ASSESSMENT BY THE OFFICE OF ECONOMIC ANALYSIS.—Before issuing any rule or regulation, the Director shall consider the review and assessment 

of such rule or regulation, including regulatory guidance, carried out by the Office of Economic Analysis. 

‘‘(6) IDENTIFICATION OF PROBLEMS AND METRICS FOR JUDGING

SUCCESS.— 

‘‘(A) IN GENERAL.—The Director shall, in each proposed 

rulemaking of the Agency— 

‘‘(i) identify the problem that the particular rule or 

regulations is seeking to solve; and 

‘‘(ii) specify the metrics by which the Agency will 

measure the success of the rule or regulation in solving such problem. 

‘‘(B) REQUIRED METRICS.—The metrics specified under 

subparagraph (A)(ii) shall include a measurement of 

changes to consumer access to, and cost of, consumer financial products and services.’’. 

(3) CONSIDERATION OF COST-BENEFIT REVIEW RELATED TO ADMINISTRATIVE ACTIONS.—The Dodd-Frank Wall Street Reform 

and Consumer Protection Act (12 U.S.C. 5301 et seq.) is 

amended— 

(A) in subtitle E of title X, by adding at the end the following: 

‘‘SEC. 1059. CONSIDERATION OF COST-BENEFIT ANALYSIS RELATED 

TO ADMINISTRATIVE ENFORCEMENT AND CIVIL ACTIONS. 

‘‘Before initiating any administrative enforcement action or civil 

lawsuit or entering into a consent order, the Director shall consider 

the cost-benefit analysis of such action, lawsuit, or order carried 

out by the Office of Economic Analysis.’’; and 

(B) in the table of contents under section 1(b), by inserting after the item relating to section 1058 the following: 

‘‘Sec. 1059. Consideration of cost-benefit analysis related to administrative enforcement and civil actions.’’. 

(c) AVOIDANCE OF DUPLICATIVE OR UNNECESSARY ANALYSES.— 

The Consumer Law Enforcement Agency may perform any of the 

analyses required by the amendments made by this section in conjunction with, or as part of, any other agenda or analysis required 

by any other provision of law, if such other agenda or analysis satisfies the provisions of this section. 

151 

SEC. 717. NO DEFERENCE TO AGENCY INTERPRETATION. 

The Consumer Financial Protection Act of 2010 (12 U.S.C. 5481 

et seq.) is amended— 

(1) in section 1022(b)(4)— 

(A) by striking ‘‘(A) IN GENERAL.—’’; and 

(B) by striking subparagraph (B); and 

(2) in section 1061(b)(5)(E)— 

(A) by striking ‘‘affords to the—’’ and all that follows 

through ‘‘(i) Federal Trade Commission’’ and inserting ‘‘affords to the Federal Trade Commission’’; 

(B) by striking ‘‘; or’’ and inserting a period; and 

(C) by striking clause (ii). 

Subtitle B—Administrative Enhancements 

SEC. 721. ADVISORY OPINIONS. 

Section 1022(b) of the Consumer Financial Protection Act of 2010 

(12 U.S.C. 5512(b)), as amended by section 716, is further amended 

by adding at the end the following: 

‘‘(7) ADVISORY OPINIONS.— 

‘‘(A) ESTABLISHING PROCEDURES.— 

‘‘(i) IN GENERAL.—The Director shall establish a procedure and, as necessary, promulgate rules to provide 

written opinions in response to inquiries concerning 

the conformance of specific conduct with Federal consumer financial law. In establishing the procedure, the 

Director shall consult with the prudential regulators 

and such other Federal departments and agencies as 

the Director determines appropriate, and obtain the 

views of all interested persons through a public notice 

and comment period. 

‘‘(ii) SCOPE OF REQUEST.—A request for an opinion 

under this paragraph must relate to specific proposed 

or prospective conduct by a covered person contemplating the proposed or prospective conduct. 

‘‘(iii) SUBMISSION.—A request for an opinion under 

this paragraph may be submitted to the Director either by or on behalf of a covered person. 

‘‘(iv) RIGHT TO WITHDRAW INQUIRY.—Any inquiry 

under this paragraph may be withdrawn at any time 

prior to the Director issuing an opinion in response to 

such inquiry, and any opinion based on an inquiry 

that has been withdrawn shall have no force or effect. 

‘‘(B) ISSUANCE OF OPINIONS.— 

‘‘(i) IN GENERAL.—The Director shall, within 90 days 

of receiving the request for an opinion under this 

paragraph, either— 

‘‘(I) issue an opinion stating whether the described conduct would violate Federal consumer financial law; 

‘‘(II) if permissible under clause (iii), deny the 

request; or 

‘‘(III) explain why it is not feasible to issue an 

opinion. 

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‘‘(ii) EXTENSION.—Notwithstanding clause (i), if the 

Director determines that the Agency requires additional time to issue an opinion, the Director may make 

a single extension of the deadline of 90 days or less. 

‘‘(iii) DENIAL OF REQUESTS.—The Director shall not 

issue an opinion, and shall so inform the requestor, if 

the request for an opinion— 

‘‘(I) asks a general question of interpretation; 

‘‘(II) asks about a hypothetical situation; 

‘‘(III) asks about the conduct of someone other 

than the covered person on whose behalf the request is made; 

‘‘(IV) asks about past conduct that the covered 

person on whose behalf the request is made does 

not plan to continue in the future; or 

‘‘(V) fails to provide necessary supporting information requested by the Agency within a reasonable time established by the Agency. 

‘‘(iv) AMENDMENT AND REVOCATION.—An advisory 

opinion issued under this paragraph may be amended 

or revoked at any time. 

‘‘(v) PUBLIC DISCLOSURE.—An opinion rendered pursuant to this paragraph shall be placed in the Agency’s public record 90 days after the requesting party 

has received the advice, subject to any limitations on 

public disclosure arising from statutory restrictions, 

Agency regulations, or the public interest. The Agency 

shall redact any personal, confidential, or identifying 

information about the covered person or any other persons mentioned in the advisory opinion, unless the 

covered person consents to such disclosure. 

‘‘(vi) REPORT TO CONGRESS.—The Agency shall, concurrent with the semi-annual report required under 

section 1016(b), submit information regarding the 

number of requests for an advisory opinion received, 

the subject of each request, the number of requests denied pursuant to clause (iii), and the time needed to 

respond to each request. 

‘‘(C) RELIANCE ON OPINION.—Any person may rely on an 

opinion issued by the Director pursuant to this paragraph 

that has not been amended or withdrawn. No liability 

under Federal consumer financial law shall attach to conduct consistent with an advisory opinion that had not been 

amended or withdrawn at the time the conduct was undertaken. 

‘‘(D) ASSISTANCE FOR SMALL BUSINESSES.— 

‘‘(i) IN GENERAL.—The Agency shall assist, to the 

maximum extent practicable, small businesses in preparing inquiries under this paragraph. 

‘‘(ii) SMALL BUSINESS DEFINED.—For purposes of this 

subparagraph, the term ‘small business’ has the meaning given the term ‘small business concern’ under section 3 of the Small Business Act (15 U.S.C. 632). 

‘‘(E) INQUIRY FEE.— 

153 

‘‘(i) IN GENERAL.—The Director shall develop a system to charge a fee for each inquiry made under this 

paragraph in an amount sufficient, in the aggregate, 

to pay for the cost of carrying out this paragraph. 

‘‘(ii) NOTICE AND COMMENT.—Not later than 45 days 

after the date of the enactment of this paragraph, the 

Director shall publish a description of the fee system 

described in clause (i) in the Federal Register and 

shall solicit comments from the public for a period of 

60 days after publication. 

‘‘(iii) FINALIZATION.—The Director shall publish a 

final description of the fee system and implement such 

fee system not later than 30 days after the end of the 

public comment period described in clause (ii).’’. 

SEC. 722. REFORM OF CONSUMER FINANCIAL CIVIL PENALTY FUND. 

(a) SEGREGATED ACCOUNTS.—Section 1017(b) of the Consumer Financial Protection Act of 2010, as redesignated by section 712, is 

amended by redesignating paragraph (2) as paragraph (3), and by 

inserting after paragraph (1) the following new paragraph: 

‘‘(2) SEGREGATED ACCOUNTS IN CIVIL PENALTY FUND.— ‘‘(A) IN GENERAL.—The Agency shall establish and maintain a segregated account in the Civil Penalty Fund each 

time the Agency obtains a civil penalty against any person 

in any judicial or administrative action under Federal consumer financial laws. 

‘‘(B) DEPOSITS IN SEGREGATED ACCOUNTS.—The Agency 

shall deposit each civil penalty collected into the segregated account established for such penalty under subparagraph (A).’’. 

(b) PAYMENT TO VICTIMS.—Paragraph (3) of section 1017(b) of 

such Act, as redesignated by subsection (a), is amended to read as 

follows: 

‘‘(3) PAYMENT TO VICTIMS.— ‘‘(A) IN GENERAL.— ‘‘(i) IDENTIFICATION OF CLASS.—Not later than 60 

days after the date of deposit of amounts in a segregated account in the Civil Penalty Fund, the Agency 

shall identify the class of victims of the violation of 

Federal consumer financial laws for which such 

amounts were collected and deposited under paragraph (2). 

‘‘(ii) PAYMENTS.—The Agency, within 2 years after 

the date on which such class of victims is identified, 

shall locate and make payments from such amounts to 

each victim. 

‘‘(B) FUNDS DEPOSITED IN TREASURY.— 

‘‘(i) IN GENERAL.—The Agency shall deposit into the 

general fund of the Treasury any amounts remaining 

in a segregated account in the Civil Penalty Fund at 

the end of the 2-year period for payments to victims 

under subparagraph (A). 

‘‘(ii) IMPOSSIBLE OR IMPRACTICAL PAYMENTS.—If the 

Agency determines before the end of the 2-year period 

for payments to victims under subparagraph (A) that 

such victims cannot be located or payments to such 

154 

victims are otherwise not practicable, the Agency shall 

deposit into the general fund of the Treasury the 

amounts in the segregated account in the Civil Penalty Fund.’’. 

(c) EFFECTIVE DATE.— (1) IN GENERAL.—The amendments made by this section 

shall apply with respect to civil penalties collected after the 

date of enactment of this Act. 

(2) AMOUNTS IN CONSUMER FINANCIAL CIVIL PENALTY FUND

ON DATE OF ENACTMENT.—With respect to amounts in the Consumer Financial Civil Penalty Fund on the date of enactment 

of this Act that were not allocated for consumer education and 

financial literacy programs on or before September 30, 2015, 

the Consumer Law Enforcement Agency shall separate such 

amounts into segregated accounts in accordance with, and for 

purposes of, section 1017(d) of the Consumer Financial Protection Act of 2010, as amended by this section. The date of deposit of such amounts shall be deemed to be the date of enactment of this Act. 

SEC. 723. AGENCY PAY FAIRNESS. 

(a) IN GENERAL.—Section 1013(a)(2) of the Consumer Financial 

Protection Act of 2010 (12 U.S.C. 5493(a)(2)) is amended to read as 

follows: 

‘‘(2) COMPENSATION.—The rates of basic pay for all employees of the Agency shall be set and adjusted by the Director in 

accordance with the General Schedule set forth in section 5332 

of title 5, United States Code.’’. 

(b) EFFECTIVE DATE.—The amendment made by subsection (a) 

shall apply to service by an employee of the Consumer Law Enforcement Agency following the 90-day period beginning on the 

date of enactment of this Act. 

SEC. 724. ELIMINATION OF MARKET MONITORING FUNCTIONS. 

The Consumer Financial Protection Act of 2010 (12 U.S.C. 5481 

et seq.) is amended— 

(1) in section 1021(c)— 

(A) by striking paragraph (3); and 

(B) by redesignating paragraphs (4), (5), and (6) as paragraphs (3), (4), and (5), respectively; 

(2) in section 1022, by striking subsection (c); and 

(3) in section 1026(b), by striking ‘‘, and to assess and detect 

risks to consumers and consumer financial markets’’. 

SEC. 725. REFORMS TO MANDATORY FUNCTIONAL UNITS. 

The Consumer Financial Protection Act of 2010 (12 U.S.C. 5481 

et seq.) is amended— 

(1) in section 1013— 

(A) in subsection (b)— 

(i) in paragraph (1), by striking ‘‘shall establish’’ and 

inserting ‘‘may establish’’; 

(ii) in paragraph (2), by striking ‘‘shall establish’’ 

and inserting ‘‘may establish’’; and 

(iii) paragraph (3)(D)— 

(I) by striking ‘‘To facilitate preparation of the 

reports required under subparagraph (C), supervision and enforcement activities, and monitoring 

155 

of the market for consumer financial products and 

services, the’’ and inserting ‘‘The’’; and 

(II) by adding at the end the following: ‘‘Information collected under this paragraph may not be 

made publicly available, except as required by 

law.’’; 

(B) in subsection (c)— 

(i) in paragraph (1), by striking ‘‘shall establish’’ and 

inserting ‘‘may establish’’; and 

(ii) in paragraph (3), by striking ‘‘There is established the’’ and inserting ‘‘At any time when the Office 

of Fair Lending and Equal Opportunity exists within 

the Agency, there shall be a’’; 

(C) in subsection (d)— 

(i) in paragraph (1), by striking ‘‘shall establish’’ and 

inserting ‘‘may establish’’; 

(ii) in paragraph (3)— 

(I) in subparagraph (A), by inserting ‘‘, if such 

Office exists within the Agency,’’ after ‘‘Community Affairs Office’’; and 

(II) in subparagraph (B), by striking ‘‘established by the Director’’ and inserting ‘‘, if established by the Director,’’; and 

(iii) in paragraph (4), by striking ‘‘Not later than 24 

months after the designated transfer date, and annually thereafter,’’ and inserting ‘‘Annually, at any time 

when the Office of Financial Education exists within 

the Agency,’’; 

(D) in subsection (e)(1), by striking ‘‘shall establish’’ and 

inserting ‘‘may establish’’; 

(E) by striking subsection (f); 

(F) by redesignating subsections (g) and (h) as subsections (f) and (g), respectively; and 

(G) in subsection (f), as so redesignated— 

(i) in paragraph (1)— 

(I) by striking ‘‘Before the end of the 180-day period beginning on the designated transfer date, 

the Director shall’’ and inserting ‘‘The Director 

may’’; and 

(II) by striking ‘‘on protection from unfair, deceptive, and abusive practices and’’; 

(ii) in paragraph (2), by striking ‘‘The Office’’ and inserting ‘‘At any time when the Office of Financial Protection for Older Americans exists within the Agency, 

the Office’’; and 

(iii) in paragraph (3)— 

(I) in subparagraph (A)— 

(aa) by striking clause (i); 

(bb) by redesignating clauses (ii) and (iii) as 

clauses (i) and (ii), respectively; and 

(cc) in clause (ii), as so redesignated, by 

striking ‘‘to respond to consumer problems 

caused by unfair, deceptive, or abusive practices’’; 

156 

(II) in subparagraph (B), by striking ‘‘and alert 

the Commission and State regulators of certifications or designations that are identified as unfair, deceptive, or abusive’’; and 

(III) in subparagraph (D)— 

(aa) by striking clause (i); and 

(bb) by redesignating clauses (ii) and (iii) as 

clauses (i) and (ii), respectively; 

(2) in section 1029(e), by inserting after ‘‘Affairs,’’ the following: ‘‘if established under this title,’’; and 

(3) in section 1035— 

(A) in subsection (a), by striking ‘‘shall designate’’ and 

inserting ‘‘may designate’’; and 

(B) in subsection (b), by striking ‘‘The Secretary’’ and inserting ‘‘If the Secretary designates the Ombudsman under 

subsection (a), the Secretary’’. 

SEC. 726. REPEAL OF MANDATORY ADVISORY BOARD. 

(a) IN GENERAL.—Section 1014 of the Consumer Financial Protection Act of 2010 (12 U.S.C. 5494) is repealed. 

(b) CLERICAL AMENDMENT.—The table of contents in section 1(b) 

of the Dodd-Frank Wall Street Reform and Consumer Protection 

Act is amended by striking the item relation to section 1014. 

(c) RULE OF CONSTRUCTION.—Nothing in this section may be construed as limiting the authority of the Director of the Consumer 

Law Enforcement Agency to establish advisory committees pursuant to the Federal Advisory Committee Act. 

SEC. 727. ELIMINATION OF SUPERVISION AUTHORITY. 

(a) IN GENERAL.—The Consumer Financial Protection Act of 2010 

(12 U.S.C. 5481 et seq.) is amended— 

(1) in section 1002(15)(B)(ii)(I), by striking ‘‘examination or’’; 

(2) in section 1013(a)(1)(B), by striking ‘‘compliance examiners, compliance supervision analysts,’’; 

(3) in section 1016(c)— 

(A) in paragraph (5), by striking ‘‘supervisory and’’; and 

(B) in paragraph (6), by striking ‘‘orders, and supervisory actions’’ and inserting ‘‘and orders’’; 

(4) in section 1024— 

(A) in the heading, by striking ‘‘SUPERVISION OF’’ 

and inserting ‘‘AUTHORITY WITH RESPECT TO CERTAIN’’; 

(B) in subsection (a)— 

(i) in paragraph (1)(B), by striking ‘‘as defined by 

rule in accordance with paragraph (2)’’ and inserting 

‘‘as of the date of the enactment of the Financial 

CHOICE Act of 2017’’; 

(ii) by striking paragraph (2); 

(iii) by redesignating paragraph (3) as paragraph 

(2); and 

(iv) in subparagraph (A) of paragraph (2), as so redesignated, by striking ‘‘1025(a) or’’; 

(C) by striking subsection (b); 

(D) by redesignating subsections (c), (d), (e), and (f) as 

subsections (b), (c), (d), and (e), respectively; 

(E) in subsection (c), as so redesignated— 

157 

(i) in the heading, by striking ‘‘AND EXAMINATION

AUTHORITY’’; and 

(ii) by striking ‘‘, conduct examinations,’’ each place 

such term appears; 

(F) in subsection (d), as so redesignated— 

(i) by inserting ‘‘rulemaking and enforcement, but 

not supervisory,’’ before ‘‘authority of the Bureau’’; and 

(ii) by striking ‘‘conducting any examination or requiring any report from a service provider subject to 

this subsection’’ and inserting ‘‘carrying out any authority pursuant to this subsection with respect to a 

service provider’’; 

(5) by striking section 1025; 

(6) in section 1026— 

(A) by amending subsection (a) to read as follows: 

‘‘(a) SCOPE OF COVERAGE.—This section shall apply to any covered person that is an insured depository institution or an insured 

credit union.’’; 

(B) in subsection (b)(3), by striking ‘‘report of examination or related’’; 

(C) by striking subsection (c); 

(D) by redesignating subsections (d) and (e) as subsections (c) and (d), respectively; 

(E) in subsection (c), as so redesignated, by adding at the 

end the following: 

‘‘(3) VERY LARGE INSTITUTIONS.— 

‘‘(A) PRIMARY ENFORCEMENT AUTHORITY.—Notwithstanding paragraph (1), to the extent that the Agency and 

another Federal agency are authorized to enforce a Federal consumer financial law, the Agency shall have primary authority to enforce that Federal consumer financial 

law with respect to an insured depository institution or insured credit union, if such depository institution or credit 

union has total assets of more than $10,000,000,000, and 

any affiliate thereof. 

‘‘(B) REFERRAL.—Any Federal agency, other than the 

Federal Trade Commission, that is authorized to enforce a 

Federal consumer financial law may recommend, in writing, to the Agency that the Agency initiate an enforcement 

proceeding with respect to a person described in subparagraph (A), as the Agency is authorized to do by that Federal consumer financial law. 

‘‘(C) BACKUP ENFORCEMENT AUTHORITY.—If the Agency 

does not, before the end of the 120-day period beginning on 

the date on which the Agency receives a recommendation 

under subparagraph (B), initiate an enforcement proceeding, the other agency referred to in subparagraph (B) 

may initiate an enforcement proceeding.’’; and 

(F) in subsection (d), as so redesignated— 

(i) by inserting after ‘‘subsection (a)’’ the following: 

‘‘, or to any person described under subsection 

(c)(3)(A),’’; 

(ii) by striking ‘‘section 1025’’ and inserting ‘‘this 

section’’; and 

158 

(iii) by striking ‘‘When conducting any examination 

or requiring any report from a service provider subject 

to this subsection’’ and inserting ‘‘In carrying out any 

authority pursuant to this subsection with respect to 

a service provider’’; 

(7) in section 1027— 

(A) by striking ‘‘supervisory,’’ each place such term appears; 

(B) in subsection (e)(1), by striking ‘‘supervisory or’’; and 

(C) in subsection (p), by striking ‘‘section 1024(c)(1)’’ and 

inserting ‘‘section 1024(b)(1)’’; 

(8) in section 1034— 

(A) by striking subsections (b) and (c); and 

(B) by redesignating subsection (d) as subsection (b); 

(9) in section 1053— 

(A) in subsection (b)(1)(A), by striking ‘‘sections 1024, 

1025, and 1026’’ and inserting ‘‘sections 1024 and 1026’’; 

and 

(B) in subsection (c)(3)(B)(ii)(II), by striking ‘‘, by examination or otherwise,’’; 

(10) in section 1054(a), by striking ‘‘sections 1024, 1025, and 

1026’’ and inserting ‘‘sections 1024 and 1026’’; 

(11) in section 1061— 

(A) in subsection (a)(1)— 

(i) in subparagraph (A), by striking ‘‘; and’’ at the 

end and inserting a period; 

(ii) by striking ‘‘means—’’ and all that follows 

through ‘‘(A) all’’ and inserting ‘‘means all’’; 

(iii) by striking subparagraph (B); and 

(B) in subsection (c)— 

(i) by amending paragraph (1) to read as follows: 

‘‘(1) EXAMINATION.—A transferor agency that is a prudential 

regulator shall have exclusive authority (relative to the Bureau) to require reports from and conduct examinations for 

compliance with Federal consumer financial laws with respect 

to a person described in section 1026(a).’’; 

(ii) in paragraph (2)— 

(I) by striking subparagraph (A); and 

(II) by redesignating subparagraphs (B) and (C) 

as subparagraphs (A) and (B), respectively; 

(12) in section 1063, by striking ‘‘sections 1024, 1025, and 

1026’’ each place such term appears and inserting ‘‘sections 

1024 and 1026’’; and 

(13) in section 1067, by striking subsection (e). 

(b) HOME MORTGAGE DISCLOSURE ACT OF 1975.—Section 305(d) 

of the Home Mortgage Disclosure Act of 1975 (12 U.S.C. 2804(d)) 

is amended by striking ‘‘examine and’’. 

(c) OMNIBUS APPROPRIATIONS ACT, 2009.—Section 626 of the Omnibus Appropriations Act, 2009 (15 U.S.C. 1638 note) is repealed. 

(d) CLERICAL AMENDMENT.—The table of contents in section 1(b) 

of the Dodd-Frank Wall Street Reform and Consumer Protection 

Act is amended— 

(1) in the item relating to section 1024, by striking ‘‘SUPERVISION OF’’ and inserting ‘‘AUTHORITY WITH RESPECT TO 

CERTAIN’’; and 

159 

(2) by striking the item relating to section 1025. 

SEC. 728. TRANSFER OF OLD OTS BUILDING FROM OCC TO GSA. 

Within 180 days of the date of the enactment of this Act, the 

Comptroller of the Currency shall transfer, at no cost, the parcel 

of real property in the District of Columbia located at 1700 G 

Street, Northwest, to the administrative jurisdiction, custody, and 

control of the Administrator of General Services. 

SEC. 729. LIMITATION ON AGENCY AUTHORITY. 

Section 1027 of the Consumer Financial Protection Act of 2010 

(12 U.S.C. 5517) is amended— 

(1) in subsection (g)(3)(A), by striking ‘‘may not exercise any 

rulemaking or enforcement authority’’ and inserting ‘‘may not 

exercise any rulemaking, enforcement, or other authority’’; 

(2) in subsection (i)(1), by striking ‘‘shall have no authority 

to exercise any power to enforce this title’’ and inserting ‘‘may 

not exercise any rulemaking, enforcement, or other authority’’; 

and 

(3) in subsection (j)(1), by striking ‘‘shall have no authority 

to exercise any power to enforce this title’’ and inserting ‘‘may 

not exercise any rulemaking, enforcement, or other authority’’. 

Subtitle C—Policy Enhancements 

SEC. 731. CONSUMER RIGHT TO FINANCIAL PRIVACY. 

(a) REQUIREMENT OF THE AGENCY TO OBTAIN PERMISSION BE- FORE COLLECTING NONPUBLIC PERSONAL INFORMATION.—Section 

1022 of the Consumer Financial Protection Act of 2010 (12 U.S.C. 

5512), as amended by section 724(2), is further amended by inserting after subsection (b) the following: 

‘‘(c) CONSUMER PRIVACY.— ‘‘(1) IN GENERAL.—The Agency may not request, obtain, access, collect, use, retain, or disclose any nonpublic personal information about a consumer unless— 

‘‘(A) the Agency clearly and conspicuously discloses to 

the consumer, in writing or in an electronic form, what information will be requested, obtained, accessed, collected, 

used, retained, or disclosed; and 

‘‘(B) before such information is requested, obtained, 

accessed, collected, used, retained, or disclosed, the consumer informs the Agency that such information may be 

requested, obtained, accessed, collected, used, retained, or 

disclosed. 

‘‘(2) APPLICATION OF REQUIREMENT TO CONTRACTORS OF THE

AGENCY.—Paragraph (1) shall apply to any person directed or 

engaged by the Agency to collect information to the extent such 

information is being collected on behalf of the Agency. 

‘‘(3) DEFINITION OF NONPUBLIC PERSONAL INFORMATION.—In 

this subsection, the term ‘nonpublic personal information’ has 

the meaning given the term in section 509 of the GrammLeach-Bliley Act (15 U.S.C. 6809).’’. 

(b) REMOVAL OF EXEMPTION FOR THE AGENCY FROM THE RIGHT

TO FINANCIAL PRIVACY ACT.—Section 1113 of the Right to Financial 

Privacy Act of 1978 (12 U.S.C. 3413) is amended by striking subsection (r). 

160 

SEC. 732. REPEAL OF COUNCIL AUTHORITY TO SET ASIDE AGENCY 

RULES AND REQUIREMENT OF SAFETY AND SOUNDNESS 

CONSIDERATIONS WHEN ISSUING RULES. 

(a) REPEAL OF AUTHORITY.— (1) IN GENERAL.—Section 1023 of the Consumer Financial 

Protection Act of 2010 (12 U.S.C. 5513) is hereby repealed. 

(2) CONFORMING AMENDMENT.—Section 1022(b)(2)(C) of the 

Consumer Financial Protection Act of 2010 (12 U.S.C. 

5512(b)(2)(C)) is amended by striking ‘‘, except that nothing in 

this clause shall be construed as altering or limiting the procedures under section 1023 that may apply to any rule prescribed by the Bureau’’. 

(3) CLERICAL AMENDMENT.—The table of contents under section 1(b) of the Dodd-Frank Wall Street Reform and Consumer 

Protection Act is amended by striking the item relating to section 1023. 

(b) SAFETY AND SOUNDNESS CHECK.—Section 1022(b)(2)(A) of the 

Consumer Financial Protection Act of 2010 (12 U.S.C. 

5512(b)(2)(A)) is amended— 

(1) in clause (i), by striking ‘‘and’’ at the end; 

(2) in clause (ii), by adding ‘‘and’’ at the end; and 

(3) by adding at the end the following: 

‘‘(iii) the impact of such rule on the financial safety 

or soundness of an insured depository institution;’’. 

SEC. 733. REMOVAL OF AUTHORITY TO REGULATE SMALL-DOLLAR 

CREDIT. 

The Consumer Financial Protection Act of 2010 (12 U.S.C. 5481 

et seq.) is amended— 

(1) in section 1024(a)(1)— 

(A) in subparagraph (C), by adding ‘‘or’’ at the end; 

(B) in subparagraph (D), by striking ‘‘; or’’ and inserting 

a period; and 

(C) by striking subparagraph (E); and 

(2) in section 1027, by adding at the end the following: 

‘‘(t) NO AUTHORITY TO REGULATE SMALL-DOLLAR CREDIT.—The 

Agency may not exercise any rulemaking, enforcement, or other authority with respect to payday loans, vehicle title loans, or other 

similar loans.’’. 

SEC. 734. REFORMING INDIRECT AUTO FINANCING GUIDANCE. 

(a) NULLIFICATION OF AUTO LENDING GUIDANCE.—Bulletin 2013– 

02 of the Bureau of Consumer Financial Protection (published 

March 21, 2013) shall have no force or effect. 

(b) GUIDANCE REQUIREMENTS.—Section 1022(b) of the Consumer 

Financial Protection Act of 2010 (12 U.S.C. 5512(b)), as amended 

by section 721, is further amended by adding at the end the following: 

‘‘(8) GUIDANCE ON INDIRECT AUTO FINANCING.—In proposing 

and issuing guidance primarily related to indirect auto financing, the Agency shall— 

‘‘(A) provide for a public notice and comment period before issuing the guidance in final form; 

‘‘(B) make available to the public, including on the 

website of the Agency, all studies, data, methodologies, 

analyses, and other information relied on by the Agency in 

preparing such guidance; 

161 

‘‘(C) redact such information as necessary to maintain 

the nonpublic nature of confidential information, such as 

trade secrets and other confidential commercial or financial information, and personally identifiable information; 

‘‘(D) consult with the Board of Governors of the Federal 

Reserve System, the Federal Trade Commission, and the 

Department of Justice; and 

‘‘(E) conduct a study on the costs and impacts of such 

guidance to consumers and women-owned, minority-owned, 

veteran-owned, and small businesses, including consumers 

and small businesses in rural areas.’’. 

(c) RULE OF CONSTRUCTION.—Nothing in this section shall be 

construed to apply to guidance issued by the Consumer Law Enforcement Agency that is not primarily related to indirect auto financing. 

SEC. 735. REMOVAL OF AGENCY UDAAP AUTHORITY. 

