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[Congressional Bills 112th Congress]
[From the U.S. Government Publishing Office]
[S. 1731 Introduced in Senate (IS)]

112th CONGRESS
  1st Session
                                S. 1731

    To improve the prohibitions on money laundering, and for other 
                               purposes.

_______________________________________________________________________

                   IN THE SENATE OF THE UNITED STATES

                            October 18, 2011

Mr. Grassley (for himself and Mrs. Feinstein) introduced the following 
    bill; which was read twice and referred to the Committee on the 
                               Judiciary

_______________________________________________________________________

                                 A BILL

 
    To improve the prohibitions on money laundering, and for other 
                               purposes.

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

SECTION 1. SHORT TITLE, TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Combating Money 
Laundering, Terrorist Financing, and Counterfeiting Act of 2011''.
    (b) Table of Contents.--The table of contents for this Act is as 
follows:

Sec. 1. Short title, table of contents.
Sec. 2. Specified unlawful activity.
Sec. 3. Interstate transportation of criminal proceeds and reverse 
                            money laundering.
Sec. 4. Transportation or transhipment of blank checks in bearer form.
Sec. 5. Bulk cash smuggling.
Sec. 6. Section 1957 violations involving commingled funds and 
                            structured transactions.
Sec. 7. Charging money laundering as a course of conduct.
Sec. 8. Illegal money transmitting businesses.
Sec. 9. Knowledge that property is from the proceeds of a specific 
                            felony.
Sec. 10. Extraterritorial jurisdiction.
Sec. 11. Freezing bank accounts of persons arrested for offenses 
                            involving the movement of money across 
                            international borders.
Sec. 12. Making the international money laundering statute apply to tax 
                            evasion.
Sec. 13. Prohibiting money laundering through hawalas, other informal 
                            value transfer systems, and closely related 
                            transactions.
Sec. 14. Technical amendment to restore wiretap authority for certain 
                            money laundering and counterfeiting 
                            offenses.
Sec. 15. Conduct in aid of counterfeiting.
Sec. 16. Prepaid access devices, digital currencies, or other similar 
                            instruments.
Sec. 17. Procedure for issuing subpoenas in money laundering cases.
Sec. 18. Danger pay allowance.
Sec. 19. United States Secret Service use of proceeds derived from 
                            criminal investigations.
Sec. 20. Authority of Secret Service to arrest persons in violation of 
                            money laundering laws.
Sec. 21. Law enforcement regulations and cooperation.
Sec. 22. Rule of construction.

SEC. 2. SPECIFIED UNLAWFUL ACTIVITY.

    Section 1956(c)(7) of title 18, United States Code, is amended to 
read as follows:
            ``(7) the term `specified unlawful activity' means any act 
        or activity constituting an offense in violation of the laws of 
        the United States punishable by imprisonment for a term 
        exceeding 1 year;''.

SEC. 3. INTERSTATE TRANSPORTATION OF CRIMINAL PROCEEDS AND REVERSE 
              MONEY LAUNDERING.

