II 

114TH CONGRESS 

1ST SESSION S. 1206 

To address the concept of ‘‘Too Big To Fail’’ with respect to certain financial 

entities. 

IN THE SENATE OF THE UNITED STATES 

MAY 6, 2015 

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

to the Committee on Banking, Housing, and Urban Affairs 

A BILL 

To address the concept of ‘‘Too Big To Fail’’ with respect 

to certain financial entities. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Too Big To Fail, Too 

5 Big To Exist Act’’. 

6 SEC. 2. COMPILATION AND REPORT ON INSTITUTIONS 

7 THAT ARE TOO BIG TO FAIL. 

8 (a) COMPILATION.—Notwithstanding any other pro9 vision of law, not later than 90 days after the date of en10 actment of this Act, the Financial Stability Oversight 


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1 Council shall compile and submit to the Secretary of the 

2 Treasury a list of entities that it deems Too Big To Fail, 

3 which shall include, but is not limited to, any United 

4 States bank holding companies that have been identified 

5 as systemically important banks by the Financial Stability 

6 Board (in this Act referred to as the ‘‘Too Big To Fail 

7 List’’). 

8 (b) SUBMISSION TO CONGRESS AND THE PRESI9 DENT.—Upon receipt of the Too Big To Fail List, the 

10 Secretary of the Treasury shall submit the List to Con11 gress and the President. 

12 SEC. 3. BREAKING-UP TOO BIG TO FAIL INSTITUTIONS. 

13 (a) IN GENERAL.—Notwithstanding any other provi14 sion of law, but not later than 1 year after the date of 

15 enactment of this Act, the Secretary of the Treasury shall 

16 break up entities included on the Too Big To Fail List, 

17 so that their failure would no longer cause a catastrophic 

18 effect on the United States or global economy without a 

19 taxpayer bailout. 

20 (b) CONSULTATION WITH OTHER REGULATORS.—In 

21 carrying out the requirement of subsection (a), the Sec22 retary of the Treasury shall consult with the primary fi23 nancial regulatory agency of the entity to be broken up. 


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1 SEC. 4. PROHIBITION AGAINST USE OF FEDERAL RESERVE 

2 FINANCING. 

3 Notwithstanding any other provision of law (includ4 ing regulations), any entity included on the Too Big To 

5 Fail List may not use or otherwise have access to advances 

6 from any Federal Reserve credit facility, the Federal Re7 serve discount window, or any other program or facility 

8 made available under the Federal Reserve Act (12 U.S.C. 

9 221 et seq.), including any asset purchases, temporary or 

10 bridge loans, government investments in debt or equity, 

11 or capital injections from any Federal institution. 

12 SEC. 5. PROHIBITION ON USE OF INSURED DEPOSITS. 

13 (a) IN GENERAL.—Any entity included on the Too 

14 Big To Fail List that is an insured depository institution, 

15 or owns such an institution, may not use any insured de16 posit amounts to fund— 

17 (1) any activity relating to hedging that is not 

18 directly related to commercial banking activity at the 

19 insured bank; 

20 (2) any use of derivatives for speculative pur21 poses; 

22 (3) any activity related to the dealing of deriva23 tives; or 

24 (4) any other form of speculative activity that 

25 regulators specify. 


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1 (b) RISK OF LOSS.—An entity included on the Too 

2 Big To Fail List may not conduct any activity listed in 

3 subsection (a) in such a manner that— 

4 (1) puts insured deposits at risk; or 

5 (2) creates a risk of loss to the Deposit Insur6 ance Fund. 

7 SEC. 6. DEFINITIONS. 

8 For purposes of this Act— 

9 (1) the term ‘‘primary financial regulatory 

10 agency’’ has the same meaning as in section 2(12) 

11 of the Dodd-Frank Wall Street Reform and Con12 sumer Protection Act (12 U.S.C. 5301(12)); and 

13 (2) the term ‘‘Too Big To Fail’’ means any en14 tity whose failure, due to its size, exposure to 

15 counterparties, liquidity position, interdependencies, 

16 role in critical markets, or other characteristics or 

17 factors, would have a catastrophic effect on the sta18 bility of either the financial system or the United 

19 States economy without substantial Government as20 sistance. 

Æ 


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