(a) IN GENERAL.—The Consumer Financial Protection Act of 2010 

(12 U.S.C. 5481 et seq.) is amended— 

(1) in section 1021(b)(2), by striking ‘‘from unfair, deceptive, 

or abusive acts and practices and’’; 

(2) by striking section 1031; 

(3) in section 1036(a)— 

(A) in paragraph (1)— 

(i) by striking ‘‘provider’’ and all that follows 

through ‘‘to offer’’ and inserting ‘‘provider to offer’’; 

(ii) by striking subparagraph (B); and 

(B) in paragraph (2)(C), by striking ‘‘; or’’ at the end and 

inserting a period; and 

(C) by striking paragraph (3); and 

(4) in section 1061(b)(5)— 

(A) in subparagraph (B)— 

(i) by striking ‘‘(i) In general.—’’; and 

(ii) by striking clause (ii); 

(B) by striking subparagraph (D); and 

(C) by redesignating subparagraph (E) (as amended by 

section 717(2)) as subparagraph (D); and 

(5) in section 1076(b)(2), by striking ‘‘determine—’’ and all 

that follows through ‘‘(B) provide for’’ and inserting ‘‘determine, 

provide for’’. 

(b) TELEMARKETING AND CONSUMER FRAUD AND ABUSE PREVENTION ACT.—Section 3(c) of the Telemarketing and Consumer Fraud 

and Abuse Prevention Act (15 U.S.C. 6102) is amended— 

(1) in paragraph (1), by striking ‘‘; and’’ at the end and inserting a period; 

(2) by striking paragraph (2); and 

(3) by striking ‘‘subsection (a)—’’ and all that follows through 

‘‘(1) shall’’ and inserting ‘‘subsection (a) shall’’. 

(c) CLERICAL AMENDMENT.—The table of contents in section 1(b) 

of the Dodd-Frank Wall Street Reform and Consumer Protection 

Act is amended by striking the item relating to section 1031. 

SEC. 736. PRESERVATION OF UDAP AUTHORITY FOR FEDERAL BANKING REGULATORS. 

(a) IN GENERAL.—Section 18(f) of the Federal Trade Commission 

Act (15 U.S.C. 57a(f)) is amended to read as follows: 

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‘‘(f) UNFAIR OR DECEPTIVE ACTS OR PRACTICES BY DEPOSITORY INSTITUTIONS.— 

‘‘(1) IN GENERAL.—In order to prevent unfair or deceptive 

acts or practices in or affecting commerce (including acts or 

practices which are unfair or deceptive to consumers) by depository institutions, each Federal banking regulator shall prescribe regulations to carry out the purposes of this section, including regulations defining with specificity such unfair or deceptive acts or practices, and containing requirements prescribed for the purpose of preventing such acts or practices. 

‘‘(2) PROMULGATING SUBSTANTIALLY SIMILAR REGULATIONS.— 

Whenever the Commission prescribes a rule under subsection 

(a)(1)(B), then within 60 days after such rule takes effect each 

Federal banking regulator shall promulgate substantially similar regulations prohibiting acts or practices of depository institutions which are substantially similar to those prohibited by 

rules of the Commission and which impose substantially similar requirements, unless— 

‘‘(A) the Federal banking regulator finds that such acts 

or practices of depository institutions are not unfair or deceptive; or 

‘‘(B) the Board of Governors of the Federal Reserve System finds that implementation of similar regulations with 

respect to depository institutions would seriously conflict 

with essential monetary and payments systems policies of 

such Board, and publishes any such finding, and the reasons therefor, in the Federal Register. 

‘‘(3) ENFORCEMENT.— 

‘‘(A) IN GENERAL.—Compliance with regulations prescribed under this subsection shall be enforced— 

‘‘(i) under section 8 of the Federal Deposit Insurance 

Act, with respect to a depository institution other than 

a Federal credit union; and 

‘‘(ii) under sections 120 and 206 of the Federal Credit Union Act, with respect to a Federal credit union. 

‘‘(B) DEEMING OF VIOLATION.—For the purpose of the exercise by a Federal banking regulator of the regulator’s 

powers under any Act referred to in subparagraph (A), a 

violation of any regulation prescribed under this subsection shall be deemed to be a violation of a requirement 

imposed under that Act. 

‘‘(C) ENFORCEMENT THROUGH ANY EXISTING AUTHORITY.— 

In addition to its powers under any provision of law specifically referred to in subparagraph (A), each Federal 

banking regulator may exercise, for the purpose of enforcing compliance with any regulation prescribed under this 

subsection, any other authority conferred on the regulator 

by law. 

‘‘(4) RULE OF CONSTRUCTION.—The authority of the Board of 

Governors of the Federal Reserve System to issue regulations 

under this subsection does not impair the authority of any 

other Federal banking regulator to make rules respecting the 

regulator’s own procedures in enforcing compliance with regulations prescribed under this subsection. 

163 

‘‘(5) REPORT TO CONGRESS.—Each Federal banking regulator 

exercising authority under this subsection shall transmit to the 

Congress each year a detailed report on its activities under 

this subsection during the preceding calendar year. 

‘‘(6) DEFINITIONS.—For purposes of this Act: 

‘‘(A) BANK.—The term ‘bank’ means— 

‘‘(i) national banks and Federal branches and Federal agencies of foreign banks; 

‘‘(ii) member banks of the Federal Reserve System 

(other than national banks), branches and agencies of 

foreign banks (other than Federal branches, Federal 

agencies, and insured State branches of foreign 

banks), commercial lending companies owned or controlled by foreign banks, and organizations operating 

under section 25 or 25A of the Federal Reserve Act; 

and 

‘‘(iii) banks insured by the Federal Deposit Insurance Corporation (other than banks referred to in 

clause (i) or (ii)) and insured State branches of foreign 

banks. 

‘‘(B) DEPOSITORY INSTITUTION.—The term ‘depository institution’ means a bank, a savings and loan institution, or 

a Federal credit union. 

‘‘(C) FEDERAL BANKING REGULATOR.—The term ‘Federal 

banking regulator’— 

‘‘(i) has the meaning given the term ‘appropriate 

Federal banking agency’ under section 3 of the Federal 

Deposit Insurance Act; and 

‘‘(ii) means the National Credit Union Administration, in the case of a Federal credit union. 

‘‘(D) FEDERAL CREDIT UNION.—The term ‘Federal credit 

union’ has the same meaning as in section 101 of the Federal Credit Union Act. 

‘‘(E) SAVINGS AND LOAN INSTITUTION.—The term ‘savings 

and loan institution’ has the same meaning as in section 

3 of the Federal Deposit Insurance Act. 

‘‘(F) OTHER TERMS.—The terms used in this paragraph 

that are not defined in this Act or otherwise defined in section 3(s) of the Federal Deposit Insurance Act shall have 

the meaning given to them in section 1(b) of the International Banking Act of 1978.’’. 

(b) CONFORMING AMENDMENTS.—The Federal Trade Commission 

Act (15 U.S.C. 41 et seq.) is amended— 

(1) in section 6(j)(6), by striking ‘‘section 18(f)(3) (15 U.S.C. 

57a(f)(3)), a Federal credit union described in section 18(f)(4) 

(15 U.S.C. 57a(f)(4))’’ and inserting ‘‘section 18(f), a Federal 

credit union described in section 18(f)’’; 

(2) in section 21(b)(6)(C), by striking ‘‘section 18(f)(3) of the 

Federal Trade Commission Act (15 U.S.C. 57a(f)(3)), or a Federal credit union described in section 18(f)(4) of the Federal 

Trade Commission Act (15 U.S.C. 57a(f)(4))’’ and inserting ‘‘section 18(f), or a Federal credit union described in section 18(f)’’; 

(3) by striking ‘‘section 18(f)(2)’’ and inserting ‘‘section 18(f)’’; 

(4) by striking ‘‘section 18(f)(3)’’ each place such term appears and inserting ‘‘section 18(f)’’; and 

164 

(5) by striking ‘‘section 18(f)(4)’’ each place such term appears and inserting ‘‘section 18(f)’’. 

SEC. 737. REPEAL OF AUTHORITY TO RESTRICT ARBITRATION. 

(a) IN GENERAL.—Section 1028 of the Consumer Financial Protection Act of 2010 (12 U.S.C. 5518) is hereby repealed. 

(b) CLERICAL AMENDMENT.—The table of contents under section 

1(b) of the Dodd-Frank Wall Street Reform and Consumer Protection Act is amended by striking the item relating to section 1028. 

TITLE VIII—CAPITAL MARKETS 

IMPROVEMENTS 

Subtitle A—SEC Reform, Restructuring, 

and Accountability 

SEC. 801. AUTHORIZATION OF APPROPRIATIONS. 

Section 35 of the Securities Exchange Act of 1934 (15 U.S.C. 

78kk) is amended by striking paragraphs (1) through (5) and inserting the following: 

‘‘(1) for fiscal year 2017, $1,605,000,000; 

‘‘(2) for fiscal year 2018, $1,655,000,000; 

‘‘(3) for fiscal year 2019, $1,705,000,000; 

‘‘(4) for fiscal year 2020, $1,755,000,000; 

‘‘(5) for fiscal year 2021, $1,805,000,000; and 

‘‘(6) for fiscal year 2022, $1,855,000,000.’’. 

SEC. 802. REPORT ON UNOBLIGATED APPROPRIATIONS. 

Section 23 of the Securities Exchange Act of 1934 (15 U.S.C. 

78w) is amended by adding at the end the following: 

‘‘(e) REPORT ON UNOBLIGATED APPROPRIATIONS.—If, at the end of 

any fiscal year, there remain unobligated any funds that were appropriated to the Commission for such fiscal year, the Commission 

shall, not later than 30 days after the last day of such fiscal year, 

submit to the Committee on Financial Services and the Committee 

on Appropriations of the House of Representatives and the Committee on Banking, Housing, and Urban Affairs and the Committee 

on Appropriations of the Senate and make available on the Commission’s website a report stating the amount of such unobligated 

funds. If there is any material change in the amount stated in the 

report, the Commission shall, not later than 7 days after determining the amount of the change, submit to such committees and 

make available on the Commission’s website a supplementary report stating the amount of and reason for the change.’’. 

SEC. 803. SEC RESERVE FUND ABOLISHED. 

Section 4 of the Securities Exchange Act of 1934 (15 U.S.C. 78d) 

is amended by striking subsection (i). 

SEC. 804. FEES TO OFFSET APPROPRIATIONS. 

(a) SECTION 31 OF THE SECURITIES EXCHANGE ACT OF 1934.—Section 31 of the Securities Exchange Act of 1934 (15 U.S.C. 78ee) is 

amended— 

(1) by striking subsection (a) and inserting the following: 

165 

‘‘(a) COLLECTION.—The Commission shall, in accordance with this 

section, collect transaction fees and assessments.’’; 

(2) in subsection (i)— 

(A) in paragraph (1)(A), by inserting ‘‘except as provided 

in paragraph (2),’’ before ‘‘shall’’; and 

(B) by striking paragraph (2) and inserting the following: 

‘‘(2) GENERAL REVENUE.—Any fees collected for a fiscal year 

pursuant to this section, sections 13(e) and 14(g) of this title, 

and section 6(b) of the Securities Act of 1933 in excess of the 

amount provided in appropriation Acts for collection for such 

fiscal year pursuant to such sections shall be deposited and 

credited as general revenue of the Treasury.’’; 

(3) in subsection (j)— 

(A) by striking ‘‘the regular appropriation to the Commission by Congress for such fiscal year’’ each place it appears and inserting ‘‘the target offsetting collection amount 

for such fiscal year’’; and 

(B) in paragraph (2), by striking ‘‘subsection (l)’’ and inserting ‘‘subsection (l)(2)’’; and 

(4) by striking subsection (l) and inserting the following: 

‘‘(l) DEFINITIONS.—For purposes of this section: 

‘‘(1) TARGET OFFSETTING COLLECTION AMOUNT.—The target 

offsetting collection amount for a fiscal year is— ‘‘(A) for fiscal year 2017, $1,400,000,000; and 

‘‘(B) for each succeeding fiscal year, the target offsetting 

collection amount for the prior fiscal year, adjusted by the 

rate of inflation. 

‘‘(2) BASELINE ESTIMATE OF THE AGGREGATE DOLLAR AMOUNT

OF SALES.—The baseline estimate of the aggregate dollar 

amount of sales for any fiscal year is the baseline estimate of 

the aggregate dollar amount of sales of securities (other than 

bonds, debentures, other evidences of indebtedness, security futures products, and options on securities indexes (excluding a 

narrow-based security index)) to be transacted on each national 

securities exchange and by or through any member of each national securities association (otherwise than on a national securities exchange) during such fiscal year as determined by the 

Commission, after consultation with the Congressional Budget 

Office and the Office of Management and Budget, using the 

methodology required for making projections pursuant to section 257 of the Balanced Budget and Emergency Deficit Control Act of 1985.’’. 

(b) SECTION 6(b) OF THE SECURITIES ACT OF 1933.—Section 6(b) 

of the Securities Act of 1933 (15 U.S.C. 77f(b)) is amended— 

(1) by striking ‘‘target fee collection amount’’ each place it appears and inserting ‘‘target offsetting collection amount’’; 

(2) in paragraph (4), by striking the last sentence and inserting the following: ‘‘Subject to paragraphs (6)(B) and (7), an adjusted rate prescribed under paragraph (2) shall take effect on 

the later of— 

‘‘(A) the first day of the fiscal year to which such rate applies; or 

‘‘(B) five days after the date on which a regular appropriation to the Commission for such fiscal year is enacted.’’; 

166 

(3) in paragraph (5), by inserting ‘‘of the Securities Exchange 

Act of 1934’’ after ‘‘sections 13(e) and 14(g)’’; 

(4) by redesignating paragraph (6) as paragraph (8); 

(5) by inserting after paragraph (5) the following: 

‘‘(6) OFFSETTING COLLECTIONS.—Fees collected pursuant to 

this subsection for any fiscal year— 

‘‘(A) except as provided in section 31(i)(2) of the Securities Exchange Act of 1934, shall be deposited and credited 

as offsetting collections to the account providing appropriations to the Commission; and 

‘‘(B) except as provided in paragraph (7), shall not be collected for any fiscal year except to the extent provided in 

advance in appropriation Acts. 

‘‘(7) LAPSE OF APPROPRIATION.—If on the first day of a fiscal 

year a regular appropriation to the Commission has not been 

enacted, the Commission shall continue to collect fees (as offsetting collections) under this subsection at the rate in effect 

during the preceding fiscal year, until 5 days after the date 

such a regular appropriation is enacted.’’; and 

(6) in subparagraph (A) of paragraph (8) (as so redesignated)— 

(A) by striking the subparagraph heading and inserting 

‘‘TARGET OFFSETTING COLLECTION AMOUNT.—’’; and 

(B) in the heading of the right column of the table, by 

striking ‘‘fee’’ and inserting ‘‘offsetting’’. 

(c) SECTION 13(e) OF THE SECURITIES EXCHANGE ACT OF 1934.— 

Section 13(e) of the Securities Exchange Act of 1934 (15 U.S.C. 

78m(e)) is amended— 

(1) by striking paragraph (5) and inserting the following: 

‘‘(5) OFFSETTING COLLECTIONS.—Fees collected pursuant to 

this subsection for any fiscal year— 

‘‘(A) except as provided in section 31(i)(2), shall be deposited and credited as offsetting collections to the account 

providing appropriations to the Commission; and 

‘‘(B) except as provided in paragraph (8), shall not be collected for any fiscal year except to the extent provided in 

advance in appropriations Acts.’’; and 

(2) by adding at the end the following: 

‘‘(8) LAPSE OF APPROPRIATION.—If on the first day of a fiscal 

year a regular appropriation to the Commission has not been 

enacted, the Commission shall continue to collect fees (as offsetting collections) under this subsection at the rate in effect 

during the preceding fiscal year, until 5 days after the date 

such a regular appropriation is enacted.’’. 

(d) SECTION 14(g) OF THE SECURITIES EXCHANGE ACT OF 1934.— 

Section 14(g) of the Securities Exchange Act of 1934 (15 U.S.C. 

78n(g)) is amended— 

(1) by striking paragraph (5) and inserting the following: 

‘‘(5) OFFSETTING COLLECTIONS.—Fees collected pursuant to 

this subsection for any fiscal year— 

‘‘(A) except as provided in section 31(i)(2), shall be deposited and credited as offsetting collections to the account 

providing appropriations to the Commission; and 

167 

‘‘(B) except as provided in paragraph (8), shall not be collected for any fiscal year except to the extent provided in 

advance in appropriations Acts.’’; 

(2) by redesignating paragraph (8) as paragraph (9); and 

(3) by inserting after paragraph (7) the following: 

‘‘(8) LAPSE OF APPROPRIATION.—If on the first day of a fiscal 

year a regular appropriation to the Commission has not been 

enacted, the Commission shall continue to collect fees (as offsetting collections) under this subsection at the rate in effect 

during the preceding fiscal year, until 5 days after the date 

such a regular appropriation is enacted.’’. 

(e) EFFECTIVE DATE.—The amendments made by this section— 

(1) shall apply beginning on October 1, 2017, except that for 

fiscal year 2018, the Securities and Exchange Commission 

shall publish— 

(A) the rates established under section 31 of the Securities Exchange Act of 1934, as amended by this section, not 

later than 30 days after the date on which an Act making 

a regular appropriation to the Commission for fiscal year 

2018 is enacted; and 

(B) the rate established under section 6(b) of the Securities Act of 1933, as amended by this section, not later than 

August 31, 2017; and 

(2) shall not apply with respect to fees for any fiscal year before fiscal year 2018. 

SEC. 805. COMMISSION FEDERAL CONSTRUCTION FUNDING PROHIBITION. 

The Securities and Exchange Commission may not obligate any 

funds for the purpose of Federal construction of a new headquarters facility of the Commission. 

SEC. 806. IMPLEMENTATION OF RECOMMENDATIONS. 

Section 967 of the Dodd-Frank Wall Street Reform and Consumer Protection Act is amended by adding at the end the following: 

‘‘(d) IMPLEMENTATION OF RECOMMENDATIONS.—Not later than 6 

months after the date of enactment of this subsection, the Securities and Exchange Commission shall complete an implementation 

of the recommendations contained in the report of the independent 

consultant issued under subsection (b) on March 10, 2011. To the 

extent that implementation of certain recommendations requires 

legislation, the Commission shall submit a report to Congress containing a request for legislation granting the Commission such authority it needs to fully implement such recommendations.’’. 

SEC. 807. OFFICE OF CREDIT RATINGS TO REPORT TO THE DIVISION 

OF TRADING AND MARKETS. 

Section 15E(p)(1) of the Securities Exchange Act of 1934 (15 

U.S.C. 78o–7(p)(1)) is amended— 

(1) in subparagraph (A), by striking ‘‘within the Commission’’ 

and inserting ‘‘within the Division of Trading and Markets’’; 

and 

(2) in subparagraph (B), by striking ‘‘report to the Chairman’’ 

and inserting ‘‘report to the head of the Division of Trading 

and Markets’’. 

168 

SEC. 808. OFFICE OF MUNICIPAL SECURITIES TO REPORT TO THE DIVISION OF TRADING AND MARKETS. 

Section 979 of the Dodd-Frank Wall Street Reform and Consumer Protection Act (15 U.S.C. 78o–4a) is amended— 

(1) in subsection (a), by inserting ‘‘, within the Division of 

Trading and Markets,’’ after ‘‘There shall be in the Commission’’; and 

(2) in subsection (b), by striking ‘‘report to the Chairman’’ 

and inserting ‘‘report to the head of the Division of Trading 

and Markets’’. 

SEC. 809. INDEPENDENCE OF COMMISSION OMBUDSMAN. 

Section 4(g)(8) of the Securities Exchange Act of 1934 (15 U.S.C. 

78d(g)(8)) is amended— 

(1) in subparagraph (A), by striking ‘‘the Investor Advocate 

shall appoint’’ and all that follows through ‘‘Investor Advocate’’ 

and inserting ‘‘the Chairman shall appoint an Ombudsman, 

who shall report to the Commission’’; and 

(2) in subparagraph (D)— 

(A) by striking ‘‘report to the Investor Advocate’’ and inserting ‘‘report to the Commission’’; and 

(B) by striking the last sentence. 

SEC. 810. INVESTOR ADVISORY COMMITTEE IMPROVEMENTS. 

Section 39 of the Securities Exchange Act of 1934 (15 U.S.C. 

78pp) is amended— 

(1) in subsection (a)(2)(B), by striking ‘‘submit’’ and inserting 

‘‘in consultation with the Small Business Capital Formation 

Advisory Committee established under section 40, submit’’; 

(2) in subsection (b)— 

(A) in paragraph (1)— 

(i) in subparagraph (C), by striking ‘‘and’’; 

(ii) in subparagraph (D)(iv), by striking the period at 

the end and inserting ‘‘; and’’; and 

(iii) by adding at the end the following: 

‘‘(E) a member of the Small Business Capital Formation 

Advisory Committee who shall be a nonvoting member.’’; 

(B) by amending paragraph (2) to read as follows: 

‘‘(2) TERM.— ‘‘(A) LENGTH OF TERM FOR MEMBERS OF THE COM- MITTEE.—Each member of the Committee appointed under 

paragraph (1), other than the Investor Advocate, shall 

serve for a term of 4 years. 

‘‘(B) LIMITATION ON MULTIPLE TERMS.—A member of the 

Committee may not serve for more than one term, except 

for the Investor Advocate, a representative of State securities commissions, and the member of the Small Business 

Capital Formation Advisory Committee.’’; and 

(C) in paragraph (3), by striking ‘‘paragraph (1)(B)’’ and 

inserting ‘‘paragraph (1)’’; 

(3) in subsection (c), by amending paragraph (2) to read as 

follows: 

‘‘(2) TERM.— 

‘‘(A) LENGTH OF TERM.—Each member elected under 

paragraph (1) shall serve for a term of 3 years in the capacity for which the member was elected under paragraph 

(1). 

169 

‘‘(B) LIMITATION ON MULTIPLE TERMS.—A member elected 

under paragraph (1) may not serve for more than one term 

in the capacity for which the member was elected under 

paragraph (1).’’; and 

(4) by striking subsections (i) and (j). 

SEC. 811. DUTIES OF INVESTOR ADVOCATE. 

Section 4(g)(4) of the Securities Exchange Act of 1934 (15 U.S.C. 

78d(g)(4)) is amended— 

(1) in subparagraph (D)(ii), by striking ‘‘and’’; 

(2) in subparagraph (E), by striking the period at the end 

and inserting a semicolon; and 

(3) by adding at the end the following: 

‘‘(F) not take a position on any legislation pending before 

Congress other than a legislative change proposed by the 

Investor Advocate pursuant to subparagraph (E); 

‘‘(G) consult with the Advocate for Small Business Capital Formation on proposed recommendations made under 

subparagraph (E); and 

‘‘(H) advise the Advocate for Small Business Capital Formation on issues related to small business investors.’’. 

SEC. 812. ELIMINATION OF EXEMPTION OF SMALL BUSINESS CAPITAL 

FORMATION ADVISORY COMMITTEE FROM FEDERAL ADVISORY COMMITTEE ACT. 

Section 40 of the Securities Exchange Act of 1934 (as added by 

Public Law 114–284) is amended by striking subsection (h). 

SEC. 813. INTERNAL RISK CONTROLS. 

The Securities Exchange Act of 1934 (15 U.S.C. 78a et seq.) is 

amended— 

(1) by inserting after section 4G, as added by this Act, the 

following: 

‘‘SEC. 4H. INTERNAL RISK CONTROLS. 

‘‘(a) IN GENERAL.—Each of the following entities, in consultation 

with the Chief Economist, shall develop comprehensive internal 

risk control mechanisms to safeguard and govern the storage of all 

market data by such entity, all market data sharing agreements of 

such entity, and all academic research performed at such entity 

using market data: 

‘‘(1) The Commission. 

‘‘(2) Each national security association required to register 

under section 15A. 

‘‘(b) CONSOLIDATED AUDIT TRAIL.—The Commission may not approve a national market system plan pursuant to part 242.613 of 

title 17, Code of Federal Regulations (or any successor regulation), 

unless the operator of the consolidated audit trail created by such 

plan has developed, in consultation with the Chief Economist, comprehensive internal risk control mechanisms to safeguard and govern the storage of all market data by such operator, all market 

data sharing agreements of such operator, and all academic research performed at such operator using market data.’’; 

(2) in section 3(a), by redesignating the second paragraph 

(80) (relating to funding portals) as paragraph (81); and 

(3) in section 3(a), by adding at the end the following: 

‘‘(82) CHIEF ECONOMIST.—The term ‘Chief Economist’ means 

the Director of the Division of Economic and Risk Analysis, or 

170 

an employee of the Commission with comparable authority, as 

determined by the Commission.’’. 

SEC. 814. APPLICABILITY OF NOTICE AND COMMENT REQUIREMENTS 

OF THE ADMINISTRATIVE PROCEDURE ACT TO GUIDANCE 

VOTED ON BY THE COMMISSION. 

The Securities Exchange Act of 1934 (15 U.S.C. 78a et seq.) is 

amended by inserting after section 4H, as added by this Act, the 

following: 

‘‘SEC. 4I. APPLICABILITY OF NOTICE AND COMMENT REQUIREMENTS 

OF THE ADMINISTRATIVE PROCEDURE ACT TO GUIDANCE 

VOTED ON BY THE COMMISSION. 

‘‘The notice and comment requirements of section 553 of title 5, 

United States Code, shall also apply with respect to any Commission statement or guidance, including interpretive rules, general 

statements of policy, or rules of Commission organization, procedure, or practice, that has the effect of implementing, interpreting, 

or prescribing law or policy and that is voted on by the Commission.’’. 

SEC. 815. LIMITATION ON PILOT PROGRAMS. 

(a) IN GENERAL.—Section 4 of the Securities Exchange Act of 

1934 (15 U.S.C. 78d), as amended by section 371(e), is further 

amended by adding at the end the following: 

‘‘(l) LIMITATION ON PILOT PROGRAMS.— 

‘‘(1) IN GENERAL.—Any pilot program established by self-regulatory organizations, either individually or jointly, and filed 

with the Commission, including under section 11A or 19, shall 

terminate after the end of the 5-year period beginning on the 

date that the Commission approved such program, unless the 

Commission issues a rule to permanently continue such program or approves such program on a permanent basis. 

‘‘(2) EXTENSION.—With respect to a particular pilot program 

described under paragraph (1), the Commission may extend 

the 5-year period described under such paragraph for an additional 3 years if the Commission determines such extension is 

necessary or appropriate in the public interest or for the protection of investors. 

‘‘(3) LACK OF STATUTORY AUTHORITY.—If, with respect to a 

pilot program described under paragraph (1), the Commission 

determines that the pilot program should continue permanently, but the Commission lacks sufficient statutory authority 

to permanently continue the program, the Commission shall, 

not later than 1 year before such pilot program is scheduled to 

terminate pursuant to paragraph (1), notify the Committee on 

Financial Services of the House of Representatives and the 

Committee on Banking, Housing, and Urban Affairs of the 

Senate that the Commission believes the program should continue permanently but does not have sufficient statutory authority to continue the program.’’. 

(b) TREATMENT OF EXISTING PILOT PROGRAMS.—For purposes of 

section 4(k) of Securities Exchange Act of 1934, as added by subsection (a), the date on which the Commission approved a pilot program that was in existence on the date of the enactment of this Act 

shall be deemed to be the date of the enactment of this Act. 

171 

SEC. 816. PROCEDURE FOR OBTAINING CERTAIN INTELLECTUAL 

PROPERTY. 

(a) PERSONS UNDER SECURITIES ACT OF 1933.—Section 8 of the 

Securities Act of 1933 (15 U.S.C. 77h) is amended by adding at the 

end the following: 

‘‘(g) PROCEDURE FOR OBTAINING CERTAIN INTELLECTUAL PROP- ERTY.—The Commission is not authorized to compel under this title 

a person to produce or furnish source code, including algorithmic 

trading source code or similar intellectual property, to the Commission unless the Commission first issues a subpoena.’’. 

(b) PERSONS UNDER THE SECURITIES EXCHANGE ACT OF 1934.— 

Section 23 of the Securities Exchange Act of 1934 (15 U.S.C. 78w), 

as amended by section 802, is further amended by adding at the 

end the following: 

‘‘(f) PROCEDURE FOR OBTAINING CERTAIN INTELLECTUAL PROPERTY.—The Commission is not authorized to compel under this title 

a person to produce or furnish source code, including algorithmic 

trading source code or similar intellectual property, to the Commission unless the Commission first issues a subpoena.’’. 

(c) INVESTMENT COMPANIES.—Section 31 of the Investment Company Act of 1940 (15 U.S.C. 80a–30) is amended by adding at the 

end the following: 

‘‘(e) PROCEDURE FOR OBTAINING CERTAIN INTELLECTUAL PROPERTY.—The Commission is not authorized to compel under this title 

an investment company to produce or furnish source code, including algorithmic trading source code or similar intellectual property, 

to the Commission unless the Commission first issues a subpoena.’’. 

(d) INVESTMENT ADVISERS.—Section 204 of the Investment Advisers Act of 1940 (15 U.S.C. 80b–4) is amended— 

(1) by adding at the end the following: 

‘‘(f) PROCEDURE FOR OBTAINING CERTAIN INTELLECTUAL PROPERTY.—The Commission is not authorized to compel under this title 

an investment adviser to produce or furnish source code, including 

algorithmic trading source code or similar intellectual property, to 

the Commission unless the Commission first issues a subpoena.’’; 

and 

(2) in the second subsection (d), by striking ‘‘(d)’’ and inserting ‘‘(e)’’. 

SEC. 817. PROCESS FOR CLOSING INVESTIGATIONS. 

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

enactment of this Act, the Securities and Exchange Commission 

shall establish a process for closing investigations (including preliminary or informal investigations) that is designed to ensure that 

the Commission, in a timely manner— 

(1) makes a determination of whether or not to institute an 

administrative or judicial action in a matter or refer the matter to the Attorney General for potential criminal prosecution; 

and 

(2) if the Commission determines not to institute such an action or refer the matter to the Attorney General, informs the 

persons who are the subject of the investigation that the investigation is closed. 

(b) RULE OF CONSTRUCTION.—Nothing in this section shall be 

construed to affect the authority of the Commission to re-open an 

investigation if the Commission obtains new evidence after the inVerDate Sep 11 2014 05:01 Jun 07, 2017 Jkt 025698 PO 00000 Frm 00171 Fmt 6659 Sfmt 6602 E:\HR\OC\HR163.XXX HR163
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vestigation is closed, subject to any applicable statute of limitations. 

SEC. 818. ENFORCEMENT OMBUDSMAN. 

(a) IN GENERAL.—Section 4 of the Securities Exchange Act of 

1934 (15 U.S.C. 78d), as amended by section 803, is further amended by inserting after subsection (h) the following: 

‘‘(i) ENFORCEMENT OMBUDSMAN.— 

‘‘(1) ESTABLISHMENT.—The Commission shall have an Enforcement Ombudsman, who shall be appointed by and report 

directly to the Commission. 