    (a) In General.--Section 1957(a) of title 18, United States Code, 
is amended to read as follows:
    ``(a)(1) Whoever, in any of the circumstances set forth in 
subsection (d)--
            ``(A) knowingly conducts or attempts to conduct a monetary 
        transaction involving the proceeds of some form of unlawful 
        activity that is of a value greater than $10,000 and is derived 
        from specified unlawful activity; or
            ``(B) conducts or attempts to conduct a monetary 
        transaction involving property of a value greater than $10,000, 
        with the intent to promote the carrying on of specified 
        unlawful activity,
shall be punished as provided in subsection (b).
    ``(2) Whoever, in any of the circumstances set forth in subsection 
(d), transports, attempts to transport, or conspires to transport more 
than $10,000 in currency, monetary instruments in bearer form, or 
precious metals and jewels in interstate commerce--
            ``(A) knowing that the property being transported was 
        derived from some form of unlawful activity; or
            ``(B) knowing that the property being transported was 
        intended to be used to promote some form of unlawful activity,
shall be punished as provided in subsection (b).''.
    (b) Penalty.--Section 1957(b) of title 18, United States Code, is 
amended--
            (1) in paragraph (1), by striking ``paragraph (2)'' and 
        inserting ``paragraphs (2) and (3)''; and
            (2) by adding at the end the following:
            ``(3) The maximum period of incarceration for a person 
        convicted of an offense under subsection (a)(1)(B) shall not 
        exceed the statutory maximum for the offense being promoted.''.
    (c) Conforming Amendment.--Section 1957(f) of title 18, United 
States Code, is amended--
            (1) in paragraph (2), by striking ``; and'' and by 
        inserting a semicolon;
            (2) in paragraph (3), by striking the period and inserting 
        ``; and''; and
            (3) by adding at the end the following:
            ``(4) the term `conducts' has the meaning given that term 
        in section 1956 of this title.''.
    (d) Statutory Heading.--Section 1957 of title 18, United States 
Code, is amended, in the section heading, by inserting ``or in support 
of criminal activity'' after ``specified unlawful activity''.
    (e) Chapter Analysis.--The item relating to section 1957 in the 
table of sections for chapter 95 of title 18, United States Code, is 
amended to read as follows:

``1957. Conducting monetary transactions in property derived from 
                            specified unlawful activity or in support 
                            of criminal activity.''.

SEC. 4. TRANSPORTATION OR TRANSHIPMENT OF BLANK CHECKS IN BEARER FORM.

    Section 5316 of title 31, United States Code, is amended by adding 
at the end the following:
    ``(e) Monetary Instruments With Amount Left Blank.--For purposes of 
this section, a monetary instrument in bearer form that has the amount 
left blank, such that the amount could be filled in by the bearer, 
shall be considered to have a value in excess of $10,000 if the 
instrument was drawn on an account that contained or was intended to 
contain more than $10,000 at the time the instrument was transported or 
the time period it was negotiated or was intended to be negotiated.''.

SEC. 5. BULK CASH SMUGGLING.

    Section 5332(b) of title 31, United States Code, is amended--
            (1) in paragraph (1), by striking ``5 years'' and inserting 
        ``10 years'';
            (2) by redesignating paragraphs (2), (3), and (4), as 
        paragraphs (3), (4), and (5), respectively; and
            (3) by inserting after paragraph (1) the following:
            ``(2) Fine.--
                    ``(A) In general.--Whoever violates this section 
                shall be fined under title 18.
                    ``(B) Enhanced fine for aggravated cases.--Whoever 
                violates this section while violating another law of 
                the United States, other than section 5316 or 5324(c), 
                or as a part of a pattern of any unlawful activity, 
                including a violation of section 5316 or 5324(c), shall 
                be fined twice the amount provided in subsection (b)(3) 
                or (c)(3) of section 3571 of title 18.''.

SEC. 6. SECTION 1957 VIOLATIONS INVOLVING COMMINGLED FUNDS AND 
              STRUCTURED TRANSACTIONS.

    Section 1957 of title 18, United States Code, is amended by adding 
at the end the following:
    ``(g) The Government may satisfy the $10,000 requirement in 
subsection (a)(1) by showing that--
            ``(1) the monetary transaction involved the transfer, 
        withdrawal, encumbrance, or other disposition of more than 
        $10,000 from an account in which more than $10,000 in proceeds 
        of specified unlawful activity was commingled with other funds; 
        or
            ``(2) the defendant conducted a series of monetary 
        transactions in amounts under $10,000 that exceeded $10,000 in 
        the aggregate and that were closely related to each other in 
        terms of such factors as time, the identity of the parties 
        involved, the nature or purpose of the transactions or the 
        manner in which they were conducted.''.

SEC. 7. CHARGING MONEY LAUNDERING AS A COURSE OF CONDUCT.

    (a) In General.--Section 1956 of title 18, United States Code, is 
amended by adding at the end the following:
    ``(j) Multiple Violations.--Multiple violations of this section 
that are part of the same scheme or continuing course of conduct may be 
charged, at the election of the Government, in a single count in an 
indictment or information.''.
    (b) Conspiracies.--Section 1956(h) of title 18, United States Code, 
is amended by striking ``or section 1957'' and inserting ``, section 
1957, or section 1960''.

SEC. 8. ILLEGAL MONEY TRANSMITTING BUSINESSES.

    (a) Money Transmitting Business Defined.--Section 1960(b)(2) of 
title 18, United States Code, is amended to read as follows:
            ``(2) the term `money transmitting business' means any 
        business other than the United States Postal Service, which 
        provides check cashing, currency exchange, money transmitting 
        or remittance services, or issues, sells, or redeems money 
        orders, travelers' checks, prepaid access devices, digital 
        currencies, or other similar instruments, or any other person 
        or association of persons, formal or informal, engaging as a 
        business in transporting, transferring, exchanging, or 
        transmitting currency or funds in any form, including any 
        person or association of persons, formal or informal, engaging 
        as a business in any informal money transfer system, monetary 
        value represented in digital electronic format, or any network 
        of people who engage as a business in facilitating the transfer 
        of money domestically or internationally outside of the 
        conventional financial institutions system.''.
    (b) General Intent Requirement.--Section 1960(b)(1)(B) of title 18, 
United States Code, is amended by inserting the following before the 
semicolon: ``, whether or not the defendant knew that the operation was 
required to comply with such registration requirements''.
    (c) Technical Amendments.--Section 1960 of title 18, United States 
Code, is amended--
            (1) in the section heading, by striking ``unlicensed'' and 
        inserting ``illegal'';
            (2) in subsection (a), by striking ``unlicensed'' and 
        inserting ``illegal'';
            (3) in subsection (b)(1), by striking ``unlicensed'' and 
        inserting ``illegal''; and
            (4) in subsection (b)(1)(C), by inserting ``, exchange,'' 
        after ``transportation''.

SEC. 9. KNOWLEDGE THAT PROPERTY IS FROM THE PROCEEDS OF A SPECIFIC 
              FELONY.

    (a) Proceeds of A Felony.--Section 1956(c)(1) of title 18, United 
States Code, is amended by inserting ``, and regardless of whether or 
not the person knew that the activity constituted a felony'' before the 
semicolon at the end.
    (b) Intent To Conceal or Disguise.--Section 1956(a) of title 18, 
United States Code, is amended--
            (1) in paragraph (1)(B), by striking ``knowing that'' and 
        all that follows through ``Federal law,'' and inserting the 
        following:
                    ``(B) knowing that the transaction--
                            ``(i) conceals or disguises, or is intended 
                        to conceal or disguise, the nature, source, 
                        location, ownership, or control of the proceeds 
                        of some form of unlawful activity; or
                            ``(ii) avoids, or is intended to avoid, a 
                        transaction reporting requirement under State 
                        or Federal law,''; and
            (2) in paragraph (2)(B), by striking ``knowing that'' and 
        all that follows through ``Federal law,'' and inserting the 
        following:
                    ``(B) knowing that the monetary instrument or funds 
                involved in the transportation, transmission, or 
                transfer represent the proceeds of some form of 
                unlawful activity, and knowing that such 
                transportation, transmission, or transfer--
                            ``(i) conceals or disguises, or is intended 
                        to conceal or disguise, the nature, source, 
                        location, ownership, or control of the proceeds 
                        of some form of unlawful activity; or
                            ``(ii) avoids, or is intended to avoid, a 
                        transaction reporting requirement under State 
                        or Federal law,''.

SEC. 10. EXTRATERRITORIAL JURISDICTION.

    Section 1956(f)(1) of title 18, United States Code, is amended by 
inserting ``or has an effect in the United States'' after ``conduct 
occurs in part in the United States''.

SEC. 11. FREEZING BANK ACCOUNTS OF PERSONS ARRESTED FOR OFFENSES 
              INVOLVING THE MOVEMENT OF MONEY ACROSS INTERNATIONAL 
              BORDERS.