‘‘(2) DUTIES.—The Enforcement Ombudsman shall— 

‘‘(A) act as a liaison between the Commission and any 

person who is the subject of an investigation (including a 

preliminary or informal investigation) by the Commission 

or an administrative or judicial action brought by the Commission in resolving problems that such persons may have 

with the Commission or the conduct of Commission staff; 

and 

‘‘(B) establish safeguards to maintain the confidentiality 

of communications between the persons described in subparagraph (A) and the Enforcement Ombudsman. 

‘‘(3) LIMITATION.—In carrying out the duties of the Enforcement Ombudsman under paragraph (2), the Enforcement Ombudsman shall utilize personnel of the Commission to the extent practicable. Nothing in this subsection shall be construed 

as replacing, altering, or diminishing the activities of any ombudsman or similar office of any other agency. 

‘‘(4) REPORT.—The Enforcement Ombudsman shall submit to 

the Commission and to the Committee on Financial Services of 

the House of Representatives and the Committee on Banking, 

Housing, and Urban Affairs of the Senate an annual report 

that describes the activities and evaluates the effectiveness of 

the Enforcement Ombudsman during the preceding year.’’. 

(b) DEADLINE FOR INITIAL APPOINTMENT.—The Securities and Exchange Commission shall appoint the initial Enforcement Ombudsman under subsection (i) of section 4 of the Securities Exchange 

Act of 1934, as added by subsection (a), not later than 180 days 

after the date of the enactment of this Act. 

SEC. 819. ADEQUATE NOTICE. 

Section 21 of the Securities Exchange Act of 1934 (15 U.S.C. 78u) 

is amended by adding at the end the following: 

‘‘(j) ADEQUATE NOTICE REQUIRED BEFORE BRINGING AN ENFORCEMENT ACTION.— ‘‘(1) IN GENERAL.—No person shall be subject to an enforcement action by the Commission for an alleged violation of the 

securities laws or the rules and regulations issued thereunder 

if such person did not have adequate notice of such law, rule, 

or regulation. 

‘‘(2) PUBLISHING OF INTERPRETATION DEEMED ADEQUATE NO- TICE.—With respect to an enforcement action, adequate notice 

of a securities law or a rule or regulation issued thereunder 

shall be deemed to have been provided to a person if the Commission approved a statement or guidance, in accordance with 

section 4I, with respect to the conduct that is the subject of the 

173 

enforcement action, prior to the time that the person engaged 

in the conduct that is the subject of the enforcement action.’’. 

SEC. 820. ADVISORY COMMITTEE ON COMMISSION’S ENFORCEMENT 

POLICIES AND PRACTICES. 

(a) ESTABLISHMENT.—Not later than 6 months after the date of 

the enactment of this Act, the Chairman shall establish an advisory committee on the Commission’s enforcement policies and practices (in this section referred to as the ‘‘Committee’’). 

(b) DUTIES.— 

(1) ANALYSIS AND RECOMMENDATIONS.— 

(A) IN GENERAL.—The Committee shall conduct an analysis of the policies and practices of the Commission relating to the enforcement of the securities laws and make recommendations to the Commission regarding changes to 

such policies and practices. 

(B) SPECIFIC MATTERS INCLUDED.—In carrying out subparagraph (A), the Committee shall analyze and make recommendations to the Commission regarding matters including the following: 

(i) How the Commission’s enforcement objectives 

and strategies may be more effective. 

(ii) The Commission’s enforcement practices and 

procedures from the point of view of due process, the 

relationship of enforcement action to notice of legal requirements, the attribution of responsibility for violations, and the protection of reputation and rights of 

privacy. 

(iii) The Commission’s enforcement policies and 

practices in light of its statutory responsibility to protect investors, maintain fair, orderly, and efficient 

markets, and facilitate capital formation. 

(iv) The appropriate blend of regulation, publicity, 

and formal enforcement action and on methods of furthering voluntary compliance. 

(v) Criteria for the selection and disposition of enforcement actions, the adequacy of sanctions authorized by law, and the suitability and effectiveness of 

sanctions imposed by the Commission proceedings. 

(2) REPORT.—Not later than 1 year after the establishment 

of the Committee under subsection (a), the Committee shall 

submit to the Commission and the appropriate congressional 

committees a report containing the results of the analysis and 

the recommendations required by paragraph (1)(A). 

(c) MEMBERSHIP.— 

(1) NUMBER AND APPOINTMENT.—The Committee shall be 

composed of not less than 3 and not greater than 7 members 

appointed by the Chairman. 

(2) CHAIRPERSON.—The Chairperson of the Committee shall 

be designated by the Chairman at the time of appointment of 

the members. 

(d) SUPPORT.—The Commission shall provide the Committee with 

the administrative, professional, and technical support required by 

the Committee to carry out its responsibilities under this section. 

174 

(e) TERMINATION OF COMMITTEE.—The Committee established by 

subsection (a) shall terminate on the date that the report required 

by subsection (b)(2) is submitted. 

(f) CONSIDERATION AND ADOPTION OF RECOMMENDATIONS BY

COMMISSION.—Not later than 180 days after the Committee submits the report required by subsection (b)(2), the Commission 

shall— 

(1) consider the analysis and recommendations included in 

such report; 

(2) adopt such recommendations, with any modifications, as 

the Commission considers appropriate; and 

(3) submit to the appropriate congressional committees a report that— 

(A) lists each recommendation included in such report 

that the Commission does not adopt or adopts with material modifications; and 

(B) for each recommendation listed under subparagraph 

(A), explains why the Commission does not consider it appropriate or does not have sufficient authority to adopt the 

recommendation or to adopt the recommendation without 

material modification. 

(g) DEFINITIONS.—In this section: 

(1) APPROPRIATE CONGRESSIONAL COMMITTEES.—The term 

‘‘appropriate congressional committees’’ means the Committee 

on Financial Services of the House of Representatives and the 

Committee on Banking, Housing, and Urban Affairs of the 

Senate. 

(2) CHAIRMAN.—The term ‘‘Chairman’’ means the Chairman 

of the Commission. 

(3) COMMISSION.—The term ‘‘Commission’’ means the Securities and Exchange Commission. 

(4) SECURITIES LAWS.—The term ‘‘securities laws’’ has the 

meaning given such term in section 3(a) of the Securities Exchange Act of 1934 (15 U.S.C. 78c(a)). 

(h) APPLICATION OF THE FEDERAL ADVISORY COMMITTEE ACT.— The Committee is an advisory committee for purposes of the Federal Advisory Committee Act (5 U.S.C. App.). 

SEC. 821. PROCESS TO PERMIT RECIPIENT OF WELLS NOTIFICATION 

TO APPEAR BEFORE COMMISSION STAFF IN-PERSON. 

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

enactment of this Act, the Securities and Exchange Commission 

shall establish a process under which, in any instance in which the 

Commission staff provides a written Wells notification to an individual informing the individual that the Commission staff has 

made a preliminary determination to recommend that the Commission bring an administrative or judicial action against the individual, the individual shall have the right to make an in-person 

presentation before the Commission staff concerning such recommendation and to be represented by counsel at such presentation, at the individual’s own expense. 

(b) ATTENDANCE BY COMMISSIONERS.—Such process shall provide 

that each Commissioner of the Commission, or a designee of the 

Commissioner, may attend any such presentation. 

(c) REPORT BY COMMISSION STAFF.—Such process shall provide 

that, before any Commission vote on whether to bring the adminisVerDate Sep 11 2014 05:01 Jun 07, 2017 Jkt 025698 PO 00000 Frm 00174 Fmt 6659 Sfmt 6602 E:\HR\OC\HR163.XXX HR163
175 

trative or judicial action against the individual, the Commission 

staff shall provide to each Commissioner a written report on any 

such presentation, including any factual or legal arguments made 

by the individual and any supporting documents provided by the 

individual. 

SEC. 822. PUBLICATION OF ENFORCEMENT MANUAL. 

(a) IN GENERAL.—Not later than 1 year after the date of the enactment of this Act, the Securities and Exchange Commission shall 

approve, by vote of the Commission, and publish an updated manual that sets forth the policies and practices that the Commission 

will follow in the enforcement of the securities laws (as defined in 

section 3(a) of the Securities Exchange Act of 1934 (15 U.S.C. 

78c(a))). Such manual shall include policies and practices required 

by this Act, and by the amendments made by this Act, and shall 

be developed so as to ensure transparency in such enforcement and 

uniform application of such laws by the Commission. 

(b) ENFORCEMENT PLAN AND REPORT.—Beginning on the date 

that is one year after the date of enactment of this Act, and each 

year thereafter, the Securities and Exchange Commission shall 

transmit to Congress and publish on its Internet website an annual 

enforcement plan and report that shall— 

(1) detail the priorities of the Commission with regard to enforcement and examination activities for the forthcoming year; 

(2) report on the Commission’s enforcement and examination 

activities for the previous year, including an assessment of how 

such activities comported with the priorities identified for that 

year pursuant to paragraph (1); 

(3) contain an analysis of litigated decisions found not in 

favor of the Commission over the preceding year; 

(4) contain a description of any emerging trends the Commission has focused on as part of its enforcement program, including whether and how the Commission has alerted or communicated with those who may be subject to the Commission’s 

regulation of emerging trends; 

(5) contain a description of legal theories or standards employed by the Commission in enforcement over the preceding 

year that had not previously been employed, and a summary 

justifying each such theory or standard; and 

(6) provide an opportunity and mechanism for public comment. 

SEC. 823. PRIVATE PARTIES AUTHORIZED TO COMPEL THE SECURITIES AND EXCHANGE COMMISSION TO SEEK SANCTIONS 

BY FILING CIVIL ACTIONS. 

Title I of the Securities Exchange Act of 1934 (15 U.S.C. 78a et 

seq.) is amended by adding at the end the following: 

‘‘SEC. 41. PRIVATE PARTIES AUTHORIZED TO COMPEL THE COMMISSION TO SEEK SANCTIONS BY FILING CIVIL ACTIONS. 

‘‘(a) TERMINATION OF ADMINISTRATIVE PROCEEDING.—In the case 

of any person who is a party to a proceeding brought by the Commission under a securities law, to which section 554 of title 5, 

United States Code, applies, and against whom an order imposing 

a cease and desist order and a penalty may be issued at the conclusion of the proceeding, that person may, not later than 20 days 

176 

after receiving notice of such proceeding, and at that person’s discretion, require the Commission to terminate the proceeding. 

‘‘(b) CIVIL ACTION AUTHORIZED.—If a person requires the Commission to terminate a proceeding pursuant to subsection (a), the 

Commission may bring a civil action against that person for the 

same remedy that might be imposed. 

‘‘(c) STANDARD OF PROOF IN ADMINISTRATIVE PROCEEDING.—Notwithstanding any other provision of law, in the case of a proceeding 

brought by the Commission under a securities law, to which section 

554 of title 5, United States Code, applies, a legal or equitable remedy may be imposed on the person against whom the proceeding 

was brought only on a showing by the Commission of clear and 

convincing evidence that the person has violated the relevant provision of law.’’. 

SEC. 824. CERTAIN FINDINGS REQUIRED TO APPROVE CIVIL MONEY 

PENALTIES AGAINST ISSUERS. 

The Securities Exchange Act of 1934 (15 U.S.C. 78a et seq.) is 

amended by inserting after section 4E the following: 

‘‘SEC. 4F. CERTAIN FINDINGS REQUIRED TO APPROVE CIVIL MONEY 

PENALTIES AGAINST ISSUERS. 

‘‘The Commission may not seek against or impose on an issuer 

a civil money penalty for violation of the securities laws unless the 

publicly available text of the order approving the seeking or imposition of such penalty contains findings, supported by an analysis by 

the Division of Economic and Risk Analysis and certified by the 

Chief Economist, of whether— 

‘‘(1) the alleged violation resulted in direct economic benefit 

to the issuer; and 

‘‘(2) the penalty will harm the shareholders of the issuer.’’. 

SEC. 825. REPEAL OF AUTHORITY OF THE COMMISSION TO PROHIBIT 

PERSONS FROM SERVING AS OFFICERS OR DIRECTORS. 

(a) UNDER SECURITIES ACT OF 1933.—Subsection (f) of section 8A 

of the Securities Act of 1933 (15 U.S.C. 77h–1) is repealed. 

(b) UNDER SECURITIES EXCHANGE ACT OF 1934.—Subsection (f) of 

section 21C of the Securities Exchange Act of 1934 (15 U.S.C. 78u– 

3) is repealed. 

SEC. 826. SUBPOENA DURATION AND RENEWAL. 

Section 21(b) of the Securities Exchange Act of 1934 (15 U.S.C. 

78u(b)) is amended— 

(1) by inserting ‘‘SUBPOENA.—’’ after the enumerator; 

(2) by striking ‘‘For the purpose of’’ and inserting the following: 

‘‘(1) IN GENERAL.—For the purpose of’’; and 

(3) by adding at the end the following: 

‘‘(2) OMNIBUS ORDERS OF INVESTIGATION.— 

‘‘(A) DURATION AND RENEWAL.—An omnibus order of investigation shall not be for an indefinite duration and may 

be renewed only by Commission action. 

‘‘(B) DEFINITION.—In subparagraph (A), the term ‘omnibus order of investigation’ means an order of the Commission authorizing 1 or more members of the Commission or 

its staff to issue subpoenas under paragraph (1) to multiple persons in relation to a particular subject matter 

area.’’. 

177 

SEC. 827. ELIMINATION OF AUTOMATIC DISQUALIFICATIONS. 

The Securities Exchange Act of 1934 (15 U.S.C. 78a et seq.), as 

amended by this Act, is further amended by inserting after section 

4F the following: 

‘‘SEC. 4G. ELIMINATION OF AUTOMATIC DISQUALIFICATIONS. 

‘‘(a) IN GENERAL.—Notwithstanding any other provision of law, a 

non-natural person may not be disqualified or otherwise made ineligible to use an exemption or registration provision, engage in an 

activity, or qualify for any similar treatment under a provision of 

the securities laws or the rules issued by the Commission under 

the securities laws by reason of having, or a person described in 

subsection (b) having, been convicted of any felony or misdemeanor 

or made the subject of any judicial or administrative order, judgment, or decree arising out of a governmental action (including an 

order, judgment, or decree agreed to in a settlement), or having, or 

a person described in subsection (b) having, been suspended or expelled from membership in, or suspended or barred from association with a member of, a registered national securities exchange or 

a registered national or affiliated securities association for any act 

or omission to act constituting conduct inconsistent with just and 

equitable principles of trade, unless the Commission, by order, on 

the record after notice and an opportunity for hearing, makes a determination that such non-natural person should be so disqualified 

or otherwise made ineligible for purposes of such provision. 

‘‘(b) PERSON DESCRIBED.—A person is described in this subsection 

if the person is— 

‘‘(1) a natural person who is a director, officer, employee, 

partner, member, or shareholder of the non-natural person referred to in subsection (a) or is otherwise associated or affiliated with such non-natural person in any way; or 

‘‘(2) a non-natural person who is associated or affiliated with 

the non-natural person referred to in subsection (a) in any 

way. 

‘‘(c) RULE OF CONSTRUCTION.—Nothing in this section shall be 

construed to limit any authority of the Commission, by order, on 

the record after notice and an opportunity for hearing, to prohibit 

a person from using an exemption or registration provision, engaging in an activity, or qualifying for any similar treatment under a 

provision of the securities laws, or the rules issued by the Commission under the securities laws, by reason of a circumstance referred 

to in subsection (a) or any similar circumstance.’’. 

SEC. 828. DENIAL OF AWARD TO CULPABLE WHISTLEBLOWERS. 

Section 21F(c) of the Securities Exchange Act of 1934 (15 U.S.C. 

78u–6(c)) is amended— 

(1) in paragraph (2)— 

(A) in subparagraph (C), by striking ‘‘or’’ at the end; 

(B) in subparagraph (D), by striking the period and inserting ‘‘; or’’; and 

(C) by adding at the end the following: 

‘‘(E) to any whistleblower who is responsible for, or 

complicit in, the violation of the securities laws for which 

the whistleblower provided information to the Commission.’’; and 

(2) by adding at the end the following: 

178 

‘‘(3) DEFINITION.—For purposes of paragraph (2)(E), a person 

is responsible for, or complicit in, a violation of the securities 

laws if, with the intent to promote or assist the violation, the 

person— 

‘‘(A) procures, induces, or causes another person to commit the offense; 

‘‘(B) aids or abets another person in committing the offense; or 

‘‘(C) having a duty to prevent the violation, fails to make 

an effort the person is required to make.’’. 

SEC. 829. CLARIFICATION OF AUTHORITY TO IMPOSE SANCTIONS ON 

PERSONS ASSOCIATED WITH A BROKER OR DEALER. 

Section 15(b)(6)(A)(i) of the Securities Exchange Act of 1934 (15 

U.S.C. 78o(b)(6)(A)(i)) is amended by striking ‘‘enumerated’’ and all 

that follows and inserting ‘‘enumerated in subparagraph (A), (D), 

(E), (G), or (H) of paragraph (4) of this subsection;’’. 

SEC. 830. COMPLAINT AND BURDEN OF PROOF REQUIREMENTS FOR 

CERTAIN ACTIONS FOR BREACH OF FIDUCIARY DUTY. 

Section 36(b) of the Investment Company Act of 1940 (15 U.S.C. 

80a–35(b)) is amended by adding at the end the following: 

‘‘(7) In any such action brought by a security holder of a registered investment company on behalf of such company— 

‘‘(A) the complaint shall state with particularity all facts 

establishing a breach of fiduciary duty, and, if an allegation of any such facts is based on information and belief, 

the complaint shall state with particularity all facts on 

which that belief is formed; and 

‘‘(B) such security holder shall have the burden of proving a breach of fiduciary duty by clear and convincing evidence.’’. 

SEC. 831. CONGRESSIONAL ACCESS TO INFORMATION HELD BY THE 

PUBLIC COMPANY ACCOUNTING OVERSIGHT BOARD. 

Section 105(b)(5) of the Sarbanes-Oxley Act of 2002 (15 U.S.C. 

7215(b)(5)) is amended— 

(1) in subparagraph (A), by striking ‘‘subparagraphs (B) and 

(C)’’ and inserting ‘‘subparagraphs (B), (C), and (D)’’; and 

(2) by adding at the end the following: 

‘‘(D) AVAILABILITY TO THE CONGRESSIONAL COMMITTEES.—The Board shall make available to the Committees 

specified under section 101(h)— 

‘‘(i) such information as the Committees shall request; and 

‘‘(ii) with respect to any confidential or privileged information provided in response to a request under 

clause (i), including any information subject to section 

104(g) and subparagraph (A), or any confidential or 

privileged information provided orally in response to 

such a request, such information shall maintain the 

protections provided in subparagraph (A), and shall 

retain its confidential and privileged status in the 

hands of the Board and the Committees.’’. 

SEC. 832. ABOLISHING INVESTOR ADVISORY GROUP. 

The Public Company Accounting Oversight Board shall abolish 

the Investor Advisory Group. 

179 

SEC. 833. REPEAL OF REQUIREMENT FOR PUBLIC COMPANY ACCOUNTING OVERSIGHT BOARD TO USE CERTAIN FUNDS 

FOR MERIT SCHOLARSHIP PROGRAM. 

(a) IN GENERAL.—Section 109(c) of the Sarbanes-Oxley Act of 

2002 (15 U.S.C. 7219(c)) is amended by striking paragraph (2). 

(b) CONFORMING AMENDMENTS.—Section 109 of the SarbanesOxley Act of 2002 (15 U.S.C. 7219) is amended— 

(1) in subsection (c), by striking ‘‘USES OF FUNDS’’ and all 

that follows through ‘‘The budget’’ and inserting ‘‘USES OF

FUNDS.—The budget’’; and 

(2) in subsection (f), by striking ‘‘subsection (c)(1)’’ and inserting ‘‘subsection (c)’’. 

SEC. 834. REALLOCATION OF FINES FOR VIOLATIONS OF RULES OF 

MUNICIPAL SECURITIES RULEMAKING BOARD. 

(a) IN GENERAL.—Section 15B(c)(9) of the Securities Exchange 

Act of 1934 (15 U.S.C. 78o–4(c)(9)) is amended to read as follows: 

‘‘(9) Fines collected for violations of the rules of the Board shall 

be deposited and credited as general revenue of the Treasury, except as otherwise provided in section 308 of the Sarbanes-Oxley Act 

of 2002 or section 21F of this title.’’. 

(b) EFFECTIVE DATE.—The amendment made by subsection (a) 

shall apply to fines collected after the date of enactment of this Act. 

Subtitle B—Eliminating Excessive Government Intrusion in the Capital Markets 

SEC. 841. REPEAL OF DEPARTMENT OF LABOR FIDUCIARY RULE AND 

REQUIREMENTS PRIOR TO RULEMAKING RELATING TO 

STANDARDS OF CONDUCT FOR BROKERS AND DEALERS. 

(a) REPEAL OF DEPARTMENT OF LABOR FIDUCIARY RULE.—The 

final rule of the Department of Labor titled ‘‘Definition of the Term 

‘Fiduciary’; Conflict of Interest Rule—Retirement Investment Advice’’ and related prohibited transaction exemptions published April 

8, 2016 (81 Fed. Reg. 20946) shall have no force or effect. 

(b) STAY ON RULES DEFINING CERTAIN FIDUCIARIES.—After the 

date of enactment of this Act, the Secretary of Labor shall not prescribe any regulation under the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1001 et seq.) defining the circumstances 

under which an individual is considered a fiduciary until the date 

that is 60 days after the Securities and Exchange Commission 

issues a final rule relating to standards of conduct for brokers and 

dealers pursuant to the second subsection (k) of section 15 of the 

Securities Exchange Act of 1934 (15 U.S.C. 78o(k)). 

(c) REQUIREMENTS PRIOR TO RULEMAKING RELATING TO STANDARDS OF CONDUCT FOR BROKERS AND DEALERS.—The second subsection (k) of section 15 of the Securities Exchange Act of 1934 (15 

U.S.C. 78o(k)), as added by section 913(g)(1) of the Dodd-Frank 

Wall Street Reform and Consumer Protection Act (12 U.S.C. 5301 

et seq.), is amended by adding at the end the following: 

‘‘(3) REQUIREMENTS PRIOR TO RULEMAKING.—The Commission 

shall not promulgate a rule pursuant to paragraph (1) before 

providing 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 and making such reVerDate Sep 11 2014 05:01 Jun 07, 2017 Jkt 025698 PO 00000 Frm 00179 Fmt 6659 Sfmt 6602 E:\HR\OC\HR163.XXX HR163
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port available on the Commission’s website describing whether— 

‘‘(A) retail investors (and such other customers as the 

Commission may provide) are being harmed due to brokers 

or dealers operating under different standards of conduct 

than those that apply to investment advisors under section 

211 of the Investment Advisers Act of 1940 (15 U.S.C. 

80b–11); 

‘‘(B) alternative remedies will reduce any confusion or 

harm to retail investors due to brokers or dealers operating under different standards of conduct than those 

standards that apply to investment advisors under section 

211 of the Investment Advisers Act of 1940 (15 U.S.C. 

80b–11), including— 

‘‘(i) simplifying the titles used by brokers, dealers, 

and investment advisers; and 

‘‘(ii) enhancing disclosure surrounding the different 

standards of conduct currently applicable to brokers, 

dealers, and investment advisers; 

‘‘(C) the adoption of a uniform fiduciary standard of conduct for brokers, dealers, and investment advisors would 

adversely impact the commissions of brokers and dealers, 

the availability of proprietary products offered by brokers 

and dealers, and the ability of brokers and dealers to engage in principal transactions with customers; and 

‘‘(D) the adoption of a uniform fiduciary standard of conduct for brokers or dealers and investment advisors would 

adversely impact retail investor access to personalized and 

cost-effective investment advice, recommendations about 

securities, or the availability of such advice and recommendations. 

‘‘(4) ECONOMIC ANALYSIS.—The Commission’s conclusions 

contained in the report described in paragraph (3) shall be supported by economic analysis. 

‘‘(5) REQUIREMENTS FOR PROMULGATING A RULE.—The Commission shall publish in the Federal Register alongside the 

rule promulgated pursuant to paragraph (1) formal findings 

that such rule would reduce confusion or harm to retail customers (and such other customers as the Commission may by 

rule provide) due to different standards of conduct applicable 

to brokers, dealers, and investment advisors. 

‘‘(6) REQUIREMENTS UNDER INVESTMENT ADVISERS ACT OF

1940.—In proposing rules under paragraph (1) for brokers or 

dealers, the Commission shall consider the differences in the 

registration, supervision, and examination requirements applicable to brokers, dealers, and investment advisors.’’. 

SEC. 842. EXEMPTION FROM RISK RETENTION REQUIREMENTS FOR 

NONRESIDENTIAL MORTGAGE. 

(a) IN GENERAL.—Section 15G of the Securities Exchange Act of 

1934 (15 U.S.C. 78o–11) is amended— 

(1) in subsection (a)— 

(A) in paragraph (3)(B), by striking ‘‘and’’ at the end; 

(B) in paragraph (4)(B), by striking the period and inserting ‘‘; and’’; and 

(C) by adding at the end the following: 

181 

‘‘(5) the term ‘asset-backed security’ refers only to an assetbacked security that is comprised wholly of residential mortgages.’’; 

(2) in subsection (b)— 

(A) by striking paragraph (1); and 

(B) by striking ‘‘(2) RESIDENTIAL MORTGAGES.—’’; 

(3) by striking subsection (h) and redesignating subsection (i) 

as subsection (h); and 

(4) in subsection (h) (as so redesignated)— 

(A) by striking ‘‘effective—’’ and all that follows through 

‘‘(1) with respect to’’ and inserting ‘‘effective with respect 

to’’; 

(B) in paragraph (1), by striking ‘‘; and’’ and inserting a 

period; and 

(C) by striking paragraph (2). 

(b) CONFORMING AMENDMENT.—Section 941 of the Dodd-Frank 

Wall Street Reform and Consumer Protection Act is amended by 

striking subsection (c). 

SEC. 843. FREQUENCY OF SHAREHOLDER APPROVAL OF EXECUTIVE 

COMPENSATION. 

Section 14A(a) of the Securities Exchange Act of 1934 (15 U.S.C. 

78n–1(a)) is amended— 

(1) in paragraph (1), by striking ‘‘Not less frequently than 

once every 3 years’’ and inserting ‘‘Each year in which there 

has been a material change to the compensation of executives 

of an issuer from the previous year’’; and 

(2) by striking paragraph (2) and redesignating paragraph 

(3) as paragraph (2). 

SEC. 844. SHAREHOLDER PROPOSALS. 

(a) RESUBMISSION THRESHOLDS.—The Securities and Exchange 

Commission shall revise section 240.14a–8(i)(12) of title 17, Code of 

Federal Regulations to— 

(1) in paragraph (i), adjust the 3 percent threshold to 6 percent; 

(2) in paragraph (ii), adjust the 6 percent threshold to 15 

percent; and 

(3) in paragraph (iii), adjust the 10 percent threshold to 30 

percent. 

(b) HOLDING REQUIREMENT.—The Securities and Exchange Commission shall revise the holding requirement for a shareholder to 

be eligible to submit a shareholder proposal to an issuer in section 

240.14a–8(b)(1) of title 17, Code of Federal Regulations, to— 

(1) eliminate the option to satisfy the holding requirement by 

holding a certain dollar amount; 

(2) require the shareholder to hold 1 percent of the issuer’s 

securities entitled to be voted on the proposal, or such greater 

percentage as determined by the Commission; and 

(3) adjust the 1 year holding period to 3 years. 

(c) SHAREHOLDER PROPOSALS ISSUED BY PROXIES.—Section 14 of 

the Securities Exchange Act of 1934 (15 U.S.C. 78n) is amended by 

adding at the end the following: 

‘‘(j) SHAREHOLDER PROPOSALS BY PROXIES NOT PERMITTED.—An 

issuer may not include in its proxy materials a shareholder proposal submitted by a person in such person’s capacity as a proxy, 

182 

representative, agent, or person otherwise acting on behalf of a 

shareholder.’’. 

SEC. 845. PROHIBITION ON REQUIRING A SINGLE BALLOT. 

Section 14 of the Securities Exchange Act of 1934 (15 U.S.C. 78n) 

is amended by adding at the end the following: 

‘‘(k) PROHIBITION ON REQUIRING A SINGLE BALLOT.—The Commission may not require that a solicitation of a proxy, consent, or 

authorization to vote a security of an issuer in an election of members of the board of directors of the issuer be made using a single 

ballot or card that lists both individuals nominated by (or on behalf 

of) the issuer and individuals nominated by (or on behalf of) other 

proponents and permits the person granting the proxy, consent, or 

authorization to select from among individuals in both groups.’’. 

SEC. 846. REQUIREMENT FOR MUNICIPAL ADVISOR FOR ISSUERS OF 

MUNICIPAL SECURITIES. 

Section 15B(d) of the Securities Exchange Act of 1934 (15 U.S.C. 

78o–4(d)) is amended by adding at the end the following: 

‘‘(3) An issuer of municipal securities shall not be required to retain a municipal advisor prior to issuing any such securities.’’. 

SEC. 847. SMALL ISSUER EXEMPTION FROM INTERNAL CONTROL 

EVALUATION. 

Section 404(c) of the Sarbanes-Oxley Act of 2002 (15 U.S.C. 

7262(c)) is amended to read as follows: 

‘‘(c) EXEMPTION FOR SMALLER ISSUERS.—Subsection (b) shall not 

apply with respect to any audit report prepared for an issuer that 

has total market capitalization of less than $500,000,000, nor to 

any issuer that is a depository institution with assets of less than 

$1,000,000,000.’’. 

SEC. 848. STREAMLINING OF APPLICATIONS FOR AN EXEMPTION 

FROM THE INVESTMENT COMPANY ACT OF 1940. 

Section 6(c) of the Investment Company Act of 1940 (15 U.S.C. 

80a–6(c)) is amended— 

(1) by striking ‘‘(c) The Commission’’ and inserting the following: 

‘‘(c) GENERAL EXEMPTIVE AUTHORITY.— 

‘‘(1) IN GENERAL.—The Commission’’; and 

(2) by adding at the end the following: 

‘‘(2) APPLICATION PROCESS.— 

‘‘(A) IN GENERAL.—A person who wishes to receive an exemption from the Commission pursuant to paragraph (1) 

shall file an application with the Commission in such form 

and manner and containing such information as the Commission may require. 