    Section 981(b) of title 18, United States Code, is amended by 
adding at the end the following:
            ``(5)(A) If a person is arrested or charged in connection 
        with an offense described in subparagraph (C) involving the 
        movement of funds into or out of the United States, the 
        Attorney General may apply to any Federal judge or magistrate 
        judge in the district in which the arrest is made or where the 
        charges are filed for an ex parte order restraining any account 
        held by the person arrested or charged for not more than 30 
        days, except that such 30-day time period may be extended for 
        good cause shown at a hearing conducted in the manner provided 
        in Rule 43(e) of the Federal Rules of Civil Procedure. The 
        court may receive and consider evidence and information 
        submitted by the Government that would be inadmissible under 
        the Federal Rules of Evidence.
            ``(B) The application for the restraining order referred to 
        in subparagraph (A) shall--
                    ``(i) identify the offense for which the person has 
                been arrested or charged;
                    ``(ii) identify the location and description of the 
                accounts to be restrained; and
                    ``(iii) state that the restraining order is needed 
                to prevent the removal of the funds in the account by 
                the person arrested or charged, or by others associated 
                with such person, during the time needed by the 
                Government to conduct such investigation as may be 
                necessary to establish whether there is probable cause 
                to believe that the funds in the accounts are subject 
                to forfeiture in connection with the commission of any 
                criminal offense.
            ``(C) A restraining order may be issued pursuant to 
        subparagraph (A) if a person is arrested or charged with any 
        offense for which forfeiture is authorized under this title, 
        title 31, or the Controlled Substances Act.
            ``(D) For purposes of this section--
                    ``(i) the term `account' includes any safe deposit 
                box and any account (as defined in paragraphs (1) and 
                (2) of section 5318A(e) of title 31) at any financial 
                institution; and
                    ``(ii) the term `account held by the person 
                arrested or charged' includes an account held in the 
                name of such person, and any account over which such 
                person has effective control as a signatory or 
                otherwise.
            ``(E) Restraint pursuant to this paragraph shall not be 
        deemed a `seizure' for purposes of subsection 983(a) of this 
        title.
            ``(F) A restraining order issued pursuant to this paragraph 
        may be executed in any district in which the subject account is 
        found, or transmitted to the central authority of any foreign 
        State for service in accordance with any treaty or other 
        international agreement.''.

SEC. 12. MAKING THE INTERNATIONAL MONEY LAUNDERING STATUTE APPLY TO TAX 
              EVASION.

    Section 1956(a)(2)(A) of title 18, United States Code, is amended 
by--
            (1) inserting ``(i)'' before ``with the intent to 
        promote''; and
            (2) adding at the end the following:
                    ``(ii) with the intent to engage in conduct 
                constituting a violation of section 7201 or 7206 of the 
                Internal Revenue Code of 1986; or''.

SEC. 13. PROHIBITING MONEY LAUNDERING THROUGH HAWALAS, OTHER INFORMAL 
              VALUE TRANSFER SYSTEMS, AND CLOSELY RELATED TRANSACTIONS.

    The matter following section 1956(a)(1)(B)(ii) of title 18, United 
States Code, is amended by striking ``For purposes of this paragraph, a 
financial transaction'' and inserting ``For purposes of this paragraph 
and section 1957, a financial transaction or a monetary transaction''.

SEC. 14. TECHNICAL AMENDMENT TO RESTORE WIRETAP AUTHORITY FOR CERTAIN 
              MONEY LAUNDERING AND COUNTERFEITING OFFENSES.

    (a) Currency Reporting Offenses.--Section 2516(1)(g) of title 18, 
United States Code, is amended by striking ``or section 5324 of title 
31, United States Code (relating to structuring transactions to evade 
reporting requirement prohibited'' and inserting ``or sections 5324 and 
5332 of title 31, United States Code (relating to structuring financial 
transactions and bulk cash smuggling)''.
    (b) Money Laundering.--Section 2516(1)(c) of title 18, United 
States Code, is amended by inserting ``section 1960 (relating to 
illegal money transmitting businesses),'' before ``section 659''.
    (c) Counterfeiting.--Section 2516(1)(d) of title 18, United States 
Code, is amended by striking ``or 473'' and inserting ``473, 474, or 
474A,''.

SEC. 15. CONDUCT IN AID OF COUNTERFEITING.

    (a) In General.--Section 474(a) of title 18, United States Code, is 
amended by inserting after the paragraph beginning ``Whoever has in his 
control, custody, or possession any plate'' the following:
    ``Whoever, with intent to defraud, has custody, control, or 
possession of any material, tool, machinery, or other equipment that 
can be used to make, alter, forge, or counterfeit any obligation or 
other security of the United States or any part of such obligation or 
security, except under the authority of the Secretary of the Treasury; 
or''.
    (b) Foreign Obligations and Securities.--Section 481 of title 18, 
United States Code, is amended by inserting after the paragraph 
beginning ``Whoever, with intent to defraud'' the following:
    ``Whoever, with intent to defraud, has custody, control, or 
possession of any material, tool, machinery, or other equipment that 
can be used to make, alter, forge, or counterfeit any obligation or 
other security of any foreign government, bank, or corporation; or''.
    (c) Counterfeit Acts.--Section 470 of title 18, United States Code, 
is amended by striking ``or 474'' and inserting ``474, or 474A''.
    (d) Strengthening Deterrents to Counterfeiting.--Section 474A of 
title 18, United States Code is amended--
            (1) in subsection (a), by inserting ``, custody,'' after 
        ``control'';
            (2) in subsection (b)--
                    (A) by inserting ``, custody,'' after ``control''; 
                and
                    (B) by striking ``any essentially identical feature 
                or device adapted to the making of any such obligation 
                or security,'' and inserting ``any material or other 
                thing made after or in similitude of any such 
                deterrent,''; and
            (3) by adding at the end the following:
    ``(d) Whoever has in his control, custody, or possession any 
obligation or security of the United States or any foreign government 
from which the ink or other distinctive counterfeit deterrent has been 
completely or partially removed, except under the authority of the 
Secretary of the Treasury, is guilty of a class B felony.''.

SEC. 16. PREPAID ACCESS DEVICES, DIGITAL CURRENCIES, OR OTHER SIMILAR 
              INSTRUMENTS.

    (a) In General.--Section 5312(a) of title 31, United States Code, 
is amended--
            (1) by striking paragraph (1)(K) and inserting the 
        following:
                    ``(K) an issuer, redeemer, or cashier or travelers' 
                checks, checks, money orders, prepaid access devices, 
                digital currencies, or other similar instruments;'';
            (2) in paragraph (3)(C), by inserting ``prepaid access 
        devices,'' after ``delivery,''; and
            (3) by adding at the end the following:
            ``(7) `prepaid access device' means an electronic device or 
        vehicle, such as a card, plate, code, number, electronic serial 
        number, mobile identification number, personal identification 
        number, or other instrument that provides a portal to funds or 
        the value of funds that have been paid in advance and can be 
        retrievable and transferable at some point in the future.''.
    (b) GAO Report.--Not later than 18 months after the date of 
enactment of this Act, the Comptroller General of the United States 
shall submit to Congress a report on--
            (1) the impact the amendments made by subsection (a) has 
        had on law enforcement, the prepaid access industry, and 
        consumers; and
            (2) the implementation and enforcement by the Department of 
        Treasury of the final rule on Definitions and Other Regulations 
        Relating to Prepaid Access (76 Fed. Reg. 45403), issued July 
        26, 2011.
    (c) Customs and Border Protection Strategy for Prepaid Access 
Devices.--Not later than 18 months after the date of enactment of this 
Act, the Secretary of Homeland Security, in consultation with the 
Commission of the U.S. Customs and Border Protection, shall submit to 
Congress a report detailing a strategy to interdict and detect prepaid 
access devices, digital currencies, or other similar instruments, at 
border crossings and other ports of entry for the United States. The 
report shall include an assessment of infrastructure needs to carry out 
the strategy detailed in the report.

SEC. 17. PROCEDURE FOR ISSUING SUBPOENAS IN MONEY LAUNDERING CASES.