‘‘(B) PUBLICATION; REJECTION OF INVALID APPLICATIONS.— 

‘‘(i) IN GENERAL.—Not later than the end of the 5- 

day period beginning on the date that the Commission 

receives an application under subparagraph (A), the 

Commission shall either— 

‘‘(I) publish the application, including by publication on the website of the Commission; or 

‘‘(II) if the Commission determines that the application does not comply with the proper form, 

manner, or information requirements described 

183 

under subparagraph (A), reject such application 

and notify the applicant of the specific reasons the 

application was rejected. 

‘‘(ii) FAILURE TO PUBLISH APPLICATION.—If the Commission does not reject an application under clause 

(i)(II), but fails to publish the application by the end 

of the time period specified under clause (i), such application shall be deemed to have been published on 

the date that is the end of such time period. 

‘‘(3) DETERMINATION BY COMMISSION.— ‘‘(A) IN GENERAL.—Not later than 45 days after the date 

that the Commission publishes an application pursuant to 

paragraph (2)(B), the Commission shall, by order— 

‘‘(i) approve the application; 

‘‘(ii) if the Commission determines that the application would have been approved had the applicant provided additional supporting documentation or made 

certain amendments to the application— 

‘‘(I) provide the applicant with the specific additional supporting documentation or amendments 

that the Commission believes are necessary for 

the applicant to provide in order for the application to be approved; and 

‘‘(II) request that the applicant withdraw the 

application and re-submit the application with 

such additional supporting documentation and 

amendments; or 

‘‘(iii) deny the application. 

‘‘(B) EXTENSION OF TIME PERIOD.—The Commission may 

extend the time period described under subparagraph (A) 

by not more than an additional 45 days, if— 

‘‘(i) the Commission determines that a longer period 

is appropriate and publishes the reasons for such determination; or 

‘‘(ii) the applicant consents to the longer period. 

‘‘(C) TIME PERIOD FOR WITHDRAWAL.—If the Commission 

makes a request under subparagraph (A)(ii) for an applicant to withdraw an application, such application shall be 

deemed to be denied if the applicant informs the Commission that the applicant will not withdraw the application 

or if the applicant does not withdraw the application before the end of the 30-day period beginning on the date the 

Commission makes such request. 

‘‘(4) PROCEEDINGS; NOTICE AND HEARING.—If an application is 

denied pursuant to paragraph (3), the Commission shall provide the applicant with— 

‘‘(A) a written explanation for why the application was 

not approved; and 

‘‘(B) an opportunity for hearing, if requested by the applicant not later than 20 days after the date of such denial, 

with such hearing to be commenced not later than 30 days 

after the date of such denial. 

‘‘(5) RESULT OF FAILURE TO INSTITUTE OR COMMENCE PROCEEDINGS.—An application shall be deemed to have been approved by the Commission, if— 

184 

‘‘(A) the Commission fails to either approve, request the 

withdrawal of, or deny the application, as required under 

paragraph (3)(A), within the time period required under 

paragraph (3)(A), as such time period may have been extended pursuant to paragraph (3)(B); or 

‘‘(B) the applicant requests an opportunity for hearing, 

pursuant to paragraph (4)(B), but the Commission does not 

commence such hearing within the time period required 

under paragraph (4)(B). 

‘‘(6) RULEMAKING.—Not later than 180 days after the date of 

enactment of this paragraph, the Commission shall issue rules 

to carry out this subsection.’’. 

SEC. 849. RESTRICTION ON RECOVERY OF ERRONEOUSLY AWARDED 

COMPENSATION. 

Section 10D(b)(2) of the Securities Exchange Act of 1934 (15 

U.S.C. 78j–4(b)(2)) is amended by inserting before the period the 

following: ‘‘, where such executive officer had control or authority 

over the financial reporting that resulted in the accounting restatement’’. 

SEC. 850. EXEMPTIVE AUTHORITY FOR CERTAIN PROVISIONS RELATING TO REGISTRATION OF NATIONALLY RECOGNIZED 

STATISTICAL RATING ORGANIZATIONS. 

Section 15E of the Securities Exchange Act of 1934 (15 U.S.C. 

78o–7) is amended by adding at the end the following: 

‘‘(w) COMMISSION EXEMPTIVE AUTHORITY.—The Commission, by 

rules and regulations upon its own motion, or by order upon application, may conditionally or unconditionally exempt any person 

from any provision or provisions of this title or of any rule or regulation thereunder, if and to the extent it determines that such rule, 

regulation, or requirement is creating a barrier to entry into the 

market for nationally recognized statistical rating organizations or 

impeding competition among such organizations, or that such an 

exemption is necessary or appropriate in the public interest and is 

consistent with the protection of investors.’’. 

SEC. 851. RISK-BASED EXAMINATIONS OF NATIONALLY RECOGNIZED 

STATISTICAL RATING ORGANIZATIONS. 

Section 15E(p)(3) of the Securities Exchange Act of 1934 (15 

U.S.C. 78o–7(p)(3)) is amended— 

(1) in subparagraph (A)— 

(A) in the heading, by striking ‘‘ANNUAL’’ and inserting 

‘‘RISK-BASED’’; 

(B) by striking ‘‘an examination’’ and inserting ‘‘examinations’’; and 

(C) by striking ‘‘at least annually’’; and 

(2) in subparagraph (B), in the matter preceding clause (i), 

by inserting ‘‘, as appropriate,’’ after ‘‘Each examination under 

subparagraph (A) shall include’’. 

SEC. 852. TRANSPARENCY OF CREDIT RATING METHODOLOGIES. 

Section 15E(s) of the Securities Exchange Act of 1934 (15 U.S.C. 

78o–7(s)) is amended— 

(1) in paragraph (2)(B), by inserting before the semicolon the 

following: ‘‘rated by the nationally recognized statistical rating 

agency’’; and 

(2) in paragraph (3)— 

185 

(A) in subparagraph (A)(ix), by inserting before the period the following: ‘‘, except that the Commission may not 

require the inclusion of references to statutory or regulatory requirements or statutory provision headings or 

enumerators for any specific disclosure’’; 

(B) in subparagraph (B)(iv), by inserting before the period the following: ‘‘, except that the Commission may not 

require the inclusion of references to statutory or regulatory requirements or statutory provision headings or 

enumerators for any specific disclosure’’; and 

(C) by adding at the end the following: 

‘‘(C) NO MANDATE ON THE ORGANIZATION OF DISCLOSURES.—The Commission may not mandate the specific organization of the disclosures required under this paragraph.’’. 

SEC. 853. REPEAL OF CERTAIN ATTESTATION REQUIREMENTS RELATING TO CREDIT RATINGS. 

Section 15E of the Securities Exchange Act of 1934 (15 U.S.C. 

78o–7) is amended— 

(1) in subsection (c)(3)(B)— 

(A) in clause (i), by adding ‘‘and’’ at the end; 

(B) in clause (ii), by striking ‘‘; and’’ and inserting a period; and 

(C) by striking clause (iii); and 

(2) in subsection (q)(2)— 

(A) in subparagraph (D), by adding ‘‘and’’ at the end; 

(B) in subparagraph (E), by striking ‘‘; and’’ and inserting a period; and 

(C) by striking subparagraph (F). 

SEC. 854. LOOK-BACK REVIEW BY NRSRO. 

Section 15E(h)(4)(A) of the Securities Exchange Act of 1934 (15 

U.S.C. 78o–7(h)(4)(A)) is amended— 

(1) by striking ‘‘Each nationally’’ and inserting the following: 

‘‘(i) IN GENERAL.—Each nationally’’; 

(2) by striking ‘‘underwriter’’ and inserting ‘‘lead underwriter’’; 

(3) by striking ‘‘in any capacity’’; 

(4) by striking ‘‘during the 1-year period preceding the date 

an action was taken with respect to the credit rating’’; 

(5) by redesignating clauses (i) and (ii) as subclauses (I) and 

(II), respectively, and adjusting the margin of such subclauses 

accordingly; 

(6) in subclause (I), as so redesignated, by inserting before 

the semicolon the following: ‘‘during the 1-year period preceding the departure of the employee from the nationally recognized statistical rating organization’’; and 

(7) by adding at the end the following: 

‘‘(ii) MAINTENANCE OF RATINGS ACTIONS.—In the 

case of maintenance of ratings actions, the requirement under clause (i) shall only apply to employees of 

a person subject to a credit rating of the nationally 

recognized statistical rating organization or an issuer 

of a security or money market instrument subject to a 

186 

credit rating of the nationally recognized statistical 

rating organization.’’. 

SEC. 855. APPROVAL OF CREDIT RATING PROCEDURES AND METHODOLOGIES. 

Section 15E(r)(1)(A) of the Securities Exchange Act of 1934 (15 

U.S.C. 78o–7(r)(1)(A)) is amended by inserting ‘‘, or the Chief Credit Officer’’ after ‘‘performing a function similar to that of a board’’. 

SEC. 856. EXCEPTION FOR PROVIDING CERTAIN MATERIAL INFORMATION RELATING TO A CREDIT RATING. 

Section 15E(h)(3) of the Securities Exchange Act of 1934 (15 

U.S.C. 78o–7(h)(3)) is amended by adding at the end the following: 

‘‘(C) EXCEPTION FOR PROVIDING CERTAIN MATERIAL INFORMATION.—Rules issued under this paragraph may not 

prohibit a person who participates in sales or marketing of 

a product or service of a nationally recognized statistical 

rating organization from providing material information, 

or information believed in good faith to be material, to the 

issuance or maintenance of a credit rating to a person who 

participates in determining or monitoring the credit rating, 

or developing or approving procedures or methodologies 

used for determining the credit rating, so long as the information provided is not intended to influence the determination of a credit rating, or the procedures or methodologies used to determine credit ratings.’’. 

SEC. 857. REPEALS. 

(a) REPEALS.—The following provisions of title IX of the DoddFrank Wall Street Reform and Consumer Protection Act are repealed, and the provisions of law amended or repealed by such sections are restored or revived as if such sections had not been enacted: 

(1) Section 912. 

(2) Section 914. 

(3) Section 917. 

(4) Section 918. 

(5) Section 919A. 

(6) Section 919B. 

(7) Section 919C. 

(8) Section 921. 

(9) Section 929T. 

(10) Section 929X. 

(11) Section 929Y. 

(12) Section 929Z. 

(13) Section 931. 

(14) Section 933. 

(15) Section 937. 

(16) Section 939B. 

(17) Section 939C. 

(18) Section 939D. 

(19) Section 939E. 

(20) Section 939F. 

(21) Section 939G. 

(22) Section 939H. 

(23) Section 946. 

(24) Subsection (b) of section 953. 

187 

(25) Section 955. 

(26) Section 956. 

(27) Section 964. 

(28) Section 965. 

(29) Section 968. 

(30) Section 971. 

(31) Section 972. 

(32) Section 976. 

(33) Section 977. 

(34) Section 978. 

(35) Section 984. 

(36) Section 989. 

(37) Section 989A. 

(38) Section 989F. 

(39) Subsection (b) of section 989G. 

(40) Section 989I. 

(b) CONFORMING AMENDMENTS.—The Dodd-Frank Wall Street 

Reform and Consumer Protection Act (12 U.S.C. 5301) is amended— 

(1) in the table of contents in section 1(b), by striking the 

items relating to the sections described under paragraphs (1) 

through (23), (25) through (38), and (40) of subsection (a); 

(2) in section 953, by striking ‘‘(a) DISCLOSURE OF PAY

VERSUS PERFORMANCE.—’’; and 

(3) in section 989G, by striking ‘‘(a) EXEMPTION.—’’. 

SEC. 858. EXEMPTION OF AND REPORTING BY PRIVATE EQUITY FUND 

ADVISERS. 

Section 203 of the Investment Advisers Act of 1940 (15 U.S.C. 

80b–3) is amended by adding at the end the following: 

‘‘(o) EXEMPTION OF AND REPORTING BY PRIVATE EQUITY FUND ADVISERS.— 

‘‘(1) IN GENERAL.—Except as provided in this subsection, no 

investment adviser shall be subject to the registration or reporting requirements of this title with respect to the provision 

of investment advice relating to a private equity fund. 

‘‘(2) MAINTENANCE OF RECORDS AND ACCESS BY COMMISSION.—Not later than 6 months after the date of enactment of 

this subsection, the Commission shall issue final rules— 

‘‘(A) to require investment advisers described in paragraph (1) to maintain such records and provide to the 

Commission such annual or other reports as the Commission, taking into account fund size, governance, investment 

strategy, risk, and other factors, determines necessary and 

appropriate in the public interest and for the protection of 

investors; and 

‘‘(B) to define the term ‘private equity fund’ for purposes 

of this subsection.’’. 

SEC. 859. RECORDS AND REPORTS OF PRIVATE FUNDS. 

The Investment Advisers Act of 1940 (15 U.S.C. 80b–1 et seq.) 

is amended— 

(1) in section 204(b)— 

(A) in paragraph (1)— 

(i) in subparagraph (A), by striking ‘‘investors,’’ and 

all that follows and inserting ‘‘investors.’’; 

188 

(ii) by striking subparagraph (B); and 

(iii) by striking ‘‘this title—’’ and all that follows 

through ‘‘to maintain’’ and inserting ‘‘this title to 

maintain’’; 

(B) in paragraph (3)(H)— 

(i) by striking ‘‘, in consultation with the Council,’’; 

and 

(ii) by striking ‘‘or for the assessment of systemic 

risk’’; 

(C) in paragraph (4), by striking ‘‘, or for the assessment 

of systemic risk’’; 

(D) in paragraph (5), by striking ‘‘or for the assessment 

of systemic risk’’; 

(E) in paragraph (6)(A)(ii), by striking ‘‘, or for the assessment of systemic risk’’; 

(F) by striking paragraph (7) and redesignating paragraphs (8) through (11) as paragraphs (7) through (10), respectively; and 

(G) in paragraph (8) (as so redesignated), by striking 

‘‘paragraph (8)’’ and inserting ‘‘paragraph (7)’’; and 

(2) in section 211(e)— 

(A) by striking ‘‘after consultation with the Council but’’; 

and 

(B) by striking ‘‘subsection 204(b)’’ and inserting ‘‘section 

204(b)’’. 

SEC. 860. DEFINITION OF ACCREDITED INVESTOR. 

(a) IN GENERAL.—Section 2(a)(15) of the Securities Act of 1933 

(15 U.S.C. 77b(a)(15)) is amended— 

(1) by redesignating clauses (i) and (ii) as subparagraphs (A) 

and (G), respectively; and 

(2) in subparagraph (A) (as so redesignated), by striking ‘‘; 

or’’ at the end and inserting a semicolon, and inserting after 

such subparagraph the following: 

‘‘(B) any natural person whose individual net worth, or 

joint net worth with that person’s spouse, exceeds 

$1,000,000 (which amount, along with the amounts set 

forth in subparagraph (C), shall be adjusted for inflation 

by the Commission every 5 years to the nearest $10,000 to 

reflect the change in the Consumer Price Index for All 

Urban Consumers published by the Bureau of Labor Statistics) where, for purposes of calculating net worth under 

this subparagraph— 

‘‘(i) the person’s primary residence shall not be included as an asset; 

‘‘(ii) indebtedness that is secured by the person’s primary residence, up to the estimated fair market value 

of the primary residence at the time of the sale of securities, shall not be included as a liability (except 

that if the amount of such indebtedness outstanding 

at the time of sale of securities exceeds the amount 

outstanding 60 days before such time, other than as a 

result of the acquisition of the primary residence, the 

amount of such excess shall be included as a liability); 

and 

189 

‘‘(iii) indebtedness that is secured by the person’s 

primary residence in excess of the estimated fair market value of the primary residence at the time of the 

sale of securities shall be included as a liability; 

‘‘(C) any natural person who had an individual income 

in excess of $200,000 in each of the 2 most recent years 

or joint income with that person’s spouse in excess of 

$300,000 in each of those years and has a reasonable expectation of reaching the same income level in the current 

year; 

‘‘(D) any natural person who, by reason of their net 

worth or income, is an accredited investor under section 

230.215 of title 17, Code of Federal Regulations (as in effect on the day before the date of enactment of this subparagraph); 

‘‘(E) any natural person who is currently licensed or registered as a broker or investment adviser by the Commission, the Financial Industry Regulatory Authority, or an 

equivalent self-regulatory organization (as defined in section 3(a)(26) of the Securities Exchange Act of 1934), or the 

securities division of a State or the equivalent State division responsible for licensing or registration of individuals 

in connection with securities activities; 

‘‘(F) any natural person the Commission determines, by 

regulation, to have demonstrable education or job experience to qualify such person as having professional knowledge of a subject related to a particular investment, and 

whose education or job experience is verified by the Financial Industry Regulatory Authority or an equivalent selfregulatory organization (as defined in section 3(a)(26) of 

the Securities Exchange Act of 1934); or’’. 

(b) REPEAL.—Section 413 of the Dodd-Frank Wall Street Reform 

and Consumer Protection Act (Public Law 111–203) is hereby repealed. 

SEC. 861. REPEAL OF CERTAIN PROVISIONS REQUIRING A STUDY AND 

REPORT TO CONGRESS. 

The following provisions of the Dodd-Frank Wall Street Reform 

and Consumer Protection Act are repealed: 

(1) Section 412. 

(2) Section 415. 

(3) Section 416. 

(4) Section 417. 

SEC. 862. REPEAL. 

(a) REPEAL.—The following sections of title XV of the Dodd-Frank 

Wall Street Reform and Consumer Protection Act are repealed, and 

the provisions of law amended or repealed by such sections are restored or revived as if such sections had not been enacted: 

(1) Section 1502. 

(2) Section 1503. 

(3) Section 1504. 

(4) Section 1505. 

(5) Section 1506. 

(b) CLERICAL AMENDMENT.—The table of contents in section 1(b) 

of the Dodd-Frank Wall Street Reform and Consumer Protection 

190 

Act is amended by striking the items relating to sections 1502, 

1503, 1504, 1505, and 1506. 

Subtitle C—Harmonization of Derivatives 

Rules 

SEC. 871. COMMISSIONS REVIEW AND HARMONIZATION OF RULES RELATING TO THE REGULATION OF OVER-THE-COUNTER 

SWAPS MARKETS. 

The Securities and Exchange Commission and the Commodity 

Futures Trading Commission shall review each rule, order, and interpretive guidance issued by either such Commission pursuant to 

title VII of the Dodd-Frank Wall Street Reform and Consumer Protection Act (15 U.S.C. 8301 et seq.) and, where the Commissions 

find inconsistencies in any such rules, orders, or interpretive guidance, shall jointly issue new rules, orders, or interpretive guidance 

to resolve such inconsistencies. 

SEC. 872. TREATMENT OF TRANSACTIONS BETWEEN AFFILIATES. 

(a) COMMODITY EXCHANGE ACT.—Section 1a(47) of the Commodity Exchange Act (7 U.S.C. 1a(47)) is amended by adding at the 

end the following: 

‘‘(G) TREATMENT OF SWAP TRANSACTIONS BETWEEN AFFILIATES.— 

‘‘(i) EXEMPTION FROM SWAP RULES.—Except as provided under clause (ii), the Commission may not regulate a swap under this Act if all of the following apply 

to such swap: 

‘‘(I) AFFILIATION.—One counterparty, directly or 

indirectly, holds a majority ownership interest in 

the other counterparty, or a third party, directly 

or indirectly, holds a majority ownership interest 

in both counterparties. 

‘‘(II) FINANCIAL STATEMENTS.—The affiliated 

counterparty that holds the majority interest in 

the other counterparty or the third party that, directly or indirectly, holds the majority interests in 

both affiliated counterparties, reports its financial 

statements on a consolidated basis under generally accepted accounting principles or International Financial Reporting Standards, or other 

similar standards, and the financial statements 

include the financial results of the majority-owned 

affiliated counterparty or counterparties. 

‘‘(ii) REQUIREMENTS FOR EXEMPTED SWAPS.—With respect to a swap described under clause (i): 

‘‘(I) REPORTING REQUIREMENT.—If at least one 

counterparty is a swap dealer or major swap participant, that counterparty shall report the swap 

pursuant to section 4r, within such time period as 

the Commission may by rule or regulation prescribe— 

‘‘(aa) to a swap data repository; or 

191 

‘‘(bb) if there is no swap data repository 

that would accept the agreement, contract or 

transaction, to the Commission. 

‘‘(II) RISK MANAGEMENT REQUIREMENT.—If at 

least one counterparty is a swap dealer or major 

swap participant, the swap shall be subject to a 

centralized risk management program pursuant to 

section 4s(j) that is reasonably designed to monitor and to manage the risks associated with the 

swap. 

‘‘(III) ANTI-EVASION REQUIREMENT.—The swap 

shall not be structured to evade the Dodd-Frank 

Wall Street Reform and Consumer Protection Act 

in violation of any rule promulgated by the Commission pursuant to section 721(c) of such Act.’’. 

(b) SECURITIES EXCHANGE ACT OF 1934.—Section 3(a)(68) of the 

Securities Exchange Act of 1934 (15 U.S.C. 78c(a)(68)) is amended 

by adding at the end the following: 

‘‘(F) TREATMENT OF SECURITY-BASED SWAP TRANSACTIONS

BETWEEN AFFILIATES.— 

‘‘(i) EXEMPTION FROM SECURITY-BASED SWAP

RULES.—Except as provided under clause (ii), the Commission may not regulate a security-based swap under 

this Act if all of the following apply to such securitybased swap: 

‘‘(I) AFFILIATION.—One counterparty, directly or 

indirectly, holds a majority ownership interest in 

the other counterparty, or a third party, directly 

or indirectly, holds a majority ownership interest 

in both counterparties. 

‘‘(II) FINANCIAL STATEMENTS.—The affiliated 

counterparty that holds the majority interest in 

the other counterparty or the third party that, directly or indirectly, holds the majority interests in 

both affiliated counterparties, reports its financial 

statements on a consolidated basis under generally accepted accounting principles or International Financial Reporting Standards, or other 

similar standards, and the financial statements 

include the financial results of the majority-owned 

affiliated counterparty or counterparties. 

‘‘(ii) REQUIREMENTS FOR EXEMPTED SECURITY-BASED

SWAPS.—With respect to a security-based swap described under clause (i): 

‘‘(I) REPORTING REQUIREMENT.—If at least one 

counterparty is a security-based swap dealer or 

major security-based swap participant, that 

counterparty shall report the security-based swap 

pursuant to section 13A, within such time period 

as the Commission may by rule or regulation prescribe— 

‘‘(aa) to a security-based swap data repository; or 

192 

‘‘(bb) if there is no security-based swap data 

repository that would accept the agreement, 

contract or transaction, to the Commission. 

‘‘(II) RISK MANAGEMENT REQUIREMENT.—If at 

least one counterparty is a security-based swap 

dealer or major security-based swap participant, 

the security-based swap shall be subject to a centralized risk management program pursuant to 

section 15F(j) that is reasonably designed to monitor and to manage the risks associated with the 

security-based swap. 

‘‘(III) ANTI-EVASION REQUIREMENT.—The security-based swap shall not be structured to evade 

the Dodd-Frank Wall Street Reform and Consumer Protection Act in violation of any rule promulgated by the Commission pursuant to section 

761(b)(3) of such Act.’’. 

TITLE IX—REPEAL OF THE VOLCKER 

RULE AND OTHER PROVISIONS 

SEC. 901. REPEALS. 

(a) IN GENERAL.—The following sections of title VI of the DoddFrank Wall Street Reform and Consumer Protection Act are repealed, and the provisions of law amended or repealed by such sections are restored or revived as if such sections had not been enacted: 

(1) Section 603. 

(2) Section 618. 

(3) Section 619. 

(4) Section 620. 

(5) Section 621. 

(b) CLERICAL AMENDMENT.—The table of contents under section 

1(b) of the Dodd-Frank Wall Street Reform and Consumer Protection Act is amended by striking the items relating to sections 603, 

618, 619, 620, and 621. 

TITLE X—FED OVERSIGHT REFORM 

AND MODERNIZATION 

SEC. 1001. REQUIREMENTS FOR POLICY RULES OF THE FEDERAL 

OPEN MARKET COMMITTEE. 

The Federal Reserve Act (12 U.S.C. 221 et seq.) is amended by 

inserting after section 2B the following new section: 

‘‘SEC. 2C. DIRECTIVE POLICY RULES OF THE FEDERAL OPEN MARKET 

COMMITTEE. 

‘‘(a) DEFINITIONS.—In this section the following definitions shall 

apply: 

‘‘(1) APPROPRIATE CONGRESSIONAL COMMITTEES.—The term 

‘appropriate congressional committees’ means the Committee 

on Financial Services of the House of Representatives and the 

Committee on Banking, Housing, and Urban Affairs of the 

Senate. 

193 

‘‘(2) DIRECTIVE POLICY RULE.—The term ‘Directive Policy 

Rule’ means a policy rule developed by the Federal Open Market Committee that meets the requirements of subsection (c) 

and that provides the basis for the Open Market Operations 

Directive. 

‘‘(3) GDP.—The term ‘GDP’ means the gross domestic product of the United States as computed and published by the Department of Commerce. 

‘‘(4) INTERMEDIATE POLICY INPUT.—The term ‘Intermediate 

Policy Input’— 

‘‘(A) may include any variable determined by the Federal 

Open Market Committee as a necessary input to guide 

open-market operations; 

‘‘(B) shall include an estimate of, and the method of calculation for, the current rate of inflation or current inflation expectations; and 

‘‘(C) shall include, specifying whether the variable or estimate is historical, current, or a forecast and the method 

of calculation, at least one of— 

‘‘(i) an estimate of real GDP, nominal GDP, or potential GDP; 

‘‘(ii) an estimate of the monetary aggregate compiled 

by the Board of Governors of the Federal Reserve System and Federal reserve banks; or 

‘‘(iii) an interactive variable or a net estimate composed of the estimates described in clauses (i) and (ii). 

‘‘(5) LEGISLATIVE DAY.—The term ‘legislative day’ means a 

day on which either House of Congress is in session. 

‘‘(6) OPEN MARKET OPERATIONS DIRECTIVE.—The term ‘Open 

Market Operations Directive’ means an order to achieve a 

specified Policy Instrument Target provided to the Federal Reserve Bank of New York by the Federal Open Market Committee pursuant to powers authorized under section 14 of this 

Act that guide open-market operations. 

‘‘(7) POLICY INSTRUMENT.—The term ‘Policy Instrument’ 

means— 

‘‘(A) the nominal Federal funds rate; 

‘‘(B) the nominal rate of interest paid on nonborrowed 

reserves; or 

‘‘(C) the discount window primary credit interest rate 

most recently published on the Federal Reserve Statistical 

Release on selected interest rates (daily or weekly), commonly referred to as the H.15 release. 

‘‘(8) POLICY INSTRUMENT TARGET.—The term ‘Policy Instrument Target’ means the target for the Policy Instrument specified in the Open Market Operations Directive. 

‘‘(9) REFERENCE POLICY RULE.—The term ‘Reference Policy 

Rule’ means a calculation of the nominal Federal funds rate as 

equal to the sum of the following: 

‘‘(A) The rate of inflation over the previous four quarters. 

‘‘(B) One-half of the percentage deviation of the real 

GDP from an estimate of potential GDP. 

‘‘(C) One-half of the difference between the rate of inflation over the previous four quarters and two percent. 

‘‘(D) Two percent. 

194 

‘‘(b) SUBMITTING A DIRECTIVE POLICY RULE.—Not later than 48 

hours after the end of a meeting of the Federal Open Market Committee, the Chairman of the Federal Open Market Committee shall 

submit to the appropriate congressional committees and the Comptroller General of the United States a Directive Policy Rule and a 

statement that identifies the members of the Federal Open Market 

Committee who voted in favor of the Directive Policy Rule. 

‘‘(c) REQUIREMENTS FOR A DIRECTIVE POLICY RULE.—A Directive 

Policy Rule shall— 

‘‘(1) identify the Policy Instrument the Directive Policy Rule 

is designed to target; 

‘‘(2) describe the strategy or rule of the Federal Open Market 

Committee for the systematic quantitative adjustment of the 

Policy Instrument Target to respond to a change in the Intermediate Policy Inputs; 

‘‘(3) include a function that comprehensively models the 

interactive relationship between the Intermediate Policy Inputs; 

‘‘(4) include the coefficients of the Directive Policy Rule that 

generate the current Policy Instrument Target and a range of 

predicted future values for the Policy Instrument Target if 

changes occur in any Intermediate Policy Input; 

‘‘(5) describe the procedure for adjusting the supply of bank 

reserves to achieve the Policy Instrument Target; 

‘‘(6) include a statement as to whether the Directive Policy 

Rule substantially conforms to the Reference Policy Rule and, 

if applicable— 

‘‘(A) an explanation of the extent to which it departs 

from the Reference Policy Rule; 

‘‘(B) a detailed justification for that departure; and 

‘‘(C) a description of the circumstances under which the 

Directive Policy Rule may be amended in the future; 

‘‘(7) include a certification that the Directive Policy Rule is 

expected to support the economy in achieving stable prices and 

maximum natural employment over the long term; 

‘‘(8) include a calculation that describes with mathematical 

precision the expected annual inflation rate over a 5-year period; and 

‘‘(9) include a plan to use the most accurate data, subject to 

all historical revisions, for inputs into the Directive Policy Rule 

and the Reference Policy Rule. 

‘‘(d) GAO REPORT.—The Comptroller General of the United 

States shall compare the Directive Policy Rule submitted under 

subsection (b) with the rule that was most recently submitted to 

determine whether the Directive Policy Rule has materially 

changed. If the Directive Policy Rule has materially changed, the 

Comptroller General shall, not later than 7 days after each meeting 

of the Federal Open Market Committee, prepare and submit a compliance report to the appropriate congressional committees specifying whether the Directive Policy Rule submitted after that meeting and the Federal Open Market Committee are in compliance 

with this section. 

‘‘(e) CHANGING MARKET CONDITIONS.— 

‘‘(1) RULE OF CONSTRUCTION.—Nothing in this Act shall be 

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195 

atic quantitative adjustment of the Policy Instrument Target 

described under subsection (c)(2) be implemented if the Federal 

Open Market Committee determines that such plans cannot or 

should not be achieved due to changing market conditions. 

‘‘(2) GAO APPROVAL OF UPDATE.—Upon determining that 

plans described in paragraph (1) cannot or should not be 

achieved, the Federal Open Market Committee shall submit an 

explanation for that determination and an updated version of 

the Directive Policy Rule to the Comptroller General of the 

United States and the appropriate congressional committees 

not later than 48 hours after making the determination. The 

Comptroller General shall, not later than 48 hours after receiving such updated version, prepare and submit to the appropriate congressional committees a compliance report determining whether such updated version and the Federal Open 

Market Committee are in compliance with this section. 

‘‘(f) DIRECTIVE POLICY RULE AND FEDERAL OPEN MARKET COMMITTEE NOT IN COMPLIANCE.— 

‘‘(1) IN GENERAL.—If the Comptroller General of the United 

States determines that the Directive Policy Rule and the Federal Open Market Committee are not in compliance with this 

section in the report submitted pursuant to subsection (d), or 

that the updated version of the Directive Policy Rule and the 

Federal Open Market Committee are not in compliance with 

this section in the report submitted pursuant to subsection 

(e)(2), the Chairman of the Board of Governors of the Federal 

Reserve System shall, if requested by the chairman of either 

of the appropriate congressional committees, not later than 7 

legislative days after such request, testify before such committee as to why the Directive Policy Rule, the updated 

version, or the Federal Open Market Committee is not in compliance. 

‘‘(2) GAO AUDIT.—Notwithstanding subsection (b) of section 

714 of title 31, United States Code, upon submitting a report 

of noncompliance pursuant to subsection (d) or subsection (e)(2) 

and after the period of 7 legislative days described in paragraph (1), the Comptroller General shall audit the conduct of 

monetary policy by the Board of Governors of the Federal Reserve System and the Federal Open Market Committee upon 

request of the appropriate congressional committee. Such committee may specify the parameters of such audit. 

‘‘(g) CONGRESSIONAL HEARINGS.—The Chairman of the Board of 

Governors of the Federal Reserve System shall, if requested by the 

chairman of either of the appropriate congressional committees and 

not later than 7 legislative days after such request, appear before 

such committee to explain any change to the Directive Policy 

Rule.’’. 

SEC. 1002. FEDERAL OPEN MARKET COMMITTEE BLACKOUT PERIOD. 

Section 12A of the Federal Reserve Act (12 U.S.C. 263) is amended by adding at the end the following new subsection: 

‘‘(d) BLACKOUT PERIOD.— 

‘‘(1) IN GENERAL.—During a blackout period, the only public 

communications that may be made by members and staff of 

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196 

velopments or about current or prospective monetary policy 

issues are the following: 

‘‘(A) The dissemination of published data, surveys, and 

reports that have been cleared for publication by the Board 

of Governors of the Federal Reserve System. 

‘‘(B) Answers to technical questions specific to a data release. 

‘‘(C) Communications with respect to the prudential or 

supervisory functions of the Board of Governors. 

‘‘(2) BLACKOUT PERIOD DEFINED.—For purposes of this subsection, and with respect to a meeting of the Committee described under subsection (a), the term ‘blackout period’ means 

the time period that— 

‘‘(A) begins immediately after midnight on the day that 

is one week prior to the date on which such meeting takes 

place; and 

‘‘(B) ends at midnight on the day after the date on which 

such meeting takes place. 

‘‘(3) EXEMPTION FOR CHAIRMAN OF THE BOARD OF GOVERNORS.—Nothing in this section shall prohibit the Chairman 

of the Board of Governors of the Federal Reserve System from 

participating in or issuing public communications.’’. 

SEC. 1003. PUBLIC TRANSCRIPTS OF FOMC MEETINGS. 

Section 12A of the Federal Reserve Act (12 U.S.C. 263), as 

amended by section 1002, is further amended by adding at the end 

the following: 

‘‘(e) PUBLIC TRANSCRIPTS OF MEETINGS.—The Committee shall— 

‘‘(1) record all meetings of the Committee; and 

‘‘(2) make the full transcript of such meetings available to 

the public.’’. 

SEC. 1004. MEMBERSHIP OF FEDERAL OPEN MARKET COMMITTEE. 

Section 12A(a) of the Federal Reserve Act (12 U.S.C. 263(a)) is 

amended— 

(1) in the first sentence, by striking ‘‘five’’ and inserting ‘‘six’’; 

(2) in the second sentence, by striking ‘‘One by the board of 

directors’’ and all that follows through the period at the end 

and inserting the following: ‘‘One by the boards of directors of 

the Federal Reserve Banks of New York and Boston; one by 

the boards of directors of the Federal Reserve Banks of Philadelphia and Cleveland; one by the boards of directors of the 

Federal Reserve Banks of Richmond and Atlanta; one by the 

boards of directors of the Federal Reserve Banks of Chicago 

and St. Louis; one by the boards of directors of the Federal Reserve Banks of Minneapolis and Kansas City; and one by the 

boards of directors of the Federal Reserve Banks of Dallas and 

San Francisco.’’; and 

(3) by inserting after the second sentence the following: ‘‘In 

odd numbered calendar years, one representative shall be 

elected from each of the Federal Reserve Banks of Boston, 

Philadelphia, Richmond, Chicago, Minneapolis, and Dallas. In 

even-numbered calendar years, one representative shall be 

elected from each of the Federal Reserve Banks of New York, 

Cleveland, Atlanta, St. Louis, Kansas City, and San Francisco.’’. 

197 

SEC. 1005. FREQUENCY OF TESTIMONY OF THE CHAIRMAN OF THE 

BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM TO CONGRESS. 

(a) IN GENERAL.—Section 2B of the Federal Reserve Act (12 

U.S.C. 225b) is amended— 

(1) by striking ‘‘semi-annual’’ each place it appears and inserting ‘‘quarterly’’; and 

(2) in subsection (a)(2)— 

(A) by inserting ‘‘and October 20’’ after ‘‘July 20’’ each 

place it appears; and 

(B) by inserting ‘‘and May 20’’ after ‘‘February 20’’ each 

place it appears. 

(b) CONFORMING AMENDMENT.—Paragraph (12) of section 10 of 

the Federal Reserve Act (12 U.S.C. 247b(12)) is amended by striking ‘‘semi-annual’’ and inserting ‘‘quarterly’’. 

SEC. 1006. VICE CHAIRMAN FOR SUPERVISION REPORT REQUIREMENT. 

Paragraph (12) of section 10 of the Federal Reserve Act (12 

U.S.C. 247(b)) is amended— 

(1) by redesignating such paragraph as paragraph (11); and 

(2) in such paragraph, by adding at the end the following: 

‘‘In each such appearance, the Vice Chairman for Supervision 

shall provide written testimony that includes the status of all 

pending and anticipated rulemakings that are being made by 

the Board of Governors of the Federal Reserve System. If, at 

the time of any appearance described in this paragraph, the 

position of Vice Chairman for Supervision is vacant, the Vice 

Chairman for the Board of Governors of the Federal Reserve 

System (who has the responsibility to serve in the absence of 

the Chairman) shall appear instead and provide the required 

written testimony. If, at the time of any appearance described 

in this paragraph, both Vice Chairman positions are vacant, 

the Chairman of the Board of Governors of the Federal Reserve 

System shall appear instead and provide the required written 

testimony.’’. 

SEC. 1007. SALARIES, FINANCIAL DISCLOSURES, AND OFFICE STAFF 

OF THE BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM. 

(a) IN GENERAL.—Section 11 of the Federal Reserve Act (12 

U.S.C. 248) is amended— 

(1) by redesignating the second subsection (s) (relating to 

‘‘Assessments, Fees, and Other Charges for Certain Companies’’) as subsection (t); and 

(2) by inserting before subsection (w), as added by section 

371(a), the following new subsections: 

‘‘(u) ETHICS STANDARDS FOR MEMBERS AND EMPLOYEES.— 

‘‘(1) PROHIBITED AND RESTRICTED FINANCIAL INTERESTS AND

TRANSACTIONS.—The members and employees of the Board of 

Governors of the Federal Reserve System shall be subject to 

the provisions under section 4401.102 of title 5, Code of Federal Regulations, to the same extent as such provisions apply 

to an employee of the Securities and Exchange Commission. 

‘‘(2) TREATMENT OF BROKERAGE ACCOUNTS AND AVAILABILITY

OF ACCOUNT STATEMENTS.—The members and employees of the 

Board of Governors of the Federal Reserve System shall— 

198 

‘‘(A) disclose all brokerage accounts that the member or 

employee maintains, as well as any accounts in which the 

member or employee controls trading or has a financial interest (including managed accounts, trust accounts, investment club accounts, and accounts of spouses or minor children who live with the member or employee); and 

‘‘(B) with respect to any securities account that the 

member or employee is required to disclose to the Board 

of Governors, authorize the brokers and dealers of such account to send duplicate account statements directly to 

Board of Governors. 

‘‘(3) PROHIBITIONS RELATED TO OUTSIDE EMPLOYMENT AND ACTIVITIES.—The members and employees of the Board of Governors of the Federal Reserve System shall be subject to the 

prohibitions related to outside employment and activities described under section 4401.103(c) of title 5, Code of Federal 

Regulations, to the same extent as such prohibitions apply to 

an employee of the Securities and Exchange Commission. 

‘‘(4) ADDITIONAL ETHICS STANDARDS.—The members and employees of the Board of Governors of the Federal Reserve System shall be subject to— 

‘‘(A) the employee responsibilities and conduct regulations of the Office of Personnel Management under part 

735 of title 5, Code of Federal Regulations; 

‘‘(B) the canons of ethics contained in subpart C of part 

200 of title 17, Code of Federal Regulations, to the same 

extent as such subpart applies to the employees of the Securities and Exchange Commission; and 

‘‘(C) the regulations concerning the conduct of members 

and employees and former members and employees contained in subpart M of part 200 of title 17, Code of Federal 

Regulations, to the same extent as such subpart applies to 

the employees of the Securities and Exchange Commission. 

‘‘(v) DISCLOSURE OF STAFF SALARIES AND FINANCIAL INFORMATION.—The Board of Governors of the Federal Reserve System shall 

make publicly available, on the website of the Board of Governors, 

a searchable database that contains the names of all members, officers, and employees of the Board of Governors who receive an annual salary in excess of the annual rate of basic pay for GS–15 of 

the General Schedule, and— 

‘‘(1) the yearly salary information for such individuals, along 

with any nonsalary compensation received by such individuals; 

and 

‘‘(2) any financial disclosures required to be made by such individuals.’’. 

(b) OFFICE STAFF FOR EACH MEMBER OF THE BOARD OF GOVERNORS.—Subsection (l) of section 11 of the Federal Reserve Act 

(12 U.S.C. 248) is amended by adding at the end the following: 

‘‘Each member of the Board of Governors of the Federal Reserve 

System may employ, at a minimum, 2 individuals, with such individuals selected by such member and the salaries of such individuals set by such member. A member may employ additional individuals as determined necessary by the Board of Governors.’’. 

199 

SEC. 1008. AMENDMENTS TO POWERS OF THE BOARD OF GOVERNORS 

OF THE FEDERAL RESERVE SYSTEM. 

(a) IN GENERAL.—Section 13(3) of the Federal Reserve Act (12 

U.S.C. 343(3)), as amended by section 111(b)(3), is further amended— 

(1) in subparagraph (A)— 

(A) by inserting ‘‘that pose a threat to the financial stability of the United States’’ after ‘‘unusual and exigent circumstances’’; and 

(B) by inserting ‘‘and by the affirmative vote of not less 

than nine presidents of the Federal reserve banks’’ after 

‘‘five members’’; 

(2) in subparagraph (B)— 

(A) in clause (i), by inserting at the end the following: 

‘‘Federal reserve banks may not accept equity securities 

issued by the recipient of any loan or other financial assistance under this paragraph as collateral. Not later than 

6 months after the date of enactment of this sentence, the 

Board shall, by rule, establish— 

‘‘(I) a method for determining the sufficiency of 

the collateral required under this paragraph; 

‘‘(II) acceptable classes of collateral; 

‘‘(III) the amount of any discount on the value 

of the collateral that the Federal reserve banks 

will apply for purposes of calculating the sufficiency of collateral under this paragraph; and 

‘‘(IV) a method for obtaining independent appraisals of the value of collateral the Federal reserve banks receive.’’; and 

(B) in clause (ii)— 

(i) by striking the second sentence; and 

(ii) by inserting after the first sentence the following: ‘‘A borrower shall not be eligible to borrow 

from any emergency lending program or facility unless 

the Board and all Federal banking regulators with jurisdiction over the borrower certify that, at the time 

the borrower initially borrows under the program or 

facility, the borrower is not insolvent.’’; 

(3) by inserting ‘‘financial institution’’ before ‘‘participant’’ 

each place such term appears; 

(4) in subparagraph (D)(i), by inserting ‘‘financial institution’’ 

before ‘‘participants’’; and 

(5) by adding at the end the following new subparagraphs: 

‘‘(E) PENALTY RATE.— 

‘‘(i) IN GENERAL.—Not later than 6 months after the 

date of enactment of this subparagraph, the Board 

shall, with respect to a recipient of any loan or other 

financial assistance under this paragraph, establish by 

rule a minimum interest rate on the principal amount 

of any loan or other financial assistance. 

‘‘(ii) MINIMUM INTEREST RATE DEFINED.—In this subparagraph, the term ‘minimum interest rate’ shall 

mean the sum of— 

200 

‘‘(I) the average of the secondary discount rate 

of all Federal Reserve banks over the most recent 

90-day period; and 

‘‘(II) the average of the difference between a distressed corporate bond yield index (as defined by 

rule of the Board) and a bond yield index of debt 

issued by the United States (as defined by rule of 

the Board) over the most recent 90-day period. 

‘‘(F) FINANCIAL INSTITUTION PARTICIPANT DEFINED.—For 

purposes of this paragraph, the term ‘financial institution 

participant’— 

‘‘(i) means a company that is predominantly engaged 

in financial activities (as defined in section 102(a) of 

the Dodd-Frank Wall Street Reform and Consumer 

Protection Act (12 U.S.C. 5311(a))); and 

‘‘(ii) does not include an agency described in subparagraph (W) of section 5312(a)(2) of title 31, United 

States Code, or an entity controlled or sponsored by 

such an agency.’’. 

(b) CONFORMING AMENDMENT.—Section 11(r)(2)(A) of the Federal 

Reserve Act (12 U.S.C. 248(r)(2)(A)) is amended— 

(1) in clause (ii)(IV), by striking ‘‘; and’’ and inserting a semicolon; 

(2) in clause (iii), by striking the period at the end and inserting ‘‘; and’’; and 

(3) by adding at the end the following new clause: 

‘‘(iv) the available members secure the affirmative vote of not 

less than nine presidents of the Federal reserve banks.’’. 

SEC. 1009. INTEREST RATES ON BALANCES MAINTAINED AT A FEDERAL RESERVE BANK BY DEPOSITORY INSTITUTIONS ESTABLISHED BY FEDERAL OPEN MARKET COMMITTEE. 

Subparagraph (A) of section 19(b)(12) of the Federal Reserve Act 

(12 U.S.C. 461(b)(12)(A)) is amended by inserting ‘‘established by 

the Federal Open Market Committee’’ after ‘‘rate or rates’’. 

SEC. 1010. AUDIT REFORM AND TRANSPARENCY FOR THE BOARD OF 

GOVERNORS OF THE FEDERAL RESERVE SYSTEM. 

(a) IN GENERAL.—Notwithstanding section 714 of title 31, United 

States Code, or any other provision of law, the Comptroller General 

of the United States shall annually complete an audit of the Board 

of Governors of the Federal Reserve System and the Federal reserve banks under subsection (b) of such section 714 within 12 

months after the date of the enactment of this Act. 

(b) REPORT.— 

(1) IN GENERAL.—Not later than 90 days after each audit required pursuant to subsection (a) is completed, the Comptroller 

General— 

(A) shall submit to Congress a report on such audit; and 

(B) shall make such report available to the Speaker of 

the House, the majority and minority leaders of the House 

of Representatives, the majority and minority leaders of 

the Senate, the Chairman and Ranking Member of the 

committee and each subcommittee of jurisdiction in the 

House of Representatives and the Senate, and any other 

Member of Congress who requests the report. 

201 

(2) CONTENTS.—The report under paragraph (1) shall include 

a detailed description of the findings and conclusion of the 

Comptroller General with respect to the audit that is the subject of the report, together with such recommendations for legislative or administrative action as the Comptroller General 

may determine to be appropriate. 

(c) REPEAL OF CERTAIN LIMITATIONS.—Subsection (b) of section 

714 of title 31, United States Code, is amended by striking the second sentence. 

(d) TECHNICAL AND CONFORMING AMENDMENTS.— 

(1) IN GENERAL.—Section 714 of title 31, United States Code, 

is amended— 

(A) in subsection (d)(3), by striking ‘‘or (f)’’ each place 

such term appears; 

(B) in subsection (e), by striking ‘‘the third undesignated 

paragraph of section 13’’ and inserting ‘‘section 13(3)’’; and 

(C) by striking subsection (f). 

(2) FEDERAL RESERVE ACT.—Subsection (s) (relating to ‘‘Federal Reserve Transparency and Release of Information’’) of section 11 of the Federal Reserve Act (12 U.S.C. 248) is amended— 

(A) in paragraph (4)(A), by striking ‘‘has the same meaning as in section 714(f)(1)(A) of title 31, United States 

Code’’ and inserting ‘‘means a program or facility, including any special purpose vehicle or other entity established 

by or on behalf of the Board of Governors of the Federal 

Reserve System or a Federal reserve bank, authorized by 

the Board of Governors under section 13(3), that is not 

subject to audit under section 714(e) of title 31, United 

States Code’’; 

(B) in paragraph (6), by striking ‘‘or in section 

714(f)(3)(C) of title 31, United States Code, the information 

described in paragraph (1) and information concerning the 

transactions described in section 714(f) of such title,’’ and 

inserting ‘‘the information described in paragraph (1)’’; and 

(C) in paragraph (7), by striking ‘‘and section 13(3)(C), 

section 714(f)(3)(C) of title 31, United States Code, and’’ 

and inserting ‘‘, section 13(3)(C), and’’. 

SEC. 1011. ESTABLISHMENT OF A CENTENNIAL MONETARY COMMISSION. 

(a) FINDINGS.—Congress finds the following: 

(1) The Constitution endows Congress with the power ‘‘to 

coin money, regulate the value thereof’’. 

(2) Following the financial crisis known as the Panic of 1907, 

Congress established the National Monetary Commission to 

provide recommendations for the reform of the financial and 

monetary systems of the United States. 

(3) Incorporating several of the recommendations of the National Monetary Commission, Congress created the Federal Reserve System in 1913. As currently organized, the Federal Reserve System consists of the Board of Governors in Washington, District of Columbia, and the Federal reserve banks organized into 12 districts around the United States. The stockholders of the 12 Federal reserve banks include national and 

202 

certain State-chartered commercial banks, which operate on a 

fractional reserve basis. 

(4) Originally, Congress gave the Federal Reserve System a 

monetary mandate to provide an elastic currency, within the 

context of a gold standard, in response to seasonal fluctuations 

in the demand for currency. 

(5) Congress also gave the Federal Reserve System a financial stability mandate to serve as the lender of last resort to 

solvent but illiquid banks during a financial crisis. 

(6) In 1977, Congress changed the monetary mandate of the 

Federal Reserve System to a dual mandate for maximum employment and stable prices. 

(7) Empirical studies and historical evidence, both within the 

United States and in other countries, demonstrate that price 

stability is desirable because both inflation and deflation damage the economy. 

(8) The economic challenge of recent years—most notably the 

bursting of the housing bubble, the financial crisis of 2008, and 

the ensuing anemic recovery—have occurred at great cost in 

terms of lost jobs and output. 

(9) Policymakers are reexamining the structure and functioning of financial institutions and markets to determine 

what, if any, changes need to be made to place the financial 

system on a stronger, more sustainable path going forward. 

(10) The Federal Reserve System has taken extraordinary 

actions in response to the recent economic challenges. 

(11) The Federal Open Market Committee has engaged in 

multiple rounds of quantitative easing, providing unprecedented liquidity to financial markets, while committing to holding short-term interest rates low for a seemingly indefinite period, and pursuing a policy of credit allocation by purchasing 

Federal agency debt and mortgage-backed securities. 

(12) In the wake of the recent extraordinary actions of the 

Federal Reserve System, Congress—consistent with its constitutional responsibilities and as it has done periodically 

throughout the history of the United States—has once again 

renewed its examination of monetary policy. 

(13) Central in such examination has been a renewed look at 

what is the most proper mandate for the Federal Reserve System to conduct monetary policy in the 21st century. 

(b) ESTABLISHMENT OF A CENTENNIAL MONETARY COMMISSION.— 

There is established a commission to be known as the ‘‘Centennial 

Monetary Commission’’ (in this section referred to as the ‘‘Commission’’). 

(c) STUDY AND REPORT ON MONETARY POLICY.— 

(1) STUDY.—The Commission shall— 

(A) examine how United States monetary policy since 

the creation of the Board of Governors of the Federal Reserve System in 1913 has affected the performance of the 

United States economy in terms of output, employment, 

prices, and financial stability over time; 

(B) evaluate various operational regimes under which 

the Board of Governors of the Federal Reserve System and 

the Federal Open Market Committee may conduct monetary policy in terms achieving the maximum sustainable 

203 

level of output and employment and price stability over 

the long term, including— 

(i) discretion in determining monetary policy without an operational regime; 

(ii) price level targeting; 

(iii) inflation rate targeting; 

(iv) nominal gross domestic product targeting (both 

level and growth rate); 

(v) the use of monetary policy rules; and 

(vi) the gold standard; 

(C) evaluate the use of macro-prudential supervision and 

regulation as a tool of monetary policy in terms of achieving the maximum sustainable level of output and employment and price stability over the long term; 

(D) evaluate the use of the lender-of-last-resort function 

of the Board of Governors of the Federal Reserve System 

as a tool of monetary policy in terms of achieving the maximum sustainable level of output and employment and 

price stability over the long term; 

(E) recommend a course for United States monetary policy going forward, including— 

(i) the legislative mandate; 

(ii) the operational regime; 

(iii) the securities used in open-market operations; 

and 

(iv) transparency issues; and 

(F) consider the effects of the GDP output and employment targets of the ‘‘dual mandate’’ (both from the creation 

of the dual mandate in 1977 until the present time and estimates of the future effect of the dual mandate ) on— 

(i) United States economic activity; 

(ii) actions of the Board of Governors of the Federal 

Reserve System; and 

(iii) Federal debt. 

(2) REPORT.—Not later than 1 year after the date of the enactment of this section, the Commission shall submit to Congress and make publicly available a report containing a statement of the findings and conclusions of the Commission in carrying out the study under paragraph (1), together with the recommendations the Commission considers appropriate. In making such report, the Commission shall specifically report on the 

considerations required under paragraph (1)(F). 

(d) MEMBERSHIP.— 

(1) NUMBER AND APPOINTMENT.— 

(A) APPOINTED VOTING MEMBERS.—The Commission 

shall contain 12 voting members as follows: 

(i) Six members appointed by the Speaker of the 

House of Representatives, with four members from the 

majority party and two members from the minority 

party. 

(ii) Six members appointed by the President Pro 

Tempore of the Senate, with four members from the 

majority party and two members from the minority 

party. 

204 

(B) CHAIRMAN.—The Speaker of the House of Representatives and the majority leader of the Senate shall jointly 

designate one of the members of the Commission as Chairman. 

(C) NON-VOTING MEMBERS.—The Commission shall contain 2 non-voting members as follows: 

(i) One member appointed by the Secretary of the 

Treasury. 

(ii) One member who is the president of a district 

Federal reserve bank appointed by the Chair of the 

Board of Governors of the Federal Reserve System. 

(2) PERIOD OF APPOINTMENT.—Each member shall be appointed for the life of the Commission. 

(3) TIMING OF APPOINTMENT.—All members of the Commission shall be appointed not later than 30 days after the date 

of the enactment of this section. 

(4) VACANCIES.—A vacancy in the Commission shall not affect its powers, and shall be filled in the manner in which the 

original appointment was made. 

(5) MEETINGS.— 

(A) INITIAL MEETING.—The Commission shall hold its 

initial meeting and begin the operations of the Commission as soon as is practicable. 

(B) FURTHER MEETINGS.—The Commission shall meet 

upon the call of the Chair or a majority of its members. 

(6) QUORUM.—Seven voting members of the Commission 

shall constitute a quorum but a lesser number may hold hearings. 

(7) MEMBER OF CONGRESS DEFINED.—In this subsection, the 

term ‘‘Member of Congress’’ means a Senator or a Representative in, or Delegate or Resident Commissioner to, the Congress. 

(e) POWERS.— 

(1) HEARINGS AND SESSIONS.—The Commission or, on the authority of the Commission, any subcommittee or member thereof, may, for the purpose of carrying out this section, hold hearings, sit and act at times and places, take testimony, receive 

evidence, or administer oaths as the Commission or such subcommittee or member thereof considers appropriate. 

(2) CONTRACT AUTHORITY.—To the extent or in the amounts 

provided in advance in appropriation Acts, the Commission 

may contract with and compensate government and private 

agencies or persons to enable the Commission to discharge its 

duties under this section, without regard to section 3709 of the 

Revised Statutes (41 U.S.C. 5). 

(3) OBTAINING OFFICIAL DATA.— 

(A) IN GENERAL.—The Commission is authorized to secure directly from any executive department, bureau, 

agency, board, commission, office, independent establishment, or instrumentality of the Government, any information, including suggestions, estimates, or statistics, for the 

purposes of this section. 

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205 

ment shall, to the extent authorized by law, furnish such 

information upon request made by— 

(i) the Chair; 

(ii) the Chair of any subcommittee created by a majority of the Commission; or 

(iii) any member of the Commission designated by a 

majority of the commission to request such information. 

(4) ASSISTANCE FROM FEDERAL AGENCIES.— (A) GENERAL SERVICES ADMINISTRATION.—The Administrator of General Services shall provide to the Commission 

on a reimbursable basis administrative support and other 

services for the performance of the functions of the Commission. 

(B) OTHER DEPARTMENTS AND AGENCIES.—In addition to 

the assistance prescribed in subparagraph (A), at the request of the Commission, departments and agencies of the 

United States shall provide such services, funds, facilities, 

staff, and other support services as may be authorized by 

law. 

(5) POSTAL SERVICE.—The Commission may use the United 

States mails in the same manner and under the same conditions as other departments and agencies of the United States. 

(f) COMMISSION PERSONNEL.— (1) APPOINTMENT AND COMPENSATION OF STAFF.— (A) IN GENERAL.—Subject to rules prescribed by the 

Commission, the Chair may appoint and fix the pay of the 

executive director and other personnel as the Chair considers appropriate. 

(B) APPLICABILITY OF CIVIL SERVICE LAWS.—The staff of 

the Commission may be appointed without regard to the 

provisions of title 5, United States Code, governing appointments in the competitive service, and may be paid 

without regard to the provisions of chapter 51 and subchapter III of chapter 53 of that title relating to classification and General Schedule pay rates, except that an individual so appointed may not receive pay in excess of level 

V of the Executive Schedule. 

(2) CONSULTANTS.—The Commission may procure temporary 

and intermittent services under section 3109(b) of title 5, 

United States Code, but at rates for individuals not to exceed 

the daily equivalent of the rate of pay for a person occupying 

a position at level IV of the Executive Schedule. 

(3) STAFF OF FEDERAL AGENCIES.—Upon request of the Commission, the head of any Federal department or agency may 

detail, on a reimbursable basis, any of the personnel of such 

department or agency to the Commission to assist it in carrying out its duties under this section. 

(g) TERMINATION OF COMMISSION.— (1) IN GENERAL.—The Commission shall terminate 6 months 

after the date on which the report is submitted under subsection (c)(2). 

(2) ADMINISTRATIVE ACTIVITIES BEFORE TERMINATION.—The 

Commission may use the period between the submission of its 

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206 

tivities, including providing testimony to the committee of Congress concerning its report. 

(h) AUTHORIZATION OF APPROPRIATIONS.—There is authorized to 

be appropriated to carry out this section $1,000,000, which shall remain available until the date on which the Commission terminates. 

TITLE XI—IMPROVING INSURANCE COORDINATION THROUGH AN INDEPENDENT ADVOCATE 

SEC. 1101. REPEAL OF THE FEDERAL INSURANCE OFFICE; CREATION 

OF THE OFFICE OF THE INDEPENDENT INSURANCE ADVOCATE. 

(a) ESTABLISHMENT.—Section 313 of title 31, United States Code, 

is amended to read as follows (and conforming the table of contents 

for chapter 3 of such title accordingly): 

‘‘§ 313. Office of the Independent Insurance Advocate 

‘‘(a) ESTABLISHMENT.—There is established in the Department of 

the Treasury a bureau to be known as the Office of the Independent Insurance Advocate (in this section referred to as the ‘Office’). 

‘‘(b) INDEPENDENT INSURANCE ADVOCATE.— ‘‘(1) ESTABLISHMENT OF POSITION.—The chief officer of the 

Office of the Independent Insurance Advocate shall be known 

as the Independent Insurance Advocate. The Independent Insurance Advocate shall perform the duties of such office under 

the general direction of the Secretary of the Treasury. 

‘‘(2) APPOINTMENT.—The Independent Insurance Advocate 

shall be appointed by the President, by and with the advice 

and consent of the Senate, from among persons having insurance expertise. 

‘‘(3) TERM.— 

‘‘(A) IN GENERAL.—The Independent Insurance Advocate 

shall serve a term of 6 years, unless sooner removed by the 

President upon reasons which shall be communicated to 

the Senate. 

‘‘(B) SERVICE AFTER EXPIRATION.—If a successor is not 

nominated and confirmed by the end of the term of service 

of the Independent Insurance Advocate, the person serving 

as Independent Insurance Advocate shall continue to serve 

until such time a successor is appointed and confirmed. 

‘‘(C) VACANCY.—An Independent Insurance Advocate 

who is appointed to serve the remainder of a predecessor’s 

uncompleted term shall be eligible thereafter to be appointed to a full 6 year term. 

‘‘(D) ACTING OFFICIAL ON FINANCIAL STABILITY OVERSIGHT COUNCIL.—In the event of a vacancy in the office of 

the Independent Insurance Advocate, and pending the appointment and confirmation of a successor, or during the 

absence or disability of the Independent Insurance Advocate, the Independent Member shall appoint a federal official appointed by the President and confirmed by the Senate from a member agency of the Financial Stability OverVerDate Sep 11 2014 05:01 Jun 07, 2017 Jkt 025698 PO 00000 Frm 00206 Fmt 6659 Sfmt 6602 E:\HR\OC\HR163.XXX HR163
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sight Council, not otherwise serving on the Council, who 

shall serve as a member of the Council and act in the 

place of the Independent Insurance Advocate until such 

vacancy, absence, or disability concludes. 

‘‘(4) EMPLOYMENT.—The Independent Insurance Advocate 

shall be an employee of the Federal Government within the 

definition of employee under section 2105 of title 5, United 

States Code. 

‘‘(c) INDEPENDENCE; OVERSIGHT.— ‘‘(1) INDEPENDENCE.—The Secretary of the Treasury may not 

delay or prevent the issuance of any rule or the promulgation 

of any regulation by the Independent Insurance Advocate, and 

may not intervene in any matter or proceeding before the Independent Insurance Advocate, unless otherwise specifically provided by law. 

‘‘(2) OVERSIGHT BY INSPECTOR GENERAL.—The Office of the 

Independent Insurance Advocate shall be an office in the establishment of the Department of the Treasury for purposes of 

the Inspector General Act of 1978 (5 U.S.C. App.). 

‘‘(d) RETENTION OF EXISTING STATE REGULATORY AUTHORITY.— 

Nothing in this section or section 314 shall be construed to establish or provide the Office or the Department of the Treasury with 

general supervisory or regulatory authority over the business of insurance. 

‘‘(e) BUDGET.— ‘‘(1) ANNUAL TRANSMITTAL.—For each fiscal year, the Independent Insurance Advocate shall transmit a budget estimate 

and request to the Secretary of the Treasury, which shall 

specify the aggregate amount of funds requested for such fiscal 

year for the operations of the Office of the Independent Insurance Advocate. 

‘‘(2) INCLUSIONS.—In transmitting the proposed budget to the 

President for approval, the Secretary of the Treasury shall include— 

‘‘(A) an aggregate request for the Independent Insurance 

Advocate; and 

‘‘(B) any comments of the Independent Insurance Advocate with respect to the proposal. 

‘‘(3) PRESIDENT’S BUDGET.—The President shall include in 

each budget of the United States Government submitted to the 

Congress— 

‘‘(A) a separate statement of the budget estimate prepared in accordance with paragraph (1); 

‘‘(B) the amount requested by the President for the Independent Insurance Advocate; and 

‘‘(C) any comments of the Independent Insurance Advocate with respect to the proposal if the Independent Insurance Advocate concludes that the budget submitted by the 

President would substantially inhibit the Independent Insurance Advocate from performing the duties of the office. 

‘‘(f) ASSISTANCE.—The Secretary of the Treasury shall provide the 

Independent Insurance Advocate such services, funds, facilities and 

other support services as the Independent Insurance Advocate may 

request and as the Secretary may approve. 

‘‘(g) PERSONNEL.— 

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‘‘(1) EMPLOYEES.—The Independent Insurance Advocate may 

fix the number of, and appoint and direct, the employees of the 

Office, in accordance with the applicable provisions of title 5, 

United States Code. The Independent Insurance Advocate is 

authorized to employ attorneys, analysts, economists, and 

other employees as may be deemed necessary to assist the 

Independent Insurance Advocate to carry out the duties and 

functions of the Office. Unless otherwise provided expressly by 

law, any individual appointed under this paragraph shall be an 

employee as defined in section 2105 of title 5, United States 

Code, and subject to the provisions of such title and other laws 

generally applicable to the employees of the Executive Branch. 

‘‘(2) COMPENSATION.—Employees of the Office shall be paid 

in accordance with the provisions of chapter 51 and subchapter 

III of chapter 53 of title 5, United States Code, relating to classification and General Schedule pay rates. 

‘‘(3) PROCUREMENT OF TEMPORARY AND INTERMITTENT SERV- ICES.—The Independent Insurance Advocate may procure temporary and intermittent services under section 3109(b) of title 

5, United States Code, at rates for individuals which do not exceed the daily equivalent of the annual rate of basic pay prescribed for Level V of the Executive Schedule under section 

5316 of such title. 

‘‘(4) DETAILS.—Any employee of the Federal Government 

may be detailed to the Office with or without reimbursement, 

and such detail shall be without interruption or loss of civil 

service status or privilege. An employee of the Federal Government detailed to the Office shall report to and be subject to 

oversight by the Independent Insurance Advocate during the 

assignment to the office, and may be compensated by the 

branch, department, or agency from which the employee was 

detailed. 

‘‘(5) INTERGOVERNMENTAL PERSONNEL.—The Independent Insurance Advocate may enter into agreements under subchapter 

VI of chapter 33 of title 5, United States Code, with State and 

local governments, institutions of higher education, Indian 

tribal governments, and other eligible organizations for the assignment of intermittent, part-time, and full-time personnel, on 

a reimbursable or non-reimbursable basis. 

‘‘(h) ETHICS.— 

‘‘(1) DESIGNATED ETHICS OFFICIAL.—The Legal Counsel of the 

Financial Stability Oversight Council, or in the absence of a 

Legal Counsel of the Council, the designated ethics official of 

any Council member agency, as chosen by the Independent Insurance Advocate, shall be the ethics official for the Independent Insurance Advocate. 

‘‘(2) RESTRICTION ON REPRESENTATION.—In addition to any 

restriction under section 205(c) of title18, United States Code, 

except as provided in subsections (d) through (i) of section 205 

of such title, the Independent Insurance Advocate (except in 

the proper discharge of official duties) shall not, with or without compensation, represent anyone to or before any officer or 

employee of— 

‘‘(A) the Financial Stability Oversight Council on any 

matter; or 

209 

‘‘(B) the Department of Justice with respect to litigation 

involving a matter described in subparagraph (A). 

‘‘(3) COMPENSATION FOR SERVICES PROVIDED BY ANOTHER.— For purposes of section 203 of title 18, United States Code, and 

if a special government employee— 

‘‘(A) the Independent Insurance Advocate shall not be 

subject to the restrictions of subsection (a)(1) of section 

203,of title 18, United States Code, for sharing in compensation earned by another for representations on matters covered by such section; and 

‘‘(B) a person shall not be subject to the restrictions of 

subsection (a)(2) of such section for sharing such compensation with the Independent Insurance Advocate. 

‘‘(i) ADVISORY, TECHNICAL, AND PROFESSIONAL COMMITTEES.—The 

Independent Insurance Advocate may appoint such special advisory, technical, or professional committees as may be useful in carrying out the functions of the Office and the members of such committees may be staff of the Office, or other persons, or both. 

‘‘(j) MISSION AND FUNCTIONS.— 

‘‘(1) MISSION.—In carrying out the functions under this subsection, the mission of the Office shall be to act as an independent advocate on behalf of the interests of United States 

policyholders on prudential aspects of insurance matters of importance, and to provide perspective on protecting their interests, separate and apart from any other Federal agency or 

State insurance regulator. 

‘‘(2) OFFICE.—The Office shall have the authority— 

‘‘(A) to coordinate Federal efforts on prudential aspects 

of international insurance matters, including representing 

the United States, as appropriate, in the International Association of Insurance Supervisors (or a successor entity) 

and assisting the Secretary in negotiating covered agreements (as such term is defined in subsection (q)) in coordination with States (including State insurance commissioners) and the United States Trade Representative; 

‘‘(B) to consult with the States (including State insurance regulators) regarding insurance matters of national 

importance and prudential insurance matters of international importance; 

‘‘(C) to assist the Secretary in administering the Terrorism Insurance Program established in the Department 

of the Treasury under the Terrorism Risk Insurance Act of 

2002 (15 U.S.C. 6701 note); 

‘‘(D) to observe all aspects of the insurance industry, including identifying issues or gaps in the regulation of insurers that could contribute to a systemic crisis in the insurance industry or the United States financial system; 

and 

‘‘(E) to make determinations and exercise the authority 

under subsection (m) with respect to covered agreements 

and State insurance measures. 

‘‘(3) MEMBERSHIP ON FINANCIAL STABILITY OVERSIGHT COUN- CIL.— 

‘‘(A) IN GENERAL.—The Independent Insurance Advocate 

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210 

cial Stability Act of 2010 (12 U.S.C. 5321(b)(1)(J)), as a 

member on the Financial Stability Oversight Council. 

‘‘(B) AUTHORITY.—To assist the Financial Stability Oversight Council with its responsibilities to monitor international insurance developments, advise the Congress, and 

make recommendations, the Independent Insurance Advocate shall have the authority— 

‘‘(i) to regularly consult with international insurance 

supervisors and international financial stability counterparts; 

‘‘(ii) to consult with the Board of Governors of the 

Federal Reserve System and the States with respect to 

representing the United States, as appropriate, in the 

International Association of Insurance Supervisors (including to become a non-voting member thereof), particularly on matters of systemic risk; 

‘‘(iii) to participate at the Financial Stability Board 

of The Group of Twenty and to join with other members from the United States including on matters related to insurance; and 

‘‘(iv) to participate with the United States delegation 

to the Organization for Economic Cooperation and Development and observe and participate at the Insurance and Private Pensions Committee. 

‘‘(4) LIMITATIONS ON PARTICIPATION IN SUPERVISORY COL- LEGES.—The Office may not engage in any activities that it is 

not specifically authorized to engage in under this section or 

any other provision of law, including participation in any supervisory college or other meetings or fora for cooperation and 

communication between the involved insurance supervisors established for the fundamental purpose of facilitating the effectiveness of supervision of entities which belong to an insurance 

group. 

‘‘(k) SCOPE.—The authority of the Office as specified and limited 

in this section shall extend to all lines of insurance except— 

‘‘(1) health insurance, as determined by the Secretary in coordination with the Secretary of Health and Human Services 

based on section 2791 of the Public Health Service Act (42 

U.S.C. 300gg-91); 

‘‘(2) long-term care insurance, except long-term care insurance that is included with life or annuity insurance components, as determined by the Secretary in coordination with the 

Secretary of Health and Human Services, and in the case of 

long-term care insurance that is included with such components, the Secretary shall coordinate with the Secretary of 

Health and Human Services in performing the functions of the 

Office; and 

‘‘(3) crop insurance, as established by the Federal Crop Insurance Act (7 U.S.C. 1501 et seq.). 

‘‘(l) ACCESS TO INFORMATION.—In carrying out the functions required under subsection (j), the Office may coordinate with any relevant Federal agency and any State insurance regulator (or other 

relevant Federal or State regulatory agency, if any, in the case of 

an affiliate of an insurer) and any publicly available sources for the 

provision to the Office of publicly available information. NotwithVerDate Sep 11 2014 05:01 Jun 07, 2017 Jkt 025698 PO 00000 Frm 00210 Fmt 6659 Sfmt 6602 E:\HR\OC\HR163.XXX HR163
211 

standing any other provision of law, each such relevant Federal 

agency and State insurance regulator or other Federal or State regulatory agency is authorized to provide to the Office such data or 

information. 

‘‘(m) PREEMPTION PURSUANT TO COVERED AGREEMENTS.— ‘‘(1) STANDARDS.—A State insurance measure shall be preempted pursuant to this section or section 314 if, and only to 

the extent that the Independent Insurance Advocate determines, in accordance with this subsection, that the measure— 

‘‘(A) results in less favorable treatment of a non-United 

States insurer domiciled in a foreign jurisdiction that is 

subject to a covered agreement than a United States insurer domiciled, licensed, or otherwise admitted in that 

State; and 

‘‘(B) is inconsistent with a covered agreement. 

‘‘(2) DETERMINATION.— 

‘‘(A) NOTICE OF POTENTIAL INCONSISTENCY.—Before making any determination under paragraph (1), the Independent Insurance Advocate shall— 

‘‘(i) notify and consult with the appropriate State regarding any potential inconsistency or preemption; 

‘‘(ii) notify and consult with the United States Trade 

Representative regarding any potential inconsistency 

or preemption; 

‘‘(iii) cause to be published in the Federal Register 

notice of the issue regarding the potential inconsistency or preemption, including a description of each 

State insurance measure at issue and any applicable 

covered agreement; 

‘‘(iv) provide interested parties a reasonable opportunity to submit written comments to the Office; and 

‘‘(v) consider any comments received. 

‘‘(B) SCOPE OF REVIEW.—For purposes of this subsection, 

any determination of the Independent Insurance Advocate 

regarding State insurance measures, and any preemption 

under paragraph (1) as a result of such determination, 

shall be limited to the subject matter contained within the 

covered agreement involved and shall achieve a level of 

protection for insurance or reinsurance consumers that is 

substantially equivalent to the level of protection achieved 

under State insurance or reinsurance regulation. 

‘‘(C) NOTICE OF DETERMINATION OF INCONSISTENCY.— 

Upon making any determination under paragraph (1), the 

Director shall— 

‘‘(i) notify the appropriate State of the determination 

and the extent of the inconsistency; 

‘‘(ii) establish a reasonable period of time, which 

shall not be less than 30 days, before the determination shall become effective; and 

‘‘(iii) notify the Committees on Financial Services 

and Ways and Means of the House of Representatives 

and the Committees on Banking, Housing, and Urban 

Affairs and Finance of the Senate. 

‘‘(3) NOTICE OF EFFECTIVENESS.—Upon the conclusion of the 

period referred to in paragraph (2)(C)(ii), if the basis for such 

212 

determination still exists, the determination shall become effective and the Independent Insurance Advocate shall— 

‘‘(A) cause to be published a notice in the Federal Register that the preemption has become effective, as well as 

the effective date; and 

‘‘(B) notify the appropriate State. 

‘‘(4) LIMITATION.—No State may enforce a State insurance 

measure to the extent that such measure has been preempted 

under this subsection. 

‘‘(5) APPLICABILITY OF ADMINISTRATIVE PROCEDURES ACT.— Determinations of inconsistency made pursuant to paragraph 

(2) shall be subject to the applicable provisions of subchapter 

II of chapter 5 of title 5, United States Code (relating to administrative procedure), and chapter 7 of such title (relating to 

judicial review), except that in any action for judicial review of 

a determination of inconsistency, the court shall determine the 

matter de novo. 

‘‘(n) CONSULTATION.—The Independent Insurance Advocate shall 

consult with State insurance regulators, individually or collectively, 

to the extent the Independent Insurance Advocate determines appropriate, in carrying out the functions of the Office. 

‘‘(o) NOTICES AND REQUESTS FOR COMMENT.—In addition to the 

other functions and duties specified in this section, the Independent Insurance Advocate may prescribe such notices and requests for comment in the Federal Register as are deemed necessary related to and governing the manner in which the duties 

and authorities of the Independent Insurance Advocate are carried 

out; 

‘‘(p) SAVINGS PROVISIONS.—Nothing in this section shall— 

‘‘(1) preempt— 

‘‘(A) any State insurance measure that governs any insurer’s rates, premiums, underwriting, or sales practices; 

‘‘(B) any State coverage requirements for insurance; 

‘‘(C) the application of the antitrust laws of any State to 

the business of insurance; or 

‘‘(D) any State insurance measure governing the capital 

or solvency of an insurer, except to the extent that such 

State insurance measure results in less favorable treatment of a non-United State insurer than a United States 

insurer; or 

‘‘(2) affect the preemption of any State insurance measure 

otherwise inconsistent with and preempted by Federal law. 

‘‘(q) RETENTION OF AUTHORITY OF FEDERAL FINANCIAL REGULATORY AGENCIES.—Nothing in this section or section 314 shall be 

construed to limit the authority of any Federal financial regulatory 

agency, including the authority to develop and coordinate policy, 

negotiate, and enter into agreements with foreign governments, authorities, regulators, and multinational regulatory committees and 

to preempt State measures to affect uniformity with international 

regulatory agreements. 

‘‘(r) RETENTION OF AUTHORITY OF UNITED STATES TRADE REP- RESENTATIVE.—Nothing in this section or section 314 shall be construed to affect the authority of the Office of the United States 

Trade Representative pursuant to section 141 of the Trade Act of 

1974 (19 U.S.C. 2171) or any other provision of law, including auVerDate Sep 11 2014 05:01 Jun 07, 2017 Jkt 025698 PO 00000 Frm 00212 Fmt 6659 Sfmt 6602 E:\HR\OC\HR163.XXX HR163
213 

thority over the development and coordination of United States 

international trade policy and the administration of the United 

States trade agreements program. 

‘‘(s) CONGRESSIONAL TESTIMONY.—The Independent Insurance 

Advocate shall appear before the Committee on Financial Services 

of the House of Representatives and the Committee on Banking, 

Housing, and Urban Affairs at semi-annual hearings and shall provide testimony, which shall include submitting written testimony 

in advance of such appearances to such committees and to the 

Committee on Ways and Means of the House of Representatives 

and the Committee on Finance of the Senate, on the following matters: 

‘‘(1) OFFICE ACTIVITIES.—The efforts, activities, objectives, 

and plans of the Office. 

‘‘(2) SECTION 313(L) ACTIONS.—Any actions taken by the Office 

pursuant to subsection (l) (regarding preemption pursuant to 

covered agreements). 

‘‘(3) INSURANCE INDUSTRY.—The state of, and developments 

in, the insurance industry. 

‘‘(4) U.S. AND GLOBAL INSURANCE AND REINSURANCE MAR- KETS.—The breadth and scope of the global insurance and reinsurance markets and the critical role such markets plays in 

supporting insurance in the United States and the ongoing impacts of part II of the Nonadmitted and Reinsurance Reform 

Act of 2010 on the ability of State regulators to access reinsurance information for regulated companies in their jurisdictions. 

‘‘(5) OTHER.—Any other matters as deemed relevant by the 

Independent Insurance Advocate or requested by such Committees. 

‘‘(t) REPORT UPON END OF TERM OF OFFICE.—Not later than two 

months prior to the expiration of the term of office, or discontinuation of service, of each individual serving as the Independent Insurance Advocate, the Independent Insurance Advocate shall submit a report to the Committees on Financial Services and Ways 

and Means of the House of Representatives and the Committees on 

Banking, Housing, and Urban Affairs and Finance of the Senate 

setting forth recommendations regarding the Financial Stability 

Oversight Council and the role, duties, and functions of the Independent Insurance Advocate. 

‘‘(u) DEFINITIONS.—In this section and section 314, the following 

definitions shall apply: 

‘‘(1) AFFILIATE.—The term ‘affiliate’ means, with respect to 

an insurer, any person who controls, is controlled by, or is 

under common control with the insurer. 

‘‘(2) COVERED AGREEMENT.—The term ‘covered agreement’ 

means a written bilateral or multilateral agreement regarding 

prudential measures with respect to the business of insurance 

or reinsurance that— 

‘‘(A) is entered into between the United States and one 

or more foreign governments, authorities, or regulatory entities; and 

‘‘(B) relates to the recognition of prudential measures 

with respect to the business of insurance or reinsurance 

that achieves a level of protection for insurance or reinsurance consumers that is substantially equivalent to the 

214 

level of protection achieved under State insurance or reinsurance regulation. 

‘‘(3) INSURER.—The term ‘insurer’ means any person engaged 

in the business of insurance, including reinsurance. 

‘‘(4) FEDERAL FINANCIAL REGULATORY AGENCY.—The term 

‘Federal financial regulatory agency’ means the Department of 

the Treasury, the Board of Governors of the Federal Reserve 

System, the Office of the Comptroller of the Currency, the Office of Thrift Supervision, the Securities and Exchange Commission, the Commodity Futures Trading Commission, the 

Federal Deposit Insurance Corporation, the Federal Housing 

Finance Agency, or the National Credit Union Administration. 

‘‘(5) FINANCIAL STABILITY OVERSIGHT COUNCIL.—The term ‘Financial Stability Oversight Council ’ means the Financial Stability Oversight Council established under section 111(a) of the 

Dodd-Frank Wall Street Reform and Consumer Protection Act 

(12 U.S.C. 5321(a)). 

‘‘(6) MEMBER AGENCY.—The term ‘member agency’ has the 

meaning given such term in section 111(a) of the Dodd-Frank 

Wall Street Reform and Consumer Protection Act (12 U.S.C. 

5321(a)). 

‘‘(7) NON-UNITED STATES INSURER.—The term ‘non-United 

States insurer’ means an insurer that is organized under the 

laws of a jurisdiction other than a State, but does not include 

any United States branch of such an insurer. 

‘‘(8) OFFICE.—The term ‘Office’ means the Office of the Independent Insurance Advocate established by this section. 

‘‘(9) STATE INSURANCE MEASURE.—The term ‘State insurance 

measure’ means any State law, regulation, administrative ruling, bulletin, guideline, or practice relating to or affecting prudential measures applicable to insurance or reinsurance. 

‘‘(10) STATE INSURANCE REGULATOR.—The term ‘State insurance regulator’ means any State regulatory authority responsible for the supervision of insurers. 

‘‘(11) SUBSTANTIALLY EQUIVALENT TO THE LEVEL OF PROTECTION ACHIEVED.—The term ‘substantially equivalent to the 

level of protection achieved’ means the prudential measures of 

a foreign government, authority, or regulatory entity achieve a 

similar outcome in consumer protection as the outcome 

achieved under State insurance or reinsurance regulation. 

‘‘(12) UNITED STATES INSURER.—The term ‘United States insurer’ means— 

‘‘(A) an insurer that is organized under the laws of a 

State; or 

‘‘(B) a United States branch of a non-United States insurer.’’. 

(b) PAY AT LEVEL III OF EXECUTIVE SCHEDULE.—Section 5314 of 

title 5, United States Code, is amended by adding at the end the 

following new item: 

‘‘Independent Insurance Advocate, Department of the Treasury.’’. 

(c) INDEPENDENCE.—Section 111 of Public Law 93–495 (12 U.S.C. 

250) is amended— 

215 

(1) by inserting ‘‘the Independent Insurance Advocate of the 

Department of the Treasury,’’ after ‘‘Federal Housing Finance 

Agency,’’; and 

(2) by inserting ‘‘or official’’ before ‘‘submitting them’’. 

(d) TRANSFER OF EMPLOYEES.—All employees of the Department 

of Treasury who are performing staff functions for the independent 

member of the Financial Stability Oversight Council under section 

111(b)(2)(J) of the Dodd-Frank Wall Street Reform and Consumer 

Protection Act (12 U.S.C. 5321(b)(2)(J)) on a full-time equivalent 

basis as of the date of enactment of this Act shall be eligible for 

transfer to the Office of the Independent Insurance Advocate established pursuant to the amendment made by subsection (a) of this 

section for appointment as an employee and shall be transferred at 

the joint discretion of the Independent Insurance Advocate and the 

eligible employee. Any employee eligible for transfer that is not appointed within 360 days from the date of enactment of this Act 

shall be eligible for detail under section 313(f)(4) of title 31, United 

States Code. 

(e) TEMPORARY SERVICE; TRANSITION.—Notwithstanding the 

amendment made by subsection (a) of this section, during the period beginning on the date of the enactment of this Act and ending 

on the date on which the Independent Insurance Advocate is appointed and confirmed pursuant to section 313(b)(2) of title 31, 

United States Code, as amended by such amendment, the person 

serving, on such date of enactment, as the independent member of 

the Financial Stability Oversight Council pursuant to section 

111(b)(1)(J) of the Dodd-Frank Wall Street Reform and Consumer 

Protection Act (12 U.S.C. 5321(b)(1)(J)) shall act for all purposes 

as, and with the full powers of, the Independent Insurance Advocate. 

(f) COMPARABILITY IN COMPENSATION SCHEDULES.—Subsection (a) 

of section 1206 of the Financial Institutions Reform, Recovery, and 

Enforcement Act of 1989 (12 U.S.C. 1833b(a)), as amended by section 711(c)(11)(D), is further amended by inserting ‘‘the Office of 

the Independent Insurance Advocate of the Department of the 

Treasury,’’ before ‘‘and the Farm Credit Administration,’’. 

(g) SENIOR EXECUTIVES.—Subparagraph (D) of section 3132(a)(1) 

of title 5, United States Code, is amended by inserting ‘‘the Office 

of the Independent Insurance Advocate of the Department of the 

Treasury,’’ after ‘‘Finance Agency,’’. 

SEC. 1102. TREATMENT OF COVERED AGREEMENTS. 

Subsection (c) of section 314 of title 31, United States Code is 

amended— 

(1) by redesignating paragraphs (1) and (2) as paragraphs (2) 

and (3), respectively; and 

(2) by inserting before paragraph (2), as so redesignated, the 

following new paragraph: 

‘‘(1) the Secretary of the Treasury and the United States 

Trade Representative have caused to be published in the Federal Register, and made available for public comment for a period of not fewer than 30 days and not greater than 90 days 

(which period may run concurrently with the 90-day period for 

the covered agreement referred to in paragraph (3)), the proposed text of the covered agreement;’’. 

216 

TITLE XII—TECHNICAL CORRECTIONS 

SEC. 1201. TABLE OF CONTENTS; DEFINITIONAL CORRECTIONS. 

(a) TABLE OF CONTENTS.—The table of contents for the DoddFrank Wall Street Reform and Consumer Protection Act (Public 

Law 111–203; 124 Stat. 1376) is amended by striking the items relating to sections 407 through 414 and inserting the following: 

‘‘Sec. 407. Exemption of and reporting by venture capital fund advisers. 

‘‘Sec. 408. Exemption of and reporting by certain private fund advisers. 

‘‘Sec. 409. Family offices. 

‘‘Sec. 410. State and Federal responsibilities; asset threshold for Federal registration of investment advisers. 

‘‘Sec. 411. Custody of client assets. 

‘‘Sec. 414. Rule of construction relating to the Commodity Exchange Act. 

‘‘Sec. 418. Qualified client standard. 

‘‘Sec. 419. Transition period.’’. 

(b) DEFINITIONS.—Section 2 of the Dodd-Frank Wall Street Reform and Consumer Protection Act (12 U.S.C. 5301) is amended— 

(1) in paragraph (1)— 

(A) by striking ‘‘section 3’’ and inserting ‘‘section 3(w)’’; 

and 

(B) by striking ‘‘(12 U.S.C. 1813)’’ and inserting ‘‘(12 

U.S.C. 1813(w))’’; 

(2) in paragraph (6), by striking ‘‘1 et seq.’’ and inserting 

‘‘1a’’; and 

(3) in paragraph (18)(A)— 

(A) by striking ‘‘ ‘bank holding company’,’’; and 

(B) by inserting ‘‘ ‘includes’,’’ before ‘‘ ‘including’,’’. 

SEC. 1202. ANTITRUST SAVINGS CLAUSE CORRECTIONS. 

Section 6 of the Dodd-Frank Wall Street Reform and Consumer 

Protection Act (12 U.S.C. 5303) is amended, in the second sentence— 

(1) by inserting ‘‘(15 U.S.C. 12(a))’’ after ‘‘Clayton Act’’; and 

(2) by striking ‘‘Act, to’’ and inserting ‘‘Act (15 U.S.C. 45) to’’. 

SEC. 1203. TITLE I CORRECTIONS. 

Title I of the Dodd-Frank Wall Street Reform and Consumer Protection Act (12 U.S.C. 5311 et seq.) is amended— 

(1) in section 102(a)(6) (12 U.S.C. 5311(a)(6)), by inserting 

‘‘(12 U.S.C. 1843(k))’’ after ‘‘of 1956’’ each place that term appears; 

(2) in section 111(c)(3) (12 U.S.C. 5321(c)(3)), by striking 

‘‘that agency or department head’’ and inserting ‘‘the head of 

that member agency or department’’; 

(3) in section 112 (12 U.S.C. 5322)— 

(A) in subsection (a)(2)— 

(i) in subparagraph (C) (as redesignated by section 

151)— 

(I) by striking ‘‘to monitor’’ and inserting ‘‘monitor’’; and 

(II) by striking ‘‘to advise’’ and inserting ‘‘advise’’; 

(ii) in subparagraph (H) (as redesignated by section 

151), by striking ‘‘may’’; and 

217 

(B) in subsection (d)(5), by striking ‘‘subsection and subtitle B’’ each place such term appears and inserting ‘‘subtitle’’; and 

(4) in section 171(b)(4)(D) (12 U.S.C. 5371(b)(4)(D)), by adding a period at the end. 

SEC. 1204. TITLE III CORRECTIONS. 

(a) IN GENERAL.—Title III of the Dodd-Frank Wall Street Reform 

and Consumer Protection Act (12 U.S.C. 5401 et seq.) is amended— 

(1) in section 327(b)(5) (12 U.S.C. 5437(b)(5)), by striking ‘‘in’’ 

and inserting ‘‘into’’; 

(2) in section 333(b)(2) (124 Stat. 1539), by inserting ‘‘the second place that term appears’’ before ‘‘and inserting’’; and 

(3) in section 369(5) (124 Stat. 1559)— 

(A) in subparagraph (D)(i)— 

(i) in subclause (III), by redesignating items (aa), 

(bb), and (cc) as subitems (AA), (BB), and (CC), respectively, and adjusting the margins accordingly; 

(ii) in subclause (IV), by redesignating items (aa) 

and (bb) as subitems (AA) and (BB), respectively, and 

adjusting the margins accordingly; 

(iii) in subclause (V), by redesignating items (aa), 

(bb), and (cc) as subitems (AA), (BB), and (CC), respectively, and adjusting the margins accordingly; and 

(iv) by redesignating subclauses (III), (IV), and (V) 

as items (bb), (cc), and (dd), respectively, and adjusting the margins accordingly; 

(B) in subparagraph (F)— 

(i) in clause (ii), by adding ‘‘and’’ at the end; 

(ii) in clause (iii), by striking ‘‘and’’ at the end and 

inserting a semicolon; and 

(iii) by striking clause (iv); and 

(C) in subparagraph (G)(i), by inserting ‘‘each place such 

term appears’’ before ‘‘and inserting’’. 

(b) EFFECTIVE DATES.— 

(1) SECTION 333.—The amendment made by subsection (a)(2) 

of this section shall take effect as though enacted as part of 

subtitle C of title III of the Dodd-Frank Wall Street Reform 

and Consumer Protection Act (124 Stat. 1538). 

(2) SECTION 369.—The amendments made by subsection (a)(3) 

of this section shall take effect as though enacted as part of 

subtitle E of title III of the Dodd-Frank Wall Street Reform 

and Consumer Protection Act (124 Stat. 1546). 

SEC. 1205. TITLE IV CORRECTION. 

Section 414 of the Dodd-Frank Wall Street Reform and Consumer Protection Act (124 Stat. 1578) is amended in the section 

heading by striking ‘‘COMMODITIES’’ and inserting ‘‘COMMODITY’’. 

SEC. 1206. TITLE VI CORRECTIONS. 

(a) IN GENERAL.—Section 610 of the Dodd-Frank Wall Street Reform and Consumer Protection Act (124 Stat. 1596) is amended— 

(1) by striking subsection (b); and 

(2) by redesignating subsection (c) as subsection (b). 

(b) EFFECTIVE DATE.—The amendments made by subsection (a) 

of this section shall take effect as though enacted as part of section 

218 

610 of the Dodd-Frank Wall Street Reform and Consumer Protection Act (124 Stat. 1611). 

SEC. 1207. TITLE VII CORRECTIONS. 

(a) IN GENERAL.—Title VII of the Dodd-Frank Wall Street Reform and Consumer Protection Act (15 U.S.C. 8301 et seq.) is 

amended— 

(1) in section 719(c)(1)(B) (15 U.S.C. 8307(c)(1)(B)), by adding 

a period at the end; 

(2) in section 723(a)(1)(B) (124 Stat. 1675), by inserting ‘‘, as 

added by section 107 of the Commodity Futures Modernization 

Act of 2000 (Appendix E of Public Law 106–554; 114 Stat. 

2763A–382),’’ after ‘‘subsection (i)’’; 

(3) in section 724(a), by striking ‘‘adding at the end’’ and inserting ‘‘inserting after subsection (e)’’; 

(4) in section 734(b)(1) (124 Stat. 1718), by striking ‘‘is 

amended’’ and all that follows through ‘‘(B) in’’ and inserting 

‘‘is amended in’’; 

(5) in section 741(b)(10) (124 Stat. 1732), by striking 

‘‘1a(19)(A)(iv)(II)’’ each place it appears and inserting 

‘‘1a(18)(A)(iv)(II)’’; and 

(6) in section 749 (124 Stat. 1746)— 

(A) in subsection (a)(2), by striking ‘‘adding at the end’’ 

and inserting ‘‘inserting after subsection (f)’’; and 

(B) in subsection (h)(1)(B), by inserting ‘‘the second place 

that term appears’’ before the semicolon. 

(b) EFFECTIVE DATE.—The amendments made by paragraphs (3), 

(4), (5), and (6) of subsection (a) of this section shall take effect as 

though enacted as part of part II of subtitle A of title VII of the 

Dodd-Frank Wall Street Reform and Consumer Protection Act (124 

Stat. 1658). 

SEC. 1208. TITLE IX CORRECTIONS. 

Section 939(h)(1) of the Dodd-Frank Wall Street Reform and Consumer Protection Act (124 Stat. 1887) is amended— 

(1) in the matter preceding subparagraph (A), by inserting 

‘‘The’’ before ‘‘Commission’’; and 

(2) by striking ‘‘feasability’’ and inserting ‘‘feasibility’’. 

SEC. 1209. TITLE X CORRECTIONS. 

(a) IN GENERAL.—Title X of the Dodd-Frank Wall Street Reform 

and Consumer Protection Act (12 U.S.C. 5481 et seq.) is amended— 

(1) in section 1002(12)(G) (12 U.S.C. 5481(12)(G)), by striking 

‘‘Home Owners’’ and inserting ‘‘Homeowners’’; 

(2) in section 1013(a)(1)(C) (12 U.S.C. 5493(a)(1)(C)), by 

striking ‘‘section 11(1) of the Federal Reserve Act (12 U.S.C. 

248(1))’’ and inserting ‘‘subsection (l) of section 11 of the Federal Reserve Act (12 U.S.C. 248(l)’’; 

(3) in section 1017(a)(2) (as so redesignated by section 712) 

(12 U.S.C. 5497(a)(5))— 

(A) in subparagraph (A), in the last sentence by striking 

‘‘716(c) of title 31, United States Code’’ and inserting ‘‘716 

of title 31, United States Code’’; and 

(B) in subparagraph (C), by striking ‘‘section 3709 of the 

Revised Statutes of the United States (41 U.S.C. 5)’’ and 

inserting ‘‘section 6101 of title 41, United States Code’’; 

219 

(4) in section 1027(d)(1)(B) (12 U.S.C. 5517(d)(1)(B)), by inserting a comma after ‘‘(A)’’; 

(5) in section 1029(d) (12 U.S.C. 5519(d)), by striking the period after ‘‘Commission Act’’; 

(6) in section 1061(b)(7) (12 U.S.C. 5581(b)(7))— 

(A) by striking ‘‘Secretary of the Department of Housing 

and Urban Development’’ each place that term appears 

and inserting ‘‘Department of Housing and Urban Development’’; and 

(B) in subparagraph (A), by striking ‘‘(12 U.S.C. 5102 et 

seq.)’’ and inserting ‘‘(12 U.S.C. 5101 et seq.)’’; 

(7) in section 1063 (12 U.S.C. 5583)— 

(A) in subsection (f)(1)(B), by striking ‘‘that’’; and 

(B) in subsection (g)(1)(A)— 

(i) by striking ‘‘(12 U.S.C. 5102 et seq.)’’ and inserting ‘‘(12 U.S.C. 5101 et seq.)’’; and 

(ii) by striking ‘‘seq)’’ and inserting ‘‘seq.)’’; 

(8) in section 1064(i)(1)(A)(iii) (12 U.S.C. 5584(i)(1)(A)(iii)), by 

inserting a period before ‘‘If an’’; 

(9) in section 1073(c)(2) (12 U.S.C. 5601(c)(2))— 

(A) in the paragraph heading, by inserting ‘‘AND EDUCATION’’ after ‘‘FINANCIAL LITERACY’’; and 

(B) by striking ‘‘its duties’’ and inserting ‘‘their duties’’; 

(10) in section 1076(b)(1) (12 U.S.C. 5602(b)(1)), by inserting 

before the period at the end the following: ‘‘, the Agency may, 

after notice and opportunity for comment, prescribe regulations’’; 

(11) in section 1077(b)(4)(F) (124 Stat. 2076), by striking ‘‘associates’’ and inserting ‘‘associate’s’’; 

(12) in section 1084(1) (124 Stat. 2081), by inserting a 

comma after ‘‘2009)’’; 

(13) in section 1089 (124 Stat. 2092)— 

(A) in paragraph (3)— 

(i) in subparagraph (A), by striking ‘‘and’’ at the end; 

and 

(ii) in subparagraph (B)(vi), by striking the period at 

the end and inserting ‘‘; and’’; and 

(B) by redesignating paragraph (4) as subparagraph (C) 

and adjusting the margins accordingly; and 

(14) in section 1098(6) (124 Stat. 2104), by inserting ‘‘the 

first place that term appears’’ before ‘‘and’’. 

(b) EFFECTIVE DATE.—The amendments made by paragraphs 

(11), (12), (13), (14), and (15) of subsection (a) shall take effect as 

though enacted as part of subtitle H of title X of the Dodd-Frank 

Wall Street Reform and Consumer Protection Act (124 Stat. 2080). 

SEC. 1210. TITLE XII CORRECTION. 

Title XII of the Dodd-Frank Wall Street Reform and Consumer 

Protection Act (124 Stat. 2129) is amended, in section 1208(b) (12 

U.S.C. 5626(b)), by inserting ‘‘, as defined in section 103(10) of the 

Riegle Community Development and Regulatory Improvement Act 

of 1994 (12 U.S.C. 4702(10)),’’ after ‘‘appropriated to the Fund’’. 

220 

SEC. 1211. TITLE XIV CORRECTION. 

Title XIV of the Dodd-Frank Wall Street Reform and Consumer 

Protection Act (124 Stat. 2136) is amended, in section 1451(c) (12 

U.S.C. 1701x–1(c)), by striking ‘‘pursuant’’. 

SEC. 1212. TECHNICAL CORRECTIONS TO OTHER STATUTES. 

(a) ALTERNATIVE MORTGAGE TRANSACTION PARITY ACT OF

1982.—The Alternative Mortgage Transaction Parity Act of 1982 

(12 U.S.C. 3801 et seq.) is amended— 

(1) in section 802(a)(3) (12 U.S.C. 3801(a)(3)), by striking 

‘‘the Director of the Office of Thrift Supervision’’ and inserting 

‘‘the Consumer Law Enforcement Agency’’; 

(2) in section 804 (12 U.S.C. 3803)— 

(A) in subsection (a), by striking ‘‘the Director of the Office of Thrift Supervision’’ each place such term appears 

and inserting ‘‘the Comptroller of the Currency’’; and 

(B) in subsection (d)(1), by striking the comma after ‘‘Administration’’. 

(b) BANK HOLDING COMPANY ACT AMENDMENTS OF 1970.—Section 106(b)(1) of the Bank Holding Company Act Amendments of 

1970 (12 U.S.C. 1972(1)) is amended, in the undesignated matter 

at the end, by striking ‘‘Federal Deposit Insurance Company’’ and 

inserting ‘‘Federal Deposit Insurance Corporation’’. 

(c) BALANCED BUDGET AND EMERGENCY DEFICIT CONTROL ACT.— 

Section 255(g)(1)(A) of the Balanced Budget and Emergency Deficit 

Control Act of 1985 (2 U.S.C. 905(g)(1)(A)) is amended by striking 

‘‘Office of Thrift Supervision (20–4108–0–3–373).’’. 

(d) BRETTON WOODS AGREEMENTS ACT.—Section 68(a)(1) of the 

Bretton Woods Agreements Act (22 U.S.C. 286tt(a)(1)) is amended 

by striking ‘‘Fund ,’’ and inserting ‘‘Fund,’’. 

(e) CAN–SPAM ACT OF 2003.—Section 7(b)(1)(D) of the CAN– 

SPAM Act of 2003 (15 U.S.C. 7706(b)(1)(D)) is amended by striking 

‘‘Director of the Office of Thrift Supervision’’ and inserting ‘‘Comptroller of the Currency or the Board of Directors of Federal Deposit 

Insurance Corporation, as applicable’’. 

(f) CHILDREN’S ONLINE PRIVACY PROTECTION ACT OF 1998.—Section 1306(b)(2) of the Children’s Online Privacy Protection Act of 

1998 (15 U.S.C. 6505(b)(2)) is amended by striking ‘‘Director of the 

Office of Thrift Supervision’’ and inserting ‘‘Comptroller of the Currency or the Board of Directors of Federal Deposit Insurance Corporation, as applicable’’. 

(g) COMMUNITY REINVESTMENT ACT OF 1977.—The Community 

Reinvestment Act of 1977 (12 U.S.C. 2901 et seq.) is amended— 

(1) in section 803(1)(C) (12 U.S.C. 2902(1)(C)), by striking the 

period at the end and inserting a semicolon; and 

(2) in section 806 (12 U.S.C. 2905), by striking ‘‘companies,,’’ 

and inserting ‘‘companies,’’. 

(h) CREDIT REPAIR ORGANIZATIONS ACT.—Section 403(4) of the 

Credit Repair Organizations Act (15 U.S.C. 1679a(4)) is amended 

by striking ‘‘103(e)’’ and inserting ‘‘103(f)’’. 

(i) DEPOSITORY INSTITUTION MANAGEMENT INTERLOCKS ACT.— 

Section 205(9) of the Depository Institution Management Interlocks 

Act (12 U.S.C. 3204(9)) is amended by striking ‘‘Director of the Office of Thrift Supervision’’ and inserting ‘‘appropriate Federal banking agency’’. 

221 

(j) ECONOMIC GROWTH AND REGULATORY PAPERWORK REDUCTION

ACT OF 1996.—Section 2227(a)(1) of the Economic Growth and Regulatory Paperwork Reduction Act of 1996 (12 U.S.C. 252(a)(1)) is 

amended by striking ‘‘the Director of the Office of Thrift Supervision,’’. 

(k) ELECTRONIC FUND TRANSFER ACT.—The Electronic Fund 

Transfer Act (15 U.S.C. 1693 et seq.) is amended— 

(1) in section 903 (15 U.S.C. 1693a)— 

(A) in paragraph (2), by striking ‘‘103(i)’’ and inserting 

‘‘103(j)’’; and 

(B) by redesignating the first paragraph designated as 

paragraph (4) (defining the term ‘‘Board’’), as paragraph 

(3); 

(2) in section 904(a) (15 U.S.C. 1693b(a))— 

(A) by redesignating the second paragraph designated as 

paragraph (1) (relating to consultation with other agencies), the second paragraph designated as paragraph (2) 

(relating to the preparation of an analysis of economic impact), paragraph (3), and paragraph (4), as subparagraphs 

(A), (B), (C), and (D), respectively, and adjusting the margins accordingly; 

(B) by striking ‘‘In prescribing such regulations, the 

Board shall:’’ and inserting the following: 

‘‘(3) REGULATIONS.—In prescribing regulations under this 

subsection, the Agency and the Board shall—’’; 

(C) in paragraph (3)(C), as so redesignated, by striking 

‘‘the Board shall’’; and 

(D) in paragraph (3)(D), as so redesignated— 

(i) by inserting ‘‘send promptly’’ before ‘‘any’’; and 

(ii) by striking ‘‘shall be sent promptly to Congress 

by the Board’’ and inserting ‘‘to Congress’’; 

(3) in section 909(c) (15 U.S.C. 1693g(c)), by striking ‘‘103(e)’’ 

and inserting ‘‘103(f)’’; 

(4) in section 918(a)(4) (15 U.S.C. 1693o(a)(4), by striking 

‘‘Act and’’ and inserting ‘‘Act; and’’; 

(5) by redesignating the section added by section 1073(4) of 

the Dodd-Frank Wall Street Reform and Consumer Protection 

Act (relating to remittance transfers) (15 U.S.C. 1693o–1) as 

section 920 of the Electronic Fund Transfer Act; 

(6) by redesignating the section headed ‘‘Reasonable fees and 

rules for payment card transaction’’ (15 U.S.C. 1693o–2) as section 921 of the Electronic Fund Transfer Act; 

(7) by redesignating the section headed ‘‘Relation to State 

laws’’ (15 U.S.C. 1693q) as section 922 of the Electronic Fund 

Transfer Act; 

(8) by redesignating the section headed ‘‘Exemption for State 

regulation’’ (15 U.S.C. 1693r) as section 923 of the Electronic 

Fund Transfer Act; and 

(9) by redesignating the section headed ‘‘Effective date’’ (15 

U.S.C. 1693 note) as section 924 of the Electronic Fund Transfer Act. 

(l) EMERGENCY ECONOMIC STABILIZATION ACT OF 2008.—Section 

101(b) of the Emergency Economic Stabilization Act of 2008 (12 

U.S.C. 5211(b)) is amended by striking ‘‘the Director of the Office 

of Thrift Supervision,’’. 

222 

(m) EQUAL CREDIT OPPORTUNITY ACT.—The Equal Credit Opportunity Act (15 U.S.C. 1691 et seq.) is amended— 

(1) in section 703 (15 U.S.C. 1691b)— 

(A) in each of subsections (c) and (d), by striking ‘‘paragraph’’ each place that term appears and inserting ‘‘subsection’’; and 

(B) in subsection (g), by adding a period at the end; 

(2) in section 704 (15 U.S.C. 1691c)— 

(A) in subsection (a)— 

(i) by striking ‘‘Consumer Protection Financial Protection Act of 2010 with’’ and inserting ‘‘Consumer Financial Protection Act of 2010, compliance with’’; 

(ii) in paragraph (1)— 

(I) by striking ‘‘section 8’’ and inserting ‘‘Section 

8’’; and 

(II) in subparagraph (C), by striking ‘‘banks;’’ 

and inserting ‘‘banks.’’; 

(iii) in each of paragraphs (6) and (7), by striking 

the semicolon at the end and inserting a period; and 

(iv) in paragraph (8), by striking ‘‘; and’’ and inserting a period; and 

(B) in subsection (c), in the second sentence, by striking 

‘‘subchapter’’ and inserting ‘‘title’’; and 

(3) in section 706(k) (15 U.S.C. 1691e(k)), by striking ‘‘, (2), 

or (3)’’ and inserting ‘‘or (2)’’. 

(n) EXPEDITED FUNDS AVAILABILITY ACT.—The Expedited Funds 

Availability Act (12 U.S.C. 4001 et seq.) is amended— 

(1) in section 605(f)(2)(A) (12 U.S.C. 4004(f)(2)(A)), by striking ‘‘,,’’ and inserting a semicolon; and 

(2) in section 610(a)(2) (12 U.S.C. 4009(a)(2)), by striking ‘‘Director of the Office of Thrift Supervision’’ and inserting ‘‘Comptroller of the Currency and the Board of Directors of the Federal Deposit Insurance Corporation, as appropriate,’’. 

(o) FAIR CREDIT REPORTING ACT.—The Fair Credit Reporting Act 

(15 U.S.C. 1681 et seq.) is amended— 

(1) in section 603 (15 U.S.C. 1681a)— 

(A) in subsection (d)(2)(D), by striking ‘‘(x)’’ and inserting 

‘‘(y)’’; 

(B) in subsection (q)(5), by striking ‘‘103(i)’’ and inserting 

‘‘103(j)’’; and 

(C) in subsection (v), by striking ‘‘Bureau’’ and inserting 

‘‘Federal Trade Commission’’; 

(2) in section 604 (15 U.S.C. 1681b)— 

(A) in subsection (b)— 

(i) in paragraph (2)(B)(i), by striking ‘‘section 

615(a)(3)’’ and inserting ‘‘section 615(a)(4)’’; 

(ii) in paragraph (3)(B)(ii), by striking ‘‘clause 

(B)(i)(IV)’’ and inserting ‘‘clause (i)(IV)’’; 

(iii) in paragraph (4)(A)(ii), by inserting ‘‘and’’ after 

the semicolon; and 

(iv) by striking ‘‘section 609(c)(3)’’ each place that 

term appears and inserting ‘‘section 609(c)’’; and 

(B) in subsection (g)(5), by striking ‘‘PARAGRAPH (2).—’’ 

and all that follows through ‘‘The Bureau’’ and inserting 

‘‘PARAGRAPH (2).—The Agency’’; 

223 

(3) in section 605 (15 U.S.C. 1681c)— 

(A) in subsection (f), by striking ‘‘who’’ and inserting 

‘‘which’’; and 

(B) in subsection (h)(2)(A)— 

(i) by striking ‘‘shall,,’’ and inserting ‘‘shall,’’; and 

(ii) by striking ‘‘Commission,,’’ and inserting ‘‘Commission,’’; 

(4) in paragraphs (1)(A), (1)(B)(i), (2)(A)(i), and (2)(B) of section 605A(h) (15 U.S.C. 1681c–1(h))— 

(A) by striking ‘‘103(i)’’ each place that term appears and 

inserting ‘‘103(j)’’ ; and 

(B) by striking ‘‘open-end’’ each place that term appears 

and inserting ‘‘open end’’; 

(5) in section 607(e)(3)(A) (15 U.S.C. 1681e(e)(3)(A)), by striking ‘‘section 604(b)(4)(E)(i)’’ and inserting ‘‘section 

604(b)(4)(D)(i)’’; 

(6) in section 609 (15 U.S.C. 1681g)— 

(A) in subsection (a)(3)(C)(i), by striking ‘‘section 

604(b)(4)(E)(i)’’ and inserting ‘‘section 604(b)(4)(D)(i)’’; 

(B) in subsection (c)(1)— 

(i) in the paragraph heading, by striking ‘‘COMMIS- SION’’ and inserting ‘‘BUREAU’’; and 

(ii) in subparagraph (B)(vi), by striking ‘‘603(w)’’ and 

inserting ‘‘603(x)’’; 

(C) in subsection (e)(2)(B)(ii)(II), by striking ‘‘an’’; and 

(D) by striking ‘‘The Commission’’ each place that term 

appears and inserting ‘‘The Bureau’’; 

(7) in section 610 (15 U.S.C. 1681h)— 

(A) in subsection (b)(1), by inserting ‘‘section’’ after 

‘‘under’’; and 

(B) in subsection (e), by inserting a comma after ‘‘on the 

report’’; 

(8) in section 611 (15 U.S.C. 1681i), by striking ‘‘The Commission’’ each place that term appears and inserting ‘‘The 

Agency’’; 

(9) in section 612 (15 U.S.C. 1681j)— 

(A) in subsection (a)(1)— 

(i) by striking ‘‘(w)’’ and inserting ‘‘(x)’’; and 

(ii) in subparagraph (C), by striking ‘‘603(w)’’ each 

place that term appears and inserting ‘‘603(x)’’; 

(B) in subsection (g), by striking ‘‘televison’’ and inserting ‘‘television’’; and 

(C) by striking ‘‘The Commission’’ each place that term 

appears and inserting ‘‘The Bureau’’; 

(10) in section 621 (15 U.S.C. 1681s)— 

(A) in subsection (a)(1), in the first sentence, by striking 

‘‘, subsection (b)’’; 

(B) in subsection (e)(2), by inserting a period after ‘‘provisions of this title’’; and 

(C) in subsection (f)(2), by striking ‘‘The Commission’’ 

and inserting ‘‘The Agency’’ and 

(11) in section 623(a)(5) (15 U.S.C. 1681s–2(a)(5)), by striking 

‘‘OF ACCOUNTS.—(A) IN GENERAL.—A person’’ and inserting ‘‘OF

ACCOUNTS.— 

‘‘(A) IN GENERAL.—A person’’. 

224 

(p) FEDERAL CREDIT UNION ACT.—Section 206(g)(7)(D)(iv) of the 

Federal Credit Union Act (12 U.S.C. 1786(g)(7)(D)(iv)) is amended 

by striking the semicolon at the end and inserting a period. 

(q) FEDERAL DEPOSIT INSURANCE ACT.—The Federal Deposit Insurance Act (12 U.S.C. 1811 et seq.) is amended— 

(1) in section 3(q)(2)(C) (12 U.S.C. 1813(q)(2)(C)), by adding 

‘‘and’’ at the end; 

(2) in section 7 (12 U.S.C. 1817)— 

(A) in subsection (b)(2)— 

(i) in subparagraph (A), by striking ‘‘(D)’’ and inserting ‘‘(C)’’; and 

(ii) by redesignating subparagraphs (D) and (E) as 

subparagraphs (C) and (D), respectively; and 

(B) in subsection (e)(2)(C), by adding a period at the end; 

(3) in section 8 (12 U.S.C. 1818)— 

(A) in subsection (b)(3), by striking ‘‘Act))’’ and inserting 

‘‘Act)’’; and 

(B) in subsection (t)(2)(C), by striking ‘‘depositors or’’ and 

inserting ‘‘depositors; or’’; 

(4) in section 11 (12 U.S.C. 1821)— 

(A) in subsection (d)(2)(I)(ii), by striking ‘‘and section 

21A(b)(4)’’; and 

(B) in subsection (m), in each of paragraphs (16) and 

(18), by striking the comma after ‘‘Comptroller of the Currency’’ each place it appears; and 

(5) in section 26(a) (12 U.S.C. 1831c(a)), by striking ‘‘Holding 

Company Act’’ each place that term appears and inserting 

‘‘Holding Company Act of 1956’’. 

(r) FEDERAL FIRE PREVENTION AND CONTROL ACT OF 1974.—Section 31(a)(5)(B) of the Federal Fire Prevention and Control Act of 

1974 (15 U.S.C. 2227(a)(5)(B)) is amended by striking ‘‘the Federal 

Deposit Insurance Corporation’’ and all that follows through the period and inserting ‘‘or the Federal Deposit Insurance Corporation 

under the affordable housing program under section 40 of the Federal Deposit Insurance Act.’’. 

(s) FEDERAL HOME LOAN BANK ACT.—The Federal Home Loan 

Bank Act (12 U.S.C. 1421 et seq.) is amended— 

(1) in section 10(h)(1) (12 U.S.C. 1430(h)(1)), by striking ‘‘Director of the Office of Thrift Supervision’’ and inserting ‘‘Comptroller of the Currency or the Board of Directors of the Federal 

Deposit Insurance Corporation, as applicable’’; and 

(2) in section 22(a) (12 U.S.C. 1442(a))— 

(A) in the matter preceding paragraph (1), by striking 

‘‘Comptroller of the Currency’’ and all that follows through 

‘‘Supervision’’ and inserting ‘‘Comptroller of the Currency, 

the Chairman of the Board of Governors of the Federal Reserve System, the Chairperson of the Federal Deposit Insurance Corporation, and the Chairman of the National 

Credit Union Administration’’; and 

(B) in the undesignated matter following paragraph (2), 

by striking ‘‘Comptroller of the Currency’’ and all that follows through ‘‘Supervision’’ and inserting ‘‘Comptroller of 

the Currency, the Chairman of the Board of Governors of 

the Federal Reserve System, and the Chairman of the National Credit Union Administration’’. 

225 

(t) FEDERAL RESERVE ACT.—Paragraph (8)(B) of section 11(s) of 

the Federal Reserve Act (headed ‘‘Federal Reserve Transparency 

and Release of Information’’) (12 U.S.C. 248) is amended by striking ‘‘this section’’ and inserting ‘‘this subsection’’. 

(u) FINANCIAL INSTITUTIONS REFORM, RECOVERY, AND ENFORCEMENT ACT OF 1989.—The Financial Institutions Reform, Recovery, 

and Enforcement Act of 1989 (Public Law 101–73; 103 Stat. 183) 

is amended in section 1121(6) (12 U.S.C. 3350(6)), by striking ‘‘the 

Office of Thrift Supervision,’’. 

(v) GRAMM-LEACH-BLILEY ACT.—The Gramm-Leach-Bliley Act 

(Public Law 106–102; 113 Stat. 1338) is amended— 

(1) in section 132(a) (12 U.S.C. 1828b(a)), by striking ‘‘the Director of the Office of Thrift Supervision,’’; 

(2) in section 206(a) (15 U.S.C. 78c note), by striking ‘‘Except 

as provided in subsection (e), for’’ and inserting ‘‘For’’; 

(3) in section 502(e)(5) (15 U.S.C. 6802(e)(5)), by striking ‘‘a 

Federal’’ and inserting ‘‘, a Federal’’; 

(4) in section 504(a)(2) (15 U.S.C. 6804(a)(2)), by striking 

‘‘and, as appropriate, and with’’ and inserting ‘‘and, as appropriate, with’’; 

(5) in section 509(2) (15 U.S.C. 6809(2))— 

(A) by striking subparagraph (D); and 

(B) by redesignating subparagraphs (E) and (F) as subparagraphs (D) and (E), respectively; and 

(6) in section 522(b)(1)(A)(iv) (15 U.S.C. 6822(b)(1)(A)(iv)), by 

striking ‘‘Director of the Office of Thrift Supervision’’ and inserting ‘‘Comptroller of the Currency and the Board of Directors of the Federal Deposit Insurance Corporation, as appropriate’’. 

(w) HELPING FAMILIES SAVE THEIR HOMES ACT OF 2009.—Section 

104 of the Helping Families Save Their Homes Act of 2009 (12 

U.S.C. 1715z–25) is amended— 

(1) in subsection (a)— 

(A) in the matter preceding paragraph (1)— 

(i) by striking ‘‘and the Director of the Office of 

Thrift Supervision, shall jointly’’ and inserting ‘‘shall’’; 

(ii) by striking ‘‘Senate,’’ and inserting ‘‘Senate and’’; 

(iii) by striking ‘‘and the Office of Thrift Supervision’’; and 

(iv) by striking ‘‘each such’’ and inserting ‘‘such’’; 

and 

(B) in paragraph (1), by striking ‘‘and the Office of Thrift 

Supervision’’; and 

(2) in subsection (b)(1)— 

(A) in subparagraph (A)— 

(i) in the first sentence— 

(I) by striking ‘‘and the Director of the Office of 

Thrift Supervision,’’; and 

(II) by striking ‘‘or the Director’’; and 

(ii) in the second sentence, by striking ‘‘and the Director of the Office of Thrift Supervision’’; and 

(B) in subparagraph (B), by striking ‘‘and the Director of 

the Office of Thrift Supervision’’. 

226 

(x) HOME MORTGAGE DISCLOSURE ACT OF 1975.—The Home 

Mortgage Disclosure Act of 1975 (12 U.S.C. 2801 et seq.) is amended— 

(1) in section 304— 

(A) in subsection (b)(5)(A), by striking ‘‘15 U.S.C. 

1602(aa)(4)’’ and inserting ‘‘section 103(aa)(4) of the Truth 

in Lending Act’’; and 

(B) in subsection (j)(3) (12 U.S.C. 2803(j)(3)), by adding 

a period at the end; and 

(2) in section 305(b)(1)(A) (12 U.S.C. 2804(b)(1)(A))— 

(A) in the matter preceding clause (i), by inserting ‘‘by’’ 

before ‘‘the appropriate Federal banking agency’’; and 

(B) in clause (iii), by striking ‘‘bank as,’’ and inserting 

‘‘bank, as’’. 

(y) HOME OWNERS’ LOAN ACT.—The Home Owners’ Loan Act (12 

U.S.C. 1461 et seq.) is amended— 

(1) in section 5 (12 U.S.C. 1464)— 

(A) in subsection (d)(2)(E)(ii)— 

(i) in the first sentence, by striking ‘‘Except as provided in section 21A of the Federal Home Loan Bank 

Act, the’’ and inserting ‘‘The’’; and 

(ii) by striking ‘‘, at the Director’s discretion,’’; 

(B) in subsection (i)(6), by striking ‘‘the Office of Thrift 

Supervision or’’; 

(C) in subsection (m), by striking ‘‘Director’s’’ each place 

that term appears and inserting ‘‘appropriate Federal 

banking agency’s’’; 

(D) in subsection (n)(9)(B), by striking ‘‘Director’s’’ and 

inserting ‘‘Comptroller’s’’; and 

(E) in subsection (s)— 

(i) in paragraph (1)— 

(I) in the matter preceding subparagraph (A), by 

striking ‘‘of such Act)’’ and all that follows through 

‘‘shall require’’ and inserting ‘‘of such Act), the appropriate Federal banking agency shall require’’; 

and 

(II) in subparagraph (B), by striking ‘‘other 

methods’’ and all that follows through ‘‘determines’’ and inserting ‘‘other methods as the appropriate Federal banking agency determines’’; 

(ii) in paragraph (2)— 

(I) by striking ‘‘DETERMINED’’ and all that follows through ‘‘may, consistent’’ and inserting ‘‘DETERMINED BY APPROPRIATE FEDERAL BANKING

AGENCY CASE-BY-CASE.—The appropriate Federal 

banking agency may, consistent’’; and 

(II) by striking ‘‘capital-to-assets’’ and all that 

follows through ‘‘determines to be necessary’’ and 

inserting ‘‘capital-to-assets as the appropriate Federal banking agency determines to be necessary’’; 

and 

(iii) in paragraph (3)— 

(I) by striking ‘‘agency, may’’ and inserting 

‘‘agency may’’; and 

227 

(II) by striking ‘‘the Comptroller’’ and inserting 

‘‘the appropriate Federal banking agency’’; 

(2) in section 6(c) (12 U.S.C. 1465(c)), by striking ‘‘sections’’ 

and inserting ‘‘section’’; 

(3) in section 10 (12 U.S.C. 1467a)— 

(A) in subsection (b)(6), by striking ‘‘time’’ and all that 

follows through ‘‘release’’ and inserting ‘‘time, upon the 

motion or application of the Board, release’’; 

(B) in subsection (c)(2)(H)— 

(i) in the matter preceding clause (i)— 

(I) by striking ‘‘1841(p))’’ and inserting 

‘‘1841(p)))’’; and 

(II) by inserting ‘‘(12 U.S.C. 1843(k))’’ before 

‘‘if—’’; and 

(ii) in clause (i), by inserting ‘‘of 1956 (12 U.S.C. 