    (a) In General.--Section 986 of title 18, United States Code, is 
amended by adding at the end the following:
    ``(e) Procedure for Issuing Subpoenas.--The Attorney General, the 
Secretary of the Treasury, or the Secretary of Homeland Security may 
issue a subpoena in any investigation of a violation of sections 1956, 
1957 or 1960, or sections 5316, 5324, 5331 or 5332 of title 31, United 
States Code, in the manner set forth under section 3486.''.
    (b) Grand Jury and Trial Subpoenas.--Section 5318(k)(3)(A) of title 
31, United States Code, is amended--
            (1) in clause (i)--
                    (A) by striking ``related to such correspondent 
                account''; and
                    (B) by striking ``or the Attorney General'' and 
                inserting ``, the Attorney General, or the Secretary of 
                Homeland Security''; and
            (2) by adding at the end the following:
                            ``(iii) Grand jury or trial subpoena.--In 
                        addition to a subpoena issued by the Attorney 
                        General, Secretary of the Treasury, or the 
                        Secretary of Homeland Security under clause 
                        (i), a subpoena under clause (i) includes a 
                        grand jury or trial subpoena requested by the 
                        Government.''.
    (c) Fair Credit Reporting Act Amendment.--Section 604(a)(1) of the 
Fair Credit Reporting Act (15 U.S.C. 1681b(a)(1)) is amended--
            (1) by striking ``or''; and
            (2) by inserting before the period the following: ``, or a 
        subpoena issued under section 5318 of title 31 or section 3486 
        of title 18, United States Code''.
    (d) Obstruction of Justice.--Section 1510(b)(3)(B) of title 18, 
United States Code, is amended--
            (1) in the matter before clause (i), by striking ``or a 
        Department of Justice Subpoena (issued under section 3486 of 
        title 18)'' and inserting ``, a subpoena issued under section 
        3486 of title 18, or an order or subpoena issued pursuant to 
        section 3512 of title 18, section 5318 of title 31, or section 
        1782 of title 28,''; and
            (2) in clause (i), by inserting ``, 1960, or an offense 
        against a foreign nation constituting specified unlawful 
        activity under section 1956, or a foreign offense for which 
        enforcement of a foreign forfeiture judgment could be brought 
        under section 2467 of title 28'' after ``1957''.
    (e) Right to Financial Privacy Act.--Section 1120(b)(1)(A) of the 
Right to Financial Privacy Act of 1978 (12 U.S.C. 3420(b)(1)(A)) is 
amended by striking--
            (1) ``or 1957'' and inserting ``, 1957, or 1960''; and
            (2) by striking ``and 5324'' and inserting ``, 5322, 5324, 
        5331, and 5332''.

SEC. 18. DANGER PAY ALLOWANCE.

    Section 151 of the Foreign Relations Authorization Act, Fiscal 
Years 1990 and 1991 (5 U.S.C. 5928 note), is amended by striking ``Drug 
Enforcement Administration or Federal Bureau of Investigation'' and 
inserting ``Drug Enforcement Administration, Federal Bureau of 
Investigation, Immigration and Customs Enforcement, Customs and Border 
Protection, or United States Secret Service''.

SEC. 19. UNITED STATES SECRET SERVICE USE OF PROCEEDS DERIVED FROM 
              CRIMINAL INVESTIGATIONS.