1843(l) and (m))’’ after ‘‘Company Act’’; and 

(C) in subsection (e)(7)(B)(iii)— 

(i) by striking ‘‘Board of the Office of Thrift Supervision’’ and inserting ‘‘Director of the Office of Thrift 

Supervision’’; and 

(ii) by inserting ‘‘, as defined in section 2 of the 

Dodd-Frank Wall Street Reform and Consumer Protection Act (12 U.S.C. 5301)’’ after ‘‘transfer date’’; and 

(4) in section 13 (12 U.S.C. 1468b), by striking ‘‘the a’’ and 

inserting ‘‘a’’. 

(z) HOUSING ACT OF 1948.—Section 502(c)(3) of the Housing Act 

of 1948 (12 U.S.C. 1701c(c)(3)) is amended by striking ‘‘Federal 

Home Loan Bank Agency’’ and inserting ‘‘Federal Housing Finance 

Agency’’. 

(aa) HOUSING AND URBAN DEVELOPMENT ACT OF 1968.—Section 

106(h)(5) of the Housing and Urban Development Act of 1968 (12 

U.S.C. 1701x(h)(5)) is amended by striking ‘‘authorised’’ and inserting ‘‘authorized’’. 

(bb) INTERNATIONAL BANKING ACT OF 1978.—Section 15 of the 

International Banking Act of 1978 (12 U.S.C. 3109) is amended— 

(1) in each of subsections (a) and (b)— 

(A) by striking ‘‘, and Director of the Office of Thrift Supervision’’ each place that term appears; and 

(B) by inserting ‘‘and’’ before ‘‘Federal Deposit’’ each 

place that term appears; 

(2) in subsection (a), by striking ‘‘Comptroller, Corporation, 

or Director’’ and inserting ‘‘Comptroller of the Currency, or 

Corporation’’; and 

(3) in subsection (c)(4)— 

(A) by inserting ‘‘and’’ before ‘‘the Federal Deposit’’; and 

(B) by striking ‘‘, and the Director of the Office of Thrift 

Supervision’’. 

(cc) INTERNATIONAL LENDING SUPERVISION ACT OF 1983.—Section 

912 of the International Lending Supervision Act of 1983 (12 

U.S.C. 3911) is amended— 

(1) by amending the section heading to read as follows: 

‘‘EQUAL REPRESENTATION FOR FEDERAL DEPOSIT 

INSURANCE CORPORATION’’; 

(2) by striking ‘‘(a) IN GENERAL.—’’; 

(3) by striking subsection (b); and 

228 

(4) by striking ‘‘4’’ and inserting ‘‘3’’. 

(dd) INTERSTATE LAND SALES FULL DISCLOSURE ACT.—The Interstate Land Sales Full Disclosure Act (15 U.S.C. 1701 et seq.) is 

amended in each of section 1411(b) (15 U.S.C. 1710(b)) and subsections (b)(4) and (d) of section 1418a (15 U.S.C. 1717a), by striking ‘‘Secretary’s’’ each place that term appears and inserting ‘‘Director’s’’. 

(ee) INVESTMENT ADVISERS ACT OF 1940.—Section 224 of the Investment Company Act of 1940 (15 U.S.C. 80b–18c) is amended in 

the heading of the section by striking ‘‘COMMODITIES’’ and inserting ‘‘COMMODITY’’. 

(ff) LEGAL CERTAINTY FOR BANK PRODUCTS ACT OF 2000.—Section 403(b)(1) of the Legal Certainty for Bank Products Act of 2000 

(7 U.S.C. 27a(b)(1)) is amended by striking ‘‘that section’’ and inserting ‘‘section’’. 

(gg) PUBLIC LAW 93–495.—Section 111 of Public Law 93–495 (12 

U.S.C. 250) is amended by striking ‘‘the Director of the Office of 

Thrift Supervision,’’. 

(hh) REVISED STATUTES OF THE UNITED STATES.—Section 

5136C(i) of the Revised Statutes of the United States (12 U.S.C. 

25b(i)) is amended by striking ‘‘POWERS.—’’ and all that follows 

through ‘‘In accordance’’ and inserting ‘‘POWERS.—In accordance’’. 

(ii) RIEGLE COMMUNITY DEVELOPMENT AND REGULATORY IMPROVEMENT ACT OF 1994.—Section 117(e) of the Riegle Community 

Development and Regulatory Improvement Act of 1994 (12 U.S.C. 

4716(e)) is amended by striking ‘‘the Director of the Office of Thrift 

Supervision,’’. 

(jj) S.A.F.E. MORTGAGE LICENSING ACT OF 2008.—Section 1514 of 

the S.A.F.E. Mortgage Licensing Act of 2008 (12 U.S.C. 5113) is 

amended in each of subsections (b)(5) and (c)(4)(C), by striking 

‘‘Secretary’s’’ each place that term appears and inserting ‘‘Director’s’’. 

(kk) SECURITIES EXCHANGE ACT OF 1934.—The Securities Exchange Act of 1934 (15 U.S.C. 78a et seq.) is amended— 

(1) in section 3D(d)(10)(A) (15 U.S.C. 78c–4(d)(10)(A)), by 

striking ‘‘taking’’ and inserting ‘‘take’’; 

(2) in section 3E(b)(1) (15 U.S.C. 78c–5(b)(1)), by striking 

‘‘though’’ and inserting ‘‘through’’; 

(3) in section 4(g)(8)(A) (15 U.S.C. 78d(g)(8)(A)), by striking 

‘‘(2)(A)(i)’’ and inserting ‘‘(2)(A)(ii)’’; 

(4) in section 15 (15 U.S.C. 78o)— 

(A) in each of subparagraphs (B)(ii) and (C) of subsection 

(b)(4), by striking ‘‘dealer municipal advisor,,’’ and inserting ‘‘dealer, municipal advisor,’’; 

(B) by redesignating subsection (j) (relating to the authority of the Commission) as subsection (p) and moving 

that subsection after subsection (o); 

(C) as amended by section 841(d), by redesignating the 

second subsection (k) and second subsection (l) (relating to 

standard of conduct and other matters, respectively), as 

added by section 913(g)(1) of the Dodd-Frank Wall Street 

Reform and Consumer Protection Act (124 Stat. 1828), as 

subsections (q) and (r), respectively and moving those subsections to the end; and 

229 

(D) in subsection (m), by inserting ‘‘the’’ before ‘‘same extent’’; 

(5) in section 15F(h) (15 U.S.C. 78o–10(h))— 

(A) in paragraph (2)— 

(i) in subparagraph (A), by inserting ‘‘a’’ after ‘‘that 

acts as an advisor to’’; and 

(ii) in subparagraph (B), by inserting ‘‘a’’ after ‘‘offers to enter into’’; and 

(B) in paragraph (5)(A)(i)— 

(i) by inserting ‘‘(A)’’ after ‘‘(18)’’; and 

(ii) in subclause (VII), by striking ‘‘act of’’ and inserting ‘‘Act of’’; 

(6) in section 15G (15 U.S.C. 78o–11)— 

(A) in subsection (e)(4)(A), by striking ‘‘subsection’’ and 

inserting ‘‘section’’; 

(B) in subsection (e)(4)(C)— 

(i) by striking ‘‘129C(c)(2)’’ and inserting 

‘‘129C(b)(2)(A)’’; and 

(ii) by inserting ‘‘(15 U.S.C. 1639c(b)(2)(A))’’ after 

‘‘Lending Act’’; and 

(C) in subsection (e)(5), by striking ‘‘subsection’’ and inserting ‘‘section’’; and 

(7) in section 17A (15 U.S.C. 78q–1), by redesignating subsection (g), as added by section 929W of the Dodd-Frank Wall 

Street Reform and Consumer Protection Act (relating to due 

diligence for the delivery of dividends, interest, and other valuable property rights) as subsection (n) and moving that subsection to the end. 

(ll) TELEMARKETING AND CONSUMER FRAUD AND ABUSE PREVENTION ACT.—Section 3(b) of the Telemarketing and Consumer Fraud 

and Abuse Prevention Act (15 U.S.C. 6102(b)) is amended by inserting before the period at the end the following: ‘‘, provided, however, nothing in this section shall conflict with or supersede section 

6 of the Federal Trade Commission Act (15 U.S.C. 46)’’. 

(mm) TITLE 5.—Title 5, United States Code, is amended— 

(1) in section 3132(a)(1)(D), as amended by section 711, by 

striking ‘‘the Office of Thrift Supervision,, the Resolution Trust 

Corporation,’’; and 

(2) in section 5314, by striking ‘‘Director of the Office of 

Thrift Supervision.’’. 

(nn) TITLE 31.— 

(1) AMENDMENTS.—Title 31, United States Code, is amended— 

(A) by striking section 309; and 

(B) in section 714(d)(3)(B) by striking ‘‘a audit’’ and inserting ‘‘an audit’’. 

(2) ANALYSIS.—The analysis for subchapter I of chapter 3 of 

title 31, United States Code, is amended by striking the item 

relating to section 309. 

(oo) TRUTH IN LENDING ACT.—The Truth in Lending Act (15 

U.S.C. 1601 et seq.) is amended— 

(1) in section 105 (15 U.S.C. 1604), by inserting subsection 

(h), as added by section 1472(c) of the Dodd-Frank Wall Street 

Reform and Consumer Protection Act (124 Stat. 2187), before 

230 

subsection (i), as added by section 1100A(7) of that Act (124 

Stat. 2108); 

(2) in section 106(f)(2)(B)(i) (15 U.S.C. 1605(f)(2)(B)(i)), by 

striking ‘‘103(w)’’ and inserting ‘‘103(x)’’; 

(3) in section 121(b) (15 U.S.C. 1631(b)), by striking ‘‘103(f)’’ 

and inserting ‘‘103(g)’’; 

(4) in section 122(d)(5) (15 U.S.C. 1632(d)(5)), by striking 

‘‘section 603)’’ and all that follows through ‘‘promulgate’’ and 

inserting ‘‘section 603), may promulgate’’; 

(5) in section 125(e)(1) (15 U.S.C. 1635(e)(1)), by striking 

‘‘103(w)’’ and inserting ‘‘103(x)’’; 

(6) in section 129 (15 U.S.C. 1639)— 

(A) in subsection (q), by striking ‘‘(l)(2)’’ and inserting 

‘‘(p)(2)’’; and 

(B) in subsection (u)(3), by striking ‘‘Board’’ each place 

that term appears and inserting ‘‘Agency’’; 

(7) in section 129C (15 U.S.C. 1639c)— 

(A) in subsection (b)(2)(B), by striking the second period 

at the end; and 

(B) in subsection (c)(1)(B)(ii)(I), by striking ‘‘a original’’ 

and inserting ‘‘an original’’; 

(8) in section 148(d) (15 U.S.C. 1665c(d)), by striking ‘‘Bureau’’ and inserting ‘‘Board’’; 

(9) in section 149 (15 U.S.C. 1665d)— 

(A) by striking ‘‘the Director of the Office of Thrift Supervision,’’ each place that term appears; 

(B) by striking ‘‘National Credit Union Administration 

Bureau’’ each place that term appears and inserting ‘‘National Credit Union Administration Board’’; and 

(C) by striking ‘‘Bureau of Directors of the Federal Deposit Insurance Corporation’’ each place that term appears 

and inserting ‘‘Board of Directors of the Federal Deposit 

Insurance Corporation’’; and 

(10) in section 181(1) (15 U.S.C. 1667(1)), by striking ‘‘103(g)’’ 

and inserting ‘‘103(h)’’. 

(pp) TRUTH IN SAVINGS ACT.—The Truth in Savings Act (12 

U.S.C. 4301 et seq.) is amended in each of sections 269(a)(4) (12 

U.S.C. 4308(a)(4)), 270(a)(2) (12 U.S.C. 4309(a)(2)), and 274(6) (12 

U.S.C. 4313(6)), by striking ‘‘Administration Bureau’’ each place 

that term appears and inserting ‘‘Administration Board’’. 

SUMMARY OF THE AMENDMENTS IN PART B MADE IN ORDER

1. Hensarling (TX): MANAGER’S Revises provisions subjecting 

certain FDIC and NCUA functions to congressional appropriations, 

relating to appointments of positions created by the Act, and providing congressional access to non-public FSOC information. (10 

minutes) 

2. Hollingsworth (IN): Allows closed-end funds that are listed on 

a national securities exchange, and that meet certain requirements 

to be considered ‘‘well-known seasoned issuers’’ or ‘‘WKSIs’’. (10 

minutes) 

3. Smucker (PA): Expresses the sense of Congress that consumer 

reporting agencies and their subsidiaries should implement stronger multi-factor authentication procedures when providing access to 

231 

personal information files to more adequately protect consumer information from identity theft. (10 minutes) 

4. Faso (NY): Allows Mutual Holding Companies (MHCs) to 

waive the receipt of dividends. (10 minutes) 

5. McSally (AZ): Requires the Department of Treasury to submit 

a report to Congress regarding its efforts to work with Federal 

bank regulators, financial institutions, and money service businesses to ensure that legitimate financial transactions along the 

southern border move freely. (10 minutes) 

6. Buck (CO): Requires the GSA to study CLEA’s real estate 

needs due to changes in the Agency’s structure. It then authorizes 

the GSA to sell the current CLEA building if CLEA’s real estate 

needs have changed and there is no government department or 

agency that can utilize the building. (10 minutes) 

PART B—TEXT OF AMENDMENTS MADE IN ORDER

1. AN AMENDMENT TO BE OFFERED BY REPRESENTATIVE HEN- SARLING OF TEXAS OR HIS DESIGNEE, DEBATABLE FOR 10 MIN- UTES

Page 48, beginning on line 15, strike ‘‘meetings of the Council, 

whether or not open to the public,’’ and insert ‘‘public meetings of 

the Council’’. 

Page 48, after line 19, insert the following (and redesignate the 

subsequent paragraph accordingly): 

‘‘(5) TRANSCRIPTION REQUIREMENT FOR NON-PUBLIC MEETINGS.—The Council shall create and preserve transcripts for all 

non-public meetings of the Council.’’. 

Amend section 361 to read as follows: 

SEC. 361. BRINGING THE FEDERAL DEPOSIT INSURANCE CORPORATION INTO THE APPROPRIATIONS PROCESS. 

(a) IN GENERAL.—Section 10(a) of the Federal Deposit Insurance 

Act (12 U.S.C. 1820(a)) is amended— 

(1) by striking ‘‘(a) The’’ and inserting the following: 

‘‘(a) POWERS.— 

‘‘(1) IN GENERAL.—The’’; 

(2) by inserting ‘‘, subject to paragraph (2),’’ after ‘‘The Board 

of Directors of the Corporation’’; and 

(3) by adding at the end the following new paragraph: 

‘‘(2) APPROPRIATIONS REQUIREMENT.—Except as provided 

under paragraph (3), the Corporation may, only to the extent 

as provided in advance by appropriations Acts, cover the costs 

incurred in carrying out the provisions of this Act, including 

with respect to the administrative costs of the Corporation and 

the costs of the examination and supervision of insured depository institutions. 

‘‘(3) EXCEPTION FOR CERTAIN PROGRAMS.—Paragraph (2) shall 

not apply to the Corporation’s Insurance Business Line Programs and Receivership Management Business Line Programs, 

as in existence on the date of enactment of this paragraph, and 

the proportion of the administrative costs of the Corporation 

related to such programs.’’. 

(b) EXAMINATION FEES.—Section 10(e)(1) of the Federal Deposit 

Insurance Act (12 U.S.C. 1820(e)(1)) is amended by striking ‘‘to 

meet the expenses of the Corporation in carrying out such examiVerDate Sep 11 2014 05:01 Jun 07, 2017 Jkt 025698 PO 00000 Frm 00231 Fmt 6659 Sfmt 6602 E:\HR\OC\HR163.XXX HR163
232 

nations’’ and inserting ‘‘and may be expended by the Board only to 

the extent as provided in advance by appropriations Acts to cover 

the costs incurred in carrying out such examinations’’. 

(c) OFFSET OF ADDITIONAL FEES.—The Federal Deposit Insurance 

Corporation shall reduce the amount of insurance premiums 

charged by the Corporation under the Federal Deposit Insurance 

Act in an amount equal to any additional fees charged by the Corporation by reason of the amendments made by this section. 

(d) EFFECTIVE DATE.—The amendments made by this section 

shall apply with respect to expenses paid and fees collected on or 

after October 1, 2017. 

Amend section 363 to read as follows: 

SEC. 363. BRINGING THE EXAMINATION AND SUPERVISION FUNCTIONS OF THE NATIONAL CREDIT UNION ADMINISTRATION INTO THE APPROPRIATIONS PROCESS. 

(a) OPERATING FEES.—Section 105(d) of the Federal Credit Union 

Act (12 U.S.C. 1755(d)) is amended— 

(1) by striking ‘‘All’’ and inserting ‘‘(1) All’’; 

(2) by striking ‘‘for the account of the Administration and 

may be expended by the Board to defray the expenses incurred 

in carrying out the provisions of this Act including the examination and supervision of Federal credit unions’’ and inserting 

‘‘and may be expended by the Board only to the extent as provided in advance by appropriations Acts, to cover the costs incurred in carrying out the provisions of this Act with respect 

to the costs of the examination and supervision of Federal 

credit unions and the proportion of the administrative costs of 

the Board related to the examination and supervision of Federal credit unions’’; and 

(3) by adding at the end the following: 

‘‘(2)(A) The Board may only use amounts in the NCUA Operating 

Fund to the extent as provided in advance by appropriations Acts, 

including to pay for the costs incurred by the Board in carrying out 

the examination and supervision of Federal credit unions and the 

proportion of the administrative costs of the Board related to the 

examination and supervision of Federal credit unions. 

‘‘(B) Subparagraph (A) shall not apply to the Board’s activities 

carried out pursuant to title II.’’. 

(b) STAFF FUNDING.—Section 120(j)(3) of the Federal Credit 

Union Act (12 U.S.C. 1766(j)(3)) is amended— 

(1) by inserting ‘‘related to the examination and supervision 

of Federal credit unions under this Act and the proportion of 

the administrative costs of the Board related to the examination and supervision of Federal credit unions under this Act’’ 

before ‘‘shall be paid’’; and 

(2) by striking ‘‘insured credit unions under this Act’’ and inserting ‘‘Federal credit unions under this title, only to the extent as provided in advance by appropriations Acts’’. 

(c) USE OF DEPOSIT FUNDS.—Section 202(c)(1)(B)(iv) of the Federal Credit Union Act (12 U.S.C. 1782(c)(1)(B)(iv)) is amended— 

(1) by striking ‘‘The’’ and inserting ‘‘To the extent provided 

for in advance by appropriations Acts, the’’; and 

(2) by adding at the end the following new sentence: ‘‘This 

clause shall not apply to the Board’s activities carried out pursuant to this title.’’. 

233 

(d) EFFECTIVE DATE.—The amendments made by this section 

shall apply with respect to expenses paid and fees collected on or 

after October 1, 2017. 

Page 297, line 18, strike ‘‘Council’’ and insert ‘‘Secretary of the 

Treasury’’. 

Page 326, line 6, strike ‘‘A’’ and insert ‘‘P’’. 

Page 327, line 9, strike ‘‘B’’ and insert ‘‘Q’’. 

Page 329, line 3, strike ‘‘C’’ and insert ‘‘R’’. 

Page 330, line 5, strike ‘‘D’’ and insert ‘‘S’’. 

Page 370, beginning on line 24, strike ‘‘DEADLINE FOR APPOINTMENT.—Not later than 60 days after the date of the enactment of 

this Act, the’’ and insert ‘‘APPOINTMENT.—The’’. 

Page 527, line 2, strike ‘‘Independent Member’’ and insert ‘‘President’’. 

2. AN AMENDMENT TO BE OFFERED BY REPRESENTATIVE HOLLINGSWORTH OF INDIANA OR HIS DESIGNEE, DEBATABLE FOR 10 MINUTES

At the end of title IV, insert the following: 

Subtitle X—Modernized Offering and 

Proxy Rules for Closed-End Funds 

SEC. 499A. PARITY FOR CLOSED-END COMPANIES REGARDING OFFERING AND PROXY RULES. 

(a) REVISION TO RULES.—Not later than 1 year after the date of 

enactment of this Act, the Securities and Exchange Commission 

shall revise any rules to the extent necessary to allow any closedend company, as defined in section 5(a)(2) of the Investment Company Act of 1940 (15 U.S.C. 80a-5), that is registered as an investment company under such Act to use the securities offering and 

proxy rules that are available to other issuers that are required to 

file reports under section 13 or section 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m; 78o(d)). Any action that the 

Commission takes pursuant to this subsection shall include the following: 

(1) The Commission shall revise section 230.405 of title 17, 

Code of Federal Regulations, to— 

(A) remove the exclusion of a registered closed-end company from the definition of a well-known seasoned issuer 

provided by that section; and 

(B) add registration statements filed on Form N–2 to the 

definition of automatic shelf registration statement provided by that section. 

(2) The Commission shall revise sections 230.168 and 

230.169 of title 17, Code of Federal Regulations, to remove the 

exclusion of a registered closed-end company from the list of 

issuers that can use the exemptions provided by those sections. 

(3) The Commission shall revise sections 230.163 and 

230.163A of title 17, Code of Federal Regulations, to remove a 

registered closed-end company from the list of issuers that are 

ineligible to use the exemptions provided by those sections. 

234 

(4) The Commission shall revise section 230.134 of title 17, 

Code of Federal Regulations, to remove the exclusion of a registered closed-end company from that section. 

(5) The Commission shall revise sections 230.138 and 

230.139 of title 17, Code of Federal Regulations, to specifically 

include any registered closed-end company as an issuer to 

which those sections apply. 

(6) The Commission shall revise section 230.164 of title 17, 

Code of Federal Regulations, to remove a registered closed-end 

company from the list of issuers that are excluded from that 

section. 

(7) The Commission shall revise section 230.433, of title 17, 

Code of Federal Regulations, to specifically include any registered closed-end company that is a well-known seasoned 

issuer as an issuer to which that section applies. 

(8) The Commission shall revise section 230.415 of title 17, 

Code of Federal Regulations, to— 

(A) state that the registration for securities provided by 

that section includes securities registered by any registered closed-end company on Form N–2; and 

(B) eliminate the requirement that a Form N–2 registrant must furnish the undertakings required by item 

34.4 of Form N–2. 

(9) The Commission shall revise section 230.497 of title 17, 

Code of Federal Regulations, to include a process for any registered closed-end company to file a form of prospectus that is 

parallel to the process for filing a form of prospectus under section 230.424(b) of such title. 

(10) The Commission shall revise sections 230.172 and 

230.173 of title 17, Code of Federal Regulations, to remove the 

exclusion of an offering of any registered closed-end company 

from those sections. 

(11) The Commission shall revise section 230.418 of title 17, 

Code of Federal Regulations, to provide that any registered 

closed-end company that would otherwise meet the eligibility 

requirements of General Instruction I.A of Form S–3 shall be 

exempt from paragraph (a)(3) of that section. 

(12) The Commission shall revise section 240.14a–101 of title 

17, Code of Federal Regulations, to provide that any registered 

closed-end company that would otherwise meet the requirements of General Instruction I.A of Form S–3 shall be deemed 

to meet the requirements of Form S–3 for purposes of Schedule 

14A. 

(13) The Commission shall revise section 243.103 of title 17, 

Code of Federal Regulations, to provide that paragraph (a) of 

that section applies for purposes of Form N–2. 

(b) REVISIONS TO FORM N–2.—Not later than 1 year after the 

date of enactment of this Act, the Commission shall revise Form 

N–2 to— 

(1) include an item or instruction that is similar to item 12 

on Form S–3 to provide that any registered closed-end company that would otherwise meet the requirements of Form S– 

3 shall incorporate by reference its reports and documents filed 

under the Securities Exchange Act of 1934 into its registration 

statement filed on Form N–2; and 

235 

(2) include an item or instruction that is similar to the instruction regarding automatic shelf offerings by well-known 

seasoned issuers on Form S–3 to provide that any registered 

closed-end company that is a well-known seasoned issuer may 

file automatic shelf offerings on Form N–2. 

(c) TREATMENT IF REVISIONS NOT COMPLETED IN A TIMELY MANNER.—If the Commission fails to complete the revisions required by 

subsections (a) and (b) by the time required by such subsections, 

any registered closed-end company shall be entitled to treat such 

revisions as having been completed in accordance with the actions 

required to be taken by the Commission by such subsections until 

such time as such revisions are completed by the Commission. 

(d) RULES OF CONSTRUCTION.— 

(1) NO EFFECT ON RULE 482.—(1) Nothing in this section or 

the amendments made by this section shall be construed to impair or limit in any way a registered closed-end company from 

using section 230.482 of title 17, Code of Federal Regulations, 

to distribute sales material. 

(2) REFERENCES.—Any reference in this section to a section 

of title 17, Code of Federal Regulations, or to any form or 

schedule means such rule, section, form, or schedule, or any 

successor to any such rule, section, form, or schedule. 

3. AN AMENDMENT TO BE OFFERED BY REPRESENTATIVE SMUCKER

OF PENNSYLVANIA OR HIS DESIGNEE, DEBATABLE FOR 10 MINUTES

Add at the end of title V the following new subtitle: 

Subtitle T—Protection of Consumer Information by Consumer Reporting Agencies 

SEC. 596. SENSE OF CONGRESS RELATED TO PROTECTION OF CONSUMER INFORMATION BY CONSUMER REPORTING AGENCIES. 

(a) IN GENERAL.—It is the sense of the Congress that consumer 

reporting agencies and subsidiaries of consumer reporting agencies 

should, when providing access to consumers to the information contained in the file of the consumer maintained by the consumer reporting agency, use strong multi-factor authentication procedures 

to verify the identity of consumers. 

(b) DEFINITIONS.—For purposes of this section, the terms ‘‘consumer’’, ‘‘consumer reporting agency’’, and ‘‘file’’ have the meanings 

given those terms in section 603 of the Fair Credit Reporting Act 

(15 U.S.C. 1681a). 

4. AN AMENDMENT TO BE OFFERED BY REPRESENTATIVE FASO OF

NEW YORK OR HIS DESIGNEE, DEBATABLE FOR 10 MINUTES

Add at the end of title V the following new subtitle: 

236 

Subtitle T—Dividend Waiver Authority for 

Mutual Holding Companies 

SEC. 596. DIVIDEND WAIVER AUTHORITY FOR MUTUAL HOLDING COMPANIES. 

Section 10(o)(11) of the Home Owners’ Loan Act (12 U.S.C. 

1467a(o)(11)) is amended— 

(1) in subparagraph (D)— 

(A) in clause (i), by adding ‘‘and’’ at the end; 

(B) in clause (ii), by striking ‘‘; and’’ and inserting a period; and 

(C) by striking clause (iii); 

(2) by amending subparagraph (E) to read as follows: 

‘‘(E) VALUATION.—The appropriate Federal banking 

agency may not consider waived dividends in determining 

an appropriate exchange ratio in the event of a full conversion to stock form.’’; and 

(3) by adding at the end the following new subparagraph: 

‘‘(F) RULE OF CONSTRUCTION.—Nothing in this paragraph shall be construed to authorize the appropriate Federal banking agency to require a vote of members of a mutual holding company to approve one or more dividend 

waivers or to place any additional restrictions on dividend 

waivers by mutual holding companies that are inconsistent 

with or exceed the requirements set forth in this paragraph.’’. 

5. AN AMENDMENT TO BE OFFERED BY REPRESENTATIVE MCSALLY

OF ARIZONA OR HER DESIGNEE, DEBATABLE FOR 10 MINUTES

At the end of title V, add the following: 

Subtitle T—Legitimate Financial 

Transactions Report 

SEC. 596. TREASURY REPORT ON LEGITIMATE FINANCIAL TRANSACTIONS. 

Not later than the end of the 90-day period beginning on the date 

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

issue a report to the Congress on— 

(1) the Secretary’s efforts to ensure that legitimate financial 

transactions move freely and globally; and 

(2) how the Secretary coordinates on such efforts with Federal bank regulators, financial institutions, and money service 

businesses. 

6. AN AMENDMENT TO BE OFFERED BY REPRESENTATIVE BUCK OF

COLORADO OR HIS DESIGNEE, DEBATABLE FOR 10 MINUTES

Page 400, line 22, insert ‘‘(a) IN GENERAL.—’’ before ‘‘Within’’. 

Page 401, after line 2, insert the following: 

(b) GSA STUDY.— 

237 

(1) STUDY.—The Administrator of General Services shall 

carry out a study to determine— 

(A) the Consumer Law Enforcement Agency’s office real 

estate leasing needs, in light of the changes to the Agency’s structure made by this Act; 

(B) whether the office space referenced in subsection (a) 

is the most cost-effective use of taxpayer money in meeting 

those needs, relative to alternative leasing options in the 

Washington, D.C. Metropolitan Area; and 

(C) if there is a Government department or agency that 

has building needs that could be met by moving all or a 

portion of the employees of such department or agency to 

the property described under subsection (a). 

(2) REPORT.—Not later than the end of the 6-month period 

beginning on the date of the enactment of this Act, the Administrator of General Services shall issue a report to the Congress containing all findings and determinations made in carrying out the study required under paragraph (1). 

(3) AUTHORITY TO SELL PROPERTY.—If, after carrying out the 

study required under paragraph (1), the Administrator of General Services determines that— 

(A) the Consumer Law Enforcement Agency’s office real 

estate leasing needs have changed in light of the changes 

to the Agency’s structure made by this Act, and 

(B) that there is no Government department or agency 

that has building needs that could be met by moving all 

or a portion of the employees of such department or agency 

to the property described under subsection (a), 

the Administrator may sell such property to the highest bidder, 

so long as the revenue from the sale exceeds the combined cost 

of building such property and the cost of the most recently 

completed renovation of such property. 

Æ