    (a) In General.--With respect to any undercover investigative 
operation of the United States Secret Service (hereafter referred to in 
this section as the ``Secret Service'') that is necessary for the 
detection and prosecution of crimes against the United States---
            (1) sums appropriated for the Secret Service, including 
        unobligated balances available from prior fiscal years, may be 
        used for purchasing property, buildings, and other facilities, 
        and for leasing space, within the United States, the District 
        of Columbia, and the territories and possessions of the United 
        States, without regard to sections 1341 and 3324 of title 31, 
        United States Code, section 8111 of title 40, sections 3732(a) 
        and 3741 of the Revised Statutes of the United States (41 
        U.S.C. 11(a) and 22), and sections 304(a) and 305 of the 
        Federal Property and Administrative Services Act of 1949 (41 
        U.S.C. 254(a) and 255);
            (2) sums appropriated for the Secret Service, including 
        unobligated balances available from prior fiscal years, may be 
        used to establish or to acquire proprietary corporations or 
        business entities as part of such undercover operation, and to 
        operate such corporations or business entities on a commercial 
        basis, without regard to sections 9102 and 9103 of title 31, 
        United States Code;
            (3) sums appropriated for the Secret Service, including 
        unobligated balances available from prior fiscal years and the 
        proceeds from such undercover operation, may be deposited in 
        banks or other financial institutions, without regard to 
        section 648 of title 18, and section 3302 of title 31, United 
        States Code; and
            (4) proceeds from such undercover operation may be used to 
        offset necessary and reasonable expenses incurred in such 
        operation, without regard to section 3302 of title 31, United 
        States Code.
    (b) Written Certification.--The authority set forth in subsection 
(a) may be exercised only upon the written certification of the 
Director of the Secret Service or his designee that any action 
authorized by any paragraph of such subsection is necessary for the 
conduct of an undercover investigative operation. Such certification 
shall continue in effect for the duration of such operation, without 
regard to fiscal years.
    (c) Deposit of Proceeds in Treasury.--As soon as practicable after 
the proceeds from an undercover investigative operation with respect to 
which an action is authorized and carried out under paragraphs (3) and 
(4) of subsection (a) are no longer necessary for the conduct of such 
operation, such proceeds or the balance of such proceeds remaining at 
the time shall be deposited in the Treasury of the United States as 
miscellaneous receipts.
    (d) Reporting and Deposit of Proceeds Upon Disposition of Certain 
Business Entities.--If a corporation or business entity established or 
acquired as part of an undercover investigative operation under 
paragraph (2) of subsection (a) with a net value of over $50,000 is to 
be liquidated, sold, or otherwise disposed of, the Secret Service, as 
much in advance as the Director or designee determines is practicable, 
shall report the circumstance to the Secretary of Homeland Security. 
The proceeds of the liquidation, sale, or other disposition, after 
obligations are met, shall be deposited in the Treasury of the United 
States as miscellaneous receipts.
    (e) Financial Audits and Reports.--
            (1) Audits.--The Secret Service shall conduct detailed 
        financial audits of closed undercover investigative operations 
        for which a written certification was made pursuant to 
        subsection (b) on a quarterly basis and shall report the 
        results of the audits in writing to the Secretary of Homeland 
        Security.
            (2) Reports.--The Secretary of Homeland Security shall 
        annually submit to the Committees on Appropriations of the 
        Senate and House of Representatives, at the time that the 
        President's budget is submitted under section 1105(a) of title 
        31, a summary of such audits.

SEC. 20. AUTHORITY OF SECRET SERVICE TO ARREST PERSONS IN VIOLATION OF 
              MONEY LAUNDERING LAWS.

    Section 3056(b)(3) of title 18, United States Code, is amended--
            (1) by inserting ``money laundering, structured 
        transactions,'' after ``devices''; and
            (2) by striking ``federally insured''.

SEC. 21. LAW ENFORCEMENT REGULATIONS AND COOPERATION.

    Not later than 1 year following the date of enactment of this Act, 
the Attorney General, Secretary of Treasury, and Secretary of Homeland 
Security, in consultation with the Director of National Intelligence, 
shall coordinate to--
            (1) promulgate regulations as necessary to implement the 
        provisions of this Act; and
            (2) issue other informal guidelines with respect to money 
        laundering, terrorist financing, counterfeiting, and other 
        matters related to the provisions of this Act, including--
                    (A) investigative guidelines; and
                    (B) memorandum of understanding in regards to 
                investigations and investigative authorities.

SEC. 22. RULE OF CONSTRUCTION.

    Nothing in this Act, or any amendment made by this Act, shall be 
construed to apply to the authorized law enforcement, protective, or 
intelligence activities of the United States or of an intelligence 
agency of the United States.
                                 <all>